Lendlease To Sell U.S. Military Housing Business For $320M
Australian construction and development giant Lendlease has reached a deal to sell its massive U.S. military housing portfolio as it works to unload most of its overseas holdings.
Lendlease is selling its 40,000-unit portfolio to an affiliate of Guggenheim Partners for 480M Australian dollars, or $320M, it announced this week.
The company said the price was at a “significant premium to book value.” The deal is expected to close in the first half of 2025, subject to consent from the Department of Defense.
The Guggenheim affiliate that is acquiring the portfolio is called Omaha Beach Investment Holdings LLC. Guggenheim Partners is a global investment firm headquartered in New York and Chicago with more than $320B in assets under management.
Lendlease's U.S. military portfolio spans 24 states, D.C. and Puerto Rico, according to its website.
The deal is part of the company’s push to exit most of its overseas business, an effort announced in May that would include selling all of its development projects in the U.S. and UK and is expected to generate AU$4.5B.
“As this transaction demonstrates, we continue to take a disciplined approach to capital recycling, achieving premiums to book value, as we balance speed of execution with achieving value for our securityholders,” Lendlease Group CEO Tony Lombardo said in a statement.
“Implementation of our strategy is progressing well, with cost savings being realized across the regions as we today move to a simplified management structure,” he added.
Lendlease's U.S. military housing developments include a project in Florida that represents the first new privatized housing for the Army in more than a decade. It said in September it expected to break ground by year's end on 75 houses and 60 two-bedroom apartments near the Army's U.S. Southern Command in Doral, Florida.
The sale of its East Coast construction operations to Consigli Construction Co. is expected to close in the coming months, and Lendlease has started preparations to sell its UK construction business within the next 18 months, it said in this week's release. It also said it plans to recycle another AU$1.1B in 2025 and has sales underway, including The Exchange TRX in Malaysia, its Keyton Australian Retirement Living investment and a senior living asset in China.
Before the company announced its restructuring initiative in May, it had already announced two plans to sell assets. Earlier that month, it announced plans to offload 50% of its life sciences portfolio in Asia to Warburg Pincus for AU$147M. That transaction is expected to close in the first half of 2025.
In December, the company announced it would sell its 12-site master-planned portfolio in Australia to Stockland for AU$1.3B.
