By Noel Towell and Kishor Napier-Raman
Lendlease, the storied old commercial property giant, is in need of urgent renovation. At least, that’s the view of big investors, including Tanarra Capital, run by high-profile and outspoken business veteran and sporting administrator John Wylie.
This month, Wylie penned a dramatic letter to the LendLease board, lashing its “bureaucratic, arrogant” management culture, and arguing that the company faced an existential threat if it didn’t flog off its international business.
John Wylie’s alternative investment firm Tanarra Capital has been questioning Lendlease C-suite’s strategy.Credit: Eamon Gallagher
And it seems like Tanarra’s view has been validated by some fresh accounts lodged with the British regulator Companies House last week, related to the firm’s ambitious Deptford Landings development in South London.
Lendlease Deptford’s 2023 financial year accounts, filed on April 12, show the subsidiary constructed cumulative losses of £64.8 million over the past two years (about $A112.8 million).
The operation managed to turn a gross profit of £5.3 million ($A9.4 million) in 2023, but this was wiped out by soaring financing costs of almost £11 million ($19.6 million). The final loss for 2023 was £4.9 million ($A8.7 million). Not great but a big improvement on the £60 million it lost the year prior.
Accounts filed by Lendlease Developments Europe, the development manager for a swathe of London-based projects, also filed its numbers, which saw pre-tax losses rise from £2.8 million ($5 million) to almost £3.5 million ($6.2 million). LD’s accounts also showed an almost five-fold increase in financing costs.
Now, Wylie and co reckon that while Lendlease’s sprawling foreign operations might’ve been good bets in the era of cheap money, the blowout in financing costs to Deptford, almost entirely interest payments to third parties, has wrecked that project’s profitability.
And while those numbers aren’t large, we reckon they show Lendlease’s international operations are dragging the company’s performance. With February’s shaky half-yearly results showing a statutory post-tax loss of AUD$136 million, every million counts.
Needless to say, it’ll put Lendlease under pressure to justify not scaling back its European operations at an investor day coming up next month, or provide something to disgruntled shareholders. Curiously, there’s still no date scheduled for that. LendLease was contacted for comment on Thursday.
WELL BUILT
Promenaders along Carlton’s busy streets have been in touch, alarmed at the prospect that construction union the CFMEU – the bad boys of Australia’s labour movement – might be going, well, a bit soft.
The CFMEU’s office during a protest in 2021.Credit: Chris Hopkins
The union is hard at work on a facelift on its Elizabeth Street HQ, which readers might remember as the scene of that remarkable punch-up in 2021 between union officials and hundreds of building workers who’d been ordered off site as part of Covid-19 public health restrictions.
The building was also shot up by an unknown gunman – acting on who-knows-what motivation – one night back in 2016.
The building works, passers-by have noticed, include a new CFMEU training and “wellness centre”.
You kidding us? Are our favourite union hard men swapping their high-vis for fluffy towelling robes, VB for herbal tea? Morning smoko for tai chi? What’s going on, we asked CFMEU leadership.
But the union’s national secretary Zach Smith called for calm, explaining that rather than going soft, the union was preparing to offer its members – who toil in Australia’s most dangerous line of work – a little TLC at the training and wellness centre “to help with members’ physical and mental health”.
“A key part of the centre will be based around rehabilitation, so injured CFMEU members can get back to work sooner and safer,” Smith told us.
“The centre will have a major focus on offering support and advice in specifically designed and culturally sensitive spaces for women and Indigenous members.” Oh. Fair enough, then.
FOR A LAUGH
The Melbourne International Comedy Festival continues to attract some interesting out-of-town types.
CBD’s informants spotted on Wednesday night former Labor senator Sam Dastyari – once a rising star in the party before his spectacular fall from grace involving a Chinese-linked donations scandal – catching Nina Oyama’s, um, robust show at Comedy Republic on Bourke Street.
Spotted at the venue’s bar that evening was current senator and former Wallaby David Pocock, unwinding after being the headline act at one of teal independent Kooyong MP Monique Ryan’s town hall events in Hawthorn earlier in the evening.
Pocock tells us he’d attended Ryan’s town hall after a visit with the Royal Children’s Hospital and didn’t catch a show that night before heading for the hotel.
Dastyari? Well,he didn’t respond to our queries about his night.
NO SHOW
Homegrown Hollywood star Rebel Wilson has cancelled three shows scheduled for Melbourne, Brisbane and the Sydney Opera House next month, as her dispute with former co-star Sacha Baron Cohen continues to dog the publication of Wilson’s memoir.
Ticket-holders will be told on Thursday that the Evening With Rebel Wilson events, scheduled as part of the promotional effort for the book Rebel Rising, are cancelled, with refunds to be processed automatically.
“Given changes to publication dates for Rebel Rising, there have been changes to the promotional schedule and as a result, this show has been cancelled,” fans will be told.
Rebel Wilson delayed the publication of her memoir amid a row with former co-star Sacha Baron Cohen.
On the upside, the legal issues delaying the publication appear to be sorted, and disappointed devotees can use their ticket refunds to place a pre-order for Rebel Rising, which is now due to hit the shelves on May 8.
The book was delayed after Wilson made accusations against Baron Cohen about his behaviour while they were working on the movie Grimsby.
She alleges that she did not want to appear naked in the film and that Baron Cohen asked her to stick her finger up his bum during the filming of a sex scene.
The British comedian subsequently released a statement denying the claims, saying they were “demonstrably false”.
Publishers HarperCollins have repeatedly refused to discuss the effect of the threat of possible legal action by Baron Cohen had on the original decision to postpone it.
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