Lendlease plans to grow fund management business

Australia-based developer Lendlease intends to grow its fund-management business and seek opportunities in larger-scale mixed-use projects here.

Mr Tony Lombardo, chief executive for Asia, told The Straits Times that it aims to expand funds under management in Singapore from $5.6 billion now to $15 billion within five years.

The developer has about $23.6 billion in funds under management globally. "There's a lot of capital that wants to own buildings in Singapore. I see it as a real opportunity to position ourselves in the right way to access some of that capital and look for opportunities to create products for investors who have the appetite to come here," said Mr Lombardo yesterday.

The optimism stems from a recent record bid for a white site in Central Boulevard at Marina Bay. IOI Properties Group clinched the land with a bullish bid of about $2.57 billion or $1,689 per sq ft per plot ratio.

Mr Lombardo said Singapore is an attractive long-term investment destination, noting that the Central Boulevard site attracted about $14 billion worth of capital from seven bids in the tender. "There's probably anywhere between US$20 billion (S$28.6 billion) and US$40 billion of capital that is going to be looking at international real estate."

INTEREST IN SINGAPORE

There's a lot of capital that wants to own buildings in Singapore. I see it as a real opportunity to position ourselves in the right way to access some of that capital and look for opportunities to create products for investors who have the appetite to come here.

MR TONY LOMBARDO, Lendlease chief executive for Asia.

Several developers, including CapitaLand and City Developments, have stepped up their fund-management business in the past years to deliver an additional income stream.

Lendlease also hopes to deepen its collaboration with the public sector in seeking large-scale mixed-use and urban renewal projects. "There was discussion around master-development sort of relationships, I think that would play to our strengths. We will look to position ourselves with the Government and see if there are opportunities," said Mr Lombardo.

National Development Minister Lawrence Wong said recently that the Government is mulling over a "master developer" approach to building new districts that will provide developers with a larger land area to work on.

Lendlease's latest mega project here is the $3.2 billion Paya Lebar Quarter, comprising office space, shops and private housing. Mr Lombardo said the firm has 12 large mixed-use projects globally and looks to add "another three to five in the portfolio over the next five years".

Another key business segment for the firm is in construction services, which is expected to be supported by continued growth in the life sciences industry.

"There are still opportunities in the pharmaceutical space... There is still a lot of capex in the life sciences space."

Retail is part of the mix as well. Mr Lombardo said one priority is to invest in technology such as data analytics to improve the shopping experience at its three malls here - Jem in Jurong, 313@ somerset in Orchard Road and Parkway Parade in East Coast.

The one at Paya Lebar Quarter is still under construction.

A version of this article appeared in the print edition of The Straits Times on November 28, 2016, with the headline 'Lendlease plans to grow fund management business'. Print Edition | Subscribe