- International general contractor and real estate developer Lendlease has announced that it will build a $600 million mixed-use development on a 3.5-acre site in Los Angeles. Lendlease and its 50% partner in the project, Australian superannuation fund Aware Super, purchased the property for $92 million.
- The transit-oriented mid-rise project, located west of downtown and next to a Los Angeles County Metro Rail station, will include 260 multifamily residential units, 250,000 square feet of office space and retail on the 500,000-square-foot building's ground-floor level. Lendlease expects to begin construction in 2023 and to complete the project in 2025.
- The Los Angeles project is part of the Lendlease Americas Residential Partnership (LARP) between Lendlease and Aware Super, which has a $2.5 billion portfolio of projects in U.S. cities with Lendlease acting as development, construction and investment manager. In addition to the new parcel in Los Angeles, the LARP recently has acquired a site in New York City and has completed projects in Boston and Chicago.
The Lendlease strategy in regard to gateway cities in the U.S. and around the world is to position itself to take advantage of their population growth, employment opportunities, ability to draw global investment and resiliency through the ups and downs of economic and property cycles.
In New York City, for example, the partnership will build an 800-unit Brooklyn apartment development valued at almost $720 million. Lendlease announced acquisition of the 2.6-acre site along the East River in October. The for-rent project will occupy a full city block and will include a waterfront esplanade that provides easy access to the India Street Pier and New York City Water Ferry.
At the time of that announcement, Carlo Scissura, president and CEO of the New York Building Congress, told Construction Dive that the Lendlease deal spoke to the resiliency of the New York City real estate market — Brooklyn to be specific — as the purchase was made amid the economic uncertainty generated by the COVID-19 pandemic.
Meanwhile, Lendlease is still trying to secure payment for the long-stalled $1 billion Oceanwide mixed-use project in downtown Los Angeles. Construction stopped there almost two years ago after the China-based developer reportedly ran out of cash.
In arbitration, according to U.S. District Court documents, Lendlease was awarded $38.4 million, but China Oceanwide Holdings Ltd. is claiming that the judgment should be vacated because Lendlease's contractor's license was automatically suspended after it went more than 90 days without a responsible managing employee (RME) or officer (RMO) in place in early 2019 while work was still underway. An RME or RMO is necessary to obtain and maintain a valid California contractor’s license.
This alleged breach of state regulations, China Oceanwide claims, renders any guarantee of payment for construction services illegal. The court has not yet ruled on that motion.