This article is from the Australian Property Journal archive
AROUND 740 people will lose their jobs at Lendlease, as the property giant cuts around 10% of its global workforce including 5% of its Australian staff.
The job cuts are expected to result in cost saving between $80 million and $100 million, as the real estate and construction group focuses on delivering its current global pipeline of projects.
This comes after the UK government hit Lendlease with a $200 million provision over residential building standards, contributing to builder and developer posting a $141 million interim loss. After posting a $264 million loss in the previous year.
In addition to the 5% loss for its Australian workforce, Lendlease’s offshore staff will see a 15% cut back, with the group having around 7,800 workers across Australia, Europe, the United States and Asia.
The cuts were announced through an internal memo by CEO Tony Lombardo, who took the top spot in June 2021.
“It’s never easy making such big decisions – ones that directly affect so many of our colleagues,” read the email.
“However, they’re absolutely necessary in order to generate more resilient returns for our security holders and sustainable careers for our ongoing workforce.”
The developer plans to support growth in its funds management business while “rightsizing our construction workbook around jobs that carry less risk and generate greater reward.”
The news comes just days after Lendlease announced it would develop a $650 million built-to-rent tower on the edge of the Melbourne CBD with Japan’s biggest homebuilder, Daiwa House.
The group also recently announced a partnership with the City of Melbourne to develop a $1.7 billion build-to-rent, affordable housing, office and student accommodation next to Queen Victoria Market.
In addition to gaining approval for a 10-storey retail and office tower above the new underground Metro Tunnel Town Hall station in Melbourne’s CBD.
“I think we’ll continue as a team to look to drive efficiency. We’ve set ourselves some clear portfolio metrics and therefore we’ll make sure we’ve got the right cost of sales to support that and the right overhead level,” said Lombardo.
