LendLease and Google signed a contract to develop ‘mixed-use’ neighbourhoods featuring residential and retail spaces worth $15 billion in Silicon Valley.
The deal has already increased LendLease’s stock price. Its shares grew as much as 5.3 percent following the announcement.
LendLease is one of Australia’s biggest construction companies headquartered in Sydney. The company said in a statement that it will redevelop Google’s landholdings in the San Francisco Bay Area.
Denis Hickey, CEO of Lendlease Americas, said, “This new joint agreement between Google and Lendlease will help address the need for new housing in the San Francisco Bay Area.” The projects will comprise 15,000 new homes and offices in addition to other developments such as retail and hospitality in San Jose, Sunnyvale and Mountain View, the company said.
The deal is a big opportunity for LendLease considering that it plans to expand its business globally. According to the Financial Times, an analyst at Macquarie Rob Freeman said that the deal will broaden the company’s scope of work for urban projects by nearly a third.
Michael McCarthy, chief market strategist at CMC Markets said that the deal might help LendLease attract more development opportunities from international players as well.
LendLease will partner with Google up to the next 15 years for the projects. The work is expected to begin in early 2021. Google Vice President of Real Estate and Workplace Services David Radcliffe, said in a statement, “LendLease will play a key role in helping deliver at least 15,000 new homes on our land.”