Barangaroo plan a 'sell out'
Philip Thalis, the original architect of the Barangaroo redevelopment 'furious' as his plans are dumped in favour of a Lend Lease proposal.
Property developer Lend Lease has won the right to carry out the first stage of a $6 billion facelift planned for Sydney's waterfront, which is billed as Australia's answer to New York's Central Park.
The Barangaroo project, named after an Aboriginal woman who lived in Sydney during early white settlement, aims to turn 22 hectares of dockland into a new precinct featuring sprawling parkland surrounded by offices, apartments, hotels and shopping.
"Barangaroo is one of the most valuable city waterfront opportunities anywhere in the world," Lend Lease chief executive Steve McCann said in a statement this morning announcing the contract win.
Shares of Lend Lease climbed 2.4 per cent to $9.52, outperforming the property sector index which rose 1.5 per cent and a 0.6 per cent climb in the benchmark S&P/ASX 200 index.
Lend Lease, which is also involved in developing London's Elephant & Castle area and 2012 Olympic village, said the first stage of Barangaroo would involve developing 7.5 hectares, including 2.6 hectares of public realm and open spaces.
To secure development rights, Lend Lease has agreed to make payments worth several hundred million dollars to the NSW government over eight years, phased to coincide with the development timetable, including about $100 million in the first 18 months, the firm said.
When asked about funding for the project, a spokeswoman for Lend Lease said the company has more than $1 billion of liquidity, including cash and undrawn facilities.
Construction is due to start in 2011, with the project taking 10 to 15 years to complete.
Lend Lease is part of a consortium that has received a preferred bidder status to buy assets of the $1.4 billion ING Retail Property Fund.
Following that announcement, Standard & Poor's put Lend Lease's ratings on credit watch with negative implications.
"Lend Lease continues to secure new development opportunities that will place further pressure on the group's near-term debt levels amid cyclically weak cash flow and an uncertain operating outlook," the credit agency said in a statement.
Reuters
