Lendlease Group

Lendlease Annual Report 2022RenewalFront cover:  London  Elephant ParkThis page:  Milan  Milan Innovation District (MIND)Artist’s impressionContents

Year in review

Chairman’s Report

Global Chief Executive Officer’s Report

FY22 snapshot

Our business

Vision, purpose and strategy

Operating segments

Renewal

The power of the city

Growing our investments platform

Development, at scale

Execution excellence

1 Java Street, New York

Our focus areas

Managing and measuring value

Health and Safety

Financial

Our Customers

Our People

Sustainability

Risk & climate-related resilience

Risk governance and management

Climate-related strategic resilience

Performance and Outlook

Group performance

Investments segment

Development segment

Construction segment

Financial position and cash flow movements

Governance

Board of Directors’ information and profiles

Engagement

Remuneration Report

Directors’ Report

Lead Auditor’s Independence Declaration

Financial Statements

Other Information

Corporate directory

Securityholder information

Glossary

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28

30

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40

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60

61

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184

185

188

All financial amounts in this report are in Australian dollars unless otherwise specified.Lendlease Corporation Limited ABN 32 000 226 228 Incorporated in NSW Australia Lendlease Responsible Entity Limited ABN 72 122 883 185 | AFS Licence 308983 as responsible entity for Lendlease Trust  ABN 39 944 184 773 | ARSN 128 052 5952

Lendlease Annual Report 2022

About this report

The 2022 Lendlease Annual Report has been prepared with reference 
to the International Integrated Reporting (IR) Framework that encourages 
businesses to consider what creates value for them and how this value 
contributes to long term sustainable returns for securityholders.

Materiality
A matter is considered material if senior 
management and those charged with 
governance believe it could significantly 
impact the value created and delivered 
in the short, medium and long term. We 
identify and capture material matters in 
the following ways:

• Project Control Groups (PCGs), which 
include key internal stakeholders and 
represent the governance structure 
for overseeing the completion of the 
Annual Report

• Capturing feedback from key 

external stakeholders including 
securityholders, analysts and other 
relevant groups

• Engagement with the Board

• Confirming the strategy is consistent 

and relevant

The outcome of these processes are the 
material issues noted on pages 32 and 33 
in Managing and Measuring Value and in 
Our Business on pages 12 to 17.

Directors’ Report and Operating 
and Financial Review (OFR)
The required elements of the Directors’ 
Report, including the OFR, are featured 
on pages 4 to 106 of this Report 
and include the sections: Year in 
Review; Our Business; Renewal; Our 
Focus Areas; Risk and Climate-related 
resilience; Performance and Outlook; 
and Governance.

The OFR is covered specifically on pages 
4 to 63. All non-financial metrics 
included in the Directors’ Report on pages 
4 to 55 have been verified through 
Lendlease's internal verification process.

The Remuneration Report on pages 78
to 103 and the Financial Statements on 
pages 107 to 174 have been audited 
by KPMG.

Reporting suite
Our reporting suite provides information 
about the organisation and its 
key financial and operational 
achievements including:
• The Annual Report 

Information about Lendlease, 
our strategy, integrated financial
and operational performance, 
corporate governance, Directors’ 
Report, Remuneration Report and 
Financial Statements

• Biannual Results Presentation 
The current reporting period’s 
financial results, detailed segment 
information, investment portfolio, 
major urban projects and pipeline

• www.lendlease.com

Additional information on 
sustainability reporting, corporate 
governance, tax compliance and 
historical financial information.

Five focus areas underpin our ability to create safe, resilient, economic and sustainable outcomes. Our success is measured by 
the value we create in these areas. Icons are used throughout this Report linking our activities to this value creation.

Focus areas

Health and Safety
Everyone has the right to go home safely. We remain committed to the health and safety of our people, and all those who 
interact with a Lendlease place.

Financial
A strong balance sheet and access to third party capital enables us to fund the execution of our pipeline and deliver 
quality earnings for our securityholders.

Our Customers
Our customers love the places we create when we partner effectively, collaborate and innovate. Only through these 
actions can we respond to a changing world.

Our People
Our people are the greatest contributors to our success and enable us to fulfil our purpose: Creating places where 
communities thrive.

Sustainability
Sustainability is core to our planning and clear in our outcomes. We have a proud history of giving emphasis to 
environmental, social and economic impacts.

 
About this Report

3

Acknowledgement of CountryWe acknowledge the Traditional Custodians of the land and pay our respect to them and their Elders past and present.As a business that works across many locations, we have a responsibility to listen, learn and walk alongside First Nations peoples so that our activities support their ongoing connection to their lands, waters, cultures, languages and traditions.We value their custodianship of 65,000 years.Lendlease’s global headquarters are in Australia where our Reconciliation Action Plan (RAP) commits us to Acknowledging Country. The RAP is one way we demonstrate our operational performance on human rights, and specifically the rights of First Nations peoples.Shoreline yarn, on Quandamooka Country and Danggan Balun Country4

Lendlease Annual Report 2022

London  Elephant ParkYear in review

5

The past year has seen a significant resetting of the organisation with both our talent and financial capital increasingly directed towards leveraging the Group’s core capabilities. We have simplified our operating structure, reduced our cost base, exited non core businesses, and enhanced our market disclosures. All while continuing to be challenged by ongoing COVID disruption. Importantly, our teams have embraced our new operating model and the greater ownership and accountability it provides.We remained disciplined and true to our strategy, securing and converting projects in global gateway cities. We also established new investment partnerships that are expected to contribute to the acceleration in development activity and grow our funds under management.Year in Review6

Lendlease Annual Report 2022

Chairman’s 
Report

As an international real estate group 
operating in targeted gateway cities 
globally, Lendlease is well positioned to 
understand and respond to the changing 
nature of cities. Cities have always 
evolved, but will remain the engine of 
economic, social and cultural life.

Throughout the period our gateway 
cities remained resilient despite emerging 
geopolitical issues, the lingering 
community health and social instability of 
the pandemic, and the continuing impacts 
of climate change.   

Our operations have been impacted by 
these challenges, but the organisation 
has been able to anticipate, mitigate 
and adapt to reset our business for 
future growth.

First term as Chairman
Now that I am in my second term 
as Chairman, I have reflected on the 
progress we have made over the last 
three years.

On becoming Chair, my immediate 
priority was to lead the Board in a 
strategic review of the business, which 
resulted in the Engineering and Services 
businesses being deemed non core. 
Plans were enacted to separate them 
from the Group, with both businesses 
now divested.

Simultaneously, a comprehensive review 
of the Board’s governance practices 
identified opportunities to enhance 
the effectiveness of Board processes. 
Changes were implemented to increase 
the focus of the Board on strategy, 
reputation, customer and our people.

Two new directors, Robert Welanetz 
and Nicholas Collishaw, strengthened 
the Board’s experience in real estate 
investment and development. Nick, along 
with David Craig and Nicola Wakefield 
Evans, are seeking re-election at the 
2022 Annual General Meeting. The 
Board remains committed to appointing 
directors with deep experience in our 
core sectors and expects to appoint 
an additional Non executive Director 
in FY23.

Tony Lombardo was appointed Global 
Chief Executive Officer in June 2021 and 
oversaw executive leadership changes 
and the refresh of the Group’s strategy 
and organisational structure. The strategy 
to leverage our competitive advantage in 
the urban renewal of large-scale, mixed-

use projects and to grow the investments 
platform remains at the centre of our five 
year roadmap. A streamlined operating 
structure supports the execution of the 
strategy, with increased transparency in 
our reporting.

We acknowledge it has been a difficult
period for our securityholders. On behalf 
of the Board, I recognise we have more 
to do in rebuilding confidence. However, 
the decisions we have made in the 
last few years have made a difference.
The Group is well on the way to 
meeting its medium term investment and 
development targets, while maintaining 
delivery excellence in construction. I 
am confident this will lead to future 
cash generation, which should deliver 
sustainable growth in securityholder value 
over time.

Health and Safety
The health and safety of our people, our 
subcontractors and the communities in 
which we operate remains our number 
one priority. We are deeply saddened by 
the fatality of a subcontractor on one of 
our construction sites in New York, in an 
area under subcontractor management. 
Our sincerest condolences are extended 
to the family and colleagues of the young 
man who lost his life. It is a sombre 
reminder of the importance of our focus 
on safety for all people who interact 
with our places. It is also why Lendlease 
goes well beyond industry practice for 
reporting fatalities.

Our safety culture, which instils pride 
among our employees, is exemplified
by the implementation of innovative 
solutions. For example, the improvements 
we have made to the perimeter screens 
on steel framed buildings has set the 
industry standard in reducing the risk 
of falls from height for workers and 
materials. Further details on health and 
safety are provided on page 34 of 
this Report. 

Financial result
Lendlease reported a Statutory Loss after 
Tax of $99m. This comprised a Core 
operating profit of $276m, a loss for Non 
operating items of $333m and a Non core 
loss of $42m. While disappointing, the 
outcome reflects the challenging global 
operating environment and the decisions 
we flagged to the market in August 2021 
that we would be taking to reset the 

Group for future growth and the refocus 
of our digital activities.

Core operating profit of $276m was 
down from $377m in the prior year with 
lower Development segment earnings, 
in part due to a revised approach to 
joint venture arrangements, more than 
offsetting a strong recovery in the 
Investments segment. While the financial
performance was subdued, a recovery 
in operating momentum is expected to 
result in improved financial performance 
over coming years. Full year distributions 
of 16 cents per security reflects a payout 
ratio of 40 per cent on Core operating 
earnings per security.

Our refreshed executive leadership team 
has simplified the business, created 
a leaner organisation and improved 
expected returns as a result of a 
reduction in annualised overhead costs 
of approximately $170m and redirecting 
capital. Restructuring costs associated 
with these changes were $342m after 
tax and include allowances for employee 
redundancies and tenancy exit costs and 
development impairments on a small 
number of underperforming projects. The 
impairment of intangibles relating to our 
Digital investments was $55m after tax. 

The Non core loss primarily reflects
costs associated with the exit of 
the Services business. We have 
maintained provisions we consider to be 
appropriate to complete our share of 
the retained Melbourne Metro project 
and for potential warranties associated 
with the now exited Engineering and 
Services businesses.   

The Group entered FY23 in a strong 
financial position with a healthy pipeline 
of work, cash and cash equivalents 
of $1.3b and gearing of 7.3 per 
cent. The strength of our balance 
sheet positions the Group to increase 
development activity and grow the 
investments platform.

Sustainability
Businesses must have a clear purpose 
aligned to a long term strategy for shared 
value creation to achieve sustainable 
success. This is reflected in our 
purpose statement, creating places where 
communities thrive. Living our purpose 
means we help to create the best places 
for customers and the communities we 
serve, inspire our people, preserve our 

 
 
 
 
 
Year in review

7

culture, and deliver sustainable growth for 
our securityholders.

We are proud of our leadership position 
on environmental sustainability. Our goal 
is not only to eliminate the use of 
fossil fuels across our business but also 
help transform the real estate sector. 
Decarbonisation mandates have been 
implemented as we work towards our 
Net Zero scope 1 and 2 emissions targets 
by 2025. Initiatives include the use of 
renewable diesel, the design of all electric 
buildings, and the switch to 100 per cent 
renewable electricity for operating assets 
in Europe. We have also made progress 
on scope 3 emissions through various 
supply chain partnerships. Further details 
on sustainability are provided on page 
42 of this Report.

From a social sustainability perspective, 
we have created more than $100m of 
social value since launching our target 
of $250m by 2025 two years ago. 
Our ‘shared value’ partnerships focus 
on creating measurable social value by 
addressing the needs of communities. 
These include: our partnership with the 
Australian Red Cross in supporting the 
delivery of cultural programs, health 
and wellbeing initiatives and disaster 
preparedness in remote Australian 
communities; and Programma 2121 which 
offers training and paid internships for 

offenders in the Italian prison system. In 
addition to our shared value partnerships, 
we continued to embed commitments 
to First Nations engagement through our 
Elevate Reconciliation Action Plan.

the Group has a clear pathway to meet 
its financial and operational targets by 
FY24. We expect FY23 to be a recovery 
year with further operating momentum 
and improved financial performance.

Board program
The Board program, in addition to its 
regular cadence of meetings this year, 
expanded to reflect the broader range 
of both operational and strategic issues 
which required oversight.  

While some engagement activities were 
restricted by the pandemic, the Board 
was able to assess our Asian operations 
in person while other parts of the 
program were maintained virtually. This 
enabled the Board to engage in 
programs in all four operating regions – 
including site tours (physical and virtual), 
project reviews, interactive employee 
roundtables, leadership discussions and 
engagement with external stakeholders. 
The Board firmly believes these activities, 
in addition to our formal meetings, 
are critical for corporate governance. 
More detail on aspects of the Board’s 
engagement is provided on page 72.

The recovery of global gateway cities 
is increasingly evident and is reflected
in the operating momentum across the 
Group. Our investment partners share 
this conviction with a record amount of 
development Work in Progress, supported 
by our construction delivery capability.

The external environment will remain 
challenging, notably geopolitics and 
monetary policy settings. The Board 
will closely monitor these, including the 
potential impacts on our supply chain, 
broader inflation and implications for our 
products and services.  

I would like to thank my Board colleagues 
and the entire Lendlease team for their 
continued dedication in navigating the 
challenges of a global pandemic and the 
resetting of the organisation. We are now 
well positioned to create long term value 
for securityholders.

Looking to the future
Following a year focused on resetting the 
organisation and rebuilding momentum, 

M J Ullmer, AO
Chairman

 
8

Lendlease Annual Report 2022

Global Chief Executive 
Officer’s Report

My thanks to our securityholders, 
customers, partners, people and the 
community for your continued support.

During the past year our operating 
environment remained challenging. 
COVID continued to impact our regions 
and geopolitical uncertainty generated 
widespread volatility in global markets.

Despite these headwinds, we made 
significant progress in resetting our 
company for future growth. We entered 
the new financial year with a renewed 
sense of optimism, reflected in solid 
operating momentum across the Group. 

Business renewal
Delivering the very best real estate 
products and services drives our purpose. 
Just as the cities in which we 
operate undergo constant renewal, so 
must Lendlease.

In 2021, I announced our five-year
roadmap: Reset; Create; Thrive to 
enhance the way we operate to deliver 
sustained performance.

This year, we implemented the first
phase, Reset. A new streamlined 
company structure generated more than 
$160m in ongoing cost savings and 
the refreshed management team and 
simplified operating model has enabled 
more nimble decision making and 
increased accountability.

Several portfolio divestments supported 
the focus on our core business 
and strengthened the Group’s balance 
sheet. More than $1b of capital was 
recycled including the exit of the 
Services business, the reduction of our 
investment in Retirement Living and the 
introduction of a partner into our Military 
Housing portfolio.

We also committed to enhancing our 
financial and non financial disclosure, 
and providing greater visibility on our 
contribution to economic, environmental, 
and social value creation. All three 
are critical to restoring securityholder 
confidence and value.

Responding to real estate trends 
with a focused business model  
The COVID pandemic has had a profound 
impact on all facets of life. Following 
its onset, we remained steadfast in our 
conviction that cities would endure and 
continue to be the centrepiece of modern 
society for generations to come. The past 
couple of years have taught us that the 
value of human connection, and a sense 
of belonging, is immeasurable.

We move to the Create phase of our 
roadmap in better shape to deliver places 
and precincts that draw people in while 
also addressing urban challenges.

We aim to be an investment led 
company that responds to continued 
strong institutional investor demand for 
real estate. We are scaling up our 
investment and asset management teams 
to further grow our product offering,
enhance the value of the assets we 
manage and provide investors with 
recurring income streams.

Our teams will pursue resilient and 
sustainable development schemes that 
leverage our capabilities in placemaking 
and enhance urban connectivity. The 
workplace of the future needs to 
adapt to both changing employee 
expectations and employers needs 
for talent retention, collaboration and 
fostering corporate culture.

Central city residential markets have 
begun to recover strongly with residents 
looking for improved amenity and 
additional spaces to connect.

In the construction sector, our goal 
remains to be a market leader, 
maintaining the right capability to support 
operational excellence. We will be more 
selective by targeting customers whose 
values align to ours.

Financial and 
operating performance
As foreshadowed at the beginning of this 
financial year, addressing legacy issues, 
and combating the ongoing impacts 
of a global pandemic suppressed our 
financial performance. This was reflected
in a substantial statutory loss and a 
modest core profit. However, financial
performance rebounded in the second 
half, providing momentum into FY23.   

The Investments segment performed 
above target, underpinned by capital 
recycling. Funds under management 
grew to $44b and $11b of investment 
partnerships were established during the 
year. This includes our pivot to acquiring 
existing secondary assets on market that 
utilise our asset management capabilities. 

Development segment returns were 
below target due to ongoing COVID 
challenges, severe weather impacts 
on Communities settlements and our 
revised joint venture structuring approach 
which means profit recognition should 
more closely align earnings with 
development milestones and cash 
going forward. Projects available to 
start total $42b following planning 
progress. Commencements exceeded 
completions, taking Work in Progress to 
a record $18.4b.

Construction segment profit was at 
the lower end of the target range. 
Ongoing COVID and global supply 
chain disruptions, along with challenging 
weather events all impacted our 
productivity during the year. The 
construction workbook remains healthy 
at $10.5b.

Refer to the Performance and Outlook on 
page 56 for a detailed analysis of our 
financial and operating performance.

Our principles drive an ambition to 
make a difference

A culture of care
Making sure people arrive home safely 
each day continues to be our highest 
priority. Tragically, a sub contractor on 
one of our projects in New York lost his 
life in September 2021. We once again 
extend our deepest condolences to the 
man’s family, friends and colleagues and 
everyone impacted by this event.

We continue to strive to eliminate 
incident and injury wherever we 
operate using our refreshed Global 
Minimum Requirements, or GMRs, as the 
cornerstone of our global approach to 
health and safety. 

We are extending our culture of care 
to encompass psychological safety to 
further support employees.

 
 
 
 
 
Year in review

9

Creating a sustainable future
The world is warming at an unsustainable 
rate. Only through collective global action 
will we avoid a climate catastrophe. Our 
carbon reduction targets are among 
the most ambitious for the real estate 
sector globally. Industry leadership in 
sustainability is becoming increasingly 
valued by our customers and reflected
in the rapid increase in demand for 
sustainable assets.

We’re now well advanced on our Mission 
Zero Roadmaps to eliminate carbon 
emissions and we’re creating significant 
social value. Our progress against these 
targets is highlighted from page 42. In 
addition, Green, Social and Sustainability 
(GSS) financing now accounts for more 
than 60 per cent of our total facilities. 

Our people are the heart and soul of 
our company
Without doubt, our people are the 
driving force of our business and have 
been resilient in adapting to how they 
perform their work. We have overhauled 
our approach to leadership, recognising 
culture is set from the top. Greater 
emphasis has been placed on career 
development, knowledge sharing and 
alignment with securityholders’ interests.   

The implementation of a range of 
new programs, including leadership 

development, accelerating diverse talent 
and technical training underpin our 
investment in people. A commitment 
to a diverse and inclusive working 
environment reflects our belief that 
to thrive as an organisation everyone 
needs a place where they feel included 
and valued.

Service and partnering ethos
We have a diverse range of customers 
– from first homeowners to governments 
with a civic refresh agenda – who trust 
us to deliver great outcomes for and with 
them. It is a privilege to serve and partner 
with our customers. To remain focused, 
each year we undertake a broad range of 
customer listening and insights research 
to improve our customer experience 
and outcomes.

Outlook 
We have entered the new financial year 
as a company that is leaner, more agile 
in responding to customer needs and less 
distracted by our legacy issues. As the 
world adapts to COVID, we’re witnessing 
a resurgence in city life that underpins 
our strategy.

There is now significant operating 
momentum across the Group, providing 
confidence in the Create phase of our 
five year roadmap. While more factors 

are within our control going forward, 
we will be influenced by the external 
environment of higher inflation and 
interest rates.

The Group remains on track to meet 
our targets of more than $8b in 
development completions per annum by 
FY24 and funds under management of 
$70b by FY26. We will also maintain 
delivery capability to support both our 
integrated projects and construction 
clients. I believe this will create lasting 
securityholder returns while delivering on 
our commitment of leadership in health, 
safety, and sustainability.

Importantly, we have the capacity to 
fund our share of this significant growth 
potential while maintaining our financial
leverage within target range.

My thanks to our Board, my management 
team and the people of Lendlease for 
your unwavering commitment.

Finally, to our securityholders I 
restate our commitment to restore 
securityholder returns.

Tony Lombardo
Global Chief Executive Officer

 
 
10

Lendlease Annual Report 2022

Singapore  ComcentreArtist’s impressionFY22 SnapshotYear in review

11

($99m)
Statutory 
loss after tax

$276m
Core operating profit 
after tax

Strong
financial position, 
gearing 7.3%

$44b
Funds 
Under Management
(up 12%1)

$18b
record level of 
development Work 
in Progress

$10.5b
Construction 
backlog revenue

31.8%
Leadership positions 
held by women

Four funds
ranked in the GRESB2 
Global Top 10

>163m
customer 
interactions

Exceptional
outcomes against 
safety metrics.
Sadly one fatality

>$1b
strategic
divestments

1. Comparative period the year ended 30 June 2021.
2. Global Real Estate Sustainability Benchmark 2021.

12

Lendlease Annual Report 2022

Sydney  Daramu House, Barangaroo SouthOur business

13

Our BusinessLendlease is a globally integrated real estate group with core expertise in shaping cities and creating strong and connected communities. For more than 60 years, we have created thriving places. We work with purpose to design, build and curate places people care about and want to be.We manage funds and assets for some of the world’s largest real estate investors. Our experience spans decades and multiple sectors across both listed and unlisted markets.In partnership with stakeholders, we aim to create social, environmental, and economic value for cities and their communities. We have a proud legacy of creating award winning urban precincts as well as being entrusted with delivering essential civic and social infrastructure. Guiding our behaviours and underpinning our  Code of Conduct are our core values:RespectIntegrityInnovationCollaborationExcellenceTrust14

Lendlease Annual Report 2022

Vision, purpose 
and strategy

We create places where communities thrive.

Our vision for the future of the urban 
landscape is tied to our purpose as 
an organisation. This purpose centres 
on forming vibrant and enduring 
communities that contribute to a more 
liveable and sustainable future.

We are committed to creating value for all 
those who interact with us and to making 
a positive contribution, beyond just the 
places we create.

The actions we take are driven by an 
understanding that every decision we 
make has an impact and must be made in 
collaboration. Working in partnership with 
a myriad of stakeholders, we are helping 
to solve some of the biggest challenges 
confronting people, cities and the planet.

Strategy
The cornerstone of our strategy is 
to create the best urban precincts in 
targeted global gateway cities. Our point 
of difference is our proven expertise in 
placemaking and delivering major urban 
projects through our integrated business 
model, backed by our financial strength.

Our strategy is underpinned by 
an ethos that long term value 
creation is maximised by achieving 
social, environmental and economic 
outcomes. This involves collaborating 
with customers, investment partners, 
governments and the communities within 
which we operate.

A key differentiator from other industry 
players is our end-to-end capability 
across all aspects of real estate: 
from concept and planning to design 
and delivery, through to funding and 
investment management. This is the 
essence of our integrated model. 

A proven track record of creating 
large scale mixed use urban precincts 
has enabled the Group to deepen its 
expertise and sophistication to become, 
in our view, the partner of choice for 
urban regeneration.

Roadmap to success
This year we announced a five year 
roadmap: Reset; Create; Thrive, designed 
to extract the most from our strategy. 
The past year has seen a significant 
resetting of the organisation as our 
people and our financial capital has been 
directed towards leveraging the Group’s 
core capabilities, particularly across urban 
projects and our investments platform. 
We have also simplified our structure, 
exited non-core businesses and reduced 
our capital in Retirement Living.

Our partnership approach has driven 
significant growth in our investments 
platform. Future growth will be 
underpinned by the investment grade 
product we expect to create from the 
development pipeline. In addition, we 
have the appetite and global capability 
to launch new products alongside our 
investment partners.

We are targeting invested capital to 
increase to $6b in each of the 
Investments and Development segments 
by FY26.

We enter the Create phase of our 
roadmap with confidence in our strategic 
direction. The achievement of two 
key medium term operational targets; 

development completions of more than 
$8b per annum from FY24 and funds 
under management (FUM) of $70b by 
FY26, remain on track.

The size of our development pipeline, 
investment in capability to execute at 
scale and the resilience of the global 
cities in which we have a presence, 
provides us with confidence in achieving 
our development target.

Investor appetite for the geographically 
diverse and sustainable product in our 
development pipeline, as well as deep 
relationships with global investment 
partners, underpin our conviction in 
reaching our FUM target.

Our global operating model provides 
a framework for implementing best 
practice consistently, while empowering 
our teams to lead and innovate. To 
support our strategic objectives, we are 
investing in key capabilities with the 
longer term in mind.

Resilience
We understand cities will need to become 
more affordable, inclusive and sustainable 
with a greater focus on transport links, 
security and workplace flexibility. Our 
placemaking skills are already adapting 
to these challenges and the associated 
changes in consumer, corporate and 
government behaviour.

Our strategy has been designed to be 
resilient. The business model, supported 
by land management structures across 
most projects, has the agility to ride out 
market cycles.

Strategic priorities
• Scale investments

• Accelerate development

• Best practice construction delivery

• Leverage competitive edge

• Leadership in sustainability

‘Place’ is about peoples’ connection to a physical environment and the experiences that trigger both an emotional attachment and a sense of belonging. The unique places we create are carefully designed and curated to meet the needs and aspirations of the people who live, learn, work and play there.Our business

15

Major Urban Projects
We have a global portfolio of 21 major urban projects, each with an estimated end value of more than $1b. For more information 
on these projects, visit our website.

Americas
•

Lakeshore East, Chicago

Europe
•

Euston Station, London

•

•

•

•

30 Van Ness, San Francisco

•

Silvertown, London

Southbank, Chicago

• Milano Santa Giulia

1 Java Street, New York

• Milan Innovation District

San Francisco Bay 
Area project

•

Elephant Park, London

• High Road West, London

•

Smithfield, Birmingham

• Thamesmead 

Waterfront, London

•

International 
Quarter London

Asia
• The Exchange TRX, 
Kuala Lumpur

• Comcentre 

Australia
• Victoria Cross over station 
development, Sydney

• Barangaroo South, Sydney

Redevelopment, Singapore

• Melbourne Quarter

•

Sydney Place

• Victoria 

Harbour, Melbourne

Left to right: all artist's impressions: Chicago: Lakeshore East; London: Silvertown; Kuala Lumpur: The Exchange TRX; Sydney: Victoria Cross 
over station development.

San FranciscoLos AngelesChicagoBostonNew YorkLondonMilanBeijingShanghaiKuala LumpurSingaporeTokyoBrisbaneSydneyMelbourneEmploy our placemaking expertise and integrated business model in global gateway cities to deliver urban projects and investments that generate social, environmental and economic value.16

Lendlease Annual Report 2022

Operating 
segments

Investments
The segment comprises leading 
investment and asset management 
platforms and the Group’s real estate 
investment portfolio.

Capability
For decades we have managed funds and 
assets for some of the world’s largest real 
estate investors.

Our expertise spans unlisted and listed 
property funds and mandates. We offer
a research led investment capability 
supported by active asset management 
and leadership in sustainability. Our 
competitive edge lies in the opportunities 
we provide to investment partners 
in accessing the diverse, high 
quality product created through our 
integrated model.

Our development pipeline will provide a 
key source of growth for the Investments 
segment. This will be supplemented by 
pursuing other market opportunities with 
our investment partners.

Platform
• $44b funds under management

• $30b assets under management

• $3.5b investment portfolio

Development
The segment is predominantly focused 
on the creation of mixed use precincts 
that comprise apartments, workplaces 
and associated leisure and entertainment 
amenities. The Group also develops outer 
suburban masterplanned communities.

Capability
We manage the entire development 
process – from securing land, creating 
masterplans and consulting with 
communities and authorities through to 
project management, sales and leasing.

Placemaking is core to our strategy and 
competitive position. We create places 
that resonate with people and contribute 
to the quality and liveability of our 
cities by working in partnership with 
governments, institutions, landowners, 
investors and the community.

Platform
• $117b development pipeline

• 21 major urban projects in nine global 

gateway cities

• 16 communities projects in Australia

Construction
The segment provides project 
management, design and construction 
services, predominantly in the 
commercial, residential, mixed use, 
defence and social infrastructure sectors.

Capability
Our capability is showcased in the places 
and structures we create – workplaces 
for some of the world’s largest 
organisations, residential apartments 
including affordable housing options, 
hospitals and other buildings of civic and 
social importance.

Ongoing investment in innovation and 
technology aims to improve our safety, 
sustainability and efficiency.

Our Construction segment typically 
designs and delivers the built form for our 
urban projects.

Platform
• $10.5b construction backlog revenue

• Key sectors: defence; commercial; 
social infrastructure; residential

• 61 per cent of backlog revenue for 

government clients

DevelopmentInvestmentsIntegrated Business ModelProven Track RecordCreatingplaces wherecommunitiesthriveConstructionWe pursue an integrated business model, where two or more of our operating segments of Investments, Development and Construction engage on the same project, to create new mixed use precincts, communities and important civic and social infrastructure. 
Our business

17

$11b
Investment
partnerships

$18.4b
Work
in Progress

$5.3b
New 
work secured

$64b
Investment grade 
pipeline

$5.9b
Commencements

New projects
Frankston Hospital 
Redevelopment; 
Powerhouse Parramatta; 
90 Long Acre

GRESB
Four funds 
ranked in the
Global Top 10

$4.1b
added to the pipeline, 
including a new project 
in Singapore

100%
Renewable electricity 
across all Australian 
building projects

InvestmentsDevelopmentConstruction18

Lendlease Annual Report 2022

New York  1 Java Street,  existing siteRenewal

19

The theme of this year’s report is renewal, reflecting both the revitalisation of our company under new leadership and the recovery of our gateway cities from the worst pandemic in more than a century. We’ve simplified and streamlined; identified clear pathways to improved profitability; renewed our focus on core capabilities; and strengthened our commitment to creating value for our customers and securityholders.We believe cities will continue to be the lifeblood of human civilisation. Those we target as part of our gateway cities strategy are already rebounding from the social dislocation  of COVID.We have placed renewed focus on the growth of our investments platform. In addition to our extensive development pipeline that will create ongoing investment opportunities in new generation assets, we have launched new products that utilise our property expertise and drive outperformance. The conversion of our pipeline of urban renewal projects is  on track to achieve our development completion targets.  Our placemaking skills are well positioned to add significant value for our stakeholders.Our construction capability is an integral part of our integrated offering, providing certainty and flexibility of delivery. We will continue to focus on delivery excellence for all our customers and investors.Renewal20

Lendlease Annual Report 2022

The power of the city

The benefits of urban life, disrupted by COVID, are being restored. 
Human interaction drives communities, culture and commerce.

In last year's Annual Report, we 
highlighted the importance of cities. 
The past year has only reaffirmed our 
conviction. The value to society of 
‘in person’ interaction underpins the 
dominant role that cities play in the 
global economy. This should come as 
no surprise given the thousands of 
years of evolution that rewarded human 
connection and collaboration.

The pre-eminence of cities has not 
been undermined by successive waves 
of technology. In fact, technological 
change has enhanced knowledge that 
is best dispersed through close and 
personal interaction.

History is marked with significant periodic 
plagues and pandemics, of which COVID 
is the most recent. Despite these 
and other challenges, including natural 
disasters and economic cycles, cities 
continue to rebound.

Benefits of agglomeration
The benefits of agglomeration remain as 
compelling today as they have ever been.

The extensive social infrastructure and 
amenity that cities offer make them 
people magnets. Population density 
provides the scale to support the best 
educational institutions and healthcare 
facilities as well as cultural attractions 
and mass transit. The strong desire for 
social interaction and experience spurs 
vibrancy across the retail, tourism and 
hospitality sectors.

Our gateway cities strategy is founded on 
the premise that the most desirable cities 
will continue to be the driving force of 
economic, social and cultural life.

Resilient cities adapt
COVID, declared a pandemic in 
early March 2020, has been the 
greatest global threat this century. The 
ensuing lockdowns and isolation threw 
the primary purpose of cities, that 
is interaction and collaboration, into 
disarray. This had significant ramifications
for the way societies live, work and play.

Top: Sydney: Artist's impression, Victoria 
Cross over station development. 
Opposite: Boston: Clippership Wharf.

Nearly three years since the onset of the 
pandemic, cities are springing back to life. 
There is mounting evidence of a return 
to normality, or what may be described 
as the new normal, given an acceleration 
in some societal trends that were already 
well underway.

How we live: Central city residential 
markets witnessed the fastest recovery 
of all sectors in terms of occupancy and 
rents. Approximately one per cent of 
residential properties are vacant across 
New York City, a record low. There are 
similar trends in inner parts of London 
with asking rents up 25 per cent from 
their low point. Inner city vacancy rates 
across the East Coast cities of Australia 
are at or below pre-COVID levels.

How we play: The rebound in leisure and 
hospitality has been strong. Visitations 
across retail centres in our global 
gateway cities are trending towards 
2019 levels and restaurant reservations 
are approximately 10 per cent above 
pre-COVID levels. Cultural and sporting 
events have returned with theatres 
playing to full houses and major sports 
taking place in front of capacity crowds. 
The recovery underway in international 

tourism is expected to further benefit 
gateway cities.

How we work: The return to office
lags most other aspects of global 
cities’ recovery from COVID. While 
mobility data is much improved, it 
remains markedly lower than prior to the 
pandemic. CBD workplace attendance is 
10-30 per cent below pre-COVID levels 
across our gateway cities. We expect a 
gradual recovery to continue. For insight 
into shaping workplaces of the future, 
refer to page 25.

88%
of the population in 
high income countries is 
expected to be residing in 
urban areas by 20501.

1. Executive Outlook on Cities and Strategy 2030: Mykhnenko et al, University of Oxford, 2021.

 
 
Renewal

21

A recent Committee of Sydney 
study2 indicated that station precinct 
development could provide almost half 
of the new dwellings required to meet 
Sydney's expected population growth 
over the next two decades.

It is these types of opportunities across 
our targeted gateway cities that play 
to our strengths. Collaboration among 
government, the private sector and 
local communities is a must to achieve 
desired outcomes.

Our global reach, placemaking 
capabilities, integrated business model 
and partnering approach all combine to 
provide a unique skill set.

An eye to the future
As an integrated real estate group with 
projects that often span several property 
cycles, we take a long term view. In 
2009 we committed that Barangaroo 
South would be a carbon neutral precinct. 
That vision was realised in 2020, with 
Barangaroo South recognised as the first
carbon neutral precinct in Australia.

A recent Oxford University-Protiviti1 
survey revealed that business leaders 
share a very positive view on the 
increasing importance of cities given their 
concentrated pools of labour, skills, new 
talent and knowledge. Almost two thirds 
believe that by 2030 the role of cities will 
be more important for their businesses, 
compared with just six per cent who 
believe they will be less important.

The survey results indicate that first
tier, larger and specialised urban 
economies will benefit most and will 
increase in importance for business 
operations. This aligns with our strategy 
to have a presence in gateway cities 
that demonstrate the most favourable 
prospects for long term outperformance.

The upside of urban renewal   
A holistic approach to urban renewal is 
critical for cities to adapt and become 
more productive, liveable, affordable and 
sustainable. Higher urban density is linked 
to improved:

• Economic performance through 

higher wages, more innovation and 
lower costs of public service provision

• Wellbeing via social connection, as 

evidenced by growing mental health 
challenges experienced through the 
pandemic isolation

• Environmental outcomes via lower 
pollution and energy consumption.

Transport infrastructure typically 
determines the urban form of cities and 
shapes their evolution – think of the two 
hubs of New York City with Downtown 
evolving around the port and Midtown 
shaped by the rail terminals.

Sydney is currently in the throes of a rail 
infrastructure boom with the network set 
to grow to 338 stations. This provides 
for a more rapid evolution of the urban 
environment to create a more liveable, 
productive and sustainable city.

1. Executive Outlook on Cities and Strategy 2030: Mykhnenko et al, University of Oxford, 2021.
2. Rethinking Station Precincts - How to create great precincts around rail stations and why this matters for Sydney: Committee for Sydney, April 2022.

 
 
22

Lendlease Annual Report 2022

Growing our 
investments platform

Our long term strategy is to significantly grow our investments portfolio 
and over time, we expect more than half of Lendlease's invested capital 
will be allocated to the Investments segment.

A Lendlease fund has 
been the world's most 
sustainable office fund 
for seven of the last 
eight years.

For decades we have 
been trusted with 
managing funds and 
assets for some of 
the world's largest real 
estate investors.

We formed a $1b partnership to 
develop state-of-the-art labs, offices and 
manufacturing spaces in high growth 
life science clusters across the US. 
We also launched a $1b innovation 
fund which focuses on properties linked 
to both innovation and life sciences 
such as laboratories, medical science 
facilities and manufacturing spaces. We 
believe there is significant opportunity for 
FUM growth in this sector across our 
target cities.

We also have the appetite and capability 
to launch new products underpinned 
by our end-to-end capability, and both 
on and off market growth opportunities 
alongside investment partners. A recent 
example is the launch of Real Estate 
Partners 4, a value-add fund.  

We are targeting funds under 
management (FUM) of greater than $70b 
by FY26, up from $44b. This is expected 
to require approximately $6b of invested 
capital, and entails investing alongside 
partners in our existing funds, in addition 
to the launch of new investment products.

A strong foundation
Our investments platform provides 
a strong foundation to build global 
scale. We have decades of experience 
managing real estate assets with trusted 
fiduciary and governance structures, and 
our expertise spans multiple sectors in 
both the listed and unlisted markets. We 
currently manage 38 funds and mandates.

In addition to the high quality 
and sustainable product created from 
our development pipeline, we have 
expertise in generating value through 
asset management.

Top: Sydney: International House 
(Sustainable office)

Building a scale platform
Our development pipeline is anticipated 
to provide approximately two thirds of 
the growth towards our FUM target. 
This includes: 
• Sustainable office: we have a strong 
track record of creating some of 
the most sustainable Premium and A 
grade office buildings and manage 
more than $23b in FUM.

• Apartments for rent: we have 

completed residential for rent product 
in the US and UK and now have 
almost $3b in FUM.

• Life sciences: global healthcare 
is rapidly innovating to meet 
changing needs. We are pivoting 
from a construction led capability 
to fully utilising our integrated 
model, targeting life sciences 
projects globally.

• Data centres: we have started our 
first data centre in Tokyo which is 
100 per cent let and due to complete 
in FY25.

Renewal

23

Strong demand for global 
real estate
The top 100 global investors control 
approximately $1.5t in real estate assets. 
We have relationships with a large 
number of them.

We expect capital flows to remain strong, 
with real estate allocations controlled by 
the world’s largest investors likely to rise. 
They are looking for managers with the 
ability to generate long term value.

We offer investment partners high 
quality investment portfolios and access 
to our significant global development 
pipeline. Our focus on safety and 
creating innovative and sustainable 
product is also a key differentiator. 
Our deep relationships strengthen our 
capacity to tailor new products to meet 
their appetite.

There is a significant opportunity to 
attract US and European investors, which 
are currently underrepresented across 
our platform.

Sustainability credentials 
a differentiator
In the most recent Global Real 
Estate Sustainability Benchmark (2021) 
our Barangaroo office fund, Lendlease 
International Towers Sydney Trust, was 
the #1 ranked fund globally out of 1,520 
funds. We also had four funds ranked in 
the global top ten.

Optimising our portfolio
Our investment portfolio is currently 
valued at $3.5b and includes our 
co-investment positions in Lendlease’s 
managed funds and our equity interests 
in our Retirement Living and Military 
Housing businesses.

We continually assess optimisation 
and redeployment opportunities, 
demonstrated this year by two 
key initiatives.

Top left: Chicago: The Cooper 
(Apartments for rent)
Top right: Greater Tokyo: Artist's 
impression, seed asset for Lendlease 
Innovation Partnership.

Key initiatives

Redeploying capital – 
Retirement Living
We reduced our investment in the 
Retirement Living Trust from 50 per 
cent to 25.1 per cent. The sale for 
approximately $500m, to an existing 
investment partner, allows us to 
redeploy this capital.

Crystallising value – 
Military Housing
For more than 20 years, we’ve 
been providing asset management 
services to military housing and 
lodging communities across the US.

Through an existing relationship, 
an equity partner acquired a 28 
per cent interest in the asset 
management income stream on a 
multiple of approximately 26 times 
net profit after tax.

24

Lendlease Annual Report 2022

Development, at scale

We are on track to achieve our more than $8b completion target from 
FY24, almost double our historical average.

Our confidence is supported by: 
• $117b development pipeline

• Planning milestones well progressed

• Capability to deliver at scale 

• Market depth to absorb product

• Investment partners and capability to 

support funding

$117b pipeline underpins target
The origins of achieving development 
at scale emanated a little more than a 
decade ago with a very focused strategy 
of expanding our integrated business 
model to targeted international gateway 
cities. Since formulating this strategy, our 
urban pipeline has grown almost tenfold, 
from $11b in June 2009 to more than 
$100b in June 2022. Our Communities 
pipeline in Australia, which is broadly 
stable over the same period, currently 
stands at $15.4b.  

Gateway cities often have large sites 
ripe for regeneration and infill sites that 
stitch well-considered density into the 
city fabric. Large multi-stage sites that 
provide the opportunity to craft mixed 
use precincts is where the breadth of our 
skills are applied to greatest effect.

Our partnership approach with a 
demonstrated value proposition has 
been recognised by being awarded and 
completing many extraordinary projects. 
A global platform with locally based 
real estate expertise has few direct 
competitors and is difficult to replicate. 
Our current portfolio of 21 major urban 
projects spans nine gateway cities.  

Placemaking a key differentiator    
Through the places we design, build and 
curate, we aim to create destinations 
where people want to be. Improved 
liveability, environmental sustainability, 
inclusion, affordability, connectedness, 
wellbeing and a sense of community are 
important elements we incorporate to 
create 'place'.

Placemaking presents a unique 
opportunity to generate lasting and 
positive value for a city and its 
communities through the way people 
connect, learn and live. Great places 
are the product of both physical 
and experiential attributes which are 
shaped, delivered and maintained through 
ongoing curation.

Our completed projects, along with the 
current pipeline, provide a suite of proof 
points of our placemaking credentials and 
our contribution to urban renewal:

Waterfront development
• Barangaroo South, Sydney

• Lakeshore East, Chicago

• Clippership Wharf, Boston

• 1 Java Street, New York    

Transport orientated districts
• Paya Lebar Quarter, Singapore

• International Quarter London

• Victoria Cross Over Station 
Development, Sydney

• Euston Station, London

Innovation districts
• Melbourne Connect

• Milan Innovation District

>$8b
harvesting the immense 
potential of our secured 
pipeline provides ample 
opportunity to sustain 
annual completions

Top: Boston: Clippership Wharf
Opposite: Singapore: Paya Lebar Quarter; 
Melbourne: Melbourne Connect

Renewal

25

Converting the pipeline
Converting the already secured pipeline 
is key to achieving our annual 
completion target. We’ll continue to 
pursue opportunities with an emphasis 
on replenishing our pipeline in Asian and 
Australian cities.

Our pipeline is categorised by three 
phases: In conversion; Masterplanned; 
and Work in Progress. These phases 
provide an indication of the likely timing 
of project commencements given the 
timeline required to take a project from 
origination through to completion.

In Conversion
Approximately half of the pipeline, 
or $57b, is 'In Conversion'. That is, 
it has been secured but is yet to 
receive masterplanning approval from the 
relevant authorities. As a result, it is not 
in the potential pool for commencement. 
The timeframe to achieve masterplanning 
is typically two to three years from the 
date the project was secured. On smaller 
projects, the conversion period may be 
far shorter. 

Masterplanned
Approximately $42b of the pipeline has 
masterplan approvals. The focus for this 
stage is: obtaining individual building 
consents; launching products to secure 
income via pre-sales and pre-leasing; and 
working with our partners on investment 
opportunities that fit their mandates. 

Work in Progress
The pipeline moves into 'Work in 
Progress' once delivery of an asset 
commences. We currently have $18b of 
Work in Progress which puts us on track 
to meet our more than $8b completion 
target in FY24. Maintaining this level of 
completions is likely to require Work in 
Progress of more than $20b.   

Resilient product and places
Gateway cities are our future, and 
our portfolio of projects has improved 
resilience and liveability in mind. We 
believe well located and high quality 
product within amenity rich environments 
will endure. While most of the 
development pipeline is comprised of 
mixed use precincts, the key product 
categories are:

• Apartments for sale c.$38b: 

affordable to luxury

• Apartments for rent c.$28b: offering
customers the opportunity to live 
where they want and rent like 
they own

• Commercial c.$35b: CBD offices,

transport hubs, innovation districts, 
life sciences and data centres

• Communities c.$16b: key population 

growth corridors in Australia

The evolving workplace
The most significant COVID induced 
change across our real estate platform 
has been the evolution of the workplace. 
The working experience since the start 
of 2020 has demonstrated the capability, 
and in many cases, preference to partly 
work from home.

The employee value proposition, 
heightened by a tight labour market, is 
becoming more important for employers 
to attract and retain the best talent. 
Employees increasingly prioritise a 
workplace that is well connected, human-
centric, socially aware, environmentally 
proactive, and amenity rich with a focus 
on health and wellbeing. 

We believe that highly sustainable 
and digitally enabled workplaces in 
well connected locations, will remain 
in demand. Our focus is to create 
workplaces that facilitate relationships, 
collaboration and enhance organisational 

culture. Occupiers and investors are likely 
to pay a premium for this product.

Funding the pipeline
We aim to work our capital harder 
as development activity accelerates 
towards, and beyond, our target of more 
than $8b of annual completions. More 
investment partnerships are planned, 
facilitating greater capital efficiency to 
fund our share of the incremental Work 
in Progress.

The proportions of recent 
commencements funded by investment 
partners are:

• 1 Java Street, New York: 80%

• Data Centre, Tokyo: 80%      

• 60 Guest Street, Boston: 75%

• Certis Cisco Centre, Singapore: 51%

Our expectation is that approximately 
$6b of invested capital is required 
to consistently fund our share of 
completions, compared with a current 
invested capital balance of $5.4b.

These investment partner funding 
strategies complement an already capital 
efficient business model. Approximately 
90 per cent of our development pipeline 
has been secured on capital efficient 
terms. It protects downside risks for both 
ourselves and our investment partners, 
while providing the flexibility to adjust 
production as market conditions vary. 
This unique feature of our development 
platform enables $2.8b of capital in land 
and infrastructure to control our $117b 
development pipeline.

 
 
26

Lendlease Annual Report 2022

Execution excellence

We have a rich heritage of project management, design and construction 
excellence across a range of sectors with leading risk, safety and 
sustainability credentials.

Salesforce Tower
Platinum WELL1
6 Star Green Star1
5.5 Star NABERS1

Leading project management, 
design and construction capability
We combine the benefits of our 
global scale and the rich heritage of 
corporate knowledge with a localised 
capability and network to deliver high 
quality projects. Specialist design and 
project management teams combine 
deep sector knowledge with strong 
customer relationships to create places 
that are innovative, sustainable, and 
commercially successful.

We have delivered construction projects 
around the world for more than six 
decades, creating hundreds of buildings 
and precincts. Our construction capability 
is showcased in workplaces for some of 
the world’s largest organisations, vibrant 
retail centres and residential apartments 
including affordable housing options, 
state-of-the-art hospitals and other 
buildings of civic and social importance.

More than just building delivery
For us, it is more than just the 
construction of buildings. We are 
recognised for creating innovative places 
that stand the test of time and we have 
been entrusted to create and restore 
iconic buildings that shape city skylines.

Our focus is client satisfaction. A 
significant proportion of repeat business 
is testament to being a trusted and 
strategic partner. We believe our 
approach to securing, creating and 
delivering projects to exceed client and 
investor expectations is key.

Construction has played a lead role in the 
origination of some integrated projects. 
This includes the Darling Harbour precinct 
where the project commenced as a 
Public Private Partnership. Confidence in 
delivery capability and certainty is often 
the key to securing such projects.

Demonstrating delivery certainty at 
Sydney Place     
The progress on Salesforce Tower, 
the centrepiece of the Sydney Place 
project, highlights our superior delivery 
expertise and the certainty we provide to 
investment partners.

Our team has navigated a difficult
operating environment including COVID 
and weather disruptions.

Innovative design and construction 
solutions have enhanced value and 
mitigated risk. The project team used a 
number of market leading construction 
methodologies, including the use of 
a steel structure as well as modular 
components and pre-fabrication to 
minimise site works, improve safety, 
reduce waste and enhance the harbour 
views from this premium workplace.

The Construction segment provides the 
delivery capability for our integrated 
model as well as design, project 
management and construction services to 
our customers. This combination enables 
us to attract the best talent while 
providing the scale and depth of expertise 
to maintain industry best practice.

Our strategy is to provide delivery 
excellence for the integrated model 
and hold a leadership position in 
target sectors.

A key component of the 
integrated model
Our project management skills permeate 
through our end-to-end real estate 
offering and are the enabler for the 
delivery of our urban projects.

We expect the future of urbanisation 
will be increasingly tied to precincts and 
districts. Our experience strengthens our 
credentials as a partner of choice.

Large integrated projects such as 
Barangaroo South and Darling Harbour 
in Sydney and Paya Lebar Quarter in 
Singapore stand as testament to our 
delivery capability.

Looking forward, we’ll apply this 
capability to our pipeline of projects 
including Euston Station in London and 
our San Francisco Bay Area project.

1. Targeted.

 
Renewal

27

Opening the door to 
business opportunities
Not only has the Construction segment 
contributed to the origination of 
integrated projects, it has also introduced 
new business opportunities to the Group.

Almost two decades ago, when the US 
Department of Defense was privatising 
its military housing portfolio, our US 
construction business, through its delivery 
capability, facilitated our entry into the 
housing privatisation program.

Similarly, our construction business in 
Asia has a strong history delivering data 
centres and life sciences buildings. This 
provided the entry point for expanding 
the integrated model into these two 
growing real estate sectors.

Rigorous risk management
Our risk management processes have 
evolved from decades of experience. 
It starts with disciplined origination 
that incorporates thorough market 
assessments and aligns our value 
proposition with potential opportunities. 
Diversity by client, contract type 
and sector forms part of this 
origination strategy.

Substantial de-risking takes place prior 
to commencement of construction. 
Formulating detailed project briefs, which 
is our key project management skill, 
involves selecting a team with the optimal 
skill set for the project. Depending on 
contract type, we then go into product 
design and cost planning. 

The delivery phase is about construction 
management, production and program 
controls, functional reviews and reporting. 
Post construction, we apply a rigorous 
commissioning process for a smooth 
transition to the client.

We remain disciplined with our approach 
to winning work and strive to maintain 
an industry leading approach to 
risk management.

Our construction 
capability plays a critical 
role in the delivery of our 
urban projects.

Partnership approach with 
supply chain
Working collaboratively with our partners 
is essential to mitigating supply chain 
risk and achieving our sustainability 
targets. The significant disruption caused 
by COVID and geopolitical uncertainty 
has emphasised the importance of the 
supply chain in the successful delivery of 
our projects.

We have implemented a range of 
initiatives to counteract supply chain 
disruption. By working directly with 
global steel manufacturers, the material 
experiencing the greatest price pressure, 
we have improved certainty and cost 
of supply. Global agreements have been 
advanced with a number of strategic 
partners for glass and aluminium. In 
addition, we reduced the risk of 
disruption through a relationship with a 
large global logistics providers.

Key focus areas include:

• Knowing our suppliers and their 
suppliers in order to proactively 
manage risk

• Developing broader and more 

advanced strategies for key high risk 
trades and critical supplies

• Establishing the right trading 
partnerships to introduce low 
embodied carbon materials

• Building a more connected 
supply chain via the use of 
digital technologies.

Opposite: Sydney: Sydney Place
This page: Sydney: Randwick 
Campus Redevelopment

Risk Management FrameworkFive contract typesConstruction managementManaging contractorDesign and construct (two stage)Design and construct (one stage)Design and construct (PPP)Governance structureInvestment CommitteePre-construction reviewProject Control GroupProject reviewFunctional reviewsCompletion & commissioning planFour key elementsLimits of authority    |    Contract risk limits    |    Risk appetite framework    |    Global Minimum Requirements  28

Lendlease Annual Report 2022

1 Java Street, New York

Inclusivity, connection and resilience underpin the vision for 1 Java Street.

Beyond our role 
in developing and 
constructing the precinct, 
we will play an 
integral part in its 
ongoing curation.

benefit the Greenpoint community for 
generations to come.

All-electric, geothermal
To minimise carbon emissions, we intend 
to implement a geothermal system in 
lieu of traditional gas boiler heating 
and cooling. The system will use the 
stabilising temperatures of the land below 
to provide heat and cooling. In addition, 
the geothermal system is also expected to 
reduce ongoing operational costs.

When complete, 1 Java Street is 
anticipated to be one of the largest 
residential buildings in New York State to 
use all-electric and geothermal energy.

Climate resilient
Cities built around water are particularly 
vulnerable to the impacts of climate 
change. The project team undertook a 
climate related risk assessment to address 
the project’s resilience to such impacts. 
The findings were incorporated into the 
design, including raising the building to 
account for future potential flood risk.

Strong social value
1 Java Street will incorporate a diverse 
range of apartment styles to appeal 
to a variety of residents. This includes 
addressing the challenge of affordability, 
with approximately 30 per cent of the 
units allocated to affordable housing.

Forming partnerships with local not-for-
profit organisations is also a priority. 
Lendlease has partnered with the 
Billion Oyster Project which aims 
to restore oyster reefs to New 
York Harbor through public education 
initiatives. billionoysterproject.org

During the height of the COVID pandemic 
in 2020, an opportunity arose to acquire 
a land parcel located on the East River 
at Greenpoint in Brooklyn, New York to 
create a new residential community.

Our conviction in our gateway cities 
strategy, founded on the premise that 
the most desirable cities will continue to 
be the driving force of economic, social 
and cultural life, saw us look beyond the 
pandemic induced uncertainty to pursue 
the opportunity.

Drawing on our integrated capability, 
strong track record and intimate local 
knowledge, a project team was mobilised 
to unlock the potential of the 2.6-acre 
site, and 1 Java Street was born.

Lendlease’s global reach and capabilities 
offer unique insights into the evolution 
of the built environment. 1 Java Street 
provides an opportunity for reinvention 
and renewal.

Partnership approach
Consistent with our partnership approach 
and our deep relationships with 
strategically aligned global investment 
partners, we teamed up with Aware 
Super, one of Australia’s largest 
superannuation funds.

They also saw the project's potential, 
taking an 80 per cent interest. This 
extends the $2b investment partnership 
formed in 2018.

Beyond our role in developing and 
constructing the precinct, we will 
play an integral part in its ongoing 
curation through our asset management 
capabilities while also managing Aware 
Super’s investment.

Solving for the future
In line with Lendlease’s ambitious 
sustainability agenda, the project team 
has designed 1 Java Street to be a 
highly sustainable precinct, creating an 
environment that we believe will

Renewal

29

1 Java Street is 
expected to transform 
a full city block into 
a dynamic mixed-use 
residential for rent 
(multi-family) community.

The project will include a public 
waterfront esplanade with improved 
connection to the India Street Pier 
and New York City Water Ferry. 
Approximately 850 apartments for rent 
will be delivered, along with street retail 
and more than 6,300 square metres of 
outdoor space accessible to residents and 
the wider community.

The revitalised India Street Pier will 
include a ferry stop allowing residents 
and ferry users to commute to 
Manhattan’s business district. The 
waterfront esplanade is designed to 
encourage users to engage with the site’s 
natural habitat and provides direct access 
to the East River.

The Project

Details
•

$1.2b total estimated development end value

• Delivered with Aware Super through the Lendlease Americas 

Residential Partnership

•

Secured 20211; commenced 20221; expected completion 20261

Targeted sustainability features
• Geothermal, all-electric mechanical design

•

•

Sustainable building materials (low carbon concrete)

Energy efficient design and appliances

• Abundant outdoor space and ecological shoreline

• Transit oriented: adjacent to ferry; two blocks from the subway

•

Electric vehicle charging stations

Targeted sustainability ratings
•

LEED Gold

•

Fitwel Certification

• Waterfront Edge Design Guidelines Certification

•

ENERGY STAR Certification

1. Financial year, subject to change in the delivery program

Top and opposite: New York: Artist's 
impression of 1 Java Street.

30

Lendlease Annual Report 2022

Kuala Lumpur  The Exchange TRXArtist’s impressionOur focus areas

31

Our Focus AreasWe measure our success by  the positive outcomes we generate over the long term through five focus areas. They underpin our ability to create safe, sustainable and economic outcomes for our customers, partners, securityholders and the community.While we approach these focus areas with an  innovative mindset, our decisions are supported by disciplined governance and risk management. Our five focus areas areHealth and Safety Financial Our Customers Our People Sustainability 32

Lendlease Annual Report 2022

Managing and 
measuring value

Area of focus

Material issues

How do we deliver value

Value created

How we measure value

Health and Safety
Operating safely across our operations and projects. 
Maintaining the health and wellbeing of our employees 
and those who engage with our assets and sites.

We are committed to the safety of our people and 
those who interact with our assets and sites. Through 
our Global Minimum Requirements (GMRs) we apply a 
consistent standard across all operations. These GMRs 
extend to physical safety and people’s mental health 
and wellbeing.

Operating safely helps people feel valued and cared for 

Percentage of projects with no critical incidents: a critical incident is an event 

and fundamentally makes us more consistent, reliable and 

that has the potential to cause death or permanent disability. This is an indicator 

efficient in everything we do.

unique to Lendlease.

Critical Incident Frequency Rate: a Lendlease indicator measuring the rate of 

critical incidents.

next day.

Lost Time Injury Frequency Rate: an indicator and industry standard measuring 

a workplace injury which prevents a worker from returning to duties the 

Financial
Delivering securityholder returns. Maintaining a strong 
financial position to support ongoing investment in our 
future pipeline.

We deliver returns to our securityholders and adopt 
a prudent approach to capital management, with a 
view to maintaining a strong balance sheet throughout 
market cycles.

Margins, fees and equity returns across Investments, 

Core Operating Return on Equity: the annual Core Operating Profit after Tax 

Development and Construction. Our Portfolio 

attributable to average securityholders’ equity throughout the year.

Management Framework sets target guidelines for how 

we manage our portfolio.

Core Operating Earnings per Security: Core Operating Profit after Tax 

attributable to securityholders divided by the average number of securities on 

issue during the year.

Our Customers
Understanding our customers and responding to 
changes in the market. Designing and delivering 
innovative, customer driven solutions to win the 
projects we want to win and ultimately deliver the 
best places.

Embedding a process of continuous improvement 
based on customer insights and actions 
identified through market research. This 
approach also consistently measures customer 
satisfaction and advocacy.

Evolves our ability to improve the customer experience, 

Customer satisfaction and advocacy tracked: measured at the regional and 

building our brand and reputation, enabling us to win 

business unit level and reported regularly to our Global Leadership Team and 

more work and grow our business. Customer feedback 

the Board. Action plans are developed to drive continuous improvement in 

also provides greater insight into product development 

the customer experience, supporting the delivery and growth of funds under 

and innovation opportunities.

management, our development pipeline and construction backlog.

Our People
Attracting, developing and retaining diverse talent. 
Ensuring we have the right capability across the 
organisation to deliver results for all stakeholders.

We attract, develop and retain diverse talent by 
building a culture of collaboration and continuous 
learning, where successes are recognised and people 
are rewarded. We invest in developing inclusive 
leaders and capabilities to drive our success.

Sustainability
Designing, delivering and operating buildings and 
precincts that respond to the immediate challenge 
of reducing carbon emissions while creating social 
value. Meeting the increasing expectations of key 
stakeholders for climate resilient assets that support 
human health and value natural capital.

As a signatory to the United Nations Global Compact, 
we are committed to the continuous improvement of 
our operations. We integrate strategies to mitigate the 
impact of climate change.

Capable and motivated people committed to the 

Retention of key talent: the organisation benefits from its investment in leaders 

long term success of our business. Effective 

and key workforce capabilities.

succession planning and leadership transitions support 

business continuity and can reduce risks. Diversity 

supports innovation, knowledge sharing and better 

decision making.

Succession strength: demonstrates depth of capable talent ready to progress 

into leadership roles.

across our business.

Leadership positions held by women: demonstrates our broader commitment 

to diversity and inclusion and our objective of increasing female representation 

Employee engagement: provides the organisation with insights to help provide 

the right environment for our employees to perform at their best.

Recognised leadership in sustainability enhances our 

Measurement of, and reporting on our progress towards our sustainability 

brand and is a competitive differentiator. It also 

targets and tangible examples of the way we are addressing our 

provides more opportunities to partner with governments, 

sustainability imperatives.

investors and the private sector who are placing 

increasing importance around Environmental Social 

Governance (ESG) matters.

Carbon Target: we are a 1.5ºC aligned company:

• Net Zero Carbon by 2025 (scope 1 and 2)

• Absolute Zero Carbon by 2040 (scopes 1, 2 and 3, no offsets)

Social Target: create $250m of social value by 2025

 
 
Our focus areas

33

Area of focus

Material issues

How do we deliver value

Value created

How we measure value

Health and Safety

Operating safely across our operations and projects. 

Maintaining the health and wellbeing of our employees 

and those who engage with our assets and sites.

We are committed to the safety of our people and 

those who interact with our assets and sites. Through 

our Global Minimum Requirements (GMRs) we apply a 

consistent standard across all operations. These GMRs 

extend to physical safety and people’s mental health 

and wellbeing.

Operating safely helps people feel valued and cared for 
and fundamentally makes us more consistent, reliable and 
efficient in everything we do.

Percentage of projects with no critical incidents: a critical incident is an event 
that has the potential to cause death or permanent disability. This is an indicator 
unique to Lendlease.

Critical Incident Frequency Rate: a Lendlease indicator measuring the rate of 
critical incidents.

Lost Time Injury Frequency Rate: an indicator and industry standard measuring 
a workplace injury which prevents a worker from returning to duties the 
next day.

Financial

future pipeline.

Delivering securityholder returns. Maintaining a strong 

financial position to support ongoing investment in our 

We deliver returns to our securityholders and adopt 

a prudent approach to capital management, with a 

view to maintaining a strong balance sheet throughout 

market cycles.

Margins, fees and equity returns across Investments, 
Development and Construction. Our Portfolio 
Management Framework sets target guidelines for how 
we manage our portfolio.

Core Operating Return on Equity: the annual Core Operating Profit after Tax 
attributable to average securityholders’ equity throughout the year.

Core Operating Earnings per Security: Core Operating Profit after Tax 
attributable to securityholders divided by the average number of securities on 
issue during the year.

Our Customers

Understanding our customers and responding to 

changes in the market. Designing and delivering 

innovative, customer driven solutions to win the 

projects we want to win and ultimately deliver the 

best places.

Embedding a process of continuous improvement 

based on customer insights and actions 

identified through market research. This 

approach also consistently measures customer 

satisfaction and advocacy.

Evolves our ability to improve the customer experience, 
building our brand and reputation, enabling us to win 
more work and grow our business. Customer feedback 
also provides greater insight into product development 
and innovation opportunities.

Customer satisfaction and advocacy tracked: measured at the regional and 
business unit level and reported regularly to our Global Leadership Team and 
the Board. Action plans are developed to drive continuous improvement in 
the customer experience, supporting the delivery and growth of funds under 
management, our development pipeline and construction backlog.

Our People

Attracting, developing and retaining diverse talent. 

Ensuring we have the right capability across the 

organisation to deliver results for all stakeholders.

We attract, develop and retain diverse talent by 

building a culture of collaboration and continuous 

learning, where successes are recognised and people 

are rewarded. We invest in developing inclusive 

leaders and capabilities to drive our success.

Sustainability

Designing, delivering and operating buildings and 

precincts that respond to the immediate challenge 

of reducing carbon emissions while creating social 

value. Meeting the increasing expectations of key 

stakeholders for climate resilient assets that support 

human health and value natural capital.

As a signatory to the United Nations Global Compact, 

we are committed to the continuous improvement of 

our operations. We integrate strategies to mitigate the 

impact of climate change.

Capable and motivated people committed to the 
long term success of our business. Effective 
succession planning and leadership transitions support 
business continuity and can reduce risks. Diversity 
supports innovation, knowledge sharing and better 
decision making.

Retention of key talent: the organisation benefits from its investment in leaders 
and key workforce capabilities.

Succession strength: demonstrates depth of capable talent ready to progress 
into leadership roles.

Leadership positions held by women: demonstrates our broader commitment 
to diversity and inclusion and our objective of increasing female representation 
across our business.

Employee engagement: provides the organisation with insights to help provide 
the right environment for our employees to perform at their best.

Recognised leadership in sustainability enhances our 
brand and is a competitive differentiator. It also 
provides more opportunities to partner with governments, 
investors and the private sector who are placing 
increasing importance around Environmental Social 
Governance (ESG) matters.

Measurement of, and reporting on our progress towards our sustainability 
targets and tangible examples of the way we are addressing our 
sustainability imperatives.

Carbon Target: we are a 1.5ºC aligned company:

• Net Zero Carbon by 2025 (scope 1 and 2)

• Absolute Zero Carbon by 2040 (scopes 1, 2 and 3, no offsets)

Social Target: create $250m of social value by 2025

 
 
34

Lendlease Annual Report 2022

Health and Safety

The health, safety and wellbeing of our people is our highest priority.

Percentage of operations without 
a critical incident1

FY22

FY21

94%94%

94%94%

1. An event that caused or had the potential to cause 
death or permanent disability. This is an indicator 
unique to Lendlease.

Critical Incident Frequency Rate1

FY22

FY21

0.570.57

0.660.66

1. Calculated to provide a rate of instances per 

1,000,000 hours worked.

Lost Time Injury Frequency Rate1

FY22

FY21

1.41.4

1.81.8

1. Calculated to provide a rate of instances per 

1,000,000 hours worked.

Employee safety culture survey

91% Agree Lendlease operates its 

business with safety as the 
number one priority

90% Agree Lendlease creates a 

culture of working safely

89% Agree safety is a key priority in 

their team

87% Agree their manager makes 

safety the number one priority

Safety performance
We have achieved exceptional outcomes 
against some of our key safety metrics. 
Our Critical Incident Frequency Rate 
(CIFR), Lost Time Injury Frequency Rate 
(LTIFR) and percentage of operations 
without a critical incident are at their best 
ever rates of performance. 

Notwithstanding these positive outcomes, 
it is with much sadness we report a fatal 
incident at one of our operations.

A subcontractor working in an area under 
subcontractor management on the 4 
Hudson Yards project in New York was 
fatally injured following a fall from height 
while performing works on the site. Our 
thoughts continue to be with the family 
of this worker and those impacted by 
this event.

Opposite: Sydney: Salesforce Tower

Safety culture
We undertook an organisation-wide 
survey which assessed employee 
perspectives regarding our safety culture. 
This enabled comparison with the original 
safety culture survey conducted in FY19.

The survey results reinforced the 
outstanding safety culture evident across 
the organisation. Several key safety and 
culture climate statements elicited high 
employee agreement rates including key 
statements about safety culture above 85 
per cent.

Our employees demonstrate great pride 
in our approach and prioritisation 
of safety across everything we do. 
The survey results identified areas for 
continuous improvement. This included 
support for greater investment in supply 
chain capability, and further focus on 
psychological safety, in step with our 
approach to physical safety.

Our focus areas

35

Safety innovations
Our people identified priorities to help 
improve knowledge management, reduce 
administrative burden and make use 
of technology to support effective 
safety management.

S@l Bot
Our S@l chat bot provides our people 
with access to safety requirements 
and learning materials using artificial
intelligence through a query and response 
system that makes it easier to source a 
vast knowledge library. The S@l Bot can 
be accessed from remote locations via 
mobile devices. In its first 12 months more 
than 12,000 queries flowed through.

Permit to Work
Leveraging our existing Environment, 
Health and Safety (EHS) reporting 
platform, we have successfully piloted 
and implemented a digital Permit to 
Work application.

The introduction of this digital approach 
has reduced administrative burden 
and improved visibility into the 
requirements and status for many of 
the high risk activities undertaken across 
our operations.

External Learning Platform
To support the capability requirements 
of our external partners to deliver 
work safely, we launched the Lendlease 
Partner Portal. The portal is designed 
to address the learning and knowledge 
management requirements of our supply 
chain partners. 

The platform provides non Lendlease 
employees access via their mobile 
device to Lendlease Global Minimum 
Requirements (GMRs) and our EHS 
expectations. The platform also supports 
the implementation of other digital tools 
such as the Permit to Work module.

Excellence in innovation
Our goal is to keep people safe, and we 
do this by challenging how we work and 
continuously looking at ways to improve.

Senior Project Engineer, David White, is 
doing just that through the innovative 
application of full perimeter screens (over 
seven floors on a steel frame commercial 
building) safety solution.

David created the solution for the safe 
and efficient delivery of Salesforce Tower 
at Sydney Place, a 55 storey premium 
grade office tower featuring a unique 
hybrid structure of concrete and steel.

Applying existing perimeter protection 
screen applications would not have met 
Lendlease’s GMRs, or the construction 
program, so David created a new 
system engaging Lendlease’s high rise 
building experts around the world, as 

well as numerous suppliers. The solution 
demonstrated our capability to provide 
perimeter screens, common in concrete 
frame building construction, to a steel 
frame building.

The simplicity of David’s design has 
enabled a reduction in the risks of 
people or materials falling. It has 
reduced trip hazards and significantly 
reduced manual handling of components 
during installation.

The solution is a market leading 
improvement with flow on benefits for 
all Lendlease hybrid structure projects 
around the world. The screen supplier has 
also made it available to the wider market.

Increasing range of safety reporting data publicly availableBasic/standard reportingInclusion of industry metricsUnclear which persons or scenarios includedNo safety reporting 70 ASX200 companies*Transparent reporting Consistent performance dataIncludes all business scenariosIncreasing range of persons and scenarios included in statisticsIncluded in Lendlease safety  reporting data, including fatalitiesEmployeesYesConsultantsYesContractorsYesSubcontractors (incl. labour hire)YesVisitorsYesMembers of the publicYesAll businesses in all operating geographiesYesAll operations regardless of contractual or statutory health  and safety responsibilitiesYesBenchmarking industry reporting* Australian Council of Superannuation Investors (ACSI). Safety in Numbers: Safety Reporting by ASX200 Companies (September 2020). 
36

Lendlease Annual Report 2022

Financial

The Portfolio Management Framework provides structure and financial
discipline across the operating segments of Investments, Development 
and Construction.

Financial strategy
The Portfolio Management Framework 
(the Framework) is the core of 
our financial strategy, setting target 
guidelines designed to:

• Maximise long term securityholder 
value through a diversified, risk 
adjusted portfolio

our funding and enter into facilities in the 
regions in which we operate, providing 
us with a natural hedge and access to 
finance in these regions.

Accessing green and sustainability linked 
borrowings has allowed us to facilitate the 
following outcomes:

• Lengthen the maturity profile

• Leverage the competitive advantage 

• Diversify funding

Portfolio Management Framework

1. Invested capital mix

Investments

40-60% (<50%)1

Development

40-60% (>50%)1

Australia

International 
regions2

40-60%

10-25%

of our integrated model

• Support the execution of the Group’s 

2. Core business EBITDA mix3

• Optimise our business performance 

sustainability strategy

relative to the outlook for our markets 
on a long term basis

• Provide financial strength to execute 
our strategy, maintain an investment 
grade credit rating and sustain 
capacity to both absorb and respond 
to market volatility.

This year, the Group announced a 
five year plan to deliver long term 
sustainable performance.

The initial cost of implementing this 
plan included a restructuring charge and 
a development impairment. For more 
detailed information, refer to Performance 
and Outlook on page 56.

Sustainable financing
Lendlease is one of the leaders in 
sustainable financing in Australia. Of the 
Group’s total facilities, 60 per cent, or 
$3.1b are green or sustainability linked.

This includes four sustainability linked 
loans and three green bonds to help 
realise our global pipeline of sustainable 
projects. This highlights a continuing shift 
in our funding of the thriving places 
we create.

These financings have allowed us to 
extend the weighted average maturity of

• Improve lender engagement

• Provide good access to markets whilst 
achieving competitive funding costs.

Measuring financial performance
When measuring financial performance, 
we focus on Return on Equity and 
Earnings per Security on our core 
operations to measure the returns we 
generate for securityholders.

The Framework outlines target returns at 
a segment level. These returns, combined 
with an allowance for corporate costs, 
interest expense and tax, are used 
to derive a Group Core Operating 
Return on Equity target within the 
8-11 per cent range. Core Operating 
Earnings per Security forms the basis 
for securityholder distributions within the 
payout ratio of 40-60 per cent.

The elements of the Framework are based 
on the Group’s measure of Core operating 
profit with both the target EBITDA mix 
and the target distribution payout ratio 
assessed accordingly.   

See Note 1 ‘Segment Reporting’ in the 
Financial Statements for more details on 
Operating profit.

Investments

Development

Construction

3. Target returns

Core Operating ROE

Investments ROIC4

Development 
ROIC4

Construction 
EBITDA margin

4. Capital structure

Gearing5

Investment grade 
credit rating

5. Distribution policy3

Distribution 
payout ratio

35-45%

40-50%

10-20%

8-11%

6-9%

10-13%

2-3%

10-20%

40-60%

1. Reflects strategic direction.
2. Per region.
3. Core operating profit based measure.
4. Through cycle target based on rolling three 

to five year timelines.

5. Net debt to total tangible assets, less cash.

Detailed financial performance and outlook
For detailed information on our FY22 financial performance, as measured under 
the Portfolio Management Framework, refer to the Performance and Outlook 
section and the Financial Statements.

Opposite: Chicago: Lakeshore East

 
Our focus areas

37

38

Lendlease Annual Report 2022

Our Customers

From the housing needs of US service personnel to people working in 
more sustainable office buildings in Singapore; shoppers in Australia to 
investment partners around the world. Our customers are as diverse as 
our business operations globally.

In the past 12 months, we had more 
than 163 million interactions with our 
customers across Australia, Asia, Europe 
and the Americas. To track our customer 
performance, we annually measure 
customer satisfaction (CSAT) as well 
as the willingness of our customers to 
advocate on our behalf (NPS). This is 
conducted across all our lines of business 
and regions. In aggregate, our CSAT 
score lifted slightly while NPS increased 
by more than 25 per cent.

Consumer
This subset of our customers, which 
includes residents and visitors to our retail 
centres, is by far our largest. To further 
enhance the level of service we provide 
to this important group, a range of 
programs and initiatives were advanced 
during the past year including:

Continued investment to support US 
military families
We have more than $1.5b of 
development work underway in our 
military housing portfolio. More than 
120,000 service members and families 
call our communities home across 
approximately 40,000 dwellings.

Our privatised Army lodging portfolio, 
comprising more than 12,000 hotel 
rooms, has invested more than $1b in 
renovation work and new construction, 
to date.

This year, 100 Lendlease military housing 
neighbourhoods across the US were 
recognised as SatisFacts Community 
Award winners for their high resident 
satisfaction scores.

Enhanced online experience for 
Australian shoppers
• Overhaul of retail web experience 

across 13 retail assets

• Provide shoppers best-in-class 

mapping, in-depth tenant profiles
and integrated wayfinding optimised 
for mobile

• Ongoing research to assess the type 
of retail experience our shoppers 
are seeking.

Launch of Lendlease Living
• Launch of new global positioning 

to reinforce Lendlease's residential 
offering, in addition to 
urban redevelopment

• Progressively rolled out across 

communities, apartments for rent and 
sale and retirement living offerings

• Build awareness of brand among 
current and prospective residents.

Business
Our business relationships span 
partnerships with other companies, 
institutional investors across funds, 
mandates and managed assets, 
not-for-profits and approximately 
15,000 suppliers.

A number of major transactions 
with global investment partners were 
signed including:

• A new life sciences joint venture with 

Ivanhoé Cambridge to deliver state-
of-the-art laboratories, offices and 
manufacturing spaces in high-growth 
life science clusters across the US.

• The acquisition of a further 24.9 per 

cent of our Retirement Living business 
by Aware Super. The super fund 
upped its total investment to 49.9 
per cent.

• A 50:50 joint venture with CPP 

Investments for the development of 
Phase 1 of the West Gate area of the 
MIND project in Milan.

• An agreement with Dutch pension 

fund manager PGGM to establish the 
S$1b Lendlease Innovation Limited 
Partnership, which will invest in 
real estate assets in the innovation 
space, focusing on Australia, Japan 
and Singapore.

We announced a global partnership with 
one of the world’s leading suppliers 
of sustainable timber, Stora Enso, 
to help increase the use of more 
sustainable construction products in our 
gateway cities.

c.26,000
Customers 
surveyed in FY22

61%
of major construction 
backlog is public 
sector projects

38
Funds and Mandates

Opposite: Victoria: Harpley sales and 
information centre.

 
Our focus areas

39

Government
Around the world, we’re a partner 
of choice for governments. From 
state-of-the-art medical facilities, 
cultural institutions, transport-oriented 
developments, sports stadia or 
installations key to national security, 
we work shoulder-to-shoulder with our 
government partners to deliver some of 
their most important projects.

As the world continues its shift to a 
new COVID normal, we’re supporting 
administrations as they ramp up 
investment to stimulate economies.

At Victoria Cross Over Station 
Development, Sydney; Euston Station, 
London; and Smithfield, Birmingham, we 
continue to support the development 
of mixed use integrated station 
developments. This elevates these sites 
from train stations to hubs for living, 
dining and enjoyment.

Our ever-growing global expertise 
in life sciences and health has 

seen significant contracts secured for 
Australian projects including the Liverpool 
Health and Academic Precinct, Frankston 
Hospital and Adelaide Women and 
Children's Hospital.

In addition to our work across the 
US Military Housing Portfolio, we also 
continue to play a role in supporting 
Australia’s national security, through 
support to the Department of Defence at 
sites across the country.

At Garden Island in Sydney, we 
completed four years of work, which 
included a significant joint venture with 
a First Nations partner: 35 Indigenous 
contractors engaged; $10m spent on 
Indigenous suppliers; and winner of the 
Supply Nation 2019 Supplier Diversity 
Partnership of the Year Award.

>163 million
Interactions with 
customers across 
Australia, Asia, Europe 
and the Americas.

40

Lendlease Annual Report 2022

Our People

Our people bring Lendlease, our purpose and our culture to life. 
Creating places where communities thrive.

Leadership
To deliver our business strategy we need 
to continue to attract, develop, retain and 
invest in people.

With the internal appointment of a 
new CEO, we have reset our executive 
leadership team. Our bench strength 
enabled us to do this by reaching into our 
succession pools with 57 per cent filled
by internal talent. We are now focusing on 
replenishing these talent pools.  This will 
be driven by a combination of targeted, 
bespoke development of top talent and 
the relaunch of our global flagship
leadership programs in partnership with 
INSEAD. Many of our marquee training 
programs were paused during COVID 
and are being reinstated in response to 
feedback from our people.

We continue to increase the 
representation of positions filled by 
women among our leadership cohort, 
with women now filling 31.8 per cent of 
leadership positions. 

Leadership positions held 
by women

FY22

FY21

31.8%31.8%

29.9%29.9%

Careers
We have mapped the career paths of 
existing employees and, coupled with 
development actions, have created career 
paths for future employees to emulate.

Retention of key talent remains 
challenging in the current operating 
environment. While we achieved a 
retention rate of 87 per cent, this was 
below our target of 90 per cent or 
higher. We have identified talent retention 
as a key risk given the market remains 
extremely competitive.

Early career talent is a critical component 
of our talent pipeline. We refreshed 
the learning component of our global 
graduate program to keep it appealing, 
contemporary and focused on capabilities 
to support the delivery of our strategy. 
The refresh has been well received, 
with a 19 per cent increase in 
program participants reporting a positive 
experience over the six month period. Our 
globally consistent program builds early 
career talent across each region, 
enhances future career mobility and 
provides future capability throughout 
the enterprise.  

Lendlease has been 
certified as a Global 
Healthy Workplace.1

Our refreshed people strategy continues 
to bring our purpose-led business 
strategy and culture to life.

We are reinvesting in learning and 
careers, especially for our talent in 
the Investments, Development and 
Construction segments as well as our 
leaders. We have also updated our Short 
Term Incentive (STI) approach to further 
align outcomes with performance.

We remain committed to growing 
and retaining our diverse talent and 
developing inclusive leaders while 
creating a caring and trusting culture 
where people feel valued, belong and 
have an opportunity to thrive. 

Our refreshed focus areas are:

• Learning

• Careers

• Leadership

• Culture

The principles we will never compromise 
on continue to be:

• A physically safe workplace

• A psychologically safe workplace

• Prioritising the wellbeing of our 

people and their families.

1. Global Centre for Healthy Workplaces 2022.

 
 
Our focus areas

41

Learning
Our people make all the difference. To 
support them, we are developing new 
global leadership programs in partnership 
with INSEAD. These programs are 
focused on building modern and inclusive 
leaders at all levels of the organisation, 
across all regions.

We have developed and launched global 
programs to drive sponsorship of diverse 
talent by senior leaders while removing 
barriers to accelerate under-represented 
talent. Our Ignite program which focusses 
on female talent launched in February 
2022 with 56 participants. We have 
engaged Korn Ferry and together, co-
designed Mosaic, a Racial Equity and 
Sponsorship program. A cohort of 72 
will be invited to participate in the 
2022 program. These programs enhance 
and align to regional initiatives to drive 
representation and inclusion throughout 
our organisation.

Culture
We continue to be proud of our culture 
and our values.

They drive the way we interact that 
creates a sense of belonging and 
an environment for our people to thrive 
as part of a team; grow with the 
organisation; and to deliver for our 
customers and communities.

People want to work on our projects 
because of their impact on communities 
and our culture of care. This is reinforced 
by our Foundation work and initiatives 
that continue to offer leading wellbeing 
programs to our people and their families.

We continue to invest in listening to 
our employees, formally through our 
employee engagement survey as well 
as informally.

Initiatives

Mental Health First Aid
•

Provides mental health awareness skills and knowledge

•

•

c.800 employees became Mental Health First Aiders

c.400 Leaders completed Mental Health First Aid for Leaders training

Global Roadmap to Wellbeing program
• Helps navigate conversations and connections in a changing world, deal with 

stress, build resilience and unlock potential through exercise, sleep and nutrition

•

c.750 employees completed the Roadmap to Wellbeing Learning

You Can’t Ask That
• Raising awareness of mental health as part of World Suicide Prevention Day and 

R U OK? Day

•

c.1100 employees attended

Employee wellbeing
Further investment in the support 
for employee wellbeing emphasises 
the importance we place on 
psychological safety.

Our industry leading position has been 
recognised externally and we won the 
‘Best Mental Health in the Workplace 
Strategy: Large Company’ category at the 
This Can Happen Global 2022 awards. 

Our Global Engagement Score is 58 per 
cent which is below the industry average 
and well below our expectations. We 
have developed action plans to improve 
the experience of our people. This will be 
a key area of focus in FY23.

Pleasingly, our guiding principles of 
Safety, Sustainability, and Customer focus 
continue to resonate with our people 
and remain among our top performing 
areas. Safety and Sustainability in 
particular measure 81 per cent and 86 
per cent favourable respectively. Our 
Executive engagement has improved by 
10 points to 78 per cent. Based on the 
feedback from the survey, we remain 
focused on building leadership capability, 
providing career growth and developing 
our people.

The Group has a diverse global workforce 
reflecting our geographical footprint. We 
are committed to creating a workplace 
that unites diverse people and minds 
where respect and equity are the norm.

Engagement scores compared with benchmarksAustraliaLendlease GroupAmericasUKChinaJapanMalaysiaItalySingapore0102030405060708090100 Engagement score (May 2022)  Country average scores  Global average score42

Lendlease Annual Report 2022

Sustainability

Our bold targets are more than just headlines. We have clear 
decarbonisation plans in place and we continue to measure the positive 
impact we are making in communities around the world.

42%
of electricity use 
from renewable 
sources1in FY22 
(Targeting 100% 
renewables by 2030)

98 ktCO2-eq
scope 1 and 2 emissions2 
in FY22

1.5 degree aligned

Our progress
Our FY22 scope 1 and 2 gross emissions 
continue to track below our 1.5 degree 
aligned target and we are making 
important inroads into tackling our scope 
3 emissions.

Our progress is underpinned by the 
implementation of global decarbonisation 
mandates which set out carbon reduction 
expectations across our Investments, 
Development and Construction segments 
over the next five years. The sale of 
our Engineering and Services businesses 
and the ongoing disruptions from COVID 
have also impacted our emissions. For 
more information on our environmental 
performance, refer to page 45.

More information

For more information about our 
sustainability journey, please visit 
our website.

Including renewable energy certificates, power purchase agreements, green power and inherent grid renewable electricity.

1.
2. Scope 2 emissions have been calculated using the market based method, which includes the use of renewable energy certificates, power purchase agreements, green power 

and inherent grid renewables.

•MISSIONZERO•NETZEROCARBONBY2025•MISSIONZERO•ABSOLUTEZEROBY2040Our focus areas

43

Key actions

Operationalising our targets
Expanding on our 5-step decarbonisation 
pathway, we launched Regional 
Mission Zero Roadmaps, embedding 
decarbonisation into our business 
strategy for each operating segment.

Developed through extensive 
engagement with our senior leaders, the 
roadmaps outline initiatives to reduce 
scope 1, 2 and 3 carbon emissions in line 
with our targets. Each roadmap has been 
tailored to account for regional variances 
in availability of alternative fuel options, 
renewable energy markets, technology 
solutions, supply chain maturity and 
government policies.

Carbon offset guidance and procurement
We updated our global Carbon Offset 
Guidance and Criteria in response to 
price volatility and supply issues in 
the voluntary carbon offset market. We 
are now developing a Carbon Offset 
Procurement Strategy to support our Net 
Zero by 2025 target.

Renewable electricity procurement
We also developed global Renewable 
Electricity Guidance in response to the 
varied frameworks, purchasing options 
and recognised certification schemes 
across our regions of operation. This 
will help us maintain the highest level 
of quality and transparency associated 
with the purchase of renewable electricity 
as we target 100 per cent renewable 
electricity use by 2030.

Measurement and reporting for scope 3
We commenced the drafting of our 
House View and Position Statement on 
scope 3 emissions to clearly define 
our reporting boundaries and planned 
approach for measurement, tracking 
and reporting.

Expanded disclosure and 
ongoing engagement
In November 2021 we delivered our third 
annual Sustainability Investor Briefing and 
released our inaugural ESG Databook. We 
are working to evolve the ESG Databook 
to help improve the accessibility of our 
ESG data set.

We have been actively monitoring 
the evolution of ESG reporting 
standards, including participating in 
industry submissions on the International 
Sustainability Standards Board’s (ISSB) 
exposure draft standards. The 
establishment of ISSB is expected to 
lead to globally consistent ESG disclosure 
standards and we will look to align our 
reporting to these standards.

We also launched Mission Zero Ready, a 
global carbon literacy e-learning module 
to help our people understand the 
importance of our Mission Zero journey.

Building collaboration and alignment
To generate momentum for decarbonising 
the real estate sector, we participated 
in industry working groups, joined cross-
sector initiatives and shared thought-
leadership. Some examples include:

• Participated at several events at 

COP26 in Glasgow.

• Established a strategic partnership 

with Stora Enso, one of the 
world’s leading suppliers of 
sustainable timber.

• Joined Built by Nature and continued 
to be active participants in MECLA 
and the SteelZero initiative.

• Partnered with the Green Building 

Council of Australia to recognise 
leadership in the transition to fossil 
fuel free construction sites with a new 
challenge initiative.

Mission Zero Roadmap Progress
We are making progress on our Mission 
Zero Roadmap initiatives to reduce scope 
1, 2 and 3 emissions.

We are working towards our goal of 
zero fossil fuels in construction activities 
by using alternative fuels, increasing the 
use of electric construction plant and 
equipment and trialling battery storage 
and charging infrastructure.

Proof point:

• Implemented an Alternative Fuels 
Policy to help reduce fossil fuels 
usage from our UK construction sites. 
At the end of Q3, renewable diesel 
accounted for 98 per cent of fuels 
used in the UK, including sustainably 
sourced low carbon alternatives such 
as hydrotreated vegetable oil (HVO).

We are increasing the number of new 
all-electric developments and have begun 
the process of identifying legacy gas 
infrastructure to guide future capex 
aligned electrification upgrades for 
assets under management. This includes 
reducing fossil fuels used in asset 
maintenance and operation.

Proof point:

• New all-electric projects include 1 

Java Street, New York, La Cienega, 
Los Angeles, and all new homes at the 
Fort Hood residential community.

Above: London: The Pavilion, IQL.
Opposite: London: Park & Sayer, 
Elephant Park.
Left: Americas: Investigating mushroom 
remediation to create clean fill from 
roofing shingles.

SCOPE 1Fuels we burn44

Lendlease Annual Report 2022

We continue to focus on improving 
operational energy efficiency while 
increasing the generation and purchase of 
renewable electricity. We are also trialling 
battery storage technologies.

Proof points:

• Achieved Energy Star (ES) 

certification at The Cooper, 
Chicago, the first in our plan 
to target ES ratings across the 
multifamily portfolio.

• Switched to 100 per cent renewable 
electricity, with guarantees of origin, 
across our European operations.

We continue to collaborate with our 
suppliers to progressively source and 
procure low embodied carbon materials 
and our supply chain team is establishing 
a cohort of Mission Zero aligned 
supplier partnerships.

Some examples of key initiatives across 
our operations have been included below.

Steel
We are working closely with steel 
producers to identify and procure low 
carbon steel alternatives.

• At Claremont Hall, New York, we 
procured steel rebar with 97 per 
cent post-consumer recycled content, 
resulting in an estimated 27 per cent1 
reduction in embodied carbon.

• At Park & Sayer, Elephant Park, 

London, the façade being installed 
includes 75 per cent recycled 
aluminium. The use of renewable 
energy saved approximately 2,100 
tCO2e compared with primary 
aluminium manufactured using 
fossil fuels.

Timber
As we look to a low and zero carbon 
future, we continue to explore the 
application of alternative materials such 
as mass engineered timber.

• Achieved a BREEAM Outstanding 

rating on The Pavilion at International 
Quarter London (IQL). The building’s 
timber superstructure delivered a 
56 per cent reduction in embodied 
carbon compared with an efficient 
concrete alternative, surpassing 
industry best practice3.

Concrete
We have developed a tender evaluation 
tool to assess embodied carbon in 
proposed concrete mixes. We are 
specifying lower carbon concrete and 
trialling emerging technologies.

Green Leasing
To reduce downstream scope 3 
emissions, we continue to engage with 
tenants and residents on the purchase 
of renewable electricity and energy 
efficiency initiatives.

• Targeting an average 40 per cent 

• Enhanced our UK commercial green 

Portland cement replacement across 
all three residential towers at One 
Sydney Harbour is estimated to 
reduce overall embodied carbon 
emissions by up to 10 per cent2.

leases to require all new office tenants 
to procure 100 per cent renewable 
electricity. Office tenants at IQL in 
Stratford should be the first to use the 
updated lease.

Aluminium and glass
We have developed an embodied carbon 
tool in our façade designs. We are 
collaborating with suppliers to reduce 
the embodied carbon of materials by 
increasing the amount of recycled 
content in the aluminium and glass 
we buy.

1. Compared with the US Concrete Reinforcing Steel Institute industry average.
2. Against standard construction practice.
3. LETI 2020 A1-A5 embodied carbon benchmark for commercial office, excluding sequestration.

Decarbonisation challenges 
and insights
To achieve Absolute Zero Carbon 
by 2040 we will be reliant on 
sector transformation at scale and 
pace, however, we recognise there 
are challenges ahead and that key to 
finding solutions is sharing insights we 
have gained.

Fossil Fuel Free Construction
We collaborated with the University 
of Queensland to research the range 
of technologies that could drive the 
transition to fossil fuel free and ultimately 
zero emission construction sites.

The research findings showed that 
although electrification of construction 
equipment and machinery is underway, 
the pace will need to accelerate to 
achieve zero emissions construction by 
2040. Hence, we will continue to 
shift our business towards the use of 
renewable diesel and alternative fuels 
where viable, while also advocating 
for acceleration in the electrification of 
construction equipment.

Existing gas infrastructure  
The major urban regeneration schemes 
in the UK provide an insight into some 
of the challenges in eliminating fossil 
fuels from development projects and 
assets. Connecting to the local energy 
infrastructure network is mandated for 
several of these projects, some of which 
rely on the combustion of gas. We are 
working with local authorities and energy 
providers in developing and executing 
their decarbonisation strategies for these 
networks which align with our Absolute 
Zero Carbon target.

Main: Chicago: Roof Crop at The Cooper.

SCOPE 2Power we consumeSCOPE 3Indirect activitiesOur focus areas

45

FY22 energy use by segment (GWh)

FY20

FY21

FY22

Investments

Construction

Non-core

Lendlease tenancies

Total

% of electricity 
use from renewable 
sources including grid 
renewable electricity

320

122

406

8

856

195

124

58

7

384

181

101

19

6

306

33%

42%

Total energy consumption in FY22 has reduced by 20 per cent 
compared with FY21. This includes the impact of the sale of the 
Services business, the further sell down of our equity share of the 
Retirement Living Trust, and the ongoing impacts of COVID.

FY22 waste diverted and disposed (kTonnes)

Waste disposed

Waste diverted

% waste diverted 
from landfill

FY20

338

409

55%

FY21

61

181

75%

FY22

30

204

87%

In FY22 the Construction business saw an increase in waste 
diverted and a corresponding decrease in the amount of waste 
disposed. Waste disposed and diverted remained relatively static 
across our other lines of business.

FY22 water consumption by segment (MLitres)

Investments

Construction

Non-core

Lendlease tenancies

Total

FY20

4,956

470

711

47

FY21

4,289

332

27

46

FY22

4,425

356

6

28

6,185

4,694

4,816

FY22 saw an increase of water use across our operations. This 
was largely due to expanding our reporting boundary for the 
Australian Retirement Living business to implement a globally 
consistent methodology for water reporting to include resident 
potable water use in addition to common areas.

Environmental performance1
Our environmental performance data disclosure is in line with our 
financial reporting program and provides 12 months of data to 
30 June 2022, which includes actual data for Q1-Q3 and partially 
estimated Q4 data. Our full year environmental performance data 
will be available on the Lendlease website in the ESG Databook 
once Q4 data has been gathered and the limited assurance 
engagement completed.

Our environmental performance has seen both energy use and 
emissions affected by the gradual economic recovery due to 
the ongoing impacts of COVID and the sale of our Engineering 
and Services businesses. We have also made significant progress 
in reducing carbon emissions through the implementation of 
our global decarbonisation mandates, business commitments to 
renewable electricity and the use of renewable diesel where 
available. We continued our purchase of carbon offsets for 
unavoidable emissions. In FY22, we offset 18 per cent of our 
remaining scope 1 and 2 emissions, taking our net position to 
80 ktCO2-eq.

Scope 1 and 2 carbon target performance ktCO2-eq

Scope 2 emissions have been calculated using the market-
based method, which includes the use of renewable energy 
certificates, power purchase agreements, green power and 
inherent grid renewables.

Scope 1 and 2 emissions by segment

Electricity used by the Investment Management business is the 
largest contributor to our combined scope 1 and 2 emissions. Our 
plans to increase the purchase of renewable electricity to achieve 
our target of 100 per cent renewable electricity by 2030 should 
significantly reduce the scope 2 carbon emissions associated 
with this line of business.

1. Some charts and tables may not sum due to rounding.

FY20FY21FY22FY23FY24 Scope 1 Scope 2  370158981218022121019818675231183926310798 ktCO2-eq46

Lendlease Annual Report 2022

Creating social value

On track to reach our target
Since launching our social value target 
in 2020, we have created $107.3m of 
social value through the work of our 
shared value partnerships, supported by 
Lendlease Foundation. We are well on 
track to achieve our target of $250m 
by 2025, with 42.9 per cent achieved 
to date.

Shared value partnerships
Our shared value partnerships are 
assessed using a methodology that 
combines the principles of Social Return 
on Investment (SROI) with a cost benefit 
analysis. This places an economic value 
on the improvement of wellbeing across a 
series of social outcomes. For every dollar 
invested we aim for an average return on 
social value of five dollars.

More than 30 partnerships have now 
been assessed. A sample of assessment 
outcomes of our partnerships for the 
period 1 July 2019 to 30 June 2022 
are shown.

This year we launched 
#alittlehelptothrive, a social media 
campaign to celebrate the work of our 
shared value partnerships. The campaign 
stories can be found on our website.

Social value on projects and assets
Our social value target and reporting does 
not capture activities performed across 
our projects and assets. We are working 
on initiatives to support the tracking of 
social value across our sites with a key 
focus on:

• Skilling and training

• Employment

• Volunteering.

Social impact achievements
• BeOnsite won the Queen’s Award 
for Enterprise for outstanding 
achievement in promoting 
opportunity through social mobility.

• FutureSteps celebrated the opening 

of yourtown’s Louise Place, a 
transitional home that received grant 
funding to provide housing and 
support services to survivors of 
family violence.

• Long-standing Australian Community 
Grants Program expanded to the 
United Kingdom, Singapore and 
Malaysia. The total value of the 
Community Grants Program in FY22 
was over $300,000.

Partnership

Social Return 
on Investment

Social 
value

Great Barrier Reef Foundation (Global)
10-year partnership supporting the Reef Islands 
Initiative to protect and restore critical habitats

SROI – 1:14 
For every $1 we invested, 
$14 of social value 
was created

$28.3m

Minami Sanriku (Japan)
Supporting rebuilding the local community 
after the 2011 Great Eastern Japan earthquake 
and tsunami

SROI – 1:7.56 
For every $1 we invested, 
$7.56 of social value 
was created

$3.1m

Programma 2121 (Italy)
Training and paid internships for non-violent 
offenders within the Italian prison system, 
enabling them to enter the workforce 
upon release

SROI – 1:4.5 
For every $1 we invested, 
$4.50 of social value 
was created

$2.3m

Johnson Depression Center, University 
of Colorado and United Suicide Survivors 
International (Americas)
Mental health and suicide prevention 
program aimed at reducing suicide in the 
construction industry

SROI – 1:8.7 
For every $1 we invested, 
$8.70 of social value 
was created

$747k

Australian Red Cross (Australia)
Community initiative in Katherine, Northern 
Territory, operated by people in the local 
community with the support of the Red Cross

SROI – 1:15.7 
For every $1 we invested, 
$15.70 of social value 
was created

$16.7m

Top: Kuala Lumpur: Projek Komuniti Kita, 
featured in #alittlehelptothrive campaign.

Our focus areas

47

Elevate Reconciliation 
Action Plan (RAP)

During the second year of our Elevate RAP titled Country, Truth and our 
Shared Story, we have continued to embed commitments within our 
business practices and engage and collaborate with First Nations 
communities, employees, RAP partners and businesses.

Lendlease is one of only 12 organisations 
with an Elevate RAP1 out of a 
total of 2,200 Reconciliation Australia 
endorsed RAPs.

Close to four million people now 
either work or study in a RAP 
organisation which is accelerating the 
progress towards a more equitable 
and fair Australia and strengthening 
the relationships between First Nations 
peoples and non-Indigenous peoples, for 
the benefit of all Australians2.

FY22 RAP Goals

Actions

Outcome

Providing cultural 
engagement 
and learning 
for all employees

94 per cent of new starters in 
Australia have completed the 
compulsory cultural learning 
in FY22.

Understanding that recognition of 
Country and the story of place is core 
to our placemaking activity.

Making First 
Nations 
businesses 
foundational in 
our supply chain

88 per cent of the Lendlease 
Australia workforce have 
completed at least one cultural 
learning activity1.

147 Supply Nation businesses 
engaged (registered and 
certified First Nations 
businesses) $80m spent 
in FY22 with registered 
and certified First 
Nations businesses

Supporting First 
Nations voices 
within Lendlease

1.4 per cent of Lendlease 
employees in Australia identify 
as First Nations Australians.

Our procurement goal aligns with 
the national Raising the Bar initiative, 
which sets annual targets to embed 
First Nations owned businesses in our 
supply chain. We have exceeded our 
year 3 Raising the Bar target.

We are bringing First Nations 
leadership into senior management 
roles. This will be a key focus as we 
work towards our commitment of 3 
per cent by FY23.

Cairns Central, Djabugay, Yirrganydji, 
Gimuy-walubarra Yidi Country: Uluru 
Statement campaign.

1. Who has a RAP?: Reconciliation Australia (30 June 2022).
2. 2021 RAP Impact Report: Reconciliation Australia.

1. Data since FY2012

48

Lendlease Annual Report 2022

Melbourne  Melbourne QuarterRisk & climate-related resilience

49

Our approach recognises the nature and level of risk we are willing to accept to achieve our strategic goals and targets in order to create securityholder value.Risk and Climate-related Resilience50

Lendlease Annual Report 2022

Risk governance and 
management

Our approach aims to create a risk intelligent culture that supports 
strategy by driving value creation through risk based decision making.

The Board is responsible for ensuring 
the effectiveness of the risk management 
framework. The risk management process 
outlines the governance, risk appetite, 
accountability for risk management and 
operational resilience program.

Risk framework
Our risk framework, underpinned by 
a ‘Three Lines of Defence’ model, 
remains unchanged from a governance 
perspective. The model provides a 
structured approach to risk management 
by defining clear roles and responsibilities 
across the organisation and the 
relationship between the different areas.

Risk Appetite Framework
The Risk Appetite Framework articulates 
the Board’s appetite for taking on risk as 
we implement our strategy. It provides 
clarity on the types of projects we target, 
while providing a method for identifying 
projects nearing or outside of acceptable 
risk tolerances.

The Risk Appetite Framework, with 
a lens on continuous improvement, 
is periodically reviewed to ensure it 
continues to evolve and remains fit-
for-purpose. Any changes, including 
the addition of new statements and 
tolerances, are reviewed and approved by 
the Board Risk Committee.

Enterprise risks
Our Enterprise Risk Framework is 
designed to inform and support business 
strategy. The framework provides an 
important backdrop in setting our 
strategic objectives and monitoring 
operational risk assessment throughout 
the organisation.

The framework provides a harmonised 
approach with five interlinking pillars.

The connectivity between these pillars 
creates a risk management ecosystem 
in which their interaction provides clear 
and measurable linkages. This ecosystem 
is supported by our underlying risk 
systems, managing our exposure via 
insurance, a resilience framework and a 
risk intelligent culture.

Three Lines of Defence1Business OperationsIdentify, manage and own risks relevant to the project / investmentRegional  Leadership TeamAccountable for achieving regional objectives2Group FunctionsOutline assurance measures to enable appropriate identification and management of risks3Internal and  External AuditProvide assurance independently from the first and second lines  of defenceBoard and CommitteesGlobal Leadership TeamRisk EcosystemRisk Based Internal Audit Plan Root CausesControl MatrixRisk Appetite FrameworkEnterprise RisksSystems | Insurance | Resilience | Governance & CultureRisk & climate-related resilience

51

An independently appointed ‘Voice of 
Risk’ executive continues to form part 
of each Regional Leadership Team. This 
individual continues to play an objective 
role to challenge both the business 
and the risk function on strategic and 
operational risk management.

Our Risk Management Framework is 
outlined above. Each of the Enterprise 
Risks has a cascade of granular risks 
and opportunities which are tactical 
and operational. These are supported 
by Group policies and Risk Appetite 
Tolerances. This facilitates a portfolio lens 
across our risk profile.

An overview of global market risks across the business:

Geopolitical
Heightened geopolitical tensions are impacting the global economy, creating 
volatility across the global markets, reflected most notably in higher energy 
prices and rising inflation. We continue to actively monitor the global political 
and economic risk landscape, ensuring our resilience framework is up to 
date to support the business and our Board in understanding our potential 
exposures and mitigation strategies.
Disruption of supply chain
Global supply chain disruption and dependency is being actively managed 
across all areas of the business, with mitigation strategies in place across 
key areas including higher inflation, construction cost volatility and surety 
of supply.
COVID
Despite an easing of restrictions across our operations, notwithstanding 
extended lockdowns in China, we are cognisant that the business will continue 
to be challenged by COVID from both a strategic and operational perspective. 
Our risk teams work closely with the business, governments and industry to 
prepare for disruption and support business continuity across the Group.   

Our global Supply Chain team play a key role in managing the related exposures flowing
from the market risks noted above. The team supports procurement activities across the 
business by leveraging our global scale through our preferred supply chain partnerships. In 
addition, the Supply Chain team manages enterprise-wide risk policies and standards, plus 
systems to provide enhanced insights of supply chain risk. The team is also responsible for 
co-ordinating Lendlease’s modern slavery risk mitigation response.

Three Lines of Defence1Business OperationsRegional  Leadership Team2Group Functions3Internal and  External AuditBoard and CommitteesGlobal Leadership TeamStrategic DirectionRisk Management FrameworkEnterprise RisksResetCreateThrive ●Cyber, Data Governance,  Asset Protection ●Disruption ●Geopolitical ●Business Continuity ●Corporate and Environmental Sustainability ●Health, Safety and Wellbeing ●Non-Scalable Growth ●Performance, Commercial, Execution ●Corporate Culture ●Customer ●Regulatory and ComplianceGroup Policies*MarketOperationalSupporting Tools & Techniques ●Acceptable use of IT ●Information Security ●Records Management ●Risk Management ●Business Travel ●Environment, Health & Safety ●External Communications and Continuous Disclosure ●Sustainability ●Tax ●Treasury ●Conduct Breach Reporting ●Customer Complaints ●Employee Code of Conduct ●Privacy ●Political Donations* Non- exhaustive list 
52

Lendlease Annual Report 2022

Climate-related 
strategic resilience

Lendlease supports the recommendations of the Task Force on Climate-
Related Financial Disclosure (TCFD), having committed to producing 
annual disclosures that consider these recommendations in 2018.

We have a phased approach to 
integrating the recommendations of 
TCFD over time. Our disclosure 
continues to evolve as we enhance 
management of climate-related risks and 
as advancements are made in climate-
related financial disclosures.

Building strategic resilience
In FY19 we disclosed our three climate 
scenarios that we would use to 
build business strategic resilience. The 
scenarios were Polarisation (>3 degrees), 
Paris Alignment (2-3 degrees) and 
Transformation (well below 2 degrees).

In FY20 the business identified risks and 
opportunities that might arise over the 
next 30 years for each of our climate 
scenarios and which of these were likely 
should the scenario manifest in the next 
10 years.

These risks and opportunities were then 
synthesised into ten Climate-Related 
Impacts (CRIs) per scenario and disclosed 
in our FY20 Annual Report.

absorb, adapt, or transform to 
the CRIs. An assessment of the 
remaining residual sensitivities was 
subsequently undertaken.

In FY21 and FY22 we further enhanced 
the climate-related strategic resilience 
of our business by engaging with more 
than 100 of our senior leaders globally 
in a series of TCFD Business Impact 
workshops. The FY21 workshops used 
the five CRIs identified as most likely to 
appear in the next 10 years from each 
scenario (should the scenario manifest) 
as the basis of review. The remaining 
five were examined in FY22. Participants 
were asked to identify their business 
unit’s positive and negative sensitivities, 
by reference to impact to revenue, for 
each CRI relative to our baseline strategy.

Participants identified mitigating actions 
to reduce the sensitivity, if the 
scenario happened, through building 
business strategic resilience to either 

Every effort was taken to engage in 
a robust scenario analysis process with 
input from experienced senior leaders 
in each business around the globe. 
However, scenario planning is, by its 
nature, subjective and may be subject to 
change as key considerations evolve. The 
following disclosures are subject to these 
factors. The assessment of our strategic 
resilience is against a baseline which 
assumes our Mission Zero strategy.

Top: Sydney: Barangaroo Headland.

Risk & climate-related resilience

53

Our strategic resilience to climate-
related impacts
The assessment of the second set of 
five CRIs indicates a greater financial
resilience (higher residual positive 
sensitivity) in our business strategy to 
our Paris Aligned scenario, supported by 
our continued commitment to being a 
1.5 degree aligned business. In particular, 
our Mission Zero business strategy played 
a significant role in both reducing the 
risks and increasing opportunities in the 
analysis associated with our Paris Aligned 

scenario. As with most companies, we 
have negative sensitivities to global 
labour and supply chain disruptions in our 
Polarisation scenario; however, strategies 
to mitigate these risks have been well 
established during COVID disruptions. 
The dramatic shift under a transformation 
scenario poses both positive and negative 
sensitivities, depending on the level 
of transformation.

The integration of climate risk 
assessments with investment decision 
making, combined with continued 

progress in decarbonising our operations 
and supply chain, has reduced residual 
negative sensitivities to climate impacts. 
To help understand the level of mitigating 
action considered for each climate 
impact, we have expanded our CRI 
disclosure to include the level of 
action required to achieve the residual 
sensitivity. The level of action identified
for the full set of CRIs will be available 
in the Climate-related Impacts section of 
our FY22 ESG Databook.

Scenario
Polarisation Scenario (>3oC)
This scenario sees a world where climate action is delayed by 
the polarisation of climate action. This delay results in a world 
where physical climate changes are the greatest across our 
three scenarios.

The integration of ‘Leadership in Sustainability’ as a strategic 
priority and our Net and Absolute Zero Carbon targets sees low 
levels of positive sensitivity from an increased market share from 
the public sector, as well as access and cost of capital.

Having experienced similar impacts to international product 
and labour availability due to COVID, Lendlease recognises a 
transformation of global supply chains and labour sourcing is 
needed to reduce supply risks.
Paris Alignment Scenario (2-3oC)
This scenario sees a market led transition to a lower carbon future 
through global government commitments to the Paris Agreement. 
This would result in increased regulation of climate action and a 
reduction of the physical impacts of climate change compared with 
our Polarisation scenario.

There are many ‘difficult to decarbonise’ products and materials in 
our supply chain, including cement, steel, and aluminium. However, 
our continued work to achieve this goal would result in a significant 
positive sensitivity.

Our leadership in sustainability and carbon targets creates positive 
sensitivities to an increased market share from the public sector. 
It also provides an advantage whilst leadership in decarbonisation 
continues to be valued by investors.
Transformation Scenario (<2oC)
This scenario sees a rapid decarbonisation pathway, where global 
emissions are close to zero in 2040, driven by society.

The speed of change required to limit global warming to 1.5 
degrees is likely to create negative sensitivities in our supply chain 
as suppliers try to keep pace with decarbonisation demands and 
shifting preferences towards localisation. Further, however unlikely, 
a major shift towards community ownership would disrupt most 
major corporations.

Our leadership in sustainability and innovation creates positive 
sensitivities to an expectation of greater research and development 
in decarbonisation. Further, we see positive sensitivities through 
an increase in partnerships and collaboration in decarbonisation, 
such as our founding membership of the Materials and Embodied 
Carbon Leaders Alliance (MECLA), an industry led coalition to 
decarbonise Australia’s building and construction industry.

Climate-related Impact

Investments Development Construction

Residual Sensitivity

Impact market share 
from public sector

Access and cost 
of capital

Availability of 
international products

Availability and cost 
of labour

Reduced availability of 
materials and resources

Misalignment between 
legislation/regulation and 
Lendlease strategy

Demand for negative 
emissions and 
geoengineering solutions

Changing preferences 
away from new 
build development

Demand for zero-
carbon infrastructure

Increase market share 
from public sector

Availability of 
international products

Changing preferences 
away from new 
build development

Shift towards community 
'ownership' of companies

Expectation of 
R&D investment 
for decarbonisation

Greater need 
for partnerships 
and collaboration 
for decarbonisation

AdaptAdaptAbsorbTransformAdaptAbsorbTransformTransformTransformAdaptAdaptAdaptTransformTransformTransformAdaptAbsorbAbsorbAdaptAdaptAdaptTransformTransformTransformAbsorbAdaptAbsorbAdaptAdaptAdaptTransformAdaptAdaptTransformTransformTransformTransformTransformTransformTransformAdaptAdaptAdaptAdaptAdaptHigher positive sensitivityHigher negative sensitivityAbsorb: Current strategy absorbs the impact of the CRI Adapt: Changes required to current strategy to respond to the CRI Transform: New strategy or significantly altered strategy required to respond to the CRI 
 
54

Lendlease Annual Report 2022

Our disclosure progress
The table below provides a summary of 
our actions to date for each component 
of the TCFD framework, as well as 
outlining our continued commitment in 
FY23.

Governance 

Disclose the organisation’s 
governance around climate-
related risks and 
opportunities 

Strategy  

Disclose the actual and 
potential impacts of 
climate-related risks and 
opportunities on the 
organisation’s businesses, 
strategy, and financial
planning where such 
information is material

Risk Management 

Disclose how the 
organisation identifies,
assesses, and manages 
climate-related risks 

Metrics and 
Targets 

Disclose the metrics and 
targets used to assess and 
manage relevant climate-
related risks and 
opportunities where such 
information is material 

Actions

FY19 – FY21

FY22

FY23

Strengthen Board and 
Management oversight of 
climate-related risks through 
Board Sustainability Committee  

Establish and regularly convene 
a cross functional TCFD Steering 
Committee chaired by Chief 
Risk Officer  

Identify climate-related risks 
and opportunities for 
each scenario

Impact of climate-related risks 
and opportunities on the entity

Assess the effect of climate-
related risks and opportunities on 
decisions and plans of the entity

Resilience to climate-related 
risks and opportunities

Climate-related risk integrated 
into Risk Committee  

Climate-related risk 
assessments integrated into 
and undertaken as part of 
Investment Committee decision 
making process  

Integrate climate-related risks 
into risk management 
framework and register

Regular monitoring of 
scenarios and Climate 
-related Impacts

Establish metrics for 
managing climate-related 
risks and opportunities.

Continued disclosure of 
scope 1 and 2 emissions  

Establish scope 3 emission 
reporting boundaries and 
estimation methodologies

Disclose estimated scope 
3 emissions

Establish targets for 
managing climate-related 
risks and opportunities.

More information

For more information about our TCFD disclosures, please refer to our ESG Databook. 
For further information about our decarbonisation strategy, please visit Mission Zero.

CompletedProcess Established and ContinuingCommenced and Ongoing 
 
Risk & climate-related resilience

55

seek to reduce our scope 1 and 2 
emissions, which will support not being 
caught by a rising cost of carbon. 
The mandate actions include shifting 
to renewable electricity, utilising Power 
Purchase Agreements, and shifting to 
renewable diesel or biodiesel alternatives, 
where these options are available.

Carbon offsets will be centrally managed 
and procured to achieve net zero 
emissions starting in FY25 for any 
remaining unavoidable emissions. For 
illustrative purposes only, based on our 
estimated net scope 1 and 2 emissions in 
FY22, and the current estimated cost of 
carbon offsets, the potential cost range to 
achieve net zero in FY22 would have been 
between $1.2m and $2.4m2.

Emerging Climate-related Impacts
With the full business strategy resilience 
assessment now complete across the 
three scenarios, we will continue to 
monitor the identified climate-related 
risks and opportunities for signs of the 
Climate-related Impacts (CRIs) emerging. 
The value of this strategic resilience 
planning is evident with a few key CRIs 
beginning to materialise.

CRI: Industry Leadership in 
Decarbonisation valued (All scenarios)
Lendlease identified that industry 
leadership in decarbonisation would be 
valued under all three scenarios. This has 
been seen in the rise of sustainable format 
financing strategies.

We are a leader in sustainable financing
in Australia with approximately $3.1b or 
60 per cent of the Group’s total facilities 
sourced in sustainable formats.

Accessing the sustainable financing
market has supported execution of 
the Group’s strategy, improved lender 
engagement and is expected to result in 
lower borrowing costs for the Group. 

It is our intention to pursue, where 
appropriate, sustainable format financings
in the future for new facilities and 
refinancing of maturing facilities.

CRI: Increased Cost of Carbon (Paris 
Alignment scenario)
Since identifying the cost of carbon 
as a potential CRI under the Paris 
Alignment scenario in FY20, there has 
been a substantial increase in the number 
of net zero commitments made by 
corporations and governments globally 
and a corresponding increase in the 
demand for quality carbon offsets. This 
has been reflected in carbon offset 
markets, with an expectation that pricing 
will likely increase as the net zero 
deadlines declared by these entities 
approach1. This is to be expected given 
some organisations are planning to solely 
rely on the purchase of carbon offsets to 
achieve their net zero targets.

Our 2040 Absolute Zero target, which 
seeks to eliminate emissions from our 
business altogether without reliance on 
offsets, helps to mitigate the carbon 
offset price risk exposure. It is also 
intrinsic to our near-term Net Zero 
by 2025 target to reduce our carbon 
emissions as much as possible and 
therefore minimise the residual position 
requiring offset.

To help achieve our ambitious targets, 
long term decarbonisation plans (Mission 
Zero Roadmaps) and short-term carbon 
mandates have been developed for each 
business and region. The mandates

1. Taskforce on Scaling Voluntary Carbon Markets (TSVCM) Final Report, January 2021.
2. Based on our estimated net scope 1 and 2 emissions in FY22 and the current estimated cost of carbon offsets.

 
 
 
56

Lendlease Annual Report 2022

Sydney  Barangaroo SouthPerformance and Outlook

57

Performance and Outlook58

Lendlease Annual Report 2022

Group performance

Key Financials1

Core Business
Investments

Development

Construction

Segment EBITDA
Corporate Costs

Operating EBITDA
Depreciation & Amortisation

Net Finance Costs

Operating Profit before Tax
Income tax expense

$m FY21 FY22

Var.

276

469

173

918
(161)

757
(148)

(137)

472
(95)

497

80%

181

131

(61%)

(24%)

809 (12%)
(12%)
(180)

629 (17%)
1%
(146)

(116)

15%

367 (22%)
4%
(91)

Core Operating Profit after Tax

377

276 (27%)

Reconciliation to Statutory Profit / (Loss) 
after Tax
Non Core
Non Operating Items2

Statutory (Loss)/Profit after Tax

Group

Core Operating EPS

Distribution per Security

Total Group Statutory EPS
Total Group Statutory ROE3

(181)

(42) 77%

26 (333) NA

222

(99) NA

cents 54.8

40.1

(27%)

cents 27.0

16.0 (41%)

cents 32.3 (14.4) NA

% 3.2% (1.4%) NA

1. Operating earnings presented reflects Statutory earnings adjusted for non 
operating items and the Non core segment. Non operating are Investments 
segment property revaluations, restructuring charges and impairment expenses.

2. Non operating items after tax for the year ending 30 June 2022 includes 

Investment segment revaluations $70m, offset by restructuring costs $119m, 
development impairment costs $223m, intangible impairments relating to the 
Digital business $55m, other intangible impairments $6m. Prior year includes 
Investment segment revaluations $26m.

3. Return on Equity is calculated using Profit after Tax divided by the arithmetic 

average of beginning, half and year end securityholders’ equity.

Performance
The Group’s Statutory Loss after Tax for the year ending 30 June 
2022 was $99m, compared with a Statutory Profit after Tax of 
$222m for the prior year1. This included a loss of $333m from 
Non-operating items driven by restructuring costs, and a loss of 
$42m from the Non-core segment.

The Group recorded Core Operating Profit after Tax of $276m 
for the year ending 30 June 2022. Core Operating Earnings per 
Security of 40.1 cents represents a Return on Equity of 4.0 per 
cent. Distributions per security totalled 16 cents, representing a 
payout ratio of 40 per cent of Core Operating Profit. 

Good progress has been made in advancing several strategic 
priorities which provide momentum into FY23 and beyond. These 
include approximately $11b of investment partnerships and the 
commencement of $5.9b of developments.

Core segment EBITDA of $809m was down from $918m1 . 
Investment earnings were up substantially with both higher 
fund management fees and a recovery in investment income. 
Development profitability remained suppressed with limited 
completions, and Construction earnings continued to reflect
COVID impacts, cost pressures and lower new work secured in 
Europe and Americas.

The Investments segment outperformed with a 9.7 per cent 
return on invested capital, above our target range of 6-9 per cent, 
boosted by the part divestment of the asset management income 
stream of the US Military Housing portfolio, as well as a recovery 
in portfolio income and higher management fees.

The lower contribution from the Development segment reflects
fewer completions and the impact of the change in approach to 
our joint venture projects, which more closely aligns the timing 
of profit with cash flow and capital at risk. While the return on 
invested capital of 2.2 per cent was well below target, albeit 
within the expected range for FY22, progress continues to be 
made towards converting the development pipeline with Work in 
Progress at a record $18.4b.

In the Construction segment, revenue was up driven primarily by 
the Australian region. The Americas, where new work secured 
has reduced significantly since the onset of COVID, recorded a 
decline in revenue. The construction EBITDA margin of two per 
cent was at the bottom of the 2-3 per cent EBITDA target range.

Corporate costs of $180m were higher due to a combination 
of one-off provisioning in the current year and several one-
off benefits which reduced reported costs in the prior year. 
Excluding these one-off items, corporate costs would have 
declined. Net finance costs of $116m were lower with reduced 
committed facilities and lower average drawn debt. The average 
cost of debt was largely unchanged despite base rate increases 
due to the high proportion of fixed rate debt.

The balance sheet remains in a strong position with gearing of 7.3 
per cent and total available liquidity of $3.9b.

The Non-core loss primarily reflects costs associated with the 
exit of the Services business in FY22. We have maintained 
provisions we consider are appropriate to complete our share 
of the retained Melbourne Metro project and for potential 
warranties associated with the now exited Engineering and 
Services businesses.

At the beginning of the year the Group announced a five-year
roadmap to deliver long term sustainable performance, with 
FY22 a Reset year. The roadmap has simplified the business 
and created a leaner organisation. Restructuring costs associated 
with these changes, recorded as Non-operating items, were 
$342m post tax and include allowances for employee and 
tenancy costs, and development impairments on a small number 
of underperforming projects.  

Recurring annual savings arising from simplifying the Group’s 
operating model were $172m, which have exceeded our target 
of more than $160m pre tax on an annualised basis. Additional 
cost savings are anticipated in FY23.

Restructuring charges of $170m pre tax were incurred to 
generate these savings. A change in development strategy across 
a small number of projects incurred an impairment expense of 
$289m pre tax.

A review of the Group’s digital business reaffirmed the 
importance of the strategy, along with a more focused product 
offering. A refinement to the existing strategy will enable a more 
efficient use of the Group’s capital. An impairment expense of 
$55m post tax was recorded in relation to products that have 
been discontinued. 

1. Comparative period the year ended 30 June 2021.

 
 
 
 
Performance and Outlook

59

Group performance continued

Portfolio Management Framework

Target

FY21

FY22

Total Group Metrics

Core Operating ROE

Distribution payout ratio1

Gearing

Core Business 
EBITDA Mix

Investments

Development

Construction

Core Business 
Segment Returns

Investments ROIC2

Development ROIC2

Construction 
EBITDA margin

Segment Invested 
Capital Mix

Investments

Development

Regional Invested 
Capital Mix

Australia

Asia

Europe

Americas

8-11%

40-60%

10-20%

35-45%

40-50%

10-20%

6-9%3

10-13%3

5.4%

49%

5.0%

30%

51%

19%

5.9%

7.2%

4.0%

40%

7.3%

61%

23%

16%

9.7%

2.2%

2-3%

2.7%

2.0%

40-60%

40-60%

40-60%

10-25%

10-25%

10-25%

45%

55%

39%

19%

23%

19%

40%

60%

33%

22%

25%

20%

1. Distribution payout ratio has been calculated on Core Operating Earnings.
2. Return on Invested Capital (ROIC) is calculated using the Operating Profit after Tax 
divided by the arithmetic average of beginning, half and year end invested capital.

3. Through-cycle target based on rolling three to five year timeline.

COVID impacts across the Group

Segment

Impacts

Outlook
The Group enters the new financial year with significant 
operating momentum, providing confidence in the Create phase 
of our five-year roadmap. While our integrated model enables a 
high degree of control regarding executing our strategy, we will 
be influenced by the external environment of higher inflation and 
interest rates.    

The Return on Invested Capital for the Investments segment is 
expected to be in the range of 6-7.5 per cent for FY23, the lower 
half of our target range. While the urban development pipeline 
is expected to continue to provide the predominant source of 
future growth for the investments platform, new initiatives will be 
pursued selectively alongside our investment partners.

The Return on Invested Capital for the Development segment is 
expected to be in the range of 4-6 per cent for FY23. Higher 
commencements and a record amount of Work in Progress are 
driving a recovery in both completions and profit. However, scale 
benefits will not be achieved and the revised approach to our 
joint venture projects is anticipated to continue to defer profits 
on some projects in the near term. As a result, returns in FY23 
will remain well below our target of 10-13 per cent.

We remain on track to meet our $8b completion target in FY24, 
along with the Return on Invested Capital target of 10-13 per 
cent. Anticipated commencements, along with our assessment 
of project fundamentals of current Work in Progress, provides 
confidence in achieving both the completion and return targets.

The EBITDA margin for the Construction segment is expected to 
be in the range of 1.5-2.5 per cent for FY23, potentially lower 
than our target range of 2-3 per cent, due to ongoing disruption 
from the pandemic, cost pressures and supply chain constraints. 
These risks have been well managed to date but their persistence 
is likely to impact performance in FY23.

Investments
Performance was 
disrupted, although 
improved relative to FY21.

Development
Activity and profitability
were affected.

• Retail asset management fees recovered, but were partly offset by a normalisation of expenses

•

•

Income from the Group’s investment portfolio recovered, although remains below pre-COVID levels

Extended stabilisation periods were experienced on recently completed assets

• While there have been some impacts to income, real estate valuations were resilient with a $74m (pre 

tax) increase in the book value of the Group’s coinvestments.

Delays in converting opportunities across the Group’s urban pipeline included:

• Weaker demand for new apartment product

•

Population declines across many gateway cities impacting underlying real estate demand

• Weaker tenant demand and investment partner appetite in the office sector

•

Settlement delays on completed apartment product

• Deferral in completion dates of projects in delivery e.g The Exchange TRX

There were also some positive impacts:

• Demand and pricing for luxury apartments

Construction
Impacts to origination 
and revenue.

• Government stimulus measures have boosted activity for new detached housing.

•

•

Productivity disruption related to Government mandated shutdowns and social distancing protocols

Projects put on hold in some markets; delays in securing and commencing projects

• Cost management measures mitigated the impact on margins

•

Public sector activity has increased including the securing of several social infrastructure projects.

 
60

Lendlease Annual Report 2022

Investments segment

The Group’s investment portfolio is valued at $3.5b. The portfolio 
was steady against FY21 with the investment into an industrial 
portfolio joint venture and our participation in the Lendlease 
Global Commercial REIT capital raising broadly offsetting the 
Retirement Living divestment. The investment portfolio is well 
diversified, with exposure across the office, residential, retail, 
retirement and industrial sectors.

Outlook
The Return on Invested Capital for the Investments segment 
is expected to be in the range of 6-7.5 per cent for FY23, 
within our target range. Funds under management, assets under 
management and the investment portfolio are the key operating 
metrics that drive future financial performance.

Growth in funds under management of 12 per cent1  to 
$44.4b was underpinned by new partnerships and mandates, 
fund acquisitions and appreciating asset values. Additional 
funds include Real Estate Partners 4; an office partnership at 
International Quarter London; our industrial portfolio joint venture 
and acquisitions across the Australian Funds Management 
platform. In addition to the current funds under management, 
there is approximately $5b of potential FUM based on 
development projects currently in delivery via managed funds or 
mandates. This forms part of the $11b of investment partnerships 
that were established during the year.

The Group’s urban development pipeline is expected to continue 
to provide the predominant source of future growth for the 
investments platform. The existing urban development pipeline 
includes approximately $64b of institutional investment grade 
product across commercial and residential for rent assets.

Assets under management rose from $28.5b to $30.0b, primarily 
driven by foreign exchange rate movements. Fees will be lower 
in FY23 given our lower interest in the military housing asset 
management income stream.   

The Group’s investment portfolio of $3.5b includes approximately 
$1b in each of office and retail assets, $0.7b in residential and 
$0.5b in retirement, with the remainder in industrial.

The Group’s strategy is to significantly grow its investment 
portfolio over time. Growth is expected to be derived from 
retaining a proportion of completed assets from the development 
pipeline and investing alongside partners through the launch of 
new products. Key initiatives progressed in FY22 include the 
launch of a value-add diversified fund; a partnership to develop 
the office precinct at International Quarter London; a US Life 
Sciences partnership; and an Asian Innovation partnership.

Key financial and operational metrics

FY21

FY22

Management EBITDA ($m)1

Ownership EBITDA ($m)2

Operating EBITDA ($m)2

Operating Profit after Tax ($m)

Invested Capital ($b)3

Funds Under Management ($b)4

Assets Under Management ($b)4

Investment Portfolio ($b)5

165

111

276

213

3.6

39.6

28.5

3.5

141

356

497

361

3.7

44.4

30.0

3.5

1. Earnings primarily derived from the investment management platform and the 

management of US residential housing operations.

2. Returns excluding non-cash backed property related revaluation movements of 

Investment Property, Other Financial Assets, and Equity Accounted Investments in 
the Investments segment.

3. Securityholder equity plus gross debt less cash on balance sheet.
4. The Group's assessment of market value.
5. The Group’s assessment of market value of ownership interests.

Performance
The Investments segment delivered EBITDA of $497m, up 
substantially from $276m1. The recovery in performance was 
driven by several components of the segment with higher fund 
management fees, a recovery in underlying investment income 
and profits on divestments. Return on Invested Capital of 9.7 per 
cent outperformed both the anticipated range of 7.5-8.5 provided 
at the HY22 results and the segment target range of 6-9 per cent.

Management EBITDA, derived from funds and asset 
management activities across the Group’s investments platform, 
was $141m, down from $165m1 .

Funds management EBITDA rose 25 per cent to $94m1 . Revenue 
climbed from $145m to $172m, driven by base fees growing in 
line with funds under management and acquisition fees from 
investments in Asia. Higher expenses were driven by investment 
in resourcing to support the $11b in initiatives to underpin our 
growing platform, including the launch of new products.

Asset management EBITDA of $47m is down from $90m1 . 
The prior year includes fees from the $1.3b of redevelopment 
activity that was secured across the US military housing 
portfolio. Residential fees across the apartments for rent portfolio 
continued to rise while commercial asset management fees 
recovered on fewer abatements.

Investment portfolio EBITDA was $356m, up from $111m1 . 
Improved asset level performance supported a recovery in 
underlying investment income with an investment yield of 
approximately five per cent across the portfolio, up from 
approximately three per cent in the prior year. This included 
a recovery in earnings across our co-investment positions, 
including an improved operating performance from our 
Retirement Living investment. Profits from capital recycling 
initiatives included $167m pre-tax associated with the part 
divestment of the future asset management income stream from 
the US Military Housing portfolio.

1. Comparative period the year ended 30 June 2021.

Performance and Outlook

61

Development segment

Key financial and operational metrics

Operating EBITDA ($m)

Operating Profit after Tax ($m)

Invested Capital ($b)1

Work in Progress ($b)

Commencements ($b)2

Completions($b)3

Pipeline ($b)4

FY21

469

342

4.4

14.5

5.6

3.8

113.6

FY22

181

111

5.4

18.4

5.9

2.5

117.0

1. Securityholder equity plus gross debt less cash on balance sheet.
2. Project end value on product commenced during a financial period (representing 

100% of project value). Subject to changes in delivery program.

3. Project end value on product completed during a financial period (representing 

100% of project value).

4. Total estimated end value (representing 100% of project value).

Performance
The Development segment delivered EBITDA of $181m, down 
significantly from $469m.1 COVID adversely impacted the timing 
and profitability of projects during the year while weather 
disruptions suppressed the performance of the Communities 
business. The prior year profit included contributions from the 
development joint ventures formed on One Sydney Harbour, 
Towers One and Two. They generated approximately $325m in 
EBITDA, including the uplift on our retained interest of 75 per 
cent. The decision to improve earnings quality by changing our 
approach to joint venture projects delayed expected profits.

The subdued operating performance was reflected in a 
deterioration in returns. Return on Invested Capital of 2.2 per 
cent was at the lower end of the expected range of 2-4 per cent 
expected for FY22 and below our target range of 10-13 per cent.

The divestment of the remaining 20 per cent interest in our 
Sydney Place development, along with progress on both leasing 
and construction delivery milestones, was the largest contributor 
to the result. Origination fees following financial close on both 
the North East Link and Frankston Hospital Public Private 
Partnerships also contributed to EBITDA.

We completed $2.5b of developments, down from $3.8b in 
the prior year, comprised of $2.0b urban projects and $0.5b 
Communities. Across our urban portfolio, we completed both 
apartments for sale and rent buildings at Lakeshore East, 
Chicago, two office campus style buildings at Milano Santa Giulia 
and the retirement village in Shanghai.   

The Australian Communities business generated EBITDA of 
$16m, down from $42m1 . Planning and weather delays 
contributed to the decline in settlements from 2,228 to 1,478 lots.     

Further recovery in commencements, which are running well 
ahead of completions, provides us with the confidence that 
operating momentum will translate into improved financial
performance. Commencements of $5.9b, including a strong 
recovery in H2 FY22 of $4.4b, were up from $5.6b1  providing a 
clearer pathway for completions to achieve our $8b annual target 
going forward from FY24.

Our apartments for rent project at 1 Java Street, New York 
commenced against the backdrop of an improved outlook for 
the inner-city rental market. We are now underway with the 
third and final residential tower at One Sydney Harbour, Sydney. 
The Boston Life Sciences project commenced, along with office
developments in Singapore, London and Sydney. In addition, we 
commenced phase one of the data centre in Tokyo. Lot sales 
across Australian Communities rebounded from 1,940 to 3,1141  as 
we worked through planning and launched new projects.    

Invested capital rose from $4.4b to $5.4b1  as development 
expenditure accelerated ahead of higher completions. Key 
projects utilising additional capital include: One Sydney Harbour; 
The Exchange TRX, Milan Innovation District and the Australian 
Communities business. The increase in invested capital is net of 
a $0.2b reduction related to the impairment of a small number of 
development projects. 

Outlook
The Return on Invested Capital for the Development segment 
is expected to be in the range of 4-6 per cent for FY23. The 
significant operating momentum we carry into the new financial
year, reflected in higher commencements and a record amount 
of Work in Progress, will drive a recovery in both completions 
and profit. However, neither will be at a sufficient level to derive 
the full scale benefits from our development platform. In addition, 
the change in approach to our joint venture projects has shifted 
the timing of profit recognition. As a result, returns in FY23 will 
remain well below our target of 10-13 per cent.

The development pipeline rose from $113.6b to $117b1  with 
additional projects and increased scope on existing projects 
more than offsetting completions and the removal of a few 
underperforming projects. Our $3b joint venture with Singtel 
was added to the pipeline. The project comprises two premium 
grade workplaces totalling approximately 110,000 square metres. 
Our Kinma Valley community project in South East Queensland 
received planning approval, adding $0.7b to the pipeline. Master 
planning and pricing improvements across our existing urban and 
communities' projects generated an uplift of more than $5b to 
the pipeline.

The conversion of the already secured pipeline is critical for 
achieving our annual completion target of more than $8b. 
While this alleviates the need for significant origination, we will 
continue to pursue attractive opportunities with emphasis on our 
Asian and Australian cities. 

Work in Progress, the lead indicator for future completions, has 
risen to a record $18.4b. Approximately $4.5b is expected to 
complete in FY23, including Sydney Place and our apartments 
for sale project at 100 Claremont, New York. The Australian 
Communities business is recovering with more than $1b of 
presales carried into the new financial year. Consequently, we are 
targeting the lower end of our 3,000 to 4,000 settlement range 
for FY23.

We remain on track to meet our more than $8b completion 
target in FY24. Projects that underpin this level of completions 
include residential Towers One & Two, One Sydney Harbour, the 
Melbourne Quarter Tower and TRX in Kuala Lumpur.    

Maintaining this completion target will require Work in 
Progress of more than $20b. This milestone is expected to 
be reached in FY23, driven by expected commencements of 
approximately $8b.

1. Comparative period the year ended 30 June 2021.

 
 
 
62

Lendlease Annual Report 2022

Construction segment

Outlook
The EBITDA margin for the Construction segment is expected 
to be in the range of 1.5-2.5 per cent for FY23, potentially 
lower than our expected target range of 2-3 per cent, with 
the Australian region expected to be the main contributor to 
earnings. The outlook is subdued with ongoing disruption from 
the pandemic, cost pressures and supply chain constraints. The 
Group is closely monitoring these risks and has implemented 
various mitigation strategies.

Backlog revenue remains solid at $10.5b and is diversified by 
client type and sector. Public sector projects account for two 
thirds of the backlog, while three sectors: social infrastructure; 
defence; and commercial account for more than 85 per cent.   

Australia has a strong workbook, with $7.0b in backlog revenue. 
Key projects include the Frankston Hospital Redevelopment, 
RAAF Tindal Stage 6 and USFPI Airfield Works, Powerhouse 
Parramatta, Liverpool Health and Academic Precinct and the 
North and South Towers of the Over Station Development at the 
Sydney Metro Martin Place Integrated Station Development.

The Americas has backlog revenue of $2.6b. The lagged impact 
of the pandemic and our decision to remain disciplined in bidding 
for work has resulted in the Americas backlog declining to 
significantly below historic levels. We have maintained capability 
given our confidence that backlog and revenue will recover 
over time.

Backlog revenue in Europe is $0.7b, and Asia backlog revenue 
is $0.2b.

The Construction segment will continue to support the integrated 
model and target leadership positions in key sectors by 
leveraging its competitive advantage, focusing on key market 
trends and maintaining execution excellence.

Key financial and operational metrics

Revenue ($m)1

Operating EBITDA ($m)

Operating Profit after Tax ($m)

New Work Secured ($b)1

Backlog ($b)1

FY21

6,398

173

100

6.9

11.3

FY22

6,579

131

68

5.3

10.5

1. Construction revenue to be earned in future periods (excludes internal projects).

Performance
The Construction segment delivered EBITDA of $131m, down 
from $173m in the prior year. The result was adversely impacted 
by productivity delays relating to COVID, lower new work 
secured, and increased cost pressures due to inflation and supply 
chain challenges. Notwithstanding these challenges, our strong 
client relationships, risk management approach and dedicated 
teams enabled a resilient performance.

Revenue of $6.6b was modestly up on the prior year. This 
was driven by an 11 per cent uplift from Australia. Asia and 
Europe were broadly in line with the prior year. Revenue from 
the Americas was down seven per cent because of reduced 
new work secured since the onset of COVID, particularly in the 
northeast residential market.

Several health related projects drove higher revenue in Australia. 
This included the Tweed Heads Valley Hospital and Randwick 
Campus Redevelopment; and the Pathway to 144 Mental Health 
Beds project which responds to the Royal Commission into 
Victoria’s Mental Health System. Office and residential buildings 
in New York and Los Angeles contributed to revenue in 
the Americas.

The EBITDA margin was 2.0 per cent, the bottom end of the 
target range of 2-3 per cent. Australia’s margin was strong at 3.8 
per cent, while margin pressure was driven by lower productivity 
across projects in Europe and the Americas. This compares with 
an EBITDA margin of 2.7 per cent in FY21, which included COVID 
induced temporary cost reduction measures as well as project 
completions that boosted the margin.  

New work secured of $5.3b was well down from $6.9b, 
with gains in the Australian business offset by continued 
weakness in the Americas and Europe. In Australia, new work 
secured of $3.6b was underpinned by the Frankston Hospital 
Redevelopment, Powerhouse Parramatta and two health related 
social infrastructure projects.  

New work secured of $1.1b in the Americas was significantly 
below historical averages, reflecting ongoing subdued activity 
in key markets, including delays in projects being brought 
to market.

The business is preferred for $4.6b in new projects, including 
several social infrastructure projects in Australia and office
projects in Europe.

Extensive sector expertise and geographic diversity has 
been critical for the business to navigate a difficult
operating environment.

 
 
Performance and Outlook

63

Financial position and cash 
flow movements

Financial position ($m)

Investment assets

Other financial assets

Equity accounted investments

Investment properties

Development assets

Inventories

Equity accounted investments

Investment properties

Other assets and liabilities 
(including financial)

Cash and cash equivalents

FY21

FY22

Var.

1,070

2,162

278

1,149

2,128

7%

(2%)

216

(22%)

3,298

3,110

1,595

2,246

189

266

(6%)

41%

41%

1,662

1,297

(22%)

Borrowing and financing arrangements

(2,357)

(2,357)

-

Other net assets and liabilities

(946)

(1,085)

15%

Net assets

6,951

6,970

-

Investment Assets
The investment portfolio was steady with the equity 
contributions to the new Industrial Fund and Lendlease Global 
Commercial REIT broadly offsetting the Retirement Living 
divestment in Australia. Investment properties directly held fell 
due to the disposal of retail assets at Barangaroo.

Development Assets
Total development assets rose 10 per cent as Work in Progress 
accelerates ahead of higher completions. Inventory decreased 
by 6 per cent with lower carrying values on underperforming 
projects following their impairment and the reclassification of 
International Quarter London to Equity Accounted Investments 
following the formation of the new investment partnership.

Equity contributions to development projects in delivery, 
including One Sydney Harbour, The Exchange TRX, and Milan 
Innovation District also contributed to the 40 per cent increase in 
Equity Accounted Investment assets. The increase in Investment 
Properties includes capital expenditure on our Retirement Living 
asset in Asia.

Other assets and liabilities
The movement in other assets and liabilities predominantly 
relates to the disposal of the Services business. Cash and cash 
equivalents of $1.3b are moderately below the prior year levels.

Cash flow and treasury management
The Group commenced the year with cash and cash equivalents 
of $1.7b. Movements during the year comprised Operating cash 
outflow of $835m, Investing cash inflow of $552m and Financing 
cash outflow of $106m. The Group closed the year with cash and 
cash equivalents of $1.3b.

The Group measures underlying cash flow to enable an 
assessment of cash conversion.

1. Comparative period the year ended 30 June 2021.

The measures are derived by adjusting statutory cash flows, with 
the largest adjustment relating to the impact on cash flows from 
investments in development.

Underlying core operating cash inflow was $514m, representing 
a cash conversion ratio of 82 per cent. Investment segment 
cash flows were the primary driver with softer Construction 
cash flows, a result of subdued activity in international regions, 
impacting cash conversion. The change in approach to profit 
recognition has improved the cash conversion ratio.

Underlying investing cash outflow was $482m. The major 
contributors included proceeds from the 24.9 per cent 
divestment of Retirement Living and the remaining 20 per cent 
interest in our Sydney Place development, offset by equity 
contributions to the new Industrial Fund and Lendlease Global 
Commercial REIT, as well as continued investment across key 
development projects in delivery. Proceeds received from the 
sale of the Services business partially offset production spend in 
the year.

Group facilities reduced from $5.6b to $5.0b1 following the 
decision to reduce the quantum of available committed facilities. 
The Group remains in a strong financial position with $3.9b 
of liquidity comprised of $1.3b of cash and cash equivalents 
and $2.6b in available undrawn debt. Average debt maturity 
increased to 6.6 years providing greater flexibility and access to 
longer term capital.

Gearing of 7.3 per cent is below the target range of 10-20 
per cent, reflecting several divestments in the second half of 
FY22. This is expected to rise to the middle of the target range 
during FY23.

Treasury management

Net debt

Gearing1

Interest cover2

Average cost of debt

Average drawn debt maturity

Available liquidity

Average debt mix fixed:floating

FY21

695

FY22

1,060

5.0

6.4

3.6

4.9

7.3

5.6

3.6

6.6

Var.

53%

46%

(13%)

-

35%

4,930

3,944

(20%)

87:13

88:12

$m

%

times

%

years

$m

$m

1. Net debt to total tangible assets, less cash.
2. FY22 EBITDA has been adjusted to exclude the Restructure costs incurred. 
FY21 EBITDA has been adjusted to exclude one off items related to the 
Engineering business.

Credit ratings1

Moody's

Fitch

Baa3 stable outlook

BBB- stable outlook

1. Credit ratings have been issued by a credit rating agency which holds an Australian 
Financial Services Licence with an authorisation to issue credit ratings to wholesale 
clients only and are for the benefit of the Group’s debt providers.

64

Lendlease Annual Report 2022

Singapore  Board visit to  313@SomersetGovernance

65

The Lendlease Board is committed to exceptional corporate governance policies and practices which are fundamental to the long term success and prosperity of the Group. In FY22, the Board continued its longstanding practice of reviewing its corporate governance and reporting practices. The Corporate Governance Statement is available on the Lendlease website. The Corporate Governance Framework is regularly assessed and amended to remain current. The Board’s five permanent committees continue to assist, advise and make recommendations to the Board on matters falling within their areas of responsibility, as set out in the Committee Charters. The Board delegates authority for all other functions and matters necessary for the day to day management of the Group to the Global Chief Executive Officer, who delegates to senior management as required. Limits of Authority, which are reviewed at least annually, are in place. These outline the matters specifically reserved for determination by the Board and those matters delegated to Board Committees or Group Executive Management.Governance66

Lendlease Annual Report 2022

Board of Directors’ 
information and profiles

Michael J Ullmer, AO
Chairman
(Independent Non Executive Director)
Term of Office
Mr Ullmer joined the Board in December 2011 and was appointed 
Chairman in November 2018.
Skills, Experience and Qualifications
Mr Ullmer brings to the Board extensive strategic, financial
and management experience accumulated over his career in 
international banking, finance and professional services. He was 
the Deputy Group Chief Executive Officer of the National Australia 
Bank (NAB) from 2007 until he retired from the Bank in August 
2011. He joined NAB in 2004 as Finance Director and held a 
number of key positions including Chairman of the subsidiaries 
Great Western Bank (US) and JB Were. Prior to NAB, Mr Ullmer 
was at Commonwealth Bank of Australia, initially as Group Chief 
Financial Officer and then Group Executive with responsibility for 
Institutional and Business Banking. Before that, he was a Partner 
at accounting firms KPMG (1982 to 1992) and Coopers & Lybrand 
(1992 to 1997).

Mr Ullmer has a degree in mathematics from the University of 
Sussex. He is a Fellow of the Institute of Chartered Accountants, 
a Senior Fellow of the Financial Services Institute of Australia, and a 
Fellow of the Australian Institute of Company Directors.
Listed Company Directorships (held within the last 
three years)
Non Executive Director of Woolworths Limited (appointed January 
2012) (retired November 2021)
Other Current Appointments
Nil
Board Committee Memberships
Member of the Audit Committee

Member of the Nomination Committee

Member of the People & Culture Committee

Member of the Risk Committee

Member of the Sustainability Committee

Anthony P Lombardo
Global Chief Executive Officer of the Group
(Executive Director)
Term of Office
Anthony (Tony) was appointed Managing Director on 3 September 
2021 and also appointed Global Chief Executive Officer in 
June 2021.
Skills, Experience and Qualifications
Tony Lombardo has more than 25 years’ experience working across 
real estate development, investment management, finance, mergers 
and acquisitions (M&A) and strategy in Australia and internationally.

Tony joined Lendlease in 2007 as Group Head of Strategy and 
M&A where he led a number of initiatives including refocusing 
the Group's overall business strategy. In 2011, he was appointed 
Group Chief Financial Officer and played a key role in enhancing 
the flexibility of the Group’s capital structure via a stapled 
structure as well as significantly broadening its funding and 
banking relationships. He also implemented a range of people 
focused initiatives including creation of the Young Indigenous 
Pathways program, which provides mentoring opportunities for 
young Indigenous students.

In 2016, Tony was appointed Chief Executive Officer Asia based 
in Singapore. As part of resetting Lendlease Asia’s growth 
strategy, Tony spearheaded a number of major initiatives to 
drive future growth. Recent successes include the completion 
of Singapore’s S$3.7 billion Paya Lebar Quarter mixed use 
development, establishment of a US$1 billion data centres joint 
venture with a large institutional investor and the successful listing 
of S$1 billion global LREIT on the Singapore Exchange.

Prior to joining Lendlease, Tony spent almost 10 years at GE with 
responsibilities across a number of functional disciplines including 
strategy, M&A and finance for both GE Capital and GE Corporate. 
Tony commenced his career at KPMG where he worked for more 
than four years.

Tony holds a degree in Accounting and Finance from RMIT 
University and is a member of the Institute of Chartered 
Accountants in Australia.

 
Jane S Hemstritch
(Independent Non Executive Director)
Term of Office
Ms Hemstritch joined the Board in September 2011.
Skills, Experience and Qualifications
Ms Hemstritch has extensive senior executive experience in 
information technology, communications, change management 
and accounting. She also has broad experience across the 
financial services, telecommunications, government, energy and 
manufacturing sectors and in business expansion in Asia. During 
a 25 year career with Accenture and Andersen Consulting, Ms 
Hemstritch worked with clients across Australia, Asia and the US.

Ms Hemstritch was Managing Director Asia Pacific for Accenture 
from 2004 until her retirement in 2007. She was a member of 
Accenture’s global Executive Leadership Team and oversaw the 
management of Accenture’s business in the Asia Pacific region, 
which spanned 12 countries and included 30,000 personnel.

Ms Hemstritch has a Bachelor of Science in Biochemistry and 
Physiology from the University of London and is a Fellow of the 
Institute of Chartered Accountants in Australia and in England and 
Wales. She is a Member of Chief Executive Women.
Listed Company Directorships (held within the last 
three years)
Non Executive Director of Telstra Corporation Limited (appointed 
August 2016, retired January 2019)
Other Current Appointments
President of the Board of The Walter and Eliza Hall Institute of 
Medical Research

Director Brandenburg Ensemble Ltd

Chair of Accenture Australia Foundation
Board Committee Memberships
Chair of the Nomination Committee

Member of the Audit Committee

Member of the Risk Committee

Governance

67

Nicola M Wakefield Evans
(Independent Non Executive Director)
Term of Office
Ms Wakefield Evans joined the Board in September 2013.
Skills, Experience and Qualifications
Ms Wakefield Evans is an experienced business leader and 
Non Executive Director with broad ranging commercial, business 
management, strategy and legal experience gained over a 30 year 
international career.

Ms Wakefield Evans has had a diverse career as one of Australasia’s 
leading corporate finance lawyers and held several senior key 
management and leadership positions at King & Wood Mallesons 
(KWM), including Managing Partner International in Hong Kong, 
where she was responsible for the overall governance and 
strategic positioning of the business in the Asia region. She has 
extensive experience in the financial services, resources and energy 
and infrastructure sectors. She also has extensive international 
experience working in Australia, New York and Hong Kong.

Ms Wakefield Evans holds a Bachelor of Jurisprudence and a 
Bachelor of Laws from the University of New South Wales and is 
a qualified lawyer in Australia, Hong Kong and the United Kingdom. 
She is a member of Chief Executive Women.
Listed Company Directorships (held within the last 
three years)
Non Executive Director of Macquarie Group Limited (appointed 
February 2014)

Non Executive Director of Viva Energy Group Limited 
(appointed August 2021)
Other Current Appointments
Chair of 30% Club, Australia

Director of the Clean Energy Finance Corporation

Director of Metlife Insurance Limited

Director of UNSW Foundation Limited

Director of Australian Institute of Company Directors

Director of Chief Executive Women

Director of the Goodes O'Loughlin (GO) Foundation Limited

Member of the Takeovers Panel
Board Committee Memberships
Chair of the Sustainability Committee

Member of the Nomination Committee

Member of the Audit Committee

Member of the Risk Committee

68

Lendlease Annual Report 2022

David P Craig
(Independent Non Executive Director)
Term of Office
Mr Craig joined the Board in March 2016
Skills, Experience and Qualifications
Mr Craig is a business leader with a successful international 
career spanning over 40 years in finance, accounting, audit, 
risk management, strategy and mergers and acquisitions in the 
banking, property and professional services industries. He was the 
Chief Financial Officer (CFO) of Commonwealth Bank of Australia 
from 2006 through the GFC, until he retired in June 2017. At 
Commonwealth Bank, he was responsible for leading the finance,
treasury, property, security, audit and investor relations teams.

Mr Craig’s previous leadership roles have included CFO for 
Australand Property Group, Global CFO for PwC Consulting and 
a Partner at PwC (17 years).

As well as his role as CFO of Australand Property Group 
(now Frasers), Mr Craig was responsible for Property for the last 22 
years of his executive career, including overseeing three significant 
property transformations at CBA.

Mr Craig holds a Bachelor of Economics from the University of 
Sydney. He is a Fellow of the Institute of Chartered Accountants, 
ANZ and a Fellow of the Australian Institute of Company Directors.
Listed Company Directorships (held within the last 
three years)
Nil
Other Current Appointments
President of the Financial Executives Institute of Australia

Deputy Chairman of the Victor Chang Cardiac Research Institute

Director of Sydney Theatre Company
Board Committee Memberships
Chair of the Audit Committee

Member of the Nomination Committee

Member of the People and Culture Committee

Member of the Risk Committee

Philip M Coffey
(Independent Non Executive Director)
Term of Office
Mr Coffey joined the Board in January 2017
Skills, Experience and Qualifications
Mr Coffey served as the Deputy Chief Executive Officer (CEO) of 
Westpac Banking Corporation from April 2014 until his retirement 
in May 2017. As the Deputy CEO, Mr Coffey had the responsibility 
of overseeing and supporting relationships with key stakeholders 
of Westpac including industry groups, regulators, customers and 
government. He was also responsible for the Group’s Mergers 
& Acquisitions function. Prior to this role, Mr Coffey held a 
number of executive positions at Westpac including Chief Financial 
Officer and Group Executive, Westpac Institutional Bank. He has 
successfully led operations based in Australia, New Zealand, the 
United States, the United Kingdom and Asia and has extensive 
experience in financial markets, funds management, balance sheet 
management and risk management. He began his career at the 
Reserve Bank of Australia and has also held executive positions 
at Citibank.

Mr Coffey holds a Bachelor of Economics (Hons) from the 
University of Adelaide and has completed the Executive Program 
at Stanford University Business School. He is a graduate member of 
the Australian Institute of Company Directors and Senior Fellow of 
the Financial Services Institute of Australasia.
Listed Company Directorships (held within the last 
three years)
Non Executive Director of Macquarie Group Limited (appointed 
August 2018)
Other Current Appointments
Director of Goodstart Early Learning
Board Committee Memberships
Chair of the Risk Committee

Member of the Sustainability Committee

Member of the Nomination Committee

 
Governance

69

Elizabeth M Proust, AO
(Independent Non Executive Director)
Term of Office
Ms Proust joined the Board in February 2018.
Skills, Experience and Qualifications
Ms Proust is one of Australia’s leading business figures and has 
had a diverse career holding leadership roles in the public and 
private sectors for over 30 years. Ms Proust spent eight years 
at ANZ Group including four years as Managing Director of 
Esanda, Managing Director of Metrobanking and Group General 
Manager, Human Resources, Corporate Affairs and Management 
Services. Before joining ANZ, Ms Proust was Secretary (CEO) of the 
Department of Premier and Cabinet (Victoria) and Chief Executive 
of the City of Melbourne.

Ms Proust has extensive board experience in listed and private 
companies, subsidiaries and joint ventures, as well as government 
and not for profits. She was made an Officer of the Order of 
Australia in 2010 for distinguished service to public administration 
and to business, through leadership roles in government and private 
enterprise, as a mentor to women, and to the community through 
contributions to arts, charitable and educational bodies. She is a 
Life Fellow of the Australian Institute of Company Directors and a 
member of Chief Executive Women.

Ms Proust holds a Bachelor of Arts (Hons) from La Trobe University 
and a Bachelor of Laws from the University of Melbourne.
Listed Company Directorships (held within the last 
three years)
Lead Independent Director GQG Partners (appointed October 2021)
Other Current Appointments
Chair of Cuscal Limited

Chair of SuperFriend Industry Funds' Mental Health Initiative

Member of the Fujitsu Advisory Board
Board Committee Memberships
Chair of the People and Culture Committee

Member of the Nomination Committee

Member of the Risk Committee

Member of the Sustainability Committee

Robert F Welanetz
(Independent Non Executive Director)
Term of Office
Mr Welanetz joined the Board in March 2020.
Skills, Experience and Qualifications
Mr Welanetz is based in the US and has significant executive, 
advisory, strategic and operational experience in the property and 
construction sectors gained over an international career spanning 
over 40 years.

In his most recent role, Mr Welanetz served as Chief Executive 
Officer in the property division of Majid Al Futtaim (MAF), based 
in Dubai, where he had overall responsibility for managing MAF’s 
property portfolio and development pipeline. Mr Welanetz retired 
from that position in 2018. Prior to joining MAF, Mr Welanetz spent 
over seven years in a global role in Blackstone’s Real Estate Group 
advising and identifying acquisition opportunities in retail real estate 
and providing strategic guidance for Blackstone’s portfolio of retail 
assets and retail operating companies.

Mr Welanetz also served as Chief Executive Officer of Shanghai 
Kinghill Ltd, based in China, with responsibility for the operations 
and delivery of retail and development projects in mainland China. 
Prior to this, Mr Welanetz was President and Chief Executive 
Officer, Retail, at Jones Lang LaSalle Inc Americas.

Mr Welanetz holds a Bachelor of Science degree from Colorado 
State University. He is a former Chairman of the International 
Council of Shopping Centres and served on the board of the Galileo 
Property Trust, an Australian shopping centre investor.
Listed Company Directorships (held within the last 
three years)
Nil
Other Current Appointments
Non Executive Director of Qiddiya Coast Saudi Arabia

Non Executive Director of Stone Mountain Industrial Property 
Company, USA
Board Committee Memberships
Member of the Nomination Committee

Member of the Risk Committee

Member of the People & Culture Committee

Member of the Sustainability Committee

70

Lendlease Annual Report 2022

Nicholas R Collishaw
(Independent Non Executive Director)
Term of Office
Nicholas Collishaw was appointed to the Board as an independent 
Non Executive Director, effective 1 December 2021.
Skills, Experience and Qualifications
Based in Sydney, Mr Collishaw is an experienced property 
executive and non executive director with more than 40 
years’ expertise gained across Lendlease’s core segments of 
Development, Construction and Investments. During his career 
he has overseen the development and delivery of a number of 
significant and ground-breaking projects across the commercial, 
industrial and retail sectors. Mr Collishaw currently serves as 
the joint Chief Executive Officer of Lincoln Place Pty Ltd, 
a boutique funds management entity focused on affordable
retirement accommodation, and is Chairman of hospitality group, 
Redcape Hotel Group. Until his recent retirement, he was a non-
executive director of ASX-listed investment manager, Centuria 
Capital. Mr Collishaw’s executive career comprised a number 
of high-profile roles including Centuria Capital’s Chief Executive 
Officer of Listed Property. Prior to this role, Mr Collishaw spent 
eight years at Mirvac Group serving as the Chief Executive Officer
and Managing Director between 2008 and 2012. He also held 
senior leadership positions at James Fielding Group where he was 
Executive Director and Head of Property, Deutsche Industrial Trust 
and Paladin Commercial Trust.
Listed Company Directorships (held within the last 
three years)
Non Executive Director of Centuria Capital Group (appointed May 
2013, retired August 2021)
Other Current Appointments
Chair of Redcape Hotel Group (delisted 2021)
Board Committee Memberships
Member of the Audit Committee

Member of the People and Culture Committee 

Member of the Risk Committee

Member of the Nomination Committee

General Counsel 
and Company 
Secretary qualifications
and experience

Karen Pedersen
Ms Pedersen was appointed 
Group General Counsel in January 
2013. Prior to this she was 
General Counsel and Company 
Secretary for other large property 
and construction companies. Ms 
Pedersen has a Masters of Law 
from the University of Technology, 
Sydney and a Bachelor of 
Commerce/Bachelor of Laws from 
the University of New South Wales.

Wendy Lee
Ms Lee joined Lendlease in 
September 2009 and was appointed 
Company Secretary in January 
2010. Prior to her appointment, 
Ms Lee was a Company Secretary 
for several subsidiaries of a large 
financial institution listed on the 
Australian Securities Exchange. She 
has over 15 years of company 
secretarial experience. Ms Lee has 
a Bachelor of Arts and a Bachelor 
of Laws from the University of 
Sydney, a Graduate Diploma in 
Applied Corporate Governance, and 
is a Fellow of the Governance 
Institute Australia.

 
 
 
Governance

71

Board skills and experience

The Directors have a mix of Australian and international experience and expertise, as well as specialised skills to assist with decision 
making to effectively govern and direct the organisation for the benefit of securityholders. The skills matrix assists the Board with 
succession planning and professional development initiatives for Directors.

The target of 40 per cent female Board members aims to improve gender diversity and focus the Board's attention on achieving this 
objective. Current female Directors represent 33 per cent of the Board.

The table below sets out the skills and experience considered by the Board to be important for its Directors to have collectively. The 
Board considers that Governance, Strategy, People & Culture, Financial Acumen, Risk Management are core skills which all Directors 
have self-assessed as being within their core competencies.

Skills/
Experience

Governance

Michael 
Ullmer

Jane 
Hemstritch

Nicola 
Wakefield
Evans

David 
Craig

Phil Coffey

Elizabeth 
Proust

Robert 
Welanetz

Anthony 
Lombardo

Nicholas 
Collishaw Total

Commitment to and experience in setting exceptional corporate governance policies, practices and standards.

Industry 
experience

Possessing industry knowledge, exposure and experience gained in one or more of the core Lendlease 
operating segments of Investments, Development and/or Construction. This includes acting in advisory roles for 
these industries.

-

International 
Operations

Exposure to international regions either through experience gained directly in the region or through the 
management of regional clients and other stakeholder relationships.

Health and 
Safety

Experience in programs implementing safety, mental health and physical wellbeing on site and within the business. 
Monitoring the proactive management of workplace health and safety practices.

ESG

Experience in assessment strategy and performance against environmental, social and governance criteria.

-

-

Strategy

Developing, setting and executing strategic direction. Experience in driving growth and executing against a 
clear strategy.

Risk 
Management

Experience in anticipating and evaluating risks that could impact business. Recognising and managing these risks 
by developing sound risk governance policies and frameworks.

Legal

Identifying and resolving legal and regulatory issues, and advising the Board on these matters.

-

-

-

-

-

-

People and 
Culture

Experience in building workforce capability, setting a remuneration framework which attracts and retains a high 
calibre of executives, promoting workplace culture, diversity and inclusion.

Executive 
Leadership

Skills gained while performing at a senior executive level for a considerable length of time including delivering 
superior results, dealing with complex business models, projects, and issues and change management.

Financial 
Acumen

Understanding of the financial drivers of a business. Experience in financial reporting and corporate 
financial management.

Technology

Experience via direct line accountability for managing significant technology functions or major 
project implementations.

-

-

-

9

8

9

9

7

9

9

3

9

9

9

6

 
 
 
72

Lendlease Annual Report 2022

Engagement

As an international company and having regard to the material scale 
of projects, the Board program is formulated to reflect the geographic 
spread of Lendlease businesses.

Board regional program FY22
The Board program typically comprises 
formal meetings and additional business 
briefings, presentations from internal 
and external sources, project site visits, 
employee events and meetings with key 
stakeholders. These are scheduled in each 
of the regions where Lendlease operates.

The Board views that these program 
activities – in addition to the 
formal, scheduled Board and Committee 
meetings – are important for Board 
members to receive a greater 
understanding of our people and our 
business and a deep understanding of 
the activities and operations. The Chair 
works with the Company Secretary to 
plan the yearly program. Depending on 
the time of year, the program runs for 
a minimum of three days and up to five 
days where more detailed project reviews 
are required.

Program for the 
reporting period 
between 1 July 2021 
and 30 June 2022.
Board program activities 
undertaken during the reporting 
period are listed below. The Europe 
program is not included as this 
occurred in June 2021 (reported in 
the FY21 Annual Report) and July 
2022 (to be reported in the FY23 
Annual Report).

The Board maintained its regular cadence 
of meetings despite the challenge of 
COVID, including intermittent lockdowns, 
experienced across our operating regions 
The program was maintained through 
a mixture of virtual and face to face 
meetings and visits.

Asia (virtual and on-site program)
• Virtual site tour of key projects 
in each of the Asia countries 
– Singapore, Japan, China and 
Malaysia. (December 2021)

• Received a briefing from an external 

speaker on the geopolitical landscape 
in Asia including sovereign risk and 
trade issues. (December 2021)

• Site visit of Paya Lebar Quarter 

precinct. (April 2022)

• Engagement with Asia Regional 
Leadership Team – virtually in 
December 2021 and in person in 
April 2022.

• Town Hall with Asia regional staff.

(April 2022)

Australia (on-site program)
• Engagement with regional business 

leaders to provide updates 
and overview of key regional 
business issues.

• Review of the Melbourne Metro 
Tunnel Project followed by a site 
visit. Topics discussed included health 
and safety, construction and design 
challenges, innovation, sustainability, 
community and client engagement, 
financial metrics, COVID impacts and 
supply chain. (February 2022)

• Site visit and interaction with 

the Sydney Place project team. 
(May 2022)

Americas (virtual program)
• Review of the San Francisco Bay Area 
project. Interaction with senior project 
leaders and area site viewing using 
virtual technology. (August 2021)

• Review of the Military Housing 

business, virtual site visit, overview 
of customer relations and interaction 
with key business leaders. 
(November 2021)

• Engagement with Americas Regional 
Leadership team. (November 2021)

Stakeholder engagement
The Board members, led by the Chairman, 
maintain an active and extensive 
engagement program to represent the 
interests of the Group at various industry 
functions and bodies. The Chairman acts 
as a spokesperson and regularly meets 
with customers, investors, governments 
and media. In February 2022, the 
Board endorsed a refreshed investor 
engagement program to encourage two 
way communications with the investment 
community. As part of this, a presentation 
detailing the scope of the Board 
activities and focus areas for the Board 
Committees was made available on the 
Lendlease website in May 2022.

The Annual General Meeting (AGM) has 
always been an important date in our 
calendar and provides our securityholders 
with a valuable opportunity to 
communicate with the Board. For the 
last two years, the AGM has been held 
online, due to the COVID pandemic. In 
2022, we are planning to hold a hybrid 
format AGM with both an ‘in-person’ 
and virtual component which will provide 
greater access to our securityholders to 
participate and vote on all resolutions.

Board engagement with our people
The Board members have approved a 
code of conduct which articulates the 
standards of behaviour expected of all 
our people. The tone is ‘set at the 
top’ and Board members believe that 
meeting with our people, in addition to 
information received in formal meetings 
on the organisation’s culture, is an 
important element of reinforcing the 
Lendlease values. Board members plan 
to meet with employees in all the 
regions and in more focused groups with 
the Regional Leadership Teams. Wider 
employee events were reintroduced in 
the Australia and Asia regions where 
employee ‘town hall’ style events were 
held, providing the opportunity for open 
discussion on organisational culture. 
Sessions between Board members and 
the Regional Leadership teams occurred 
in person and virtually. Visits to the 
Europe and Americas regions with 
scheduled town hall events are planned 
for FY23. 

 
 
Governance

73

Board Project Assessments

A key responsibility of the Board is to approve and oversee the 
implementation of the strategy so that the Group can pursue its 
integrated business model in targeted global gateway

Since the onset of COVID, the Board 
has maintained site visits and project 
reviews in a virtual format. The Board 
reintroduced its longstanding tradition of 
visiting the Lendlease regions in person to 
conduct site visits and reviews of various 
projects in April 2022.

Site visits allow the Board to speak to 
project teams about the challenges and 
opportunities in the delivery of a project, 
enabling these to be appreciated in a 
fuller geographic and strategic context.

These activities undertaken by the Board 
are examples of how the Board oversees 
management and delivering projects in 
accordance with the Group’s strategy.

PLQ Development, Singapore
The PLQ project assessment is an 
example of how the Board reviews and 
evaluates strategic opportunities, sustains 
competitive advantage of the integrated 

model to originate, fund and deliver major 
urban projects.

opportunities were appreciated in a fuller 
geographic context.

Paya Lebar Central was identified by 
the Singapore Government as a new 
commercial hub for Singapore. This 
project was first presented to the Board 
in 2014, and after careful consideration, 
an equity commitment for Lendlease’s 
interest in PLQ was approved in 2015. Due 
to the project’s size and significance, the 
Board has continued to receive updates 
on the progress of PLQ and visited the 
project in 2015, prior to commencement 
of construction and again in 2017, to 
view progress. In April 2022, the Board 
visited the now completed project, one 
of the largest sustainable business and 
lifestyle precincts in Singapore. The 
highly activated integrated commercial 
realm includes offices, retail, residential 
and public spaces. In visiting the site 
over a longer time frame, the Board’s 
discussions on the project’s risks and 

The Board’s interactions with PLQ, before, 
during and after completion of delivery, 
including visits, tours, presentations and 
project team interactions are indicative of 
the scrutiny and governance undertaken 
by the Board to oversee the delivery 
of projects in accordance with the 
Group’s strategy.

Top: Singapore: Board visit.

74

Lendlease Annual Report 2022

Supporting 
value creation

The Board recognises that the five 
focus areas of value creation, supported 
by disciplined governance and risk 
management, contribute to performance 
and drive the long term value of 
our business.

During the year, in addition to the 
responsibilities and tasks set out in the 
charter documents, the Board and Board 
Committees deliberated on the following 
specific matters and undertook a number 
of activities to support value creation. 
While these do not represent the full 
scope of Board activities, they highlight 
some of the areas of focus by the Board.

Health and Safety

Financial

Material Issue:
Operating safely across our operations 
and projects. Maintaining the health and 
wellbeing of our employees and those 
who engage with our assets and sites.

The Board, Risk and Sustainability 
Committees undertook the following 
activities as part of their continued 
review of the Lendlease Health and 
Safety Framework and the unwavering 
commitment to the safety of our people 
and those who interact with Lendlease 
assets and sites.

Activities and actions:
•

In tandem with the People & Culture 
Committee, led the work on the 
approach to setting the guiding 
principles to manage remuneration 
adjustments following safety incidents.

• Received an independent report on and 
discussed the measures and actions 
taken in response to the subcontractor 
fatality that occurred on our operations 
in FY22. No employee fatalities were 
reported in FY22.

• Continued to receive reports from 
management on the steps taken to 
reduce incidents through continuous 
improvement measures, and by 
advocating for industry change.

• Resumed on-site project visits to observe 
and test, through speaking with site 
workers, the addressing of health 
and safety culture. Received deep-dive 
reports from management on the ways 
that safety issues are being managed on 
these projects.

• Reviewed the way safety performance 
is reported across Lendlease, noting 
that Lendlease goes beyond industry 
requirements by reporting all fatalities 
including subcontractors and everyone 
who interacts with our places.

• Received a report on the internal Safety 
Culture and Climate Survey undertaken 
in April 2022.

• Received deep dive presentations from 

various businesses on particular areas of 
EH&S focus during investment, design 
and procurement. Received reports from 
business leaders on the ways they have 
shared lessons learnt from Level 3 critical 
incident reports.

Material Issue:
Delivering securityholder returns. 
Maintaining strong capital management to 
enable investment in our future pipeline.

The Board, Audit and Risk Committees 
undertook the following activities to help 
fulfil the Board’s oversight responsibilities 
in delivering returns to securityholders 
and by adopting a prudent approach 
to capital management with a view 
to maintaining a strong balance sheet 
throughout market cycles.

Activities and actions:
• Oversighted the CEO’s wide ranging 
business review of the assessment 
of Development project impairments 
in Australia and the UK, change 
in capital partnering approach across 
urban projects, and restructure 
provisions taken.

• Reviewed relevant accounting issues 
and considered components of the 
Group’s restructuring following the 
CEO’s business review.

•

Supported the ‘Reset, Create, Thrive’ 
roadmap following the CEO’s business 
review and communications of this 
to market.

• Continued to consider project approvals 

in the context of the Portfolio 
Management Framework, with the 
object to maximising long term 
securityholder value.

• Oversaw the sale of the non-core 

Services business and reviewed the 
accounting treatment associated with 
the sale and adequacy of provisions held.

• Continued the review of existing risk 

management process to further enhance 
risk maturity.

• Continued to oversight improvements to 

internal risk standards and frameworks, 
including the risk appetite, so that 
they remained fit-for-purpose within 
the organisation.

•

In accordance with the Group’s 
Audit Committee Charter, the Audit 
Committee will be conducting an audit 
tender process during FY23.

Governance

75

Our Customers

Our People

Sustainability

Material Issue:
Managing and optimising our performance 
in the context of challenges facing the built 
environment, including climate change and 
social pressures such as population growth and 
housing affordability.

The Board and Sustainability Committee 
engaged in the following activities to help 
deliver inclusive, healthy and adaptable places 
that can thrive through change.

Activities and actions:
• Received quarterly reports tracking progress 
against the Group’s two sustainability targets 
to reflect the Group’s commitment to:

– A ‘Net Zero Carbon’ for scope 1 and 2 
emissions by 2025, and ‘Absolute Zero 
Carbon’ by 2040

– Delivering $250m of measured social value 

by 2025.

• Received regular reports on ethical supply 
chain within the Group to ameliorate 
the risk of material substitution and 
modern slavery. Encouraged management to 
adopt the recommendations from ACSI to 
enhance disclosure for the 2021 Modern 
Slavery Statement, which was lodged in 
December 2021.

• Reviewed the Group’s strategy in relation to 

social and affordable housing.

• Conducted a deep dive review of the 

ESG reporting frameworks and indices to 
understand in further detail various reporting 
and rating schemes and the gaps in reporting 
by the organisation.

• Continued to receive reports at every meeting 

on the progress against the Task Force 
on Climate-related Financial Disclosures risk 
assessment and reporting framework.

• Received reports on the progress of the 
initiatives outlined in the Group’s second 
Elevate RAP.

Material Issue:
Understanding our customers and 
responding to changes in the market. 
Designing and delivering innovative, 
customer driven solutions to win 
the projects we want to win and 
ultimately deliver the best places.

The Board and its committees 
undertook the following activities as 
part of its support of the Group’s 
customer focused approach and to 
embed a process of continuous 
improvement based on customer 
insights and actions.

Activities and actions:
• Received a presentation on the 

future of workplace as the world 
emerges from the pandemic.

• Received reports following 
endorsement of the Group 
Customer Complaint Handling & 
Feedback Policy, which set a 
minimum standard across the 
Group. Continued to receive 
reports on customer engagement, 
types of complaints and resolution 
timeframes for every region, under 
the Group Customer Complaint 
Handling & Feedback Policy.

• Continued to receive reports on the 
progress against prescribed metrics 
for the Australian Government 
Payment Times Reporting Scheme 
for small business suppliers.

• Received external reports on the 
measuring of Board effectiveness
as viewed by external investors. 
Endorsed the engagement program 
of major Board stakeholders 
through FY22.

• Received a report from the Asia 

CEO on key customer relationships 
relevant to the Senior Living 
business in Asia during the 
extended lockdown in Shanghai.

Material Issue:
Attracting, developing and retaining 
diverse talent. Ensuring we have the 
right capability across the organisation 
to deliver results for all stakeholders.

The Board, People and Culture 
Committee and Nomination Committee 
undertook the following activities to 
help attract, develop and retain diverse 
talent and to monitor the investment in 
developing leaders and capabilities.

Activities and actions:
• Upon appointment of a new CEO 
in FY21, reset CEO remuneration 
downwards and in line with market 
expectations. During FY22, oversaw 
the alignment of the structure of 
executive remuneration at Lendlease 
with the new CEO’s package.

•

Endorsed changes to the Global 
Leadership Team with new external 
hires commencing in FY22 – Deborah 
Yates as Chief People Officer, Simon 
Dixon as Chief Financial Officer, 
and Penny Ransom as Group Head 
of Investments.

• Continued the program of Board 

refreshment by actively reviewing 
Board composition against the skills 
matrix. Appointed Nick Collishaw to 
the Board effective December 2021.

• Continued to oversee the 

implementation of the human capital 
strategy, review mission critical 
capabilities and endorsed refreshed 
global leadership programs.

• Continued to receive reports on 
building a more inclusive culture 
and supported the introduction of 
a flagship program focused on 
acceleration of under-represented 
female and racial minority talent.

• Received a report on the 

global roadmap to Wellbeing 
program, supported the “You 
Can’t Ask That” series promoting 
employee engagement.

•

•

Engaged with regional senior leaders 
through in-person and virtual meet to 
gain greater visibility of the emerging 
pool of potential internal successors to 
the GLT.

Introduced simplified and metricated 
STA KPIs for the Global CEO, GLT 
and Executives, with threshold, target 
and maximum values set. Changed 
the weighting of financial/non financial
KPIs from 50% financial / 50% non 
financial to 65% financial / 35% 
non financial.

• Approved updates to leaver treatments 

for the 2022 LTA so that they are 
aligned with market practice.

 
 
76

Lendlease Annual Report 2022

Board of Directors’ information

Interests in Capital
The interests of each of the Directors in the stapled securities of the Group at 22 August 2022 set out below. The current Non Executive 
Directors acquired Lendlease securities using their own funds.

Directors

M J Ullmer

A P Lombardo1

P M Coffey

N R Collishaw

D P Craig

J S Hemstritch

E M Proust2

N M Wakefield Evans

R F Welanetz

Securities 
held directly 
2022

Securities 
held 
beneficially/ 
indirectly 
2022

Total 2022

Securities 
held directly 
2021

-

9,764

-

-

-

-

-

- 

7,000

125,000

125,000

-

21,216

14,500

73,061

33,061

68,061

34,379

-

9,764

21,216

14,500

73,061

33,061

68,061

34,379

7,000

-

-

-

-

-

-

-

-

7,000

Securities 
held 
beneficially/ 
indirectly 
2021

Total 2021

125,000

125,000

-

21,216

-

73,061

33,061

68,061

34,379

-

-

21,216

-

73,061

33,061

68,061

34,379

7,000

1. The Global CEO, Anthony Lombardo is required to accumulate and maintain a minimum holding of 150 per cent of his Total Value Package in Lendlease securities. Awards 
granted under the Restricted Securities Award and LTA Minimum may count towards this holding requirement. As at 30 June 2022, Anthony Lombardo holds 106,360 
Lendlease securities which count towards the mandatory securityholding requirement. Refer to page 100 for further details.

2. E M Proust also holds through her super fund, $500,000 face value of Lendlease Green Bonds.

Sustainability Committee
The Sustainability Committee assists the 
Board in monitoring the decisions and 
actions of management in achieving 
Lendlease’s aspiration to be a sustainable 
organisation. The Committee has 
oversight of health and safety, ESG 
matters, the Lendlease Foundation, 
modern slavery and the Group’s 
Elevate RAP.

Nomination Committee
The Nomination Committee has 
responsibility for Board renewal, 
composition and Director development 
and oversees the reviews of Board, 
Committee and Director performance.

Directors’ Meetings

Board meetings
The Board meets as often as necessary 
to fulfil its role. Directors are required to 
allocate sufficient time to the Group to 
perform their responsibilities effectively, 
including adequate time to prepare for 
Board meetings. During the financial year 
ended 30 June 2022, 12 Board meetings 
were held. Typically, four face to face 
meetings are held in Australia and one 
each in the UK, Asia and the Americas 
to align with the Group’s regional 
operations. In addition, three shorter 
meetings are scheduled to provide 
updates to the Board between the longer 
face to face meeting programs. Given 
the COVID pandemic, a mixture of face 
to face and virtual meetings were held 
during the reporting period. In April 2022, 
the Board returned to holding meetings 
in the offshore regions. Matters were 
also dealt with as required by circular 
resolution. Special subcommittees were 
also constituted to deal with specific
matters. During the reporting period, 13 
such subcommittee meetings were held.

Overview of Board Committees
The Board recognises the essential role 
of Committees in guiding the Company 
on specific issues. There are five 
standing Board Committees to assist, 
advise and make recommendations to 
the Board on matters falling within their 
areas of responsibility. Each Committee 
consists of independent, Non Executive 
Directors. The Chair of each Committee 
is not a Chair of other Committees, or 
Chair of the Board. Each Committee 

is governed by a formal Charter 
setting out its objectives, roles and 
responsibilities, composition, structure, 
membership requirements and operation. 
During the reporting period a review 
of the accompanying Charters and 
Workplans for each of the Committees 
was undertaken.

The five permanent Committees of 
the Board are:

Audit Committee
The Audit Committee assists the Board 
with its oversight responsibilities in 
relation to accounting policies and 
practices, tax matters, treasury reporting, 
monitoring of internal financial controls, 
internal and external audit functions and 
financial reporting of the Group.

People and Culture Committee
The People and Culture Committee 
assists the Board with its oversight 
responsibilities in relation to establishing 
people management, diversity and 
inclusion, talent and remuneration/
compensation policies for the Group.

Risk Committee
The Risk Committee assists the Board 
with its oversight responsibilities in 
relation to risk management and 
internal control systems, risk policies 
and practices and compliance. The 
Risk Committee also has the role 
of considering, and if approved, 
recommending to the Board for 
approval major transactions as referred 
to the Committee by the Global 
Investment Committee.

 
Governance

77

Attendance at Meetings of Directors 1 July 2021 to 30 June 2022
The number of Board and Board Committee meetings held, and the number of meetings attended by each Director during the 2022 
financial year, are set out in the tables below.

(MH) Number of meetings held. (MA) Number of meetings attended.

Membership

M J Ullmer

A P Lombardo

J S Hemstritch

N M Wakefield Evans

D P Craig

P M Coffey

E M Proust

R F Welanetz

N R Collishaw10

Board
 (Chair M J Ullmer)

MH3

MA

12

12

12

12

12

12

12

12

7

12

12

12

118

12

12

118

12

7

Board Subcommittee1

Nomination 
Committee2(Chair J 
S Hemstritch)

Audit Committee
 (Chair D P Craig)

MH

13

104

4

6

5

5

10

11

-

MA

13

10

4

6

5

5

10

11

-

MH

8

85

8

8

8

8

8

8

4

MA

MH

MA

8

8

8

8

8

8

8

8

4

4

46

4

4

4

37

29

29

111

4

4

4

4

4

3

2

2

1

1. These subcommittee meetings of the Board or its Committees were convened during the reporting period to address specific issues. Only the subcommittee members 

attended the relevant meeting.

2. Meetings are generally held in conjunction with a Board meeting.
3. Reflects the number of meetings held during the time the Director held office during the year. 3 out of 12 meetings were out of schedule Board teleconferences constituted to 

address specific issues.

4. A P Lombardo is not a member of the Subcommittee but as the Global CEO and Managing Director, has a standing invitation to all Committee and Subcommittee meetings, 

where deemed appropriate.

5. A P Lombardo is not a member of the Nomination Committee but as the Global CEO and Managing Director, has a standing invitation to the Committee.
6. A P Lombardo is not a member of the Audit Committee but as the Global CEO and Managing Director, has a standing invitation to the Committee.
7. Following a review of Committee composition, P M Coffey retired from the Committee from March 2022.
8. E M Proust and N M Wakefield Evans were unable to attend one of the three unscheduled Board teleconferences as these was called at short notice to address a 

specific issue.

9. E M Proust and R F Welanetz are not members of the Audit Committee but attend the meeting at the half and full year financial statements review.
10.N R Collishaw was appointed to the Board on 1 December 2021. The number of meetings attended reflects the number of meetings since Mr Collishaw's appointment.
11. Following a review of Committee composition, N R Collishaw was appointed to the Committee from March 2022

Membership

M J Ullmer

A P Lombardo

J S Hemstritch

N M Wakefield Evans

D P Craig

P M Coffey

E M Proust

R F Welanetz

N R Collishaw

Risk Committee
 (Chair P M Coffey)

Sustainability 
Committee(Chair N M 
Wakefield Evans)

People and Culture
 (Chair E M Proust)

MH

MA

MH

MA

MH

MA

7

71

7

7

7

7

7

7

3

7

7

7

7

7

7

7

7

3

4

42

-

4

-

16

4

4

-

4

4

-

4

-

1

4

4

-

6

63

54

35

6

54

6

6

17

6

6

5

3

6

5

6

6

1

1. A P Lombardo is not a member of the Risk Committee but as Global CEO and Managing Director, has a standing invitation.
2. A P Lombardo is not a member of the Committee but as the Global CEO and Managing Director, has a standing invitation to the Sustainability Committee.
3. A P Lombardo is not a member of the Committee but as Global CEO and Managing Director, has a standing invitation to the People & Culture Committee except during Non 

Executive Director sessions of the People & Culture Committee.

4. Following a review of Committee composition, P M Coffey and J S Hemstritch retired from the Committee from March 2022.
5. N M Wakefield Evans is not a member of the People & Culture Committee but attended to consider matters relevant to annual executive performance and remuneration.
6. Following a review of Committee composition, P M Coffey joined the Sustainability Committee in March 2022.
7. Following review of Committee composition, N R Collishaw was appointed to the Committee from March 2022.

78

Lendlease Annual Report 2022

Remuneration Report

Message from the Board
While the global operating environment 
has remained challenging, Lendlease 
made demonstrable and meaningful 
progress in resetting the company for 
long term success by delivering the first
phase of our five year Reset, Create, 
Thrive roadmap (see Performance and 
Outlook on page 56.

As part of Reset, the Board oversaw 
the decision to increase the transparency 
of financial and non-financial metrics, 
including expected return ranges 
for the core segments: Investments, 
Development and Construction. In 
addition, greater visibility has been 
provided on the Group’s contribution to 
environmental sustainability and social 
value creation. (see Sustainability on 
page 42.

Health and safety remain the 
organisation’s highest priority. Our people 
and contractors have the right to 
return home safely each day. We 
were deeply saddened by the fatality 
of a subcontractor on one of our 
projects in New York in an area under 
subcontractor management. We extend 
our condolences to the young man’s 
family and friends. 

Executive Reward Strategy
As outlined in the 2021 Remuneration 
Report, significant changes were made 
to the Executive Reward Strategy. We 
engaged with securityholders on the 
proposed changes, and subsequently 
received strong support at the 2021 AGM.

Key changes made to the Executive 
Reward Strategy:

• Removed the restricted securities plan 
to increase the remuneration portion 
subject to performance.

• Rebalanced the remuneration mix 

to address securityholder concerns 
over maximum Long Term Award 
(LTA) quantum.

• Implemented STA deferral to enable 

greater alignment of STA to 
securityholder return.

• Simplified and reduced the number 
of KPIs within the Short Term Award 
(STA) to focus on the measures that 
are most critical to business success 
over the long term.

• Introduced a threshold and maximum 
performance range, in addition to 
target for the STA to enable greater 
pay for performance alignment.

• Increased the financial performance 
weighting under the STA from 50% 
to 65% to maintain the weighting 

to financial performance post the 
rebalance of the remuneration mix.

• Simplified the communication of LTAs 
at maximum opportunity to enhance 
peer comparability on quantum.

25 years’ relevant international industry 
experience to the organisation. We thank 
former executives Johannes Dekker and 
Kylie Rampa for their contributions to 
the organisation.

Additionally, we welcomed Nicholas 
Collishaw to the Board and the People 
and Culture Committee. Philip Coffey 
and Jane Hemstritch rotated off the 
Committee during the year.

Looking ahead
As we move into the Create phase 
of our roadmap, the organisation is 
well positioned to deliver on targets 
for development completions and funds 
under management. We are also well 
progressed on our sustainability and 
broader social value targets. The incentive 
targets for next year will reflect this new 
stage of our strategic plan.

The Committee is focused on investing 
in our people in order to deliver 
for securityholders and customers and 
support the execution of our strategy.

We invite you to read the Remuneration 
Report which details the outcomes for 
KMP during the year.

M J Ullmer, AO

Chairman

Elizabeth Proust, AO

Chairman, People & Culture Committee

As well as embedding these changes, 
focus areas for the People & Culture 
Committee in FY22 included:

• Supporting improvements to the 

broader people agenda.

• Focusing on attracting and fostering 
exceptional talent, equitably and 
responsibly rewarding employees, and 
keeping people decisions central to 
business strategy.

• Enhancements to governance 

on remuneration frameworks via 
modernising the treatment of 
LTA awards in circumstances 
where participating executives 
cease employment.

FY22 outcomes and link to performance
Remuneration outcomes relating to the 
financial year were determined by 
business performance during Reset, 
while having regard to the difficult
operating conditions.

The decisive action we took during 
the year to reset the business strategy, 
simplifying the organisation structure, 
recalibrating the cost base, accelerating 
Development activity, and growing 
our investments platform has set 
the Group up for sustainable long 
term performance. Although financial
performance remains below our Portfolio 
Management Framework targets, it is 
consistent with expectations set for FY22.

Notwithstanding strong performance 
against scorecard KPIs and exceeding 
expectations on roadmap goals, the Board 
determined that a downward adjustment 
to STA outcomes should be made given 
the financial results anticipated in this 
year of strategic reset. 

Accordingly, as a result of the application 
of Board discretion, the STA outcome for 
the Group CEO was 48% of maximum, 
and for the other KMP ranged between 
55% and 61% of maximum STA.

There was no vesting of the 2020 
LTA given the relative TSR and ROE 
performance hurdles were not met.

We believe the remuneration outcomes 
for executives are appropriate, 
acknowledging the significant progress 
made on the five year roadmap.

Changes to KMP
Simon Dixon was appointed Group Chief 
Financial Officer, bringing more than 

 
 
 
Governance

79

FY22 Remuneration Snapshot76%of Global CEO  Total Maximum  Remuneration is  performance basedSimplified LTA vesting schedules(straight line vesting between Threshold  and Maximum)Leaver treatment for LTAs granted in FY23 onwards:LTA forfeited for any resignation  (both competitor and non-competitor) LTA prorated for time served for ‘good leavers’LTA changesSTA changes48%of Maximum  STA awarded to  Global CEO(KMP STA outcomes  range from 55% to 61% of  Maximum STA opportunity)FY22  Executive  Reward Strategy amended to balance  stakeholder views  and continue to support strategic prioritiesNil LTA awards vestedLong Term  Performance targets  (relative TSR and ROE)  failed to meet  challenging thresholdsTotal Maximum Remuneration opportunity reduced (compared to  the former CEO)LTA continues  to reflect the long  dated nature  of our business Simplification and  reduction of KPIsShifted KPI weightings  to 65% financial / 35% non financialThreshold and Maximum performance set in addition to Target50% of STA  deferred into equityRemoved the RSAincreasing the proportion  of performance based  reward80

Lendlease Annual Report 2022

Contents

KMPs covered by this report

Executive Reward Strategy

Alignment between Remuneration Outcomes and 
Securityholder Experience

Total Remuneration Realised

Fixed Remuneration

Short Term Award (STA)

Long Term Award (LTA)

Executive Service Agreements

Non Executive Director Fee Policy

Remuneration Governance and Risk Management

Other Statutory Disclosures

FY22 Executive Statutory Remuneration

FY22 Non Executive Director Statutory Remuneration

FY22 Executive Equity Holdings

Executive Equity Based Remuneration - Deferred Securities

Executive Equity Based Remuneration - Long Term Awards

FY22 Non Executive Director Equity Holdings

81

82

85

87

88

89

92

93

95

96

99

99

100

100

101

102

103

Abbreviations

AGM

CAGR

CIFR

CSAT

FUM

FY21

FY22

GDV

GLT

KMP

Annual General Meeting

Compound Annual Growth Rate

Critical Incident Frequency Rate

Customer Satisfaction

Funds Under Management

Financial year ending 30 June 2021

Financial year ending 30 June 2022

Google Development Ventures

Global Leadership Team

Key Management Personnel

LTA

LTI

ROE

RSA

RTSR

SBP

STA

STI

TPV

Long Term Award

Long Term Incentive

Return on Equity

Restricted Securities Award

Relative Total Shareholder Return

Security Based Payment

Short Term Award

Short Term Incentive

Total Package Value

VWAP

Volume Weighted Average Price

Governance

81

KMPs covered by this report

Current KMP

Name

Position

Term as KMP

People & 
Culture Committee

Non Executive KMP

Michael Ullmer

Philip Coffey

Independent Non Executive Chairman

Independent Non Executive Director

Nicholas Collishaw1

Independent Non Executive Director

David Craig

Jane Hemstritch

Elizabeth Proust

Independent Non Executive Director

Independent Non Executive Director

Independent Non Executive Director

Nicola Wakefield Evans

Independent Non Executive Director

Robert Welanetz

Executive KMP2

Anthony Lombardo

Dale Connor3

Simon Dixon4

Justin Gabbani

Denis Hickey

Frank Krile5

Neil Martin

Independent Non Executive Director

Global CEO

CEO, Australia

Group Chief Financial Officer

CEO, Asia

CEO, Americas and Global Chief Operating Officer

Group Chief Risk Officer

CEO, Europe

Full Year

Full Year

Part Year

Full Year

Full Year

Full Year

Full Year

Full Year

Full Year

Full Year

Part Year

Full Year

Full Year

Full Year

Full Year

X

X

X

Chair

X

1. Appointed 1 December 2021.
2. Whilst the Executive KMP are male, 30% of the Lendlease Global Leadership Team are female.
3. Dale Connor also held the position of Acting Managing Director of Investments for Australia in June 2022.
4. Appointed 1 October 2021.
5. Appointed to Group Chief Risk Officer from 1 July 2021. For the period from 1 July 2021 to 30 September 2021 Frank Krile also continued to hold the position of Acting Group 

Financial Officer.

Note: The term 'Executives' used throughout this Remuneration Report refers to the Executive KMP listed above, unless 
stated otherwise.

Former KMP
As part of the Lendlease organisational structure, effective from 1 July 2021, the following Executives ceased to be KMPs:

Name

Johannes Dekker

Kylie Rampa

Position

Group Head of Construction

CEO, Property Australia

David Andrew Wilson

Group Chief Commercial and Risk Officer

Date ceased to be KMP

30 June 2021

30 June 2021

30 June 2021

82

Lendlease Annual Report 2022

Executive Reward Strategy

In 2021, the Board undertook a holistic review of the Executive Reward 
Strategy to confirm the framework continues to reflect the Purpose and 
Strategy of the Group.

The review sought to enhance alignment of the reward structure and outcomes with shareholder interests and future strategic priorities. 
The 2022 Executive Reward Strategy continues to be informed by our Purpose, Strategy and Remuneration Principles.

Our Purpose
We create places where communities thrive.

Our Strategy
Employ our placemaking expertise and integrated business model in global gateway cities 
to deliver urban projects and investments that generate social, environmental and economic value.

Remuneration Principles
Remuneration at Lendlease should be:

Aligned with securityholder interestsTransparent and easy to communicateAligned with team behaviours and enterprise leadershipMarket competitive to retain highly capable executivesBalanced with a significant portion of remuneration at risk,  which is only earned for outstanding performanceLonger dated and aligned to our earnings profile,  reflecting the importance of urbanisation projectsRisk management focused with clear practices that minimise potential conflicts of interest and enable effective and aligned decision makingGovernance

83

Our Remuneration Framework

Purpose

Approach

Link to Performance

Governance

Fixed Remuneration

STA

LTA

To attract and retain highly 
capable Executives

To focus short term decision 
making on priority areas in the 
current financial year

To reward Executives for 
delivering sustained long term 
securityholder value

Quantum is benchmarked against 
relevant comparator companies to 
test market competitiveness

n/a

Annual opportunity to receive an 
incentive to focus performance 
on priority areas over the current 
financial year

Delivered as 50% cash and 50% 
deferred as Rights to receive 
Lendlease securities released in 
two equal tranches after one and 
two years

Current financial year 
performance, based on measures 
aligned to Lendlease’s focus areas 
of value creation:

• Financial (65%)

• Non-Financial (35%)

Annual grant of ‘at-risk’ equity 
to reward for delivering 
the Lendlease Strategy, in 
alignment with long term 
securityholder returns

Forward looking, three-
year performance:

•  Relative TSR (1/3)

•  Return on Equity (1/3)

•  Growth in Funds Under 
Management (1/3)

Award value linked to security 
price movements over three to 
six years

The People & Culture Committee and the Board review our remuneration principles and remuneration 
framework as well as determine the STA and LTA outcomes for Executive KMP, which remain subject 
to malus consideration. The Board retains the discretion to reduce or forfeit any unvested awards if it 
considers that vesting of such awards will result in the participant receiving a benefit that would be 
unwarranted or inappropriate. Additionally, the Global CEO LTA is submitted for securityholder approval at 
the AGM.

Executive Reward Strategy Structure
The following diagram illustrates the structure of the Executive Reward Strategy:

Fixed RemunerationYear 1Year 2Year 3Year 4Year 5Year 6STABase salary + Superannuation (where applicable).50 per cent Cash.  50 per cent Deferred Rights. Distribution equivalents  paid on vested awards only (in cash or via equity top up).Performance Rights. Distribution equivalents  paid on vested awards only  (in cash or via equity top up).End of deferral / performance periodLTA84

Lendlease Annual Report 2022

Maximum Remuneration Mix
Maximum remuneration mix for the Global CEO and Executives (excluding the Group Chief Risk Officer1) is as follows:

1The remuneration mix for the Group Chief Risk Officer is: 28% Fixed Remuneration, 31% Maximum STA and 41% Maximum LTA.

Adjustments were made to our Executive Reward Strategy from 1 July 2021 which included a rebalance of the 
remuneration mix and implementing STA deferral. We have retained features that reflect the long dated nature 
of the business, such as the LTA vesting over years 3 to 6 and delivering a significant proportion of remuneration 
in equity.
•

76 per cent of Total Maximum Remuneration is performance based.

•

59 per cent of Total Maximum Remuneration is delivered in deferred equity

Key Changes from FY21

Change

Rationale

Removal of RSA

Implementation of 
STA deferral

STA simplification

•

Increases proportion of remuneration subject to performance

• Maintains focus on building Executive securityholdings and alignment with securityholder experience

• Reduce number of measures in the STA to focus on the short term measures with the biggest impact on long 

term business success

Grant LTA at maximum • Reduces complexity and increases transparency in disclosures

• Aligned with market practice so easily comparable

Recalibrate LTA 
vesting schedule

Update LTA 
leaver provisions

Reset remuneration 
mix (increase STA, 
reduce LTA)

•

Straight line vesting between threshold and maximum increases simplicity

• The updates made for LTA granted from 2022 onwards to lapse unvested awards upon resignation (including 

non-competitor) and pro-rate unvested awards for good leavers are aligned with market practice

• Accounts for removal of RSA, and implementation of STA deferral
• Acknowledges securityholder concerns around LTA maximum quantum
•
• Maintains long dated nature of Executive Reward Strategy, relative to market peers

Increases proportion of remuneration subject to performance

Please refer to the FY21 Remuneration Report for details of the RSA (previously referred to as the LTA Minimum).

Performance Based24%33%Cash 16.5%Deferred 16.5%Fixed RemunerationMaximum STAMaximum LTAROE 14.3%FUM 14.3%Relative TSR 14.3%43%Governance

85

Alignment Between Remuneration Outcomes and Securityholder Experience

STA outcomes and securityholder experience
In the August 2021 Strategy Briefing1, the Global CEO set out the five year roadmap for delivering sustainable performance. The focus 
of FY22 was to reset the platform for delivery and growth. This involved deploying a more focused business model, optimising the 
Group operating structure and businesses, recalibrating the cost base, implementing the outcomes of the Development portfolio review 
and accelerating the conversion of the pipeline, and growing the Investments platform. A change was made to the approach to the 
structuring of Development joint ventures in order to improve the alignment of profit recognition with realised cash and the risk/reward 
profile. A consequence of this was to defer recognition of Development profits to later years, with a reduced OPAT expected in FY22, 
building back to our Portfolio Management Framework targets by FY24. The FY22 Operating Plan, which forms the basis for the FY22 
STA scorecard KPIs, was aligned to the strategy reset.

Key outcomes delivered in FY22 against the strategic roadmap are:

• Successful consolidation of the Australian businesses into an integrated unit

• Annualised cost savings in excess of the $160m target

• Record Development Work in Progress in the second half providing strong momentum as we enter FY23, on the pathway to 

delivering annual production in excess of $8bn by FY24

• Growth in the Investment platform ahead of plan

• Construction margin was at the bottom end of the target range.

In applying the discretion embedded in the Executive Reward Strategy, the Board had regard to these and other factors when assessing 
the appropriate balance between pay for performance in the form of STA and securityholder outcomes for FY22. More detail is given in 
the assessment of performance against the Global CEO STA scorecard set out on page 90.

1Refer to the ASX Announcement "Lendlease Strategy briefing" released on 30 August 2021.

Statutory Profit after Tax (PAT) Attributable to 
Securityholders ($m)

Core Operating Profit After Tax (PAT) 
Attributable to Securityholders ($m)

Total Dividends / Distributions ($m)

Statutory Earnings per Stapled Security (EPS) 
(cents) excluding treasury securities

Core Operating Earnings per Stapled Security 
(EPS) (cents)

Annual Total Securityholder Return (%)

Statutory Return on Equity (ROE) (%)1

Core Operating Return on Equity (ROE) (%)2

Closing Security Price as at 30 June ($)3

CEO STA outcome (% maximum opportunity)

Executive STA outcomes (% 
maximum opportunity)

FY18

792.8

708.1

399.6

137

121.4

24

12.7

11.3

19.74

67%

FY19

467

632

237

80

111.5

(33)

7.4

10.1

13.00

0%

FY20

(310)

206

191

(51.8)

34.2

(2)

(4.7)

3.1

12.37

23%

FY21

222

377

186

32.5

54.8

(6)

3.2

5.4

11.50

30%4

FY22

(99)

276

110

(14.4)

40.1

(19)

(1.4)

4.0

9.11

48%

43% - 93%

17% - 33%

17% - 27%

17% - 40%

55% - 61%

1. Statutory ROE is calculated as the annual Statutory Profit after Tax attributable to securityholders divided by the arithmetic average of beginning half year and year end 

securityholders' equity.

2. Core Operating ROE is calculated as annual Core Operating Profit after Tax attributable to securityholders divided by the arithmetic average of beginning half year and year 
end securityholders' equity. Core Operating ROE replaces Statutory ROE as an LTA hurdle from FY21 onwards as it better reflects the impact management have in creating 
value for securityholders.

3. FY18 reflects 29 June 2018 closing security price and FY19 reflects 28 June 2019 closing security price.
4. Reflects STA outcome for the Global CEO for the period 1 June 2021 to 30 June 2021. The STA outcome for the Former Group CEO was 0% for the period from 1 July 2020 to 

31 May 2021.

86

Lendlease Annual Report 2022

LTA outcomes and securityholder experience
The following chart shows LTI / LTA outcomes for the CEO relative to 3 year TSR and 3 year average ROE over time:

• Over the period from Sep-05 to Sep-19, 36% per cent of the aggregate value of LTI / LTA awards vested (outcomes range from 0 

per cent to 99 per cent)

• 4 of the 15 LTI / LTA awards were worth more than the grant value due to security price growth (Sep-10, Sep-11, Sep-12 and Sep-13)

• 6 of the 15 LTI / LTA awards were worth nothing when they were tested (Sep-05, Sep-06, Sep-07, Sep-17, Sep-18 and Sep-19).

1   The LTI / LTA grant value is the number of securities granted multiplied by the 1 September opening security price for the LTI / LTA 
grant year.

•

•

LTI / LTA outcomes have been aligned with the securityholder experience. Nil vesting for the last three years.

LTI / LTA outcomes reward steady and sustainable securityholder returns.

-0.500.51.01.52.02.53.03.54.03 YearROE-2%0%2%4%6%8%10%12%14%16%Sep05Sep06Sep07Sep08Sep09Sep10Sep11LTI / LTA Grant DateLTI / LTA value ($m)Sep12Sep13Sep14Sep15Sep16Sep17Sep18Sep19 Grant Value  Vest Value (excludes security price growth/decline) Security price growth /decline 3 Year TSR 3 Year ROE Nil vesting 
Governance

87

Total Remuneration Realised
The table below presents the remuneration paid to, or vested for, Executives in respect of FY22. A comparison to FY21 has not been 
provided due to significant change in KMPs and the FY22 Executive Reward Strategy.

A$’0001

Unhurdled

Hurdled

Name

Current Executives

Anthony Lombardo

Dale Connor

Simon Dixon2

Justin Gabbani

Denis Hickey

Frank Krile

Neil Martin

Fixed 
Remuneration

Previous 
years' RSA

Previous 
years' 
deferred 
securities 
vested

FY22 STA 
awarded

Previous 
years' LTI / 
LTA awards

Total 
Remuneration 
Realised

Awards 
forfeited or 
lapsed

1,800

1,200

750

814

1,528

1,000

1,224

321

321

-

-

321

-

201

-

-

-

72

-

-

-

1,200

1,013

638

692

1,176

680

1,000

0

0

-

-

0

-

0

3,321

2,534

1,388

1,578

3,025

1,681

2,425

(2,400)

(1,767)

(413)

(448)

(2,062)

(440)

(1,401)

1. Remuneration is reported in AUD based on the 12 month average historic foreign exchange rates for FY22 (rounded to two decimal places): SGD 0.98 (applied to Justin 

Gabbani), USD 0.72 (applied to Denis Hickey) and GBP 0.55 (applied to Neil Martin).

2. Fixed Remuneration and FY22 STA awarded for Simon Dixon reflects time as a KMP (1 October 2021 to 30 June 2022).

Definitions

Fixed Remuneration

Previous years' RSA and 
security price growth / decline

Includes the TPV / Base Salary plus superannuation (where applicable) received during FY22.

Includes the RSA that was granted in September 2019 and reached the end of the deferral period on 
30 June 2022. The value reflects the number of securities multiplied by the security price at the end 
of the deferral period. 25 per cent of this award value will be released in September 2022 and the 
remaining 75 per cent will be released in three equal tranches in September 2023, 2024 and 2025, 
subject to malus provisions.

Also includes the value of the distribution equivalent amounts paid as cash on the RSA.

Previous years' deferred 
securities vested

Includes deferred securities that are not subject to hurdles such as sign-on awards. The value reflects the 
number of securities that vested in FY21 multiplied by the grant price.

FY22 STA awarded

Previous years' LTI / 
LTA awards

Reflects the STA awarded in relation to FY22 performance. 50 per cent of the FY22 STA is paid as cash 
in September 2022 and 50 per cent is deferred as Rights that will be released in two equal tranches after 
one and two years.

Includes the 2020 LTA that reached the end of the performance period on 30 June 2022, vesting 
in September 2022. The value reflects the number of securities scheduled to vest multiplied by the 
grant price.

Awards forfeited or lapsed

The value reflects the maximum number of securities that were forfeited / lapsed in respect of FY22 
multiplied by the grant price plus the value of the forfeited portion of the maximum FY22 STA.

88

Lendlease Annual Report 2022

Fixed Remuneration
This section presents our approach to setting Fixed Remuneration.

No remuneration increases were applied in FY22 to Executive KMP.

Design

Quantum

How Fixed Remuneration Works

• No remuneration increases were applied in FY22 to Executive KMP.

• Quantum and remuneration mix are benchmarked to test that total remuneration remains 

market competitive.

• Annual review except in instance of role changes.

Benchmarking Approach

• Considers the relative size, scale and complexity of roles to enable a fair comparison.

• A target fixed and total remuneration position is established with reference to the market median and 

75th percentile.

• Aim to provide total remuneration towards the 75th percentile if outstanding performance 

is achieved.

• The People & Culture Committee typically uses a number of sources for benchmarking Global CEO 

and Executive remuneration including:
Publicly available data for similar roles in companies of a similar size, such as:

•
• Revenue Group: ASX listed companies with revenue of between 50 and 200 per cent of 

Lendlease’s revenue

• Market Capitalisation Group: ASX listed companies that are ranked between 26 and 75 by market 

•
•

capitalisation (excluding companies domiciled outside Australia)
Publicly available data for comparable roles at:
Property organisations in Australia such as Charter Hall Group, Dexus, Goodman Group, GPT Group, 
Mirvac Group, Scentre Group, Stockland and Vicinity Centres

• Companies where we compete for talent, such as Macquarie Group Limited and AMP Limited.
•

Published remuneration surveys, remuneration trends and other data sourced from 
external providers.

• To supplement the above information, we also consider the following three companies as 

comparators for Lendlease: Brambles Limited, British Land Company PLC and CapitaLand Limited. 
These companies were identified as part of a review that was undertaken during FY21 to determine 
which companies align with Lendlease based on quantitative comparisons against key metrics such 
as profit, market capitalisation and scale of operations as well as a qualitative overlay that considered 
the scope of business lines, employee base and operating environment.

Primary Sources of Data

Supplementary Peer Group

Governance

89

Short Term Award (STA)
This section presents the key features of the STA plan.

Maximum STA opportunity for FY22 has been increased (excluding the Global CEO) through a rebalance of the 
remuneration mix as part of adjustments to our Executive Reward Strategy:
• Removal of the RSA, which was not subject to performance based vesting hurdles.

•

Implementation of STA deferral, with 50 per cent deferred into Lendlease securities. The deferred portion will be 
released in two equal tranches after one and two years.

STA Design

Eligibility

Quantum

Funding

Key Performance Indicators

How the STA Works

• Global CEO and Executives

•

For FY22, target STA opportunity was as follows:

– Global CEO: 100% of Fixed Remuneration

– Executives (excluding Group Chief Risk Officer): 100% of Fixed Remuneration

– Group Chief Risk Officer: 80% of Fixed Remuneration

• The minimum possible STA outcome is zero

• The maximum STA outcome is limited to 139% of target STA opportunity for the Global CEO and 

140% of target STA opportunity for other Executives

• The Board determines the pool of funds to be made available to reward Executives, with reference to 

Group financial and non financial performance

• The Board examines safety performance and the overall health of the business (including a broader 

set of metrics around origination, sustainability and how we have managed risk)

• Global CEO and Executive scorecards, including:

– 65% Financial Performance (Group Operating Profit After Tax, Development - Completions, 

Construction - EBITDA margin, Investment Management - EBITDA margin)

– 35% Non Financial Performance (safety, sustainability, customer and people)

• Refer to page 90 for a summary of the FY22 Global CEO scorecard
•

Lendlease is committed to the safety and wellbeing of all of its employees. While the assessment is 
not structured formulaically or as a ‘gateway’ measure, poor health and safety outcomes may lead to 
a reduction in STA outcomes for the year

• The People & Culture Committee considers feedback from multiple sources to consider ‘how’ 

performance outcomes are achieved:

Delivery

•

•

– Executive input: Group Chief Financial Officer and Group Chief Risk Officer

– Board committees: the Audit Committee, Risk Committee, and Sustainability Committee

50% paid as cash in September following the assessment of performance

50% deferred as Rights to receive Lendlease securities released in two equal tranches after one and 
two years

90

Lendlease Annual Report 2022

Global CEO STA Scorecard
The following changes were made to the Global STA scorecard for FY22:

• the introduction of metricated KPIs with threshold and maximum performance set in addition to target

• simplification of KPIs and reduction in the number of KPIs

• shifting the KPI weightings to 65% financial KPIs / 35% non financial KPIs (previously 50% / 50%)

• 50% paid as cash and 50% deferred as Rights to receive Lendlease securities released in two equal tranches after one and two years

In FY22 the CEO and the executive team were able to establish an optimised structure and businesses, recalibrate the cost base, 
complete a portfolio review and implement a focused business model. This has set the business up in a better position than anticipated 
for the end of this financial year. The Board in assessing STA outcomes for the CEO and the executive team have given consideration 
to both financial outcomes and strategic progress. Actual performance of the business has either achieved or exceeded the earnings 
guidance provided for FY22.

KPI

Weighting

FY22 Result

Financials 
65%

Operating Profit After 
Tax ($m)

Development  – 
Completions ($b)

Construction – 
EBITDA margin (%)

Investments – 
Management EBITDA 
margin (%)

Safety – Critical 
Incident Frequency 
Rate (CIFR)

Sustainability - 
carbon emission 
(000's tonnes)

Non 
Financials 
35%

Sustainability - social 
value ($m created)

Customer Satisfaction 
(CSAT score)

People - Executive 
Engagement (%)

35%

10%

10%

10%

10%

5%

5%

5%

10%

OPAT of $276m reflects on-plan performance 
and is ahead of market consensus.

$2.5b result slightly below plan due to 
considerable impact of extreme unexpected 
weather events in Australia.

2.0% result is within range but at the lower 
end. Impacted by material revenue reduction 
across most regions, supply chain / inflation 
pressures, and provisions for legacy claims.

Ahead of plan and consensus performance.

FY22 CIFR result is the lowest recorded level 
to date.

Strong progress made on delivering long term 
goals, achieving carbon emissions of 98k 
tonnes well below the target of <210k tonnes.

$60m of social value created was a strong 
result against target range of >$50m.

Customer satisfaction of 7.9 improved 0.3 
points from FY21 and is above target levels 
following improved focus on the customer.

Executive engagement of 78% exceeds target, 
representing a significant 10 point increase 
from May 2021.

THRESHOLDMAXIMUMTHRESHOLDMAXIMUMTHRESHOLDMAXIMUMTHRESHOLDMAXIMUMTHRESHOLDMAXIMUMTHRESHOLDMAXIMUMTHRESHOLDMAXIMUMTHRESHOLDMAXIMUMTHRESHOLDMAXIMUMGovernance

91

Impact of Safety Incidents on FY22 STA Outcomes
We are deeply saddened by a fatal incident involving a subcontractor worker that occurred on one of our operations in FY22.

We go beyond regulatory reporting requirements and report all fatalities on our sites as we do not consider the lives of contractors, 
subcontractors, consultants and community members any different to our employees.

In line with the guiding principles for determining remuneration adjustments arising from safety incidents set out on page 97, the key 
factors considered by the Board when determining whether a remuneration adjustment should be made for the fatality that occurred 
during FY22 are:

• The project was established with a number of best practice initiatives and had performed safely prior to the 

fatal event.

4 Hudson Yards, 
New York, USA

• The Board is satisfied based on material from internal and independent external sources currently available 

that this incident is not a result of a failure of Lendlease supervision as the relevant area was under 
subcontractor management.

• The region met all other EHS metrics targets for FY22.

Based on the assessment of the above factors and materials available at the time, the Board has determined that no adjustments would 
be made to the FY22 STA outcome as a result of the fatality, noting that if new information emerges from external investigations, the 
Board can reduce future STA outcomes or apply a malus adjustment.

There are no material updates in relation to any ongoing investigations into past fatalities.

Adjusted Global CEO STA outcome

The Board assessed that the Global CEO had performed extremely strongly against his scorecard KPIs. The 
progress on the strategic reset is ahead of expectation, and strong momentum has been generated in the 
business in the second half. However, having regard to the overall financial result from the actions taken as part 
of the reset, in determining the final STA outcome, the Board have exercised discretion to reduce the outcome 
on both the financial and non-financial KPIs.
• A total downwards adjustment of 33% has been applied on the metricated scorecard outcome for the Global CEO.

• The final adjusted Global CEO STA outcome is 48% of maximum opportunity.

FY22 Short Term Performance Outcomes
The following table outlines the FY22 STA opportunity and outcomes for each Executive.

A$’0001

Current Executives

Anthony Lombardo

Dale Connor

Simon Dixon5

Justin Gabbani

Denis Hickey

Frank Krile

Neil Martin

Target STA 
opportunity

Maximum STA 
opportunity

Total STA 
awarded

STA awarded - 
cash2

STA awarded - 
deferred3

Total STA 
awarded as % 
of Maximum 
STA4

Total STA 
forfeited as % 
of Maximum 
STA4

1,800

1,200

750

814

1,528

800

1,224

2,500

1,680

1,050

1,140

2,139

1,120

1,713

1,200

1,013

638

692

1,176

680

1,000

600

507

319

346

588

340

500

600

506

319

346

588

340

500

48%

60%

61%

61%

55%

61%

58%

52%

40%

39%

39%

45%

39%

42%

1. Remuneration is reported in AUD based on the 12 month average historic foreign exchange rates for FY22 (rounded to two decimal places): SGD 0.98 (applied to Justin 

Gabbani), USD 0.72 (applied to Denis Hickey) and GBP 0.55 (applied to Neil Martin).

2. 50% of the FY22 STA is paid as cash in September 2022.
3. 50% of the FY22 STA is deferred as Rights that will be released in two equal tranches after one and two years.
4. Rounded to the nearest decimal place
5. The FY22 STA for Simon Dixon reflects time as a KMP (1 October 2021 to 30 June 2022).

92

Lendlease Annual Report 2022

Long Term Award (LTA)
This section presents the key features of the 2022 LTA (granted in September 2021).

From FY22, LTA awards are granted at maximum opportunity (rather than target). Accordingly, the vesting 
schedules have been recalibrated to reflect this change and a straight line vesting approach has been adopted 
for added simplicity.
• Maximum LTA quantum has been reduced in line with broader changes to the Executive remuneration mix.

LTA Design
Eligibility

Quantum

Delivery

Determining the 
Number of 
Performance Rights

Performance Period

Deferral

How the LTA Works

• Global CEO and Executives

•

The maximum face value of the 2022 LTA award granted in September 2021 is as follows:

– Global CEO: 178% of Fixed Remuneration

– Executives (excluding Group Chief Risk Officer): 180% of Fixed Remuneration

– Group Chief Risk Officer: 144% of Fixed Remuneration

•

•

•

•

•

•

•

•

Rights to acquire securities, subject to specific performance conditions and continued tenure

The number of performance rights is adjusted up or down at vesting based on performance over the 
assessment period

The award may be settled in cash or other means at the Board’s discretion

Face value - VWAP of stapled securities traded on the ASX over the 20 trading days prior to the release of the full year 
results preceding the grant date

Three years

Released in four equal tranches at the end of Y3, Y4, Y5 and Y6

The timeframe reflects a balance between reward that motivates Executives while reflecting the ‘long tail’ of 
profitability and risk associated with ‘today’s decisions’

The Board believes that these measures provide a suitable link to long term securityholder value creation.

• While the Board appreciates that there are, at times, differing views held by stakeholders, we believe that these 

measures provide the appropriate balance between market and non-market measures.

Market Measure

Non Market Measures

Relative Total 
Securityholder (RTSR) 
– 1/3
•

TSR incentivises 
Executives to deliver 
returns that 
outperform what a 
securityholder could 
achieve in the market 
and promotes 
management to 
maintain a strong 
focus on 
securityholder 
outcomes

•

•

TSR is measured 
by the growth in 
security price and any 
dividends/distributions 
paid during the 
performance period

TSR is measured 
against companies that 
comprise the Standard 
& Poor’s (S&P)/
Australian Securities 
Exchange (ASX) 
100 index

Rationale

Performance Hurdles

Definition

Target 
Setting

Average Operating Return on Equity (ROE) 
– 1/3

CAGR % in FUM – 1/3

• Operating ROE reflects the capital 

intensive nature of Lendlease’s activities 
and is an important long term measure 
of how well the management team 
generates acceptable earnings from 
capital invested and rewards decisions 
in respect of developing, managing, 
acquiring and disposing of assets

• Operating ROE is calculated as the 
Group’s Operating Profit After Tax 
divided by the arithmetic average 
of beginning, half and year end 
securityholders’ equity

Performance is based on the average 
Operating ROE results over the three 
year performance period

•

•

• CAGR % in FUM recognises 
the importance of growth 
in FUM to achieving our 
key strategic objective of 
increasing our Investments 
platform globally which 
will be achieved through 
our internal development 
pipeline, creating new 
products, using value-add 
strategies and through 
external market acquisitions

• CAGR % in FUM 

is calculated as the 
compounded annual growth 
rate of Lendlease’s 
funds under management 
over the three year 
performance period

Target is reviewed annually and is set 
with reference to the Group’s Portfolio 
Management Framework

•

Target is reviewed annually 
and is set with reference to 
the Group’s operating plan

• Operating ROE target aims to drive 

outperformance without incentivising 
excessive risk taking

•

•

The Board believes that the vesting 
range provides a realistic goal at the 
lower end (in the context of risk free 
rates of return, cost of capital and 
market consensus) and a stretch at the 
upper end

The Board is conscious of the impact 
that debt can have on the Operating 
ROE result and has governance 
protocols in place to monitor this

Governance

93

% of Maximum LTA

CAGR % in 
FUM

% of 
Maximum LTA

Nil

0%

Straight line vesting 
between 0% 
and 100%

Below threshold

At threshold

Between 
threshold and 
maximum

Nil

0%

Straight line 
vesting 
between 0% 
and 100%

100%

LTA Design

How the LTA Works

Vesting Schedule (as 
% of Maximum LTA)

RTSR 
Percentile 
Ranking
Below 50th

At the 50th

At or above 
the 50th and 
below the 
75th
75th or 
greater

% of Maximum LTA

Nil

40%

Average 
Operating ROE

Below threshold

At threshold

Straight line vesting 
between 40% and 100%

Between threshold 
and maximum

100%

At or 
above maximum

100%

At or above 
maximum

Retesting

Distribution

• No retesting.

•

If the performance hurdle is not met at the time of testing, the awards are forfeited

• Distributions are not paid, unless and until vesting conditions are met.

FY22 Long Term Performance Outcomes
The table below presents the performance and vesting outcomes for awards that were tested in FY22. The Board sets challenging LTA 
targets. The 2020 LTA was tested following the end of the financial year, resulting in nil vesting for FY22.

Performance 
Hurdle

Performance 
Outcome

Vesting 
Outcome

Overall Vesting 
Outcome (% 
Maximum LTA)

% Maximum 
LTA forfeited

0%

0%

0%

0%

LTA1

2020 LTA

2021 LTA

2022 LTA

Performance 
Period

1 July 2019 to 
30 June 2022

(3 years)

1 July 2020 to 
30 June 2023

(3 years)

1 July 2021 to 
30 June 2024

(3 years)

RTSR

Below Threshold

Below Threshold

ROE

RTSR

ROE

FUM

RTSR

ROE

FUM

Peformance period on going

1. Refer Note 35 of the Notes to Consolidated Financial Statements for details of LTI / LTA Awards granted in prior financial years.

As the ROE target is considered commercially sensitive, it is published following the end of the performance period.

The ROE target for the 2020 LTA was 10.5%.

Executive Service Agreements
An overview of key terms of employment for current Executives is provided below:

Contract Term

Contract type

Notice period 
by Lendlease

Notice period by executive

Global CEO

Permanent

12 months

12 months

Other Executives

Permanent

6 months

6 months

All Executives have termination benefits that are within the limit allowed by the Corporations Act 2001 without 
securityholder approval.  Specifically, in the case where the Executive is not employed for the full period of 
notice, a payment in lieu of notice may be made.

Treatment of unvested awards depends on the reason for termination:

Termination Payment

• Terminated for cause: Awards lapse.

• Terminated for poor performance: Board discretion.

• Resignation (engaged in activities that are competitive with the Group): Awards lapse.

•

‘Good leavers’:  Awards remain on foot subject to the original vesting conditions. LTA granted from FY23 
onwards are prorated for good leavers based on time served.

94

Lendlease Annual Report 2022

New Executive Appointments in FY22

Frank Krile
Frank Krile was appointed to the Group Chief Risk Officer role from 1 July 2021. Frank’s Maximum Total Remuneration was set in line 
with the FY22 Executive Remuneration Strategy approach and is as follows:

A$’000

Fixed remuneration

Maximum STA

Maximum LTA

Maximum 
total remuneration

1,000

1,120

1,440

3,560

The remuneration mix for the Group Chief Risk Officer has been structured differently to other Executives, with a lower proportion of 
STA and LTA, to support the independence of this role.

Simon Dixon
Simon Dixon was appointed to the Group Chief Financial Officer role from 1 October 2021. Simon’s Maximum Total Remuneration was 
set in line with the FY22 Executive Remuneration Strategy approach and is as follows:

A$’000

Fixed remuneration

Maximum STA

Maximum LTA

Maximum 
total remuneration

1,000

1,400

1,800

4,200

Simon was also issued a sign-on award in recognition of the unvested awards forfeited upon resignation from his previous employer. 
The details of the sign-on award are as follows:

A$’000

Value

100

200

300

Delivered as

Cash

Deferred securities

Vesting date

September 2022

September 2022

The sign-on award is subject to continued employment and malus consideration. The Board retains the discretion to reduce or 
forfeit the sign-on award if it considers that vesting will result in the participant receiving a benefit that would be unwarranted 
or inappropriate.

Bespoke Incentive Award

Denis Hickey
Denis Hickey has been issued a one–off incentive aligning to the successful delivery of Google Development Ventures (GDV) over the 
next three years, recognising the criticality of this project.

The Bespoke Incentive reflects a $5,000,000 grant in Performance Rights over a three year performance period from 1 July 2021 to 
30 June 2024.

• 70% of Performance Rights will vest based on the achievement of the key milestones for GDV during the performance period, 

including the securing of entitlements and capital plans and the commencement of construction for each project.

• 30% of Performance Rights will vest based on customer satisfaction feedback from the client and internal stakeholders at key 

touchpoints in the project life cycle, so that GDV milestones are not only delivered within the required timeframes but also to an 
exceptional standard.

• There is no retesting on any portion of the Bespoke Incentive that does not vest.

The Board retains an overarching discretion to reduce or forfeit any unvested awards if it considers that the vesting of the awards would 
result in receipt of a benefit that was unwarranted or inappropriate.

Performance Rights do not carry dividend rights.

For full details of the key terms of the incentive, refer to the Appendix 3G lodged with the ASX on 1 April 2022.

Governance

95

Non Executive Director Fee Policy

Non Executive Directors’ fees
The maximum aggregate remuneration payable to Non Executive Directors is $3.5 million per year, as approved at the 2015 Annual 
General Meeting.

Board and Committee Fees
Non Executive Directors receive a Board fee and fees for chairing or participating on Board committees:

A$’000

Chair Fee

Member Fee

Board

6401

160

Nominations 
Committee

People & Culture 
Committee

Risk Committee Audit Committee

36

Nil

48

36

48

Nil

48

36

Sustainability 
Committee

48

36

1. The Chairman does not receive extra fees for participating on committees

Board and committee fees are paid as cash. Superannuation contributions are paid in addition to the Board and committee fees outlined 
above in accordance with superannuation legislation and are capped at the Maximum Superannuation Contribution Base.

Non Executive Directors are not entitled to retirement benefits other than superannuation.

There were no increases to Non Executive Director fees during FY22.

Travel Fees
Board meetings are scheduled in Australia and in each of the regions where Lendlease operates. As an international company, the Board 
program is formulated to reflect the geographic spread of the Lendlease businesses. Generally, the program runs over three to five days 
and includes a number of activities outside the formal meeting. These include business briefings, presentations from external sources, 
project site visits, client meetings, and networking events with employees and key stakeholders. Where deeper project reviews are 
required, the program may take up to five days.

The program is an important element of the Board’s activities to enable the Non Executive Directors to obtain the required deep 
understanding of operations across the Group.

Where significant additional time has been spent travelling to fulfil the requirements of the program, fees are paid to compensate Non 
Executive Directors for the extra time commitment:

A$

Travel less than 4 hours

Travel between 4 and 10 hours

Travel over 10 hours

Fee (each way)

Nil

2,800

6,000

96

Lendlease Annual Report 2022

Remuneration Governance and Risk Management

Robust governance is a critical part of Lendlease’s approach to executive remuneration. The diagram below illustrates the roles various 
stakeholders play in making remuneration decisions at Lendlease:

Independent  Remuneration AdvisorThe Board and People & Culture Committee engage external consultants to provide advice or information. Their input is used to guide Board and Committee decisionsDuring the year, advisors did not provide a remuneration recommendation as defined in Section 9B of the Corporations  Act 2001The Board is satisfied that any advice provided by EY was made free from undue influence from any of the KMP given the structure of the engagementManagementThe Global CEO recommends Fixed Remuneration and STA outcomes for his direct reports (for approval by the People & Culture Committee)The Group Chief Financial Officer and Group Chief Risk Officer present on the ‘Health of the Business’ when the Committee is considering STA outcomesRecommends potential approaches for developing and implementing the Executive Reward Strategy and structureProvides information relevant to remuneration decisions and, if appropriate liaises with advisors to provide factual information relating to company processes, practices and other business issues; and provide management’s perspectivesAudit CommitteeAssists in setting and assessing financial targets for remuneration purposesAssesses and advises of any audit matters which may impact remuneration outcomesThe Chair of the Audit Committee is a member of the People & Culture Committee    Risk CommitteeAdvises of risk issues and/or conduct matters to assist in determining an appropriate Risk adjustment for STA outcomesThe Chair of the Risk Committee is a member of the People & Culture Committee   Sustainability CommitteeAssists in setting and assessing Safety/Sustainability related Key Performance Indicators People & Culture Committee Assists in establishing appropriate policies for people management and Reviews and recommends the goals, performance and remuneration of Undertakes a holistic assessment of annual performance when determining  STA outcomes, including input from other Committees and ManagementRegularly considers matters outside of remuneration – including organisational culture, talent development and succession, and feedback from employees through Our People SurveyBoardThe Board has overall responsibility for Executive and Non Executive Director remuneration at LendleaseThe Board assesses the performance of and determines the remuneration outcomes for the Global CEORisk management and governance processes apply across remuneration timelines, aligned with our business cycle. We have short term, 
long term and ongoing mechanisms:

Governance

97

Overall Board Discretion • The Board makes, reviews and approves decisions concerning executive remuneration throughout the 
year. The Board, uses its discretion to influence individual outcomes or to steer management towards 
appropriate outcomes.

Malus

• The Board retains an overarching discretion to reduce or forfeit any unvested awards (during the deferral 

Guiding principles 
for determining 
remuneration 
adjustments arising 
from safety incidents

period beyond the performance testing period) if it considers that vesting of such awards would result in the 
participant receiving a benefit that was unwarranted or inappropriate.

• To inform robust decision making in relation to remuneration adjustments arising from safety incidents, the 
Board formalised a set of guiding principles and relevant factors during the year. The key guiding principles 
are as follows:

– Our objective is to learn from incidents and to reinforce an open dialogue and safety culture. Our people 
must have confidence that sharing safety related information supports this objective and helps to identify 
how we will adapt in the future.

– As the facts and circumstances surrounding each incident are unique, decision making is not prescriptive or 

formulaic and requires the application of judgement.

– To facilitate a consistent approach to decision making, rather than the application of a consistent outcome, 
the following set of relevant factors are used by the Board to evaluate the application of any remuneration 
adjustments to be made arising from safety incidents:

Safety Leadership

Safety Performance

Findings

Availability of new information

How is safety leadership demonstrated in the relevant 
business / project?

How has the relevant business / project performed against safety 
performance indicators?

In the event of a fatality, what was Lendlease's role based on 
internal investigations?

As events unfold over time, has new and pertinent information 
emerged from external investigations?

Change of Control

• The early vesting of any unvested awards may be permitted by the Board in other limited circumstances 
such as a change in control of Lendlease. In these circumstances the Board will determine the timing and 
proportion of any unvested awards that vest.

Year 1Year 2Year 3Year 4Year 5Year 6Long term• Long dated performance periods (up to 3 years)• Significant portion of remuneration delivered in equity• Remuneration deferral (up to 6 years)Short term• Significant portion of annual opportunity at risk and subject to performance• Holistic assessment of annual performance• Input from Risk committeeOngoing• Board discretion• Malus• Guiding principles (remuneration adjustments arising from safety incidents)See below for details of ongoing Risk Management and Governance Mechanisms• Change of control• Mandatory securityholding• Securities trading policy• Hedging• Independent advisor governance protocols98

Lendlease Annual Report 2022

Mandatory 
Securityholding

• The Global CEO and Executives are required to accumulate and maintain a significant personal investment 
in Lendlease securities. This policy encourages Executives to consider long term securityholder value when 
making decisions.

What is the Mandatory Securityholding requirement?

Mandatory Securityholding Requirement

Global CEO

Executives (Australia)

150% of TPV

100% of TPV

Executives (International)

100% of Base Salary

What is counted towards the Mandatory Securityholding requirement?

Included

Excluded

Personally held securities

Unvested Deferred STI / STA

On foot RSA

Unvested LTI / LTA

• Until the Mandatory Securityholding requirement is reached, 50 per cent of any vested equity awards 

(Deferred STI, Deferred STA, RSA, LTI or LTA) will be subject to a disposal restriction (for Executives based 
in Australia).

•

•

Executives based outside of Australia are required to achieve the Mandatory Securityholding requirement 
within six years of their appointment to a KMP role.

Progress toward the minimum requirement is outlined in the Executive Equity Holdings table on page 100.

Securities Trading Policy • The Lendlease Securities Trading Policy applies to all employees of the Lendlease Group. In accordance with 

the policy, Directors and Executives may only deal in Lendlease securities during designated periods.

Hedging

• Directors and Executives must not enter into transactions or arrangements that operate to limit the economic 

risk of unvested entitlements to Lendlease securities. No Director or Executive may enter into a margin loan 
arrangement in respect of unvested Lendlease securities.

• Deferred STI, Deferred STA, RSA, LTI and LTA awards are subject to the Securities Trading Policy, which 

prohibits Executives from entering into any type of ‘protection arrangements’ (including hedging, derivatives 
and warrants) in respect of those awards before vesting.

Independent Advisor 
Governance Protocols

•

Strict governance protocols are observed to so that advisors’ advice to the Committee is made free from 
undue influence by Executive KMP:

– Advisors are engaged by, and report directly to, the Chair of the People & Culture Committee

– The agreement for the provision of any remuneration consulting services is executed by the Chair of the 

People & Culture Committee on behalf of the Board

– Any reports delivered by advisors were provided directly to the Chair of the People & Culture 

Committee; and

– Advisors are permitted, where approved by the People & Culture Committee Chair, to speak to 
management to understand company processes, practices and other business issues and obtain 
management’s perspectives.

Governance

99

Other Statutory Disclosures

FY22 Executive Statutory Remuneration

A$’0001

Short term benefits

Post-
employment 
benefits

Security Based 
Payments2

Cash 
salary3

STA 
cash4

Non 
monetary 
benefits5

Super-
annuation6

Other 
long 
term 
benefits7

Sub-
Total LTI/LTA

Deferred 
STI

Termi-
nation
benefits

Name

Current Executives

Anthony Lombardo

Dale Connor

Simon Dixon8

Justin Gabbani

Denis Hickey

Frank Krile

Neil Martin

Former Executives

Stephen McCann9,10

Johannes Dekker11

Tarun Gupta12

Kylie Rampa13

David 
Andrew Wilson14,10

Total

Year

2022

2021

2022

2022

2022

2021

2022

2021

2022

2021

2022

2021

2021

2021

2021

2021

1,867

1,294

1,181

732

814

67

1,533

1,434

976

542

1,334

1,283

1,941

1,170

1,040

1,154

600

244

507

319

346

10

588

368

340

94

500

164

0

150

n/a

125

175

2021

1,199

2022

8,438

3,200

2021

11,124

1,330

156

362

5

26

74

4

247

197

-

16

38

25

58

279

80

27

71

546

1,119

29

5

29

18

-

-

-

-

26

14

-

-

25

9

20

22

22

102

117

2,681

1,934

1,740

1,109

1,234

81

1,109

334

986

307

282

9

2,368

2,058

1,999

1,358

673

1,872

1,472

359

271

74

822

532

39

116

43

160

188

23

63

190

253

223

111

317

-

-

-

-

-

-

-

-

-

-

-

-

2,057

5,733

420

1,900

29

29

19

12

-

-

-

-

16

7

-

-

33

20

18

19

1,628

1,662

1,158

(1,476)

1,347

376

-

1,467

3,890

101

-

94

175

77

12,363

5,835

856

-

-

-

-

-

126

13,816 11,493

1,659

1,900

28,868

Total

3,829

2,384

2,769

1,576

1,704

113

4,489

2,548

1,882

970

2,805

2,321

10,110

3,391

(318)

1,817

5,532

19,055

1. 2022 remuneration is reported in AUD based on the 12 month average historic foreign exchange rates for FY22 (rounded to two decimal places): SGD 0.98 (applied to Justin 
Gabbani), USD 0.72 (applied to Denis Hickey) and GBP 0.55 (applied to Neil Martin). 2021 remuneration is reported in AUD based on the 12 month average historic foreign 
exchange rates for FY21 (rounded to two decimal places): SGD 1.00 (applied to Justin Gabbani), USD 0.75 (applied to Denis Hickey) and GBP 0.55 (applied to Neil Martin).
2. Security based payments reflect the accounting expense on a fair value basis. For all Executives other than Neil Martin, security based payments are issued as indeterminate 
rights and performance rights. For Neil Martin, Deferred STI (including his Executive Deferred Award) is issued as securities. LTI/LTA includes the accounting expense for the 
RSA. For Denis Hickey, this also includes the accounting expense for his bespoke incentive award relating to the successful delivery of GDV over the next three years.

3. Includes the payment of cash allowances such as motor vehicle allowance and the value of the distriibution amounts paid as cash on the RSA. For Neil Martin this also includes 

cash allowances paid in lieu of pension contributions.

4. Reflects 50 per cent of the FY22 STA that is paid as cash in September 2022.
5. Non monetary benefits may include items such as car parking, relocation and expatriate benefits (such as house rental, health insurance, shipping of goods and tax return 

preparation), motor vehicle costs, travel benefits and annual leave.

6. Superannuation includes the value of insurance premiums funded by Lendlease for Australian Executives who are members of the Lendlease default superannuation fund.
7. Other Long Term Benefits represents the accrual of long term leave entitlements (e.g. long service leave).
8. Simon Dixon was appointed to the Group Chief Financial Officer role on 1 October 2021 and remuneration reflects time as a KMP.
9. Stephen McCann retired from the Group CEO role on 31 May 2021 and remuneration reflects time as a KMP.
10.As a ‘Good Leaver’, unvested LTI, LTA and Deferred STI awards remain on foot and subject to the original vesting conditions. The security based payment accounting expense 
for FY21 therefore includes up to three years of each unvested award expense that has been accelerated and disclosed in total for FY21, including those amounts which would 
otherwise have been included in future year disclosures. All unvested equity awards that remain on foot following retirement are still subject to the original performance 
conditions and will be tested at the relevant testing date. Depending on performance, these awards may have nil value. To the extent these awards do not vest when tested, 
the accounting expense that has been previously booked will be reversed.

11. Johannes Dekker ceased as a KMP on 30 June 2021 and remuneration reflects time as a KMP.
12.Tarun Gupta resigned effective 29 November 2020 and remuneration reflects time as a KMP. All unvested equity awards were forfeited upon resignation. Additionally, Tarun 

was not eligible for an STA award in FY21.

13.Kylie Rampa ceased as a KMP on 30 June 2021 and remuneration reflects time as a KMP.
14.David Andrew Wilson ceased as a KMP on 30 June 2021 and remuneration reflects time as a KMP.

100

Lendlease Annual Report 2022

FY22 Non Executive Director Statutory Remuneration

Name

Year

Base fees1

Short term benefits

Committee 
chair fees

Committee 
membership 
fees

Post-employment 
benefits

Travel fees2

Superannuation3

Total

Current Non Executive Directors

Michael Ullmer4

Philip Coffey

Nicholas Collishaw5

David Craig

Jane Hemstritch

Elizabeth Proust6

Nicola Wakefield Evans

Robert Welanetz

Former Non Executive Directors

Colin Carter7

Margaret Ford8

Total

2022

2021

2022

2021

2022

2022

2021

2022

2021

2022

2021

2022

2021

2022

2021

2021

2021

2022

2021

512

619

160

155

93

160

155

160

155

160

160

160

160

160

155

61

21

1,565

1,641

-

-

48

48

-

48

48

36

21

48

48

48

48

-

-

15

-

228

228

-

-

60

72

24

36

36

60

72

36

36

36

36

72

72

30

12

324

366

6

-

-

-

6

6

-

6

-

6

-

6

-

36

-

-

-

72

-

24

22

24

22

12

24

22

24

22

24

16

24

22

24

22

9

4

180

161

542

641

292

297

135

274

261

286

270

274

260

274

266

292

249

115

37

2,369

2,396

1. For the 2021 financial year, from 1 July 2020 until 31 August 2020, Non Executive Directors were able to elect to temporarily reduce their base fees up to 20 per cent.
2. No travel fees were payable during the 2021 financial year as a result of the global travel restrictions in place in response to COVID-19.
3. Directors have superannuation contributions paid on their behalf in accordance with superannuation legislation.
4. To reflect accountability in the 2021 financial year for further provisions relating to the legacy Engineering business and the business review preliminary findings that were 

announced in relation to the Development portfolio, on behalf of the Board, the Chairman took a 20 per cent reduction in base fees for the 2022 financial year.

5. Appointed 1 December 2021.
6. For the 2021 financial year, Elizabeth Proust requested and was issued an SG shortfall exemption certificate for the last quarter. This means that for the period from 1 April 2021 
to 30 June 2021 that Lendlease was exempt from making superannuation contributions on behalf of Elizabeth Proust. A cash payment was made in lieu of the superannuation 
contributions that would have ordinarily been payable.

7. Colin Carter ceased to be a Non Executive Director on 20 November 2020.
8. Baroness Margaret Ford was appointed as a Non Executive Director on 1 March 2020 and ceased to be a Non Executive Director on 18 August 2020.

FY22 Executive Equity Holdings

Number of 
securities 
required 
under the 
mandatory 
securityholding 
at period end1

Securities 
held at 
beginning of 
financial year

Securities 
received 
during the 
financial year2

Other net 
changes to 
securities

Securities 
held at end of 
financial year

Total 
securities / 
performance 
rights that 
may count 
towards the 
mandatory 
securityholding 
requirement

RSA3

219,000

97,000

81,000

66,000

60,000

77,000

102,000

0

23598

n/a

0

25,989

420,852

0

470,439

9,764

10746

-

14,010

6120

12,537

4,211

57,388

-

-

-

-

(6,120)

-

-

(6,120)

9,764

34,344

0

14,010

25,989

433,389

4211

521,707

96,596

89,834

n/a

n/a

96,596

n/a

65,536

348,562

106,360

124,178

0

14,010

122,585

433,389

69,747

870,269

Name

Current Executives

Anthony Lombardo

Dale Connor

Simon Dixon4

Justin Gabbani

Denis Hickey

Frank Krile

Neil Martin

Total

1. Mandatory securityholding requirements are reviewed in August each year.
2. For Executives, securities received relate to security entitlements under employee benefit vehicles.
3. Under the RSA (LTA Minimum), performance rights will vest over a period of up to six years. This number of performance rights counts towards mandatory 

securityholding requirements.

4. Simon Dixon was appointed to the Group Chief Financial Officer role on 1 October 2021.

Executive Equity Based Remuneration – Deferred Securities

Name

Plan

Current Executives

Performance 

Year Grant date

Vesting 
date

Number 
granted

Governance

101

Fair value 
per 
security $1

Total fair 
value at 
grant date 
$1

Expense for 
the year 
ended 
30 June 
2022 $

Anthony Lombardo Deferred Equity Award

2020

Sept 2020

Sept 2022

Dale Connor

Deferred Equity Award

2020

Sept 2020

Sept 2022

Total

Simon Dixon

Sign-On Award

n/a

Nov 2021

Sept 2022

Total

Justin Gabbani

Total

Executive 
Deferred Award

2019

Sept 2019

Sept 2022

Deferred Equity Award

2020

Sept 2020

Sept 2022

Deferred STA

2021

Sept 2021

Sept 
2022-2023

Total

Denis Hickey

Deferred Equity Award

2020

Sept 2020

Sept 2022

6,364

6,364

6,988

6,988

16,889

16,889

8,807

8,059

12.16

12.16

77,412

77,412

85,002

85,002

11.84

199,966

199,966

38,706

38,706

42,501

42,501

159,973

159,973

16.86

148,486

49,495

12.16

98,030

49,015

10,102

11.84

119,608

89,706

26,968

10,388

10,388

12.16

366,124

126,360

126,360

188,216

63,180

63,180

Frank Krile

Total

Executive 
Deferred Award

2019

Sept 2019

Sept 2022

9,887

16.86

166,695

55,565

Deferred Equity Award

2020

Sept 2020

Sept 2022

12,537

12.16

152,500

76,250

Deferred STA

2021

Sept 2021

Sept 
2022-2023

13,606

11.84

161,096

120,822

36,030

480,291

252,637

2019

Sept 2019

Sept 2022

11,329

16.86

191,007

63,669

Neil Martin

Total

Executive 
Deferred Award

Deferred Equity Award

2020

Sept 2020

Sept 2022

Total

7,770

19,099

12.16

94,514

285,521

47,257

110,926

1. The fair value at grant date is the value of the Deferred STI award (as advised to the executive).

102

Lendlease Annual Report 2022

Executive Equity Based Remuneration – Long Term Awards

Name

Current Executives

Plan (for the 
year ended)

Grant Date

Vesting date

Number 
granted1

Fair value per 
security $2

Total fair 
value at 
grant date $2

Expense for 
the year 
ended 
30 June 2022 
$

Anthony Lombardo

June 2018 LTI (50%)

Sept 2017

Sept 2021

June 2019 LTA

June 2020 LTA

June 2021 LTA

June 2021 LTA 
Prorata CEO

June 2021 RSA

June 2022 LTA

Total

Nov 2018

Sept 2021-2024

Sept 2019

Sept 2022-2025

Sept 2020

Sept 2023-2026

Sept 2020

Sept 2023-2026

5,124

Sept 2020

Sept 2023-2026

Nov 2021

Sept 2024-2027

24,034

76,936

111,120

96,432

43,832

265,416

622,894

13,082

48,088

111,120

96,432

43,832

179,160

491,714

149,304

149,304

11,902

119,532

131,434

21,904

76,936

111,120

96,432

43,832

469,572

224,076

1,043,872

26,031

119,436

145,467

69,448

96,432

43,832

187,980

397,692

13.23

11.49

22.08

12.92

12.92

11.41

8.42

13.23

11.49

22.08

12.92

11.41

10.40

10.40

12.16

10.40

13.23

11.49

22.08

12.92

11.41

10.65

10.40

10.15

10.40

22.08

12.92

11.41

10.40

317,970

883,996

2,453,528

1,245,900

6,622

105,556

298,985

129,672

66,204

6,890

500,124

2,234,804

7,702,526

173,075

552,532

2,453,528

1,245,900

500,124

1,863,264

6,788,423

1,552,760

1,552,760

144,728

1,243,132

1,387,860

289,790

883,996

2,453,528

1,245,900

500,124

5,000,942

2,330,392

118,752

442,304

1,108,781

3,604

65,977

298,985

129,672

118,752

368,772

985,762

307,316

307,316

36,182

246,036

282,218

6,035

105,556

298,985

129,672

118,752

937,500

461,224

12,704,672

2,057,724

266,955

1,242,136

1,509,091

1,533,412

1,245,900

500,124

1,954,992

5,234,428

25,337

245,840

271,177

186,859

129,672

118,752

386,924

822,207

Dale Connor

June 2018 LTI (50%)

Sept 2017

Sept 2021

June 2019 LTA

June 2020 LTA

June 2021 LTA

June 2021 RSA

June 2022 LTA

Total

Nov 2018

Sept 2021-2024

Sept 2019

Sept 2022-2025

Sept 2020

Sept 2023-2026

Sept 2020

Sept 2023-2026

Sept 2021

Sept 2024-2027

Simon Dixon

June 2022 LTA

Sept 2021

Sept 2024-2027

Total

Justin Gabbani

Retention Award

Sept 2020

Sept 2021-2022

June 2022 LTA

Sept 2021

Sept 2024-2027

Denis Hickey

June 2018 LTI (50%)

Sept 2017

Sept 2021

Total

June 2019 LTA

June 2020 LTA

June 2021 LTA

June 2021 RSA

Nov 2018

Sept 2021-2024

Sept 2019

Sept 2022-2025

Sept 2020

Sept 2023-2026

Sept 2020

Sept 2023-2026

Bespoke Incentive3

Jan 2022

Sept 2024

June 2022 LTA

Sept 2021

Sept 2024-2027

Total

June 2021 LTA

June 2022 LTA

Total

June 2020 LTA

June 2021 LTA

June 2021 RSA

June 2022 LTA

Total

Sept 2020

Sept 2023-2026

Sept 2021

Sept 2024-2027

Sept 2019

Sept 2022-2025

Sept 2020

Sept 2023-2026

Sept 2020

Sept 2023-2026

Sept 2021

Sept 2024-2027

Frank Krile

Neil Martin

1. For LTA awards granted from September 2021 and for LTI and other long term awards, the number granted reflects maximum opportunity. For all prior awards, the number 

granted reflects target opportunity.

2. The fair value at grant date represents an actuarial valuation of the award, including the RSA (LTA Minimum), using assumptions underlying the Black-Scholes methodology to 

produce a Monte-Carlo simulation model in accordance with Australian Accounting Standards rounded to two decimal places.

3. Denis Hickey received a bespoke incentive award relating to the successful delivery of GDV over the next three years. Refer to 'Bespoke Incentive Award' section above for 

further detail.

FY22 Non Executive Director Equity Holdings

Name

Non Executive Directors

Michael Ullmer

Philip Coffey

Nicholas Collishaw1

David Craig

Jane Hemstritch

Elizabeth Proust2

Nicola Wakefield Evans

Robert Welanetz

Total

Governance

103

Securities held 
at beginning of 
financial year

Other net changes 
to securities

Securities held at end of 
financial year

125,000

21,216

N/A

73,061

33,061

68,061

34,379

7,000

361,778

-

-

14,500

-

-

-

-

-

14,500

125,000

21,216

14,500

73,061

33,061

68,061

34,379

7,000

376,278

1. As Nicholas Collishaw was appointed as a Non Executive Director on 1 December 2021 a nil balance is shown at the beginning of the financial year.
2. As at 30 June 2022 Elizabeth Proust also holds $500,000 of green bonds.

Purchase of Lendlease securities by Non Executive Directors
The current Non Executive Directors acquired Lendlease securities using their own funds.

Loans to KMP
No loans were made to KMP or their related parties during the current year or prior year.

Other transactions with KMP
From time to time, Directors and Executives of Lendlease or its consolidated entities, or parties related to them, may purchase 
goods from the Consolidated Entity. These purchases are on terms and conditions no more favourable that those entered into by 
unrelated customers.

104

Lendlease Annual Report 2022

Directors’ Report

The Directors’ Report for the financial year ended 30 June 2022 has been prepared in accordance with the requirements of the 
Corporations Act 2001.

The information below forms part of the Directors’ Report:

• Principal activities on page 12

• Operating and Financial Review on pages 4 to 63 incorporating the Performance and Outlook on pages 56 to 63

• Biographical information for the Directors and Company Secretary on pages 66 to 70

• Officers who were previously partners of the audit firm on page 66

• Directors’ interests in capital on page 76

• Board and committee meetings and attendance on pages 76 and 77

• Remuneration Report on pages 78 to 103

• Lead Auditor’s Independence Declaration on page 106

a. Dividends/Distributions
The 2021 final dividend/distribution of $83 million (12.0 cents per security, unfranked) referred to in the Directors’ Report dated 
16 August 2021 was paid on 15 September 2021. Details of dividends/distributions in respect of the current year are as follows:

Interim distribution of 5.0 cents per security (unfranked) paid on 16 March 20221

Final dividends/distributions of 11.0 cents per security (unfranked) declared by Directors to be payable on 21 September 20222

Total dividends/distributions

$m

35

75

110

1. Comprised of an unfranked trust distribution of 5.0 cents per unit paid by Lendlease Trust.
2. Comprised of a dividend component franked to 75 per cent of 5.7 cents per share to be paid by the Company and an unfranked trust distribution of 5.3 cents per unit to be 

paid by Lendlease Trust.

b. Significant Changes in State of Affairs
There have been no significant changes in the Group’s state of affairs.

c. Events Subsequent to Balance Date
On 14 July 2022, Lendlease and Mitsubishi Estate Asia formed a joint venture to acquire the One Circular Quay development in Sydney 
for approximately $800 million in up front and deferred consideration, with an additional $50 million payment subject to certain project 
outcomes. Mitsubishi Estate currently holds a 19.9 per cent interest in the joint venture. Subject to the satisfaction of certain conditions, 
this will increase to 66.7 per cent and Lendlease’s ownership will reduce to 33.3 per cent. Lendlease will receive an acquisition 
fee on settlement, earn development management and construction management fees, equity returns on its capital and potentially 
performance fees.

On 9 August 2022, the Group exchanged contracts with a third party to acquire a further 13 per cent interest in the asset management 
income stream of the Group’s Military Housing portfolio, through the existing DoD Asset Management Holdings joint venture. The 
Group received $86 million in consideration on financial close, generating an estimated pre tax gain on sale of $73 million.

There were no other material events subsequent to the end of financial reporting period.

d. Security Options
No security options were issued during the year by the Company or any of its controlled entities, and there are no such options 
on issue.

e. Indemnification and Insurance of Directors and Officers
Rule 12 of the Company’s Constitution provides for indemnification in favour of each of the Directors named on pages 66 to 70 of 
this report and the officers of the Company or of wholly owned subsidiaries or related entities of the Company (Officers) to the extent 
permitted by the Corporations Act 2001. Rule 12 does not indemnify a Director, Company Secretary or Officer for any liability involving 
a lack of good faith.

In conformity with Rule 12 of the Company’s Constitution, the Company has entered into Deeds of Indemnity, Insurance and Access 
with each of the Directors named on pages 66 to 70 of this report and for officers of the Company and Directors of related entities 
of the Company. The indemnities operate to the full extent permitted by law and are not subject to a monetary limit. The Company is 
not aware of any liability having arisen, and no claims have been made during or since the financial year under the Deeds of Indemnity, 
Insurance and Access.

For unrelated entities in which the Group has an interest, Deeds of Indemnity may be entered into between Lendlease Corporation 
Limited and the Director or Officer. Since the date of the last report, the Company has not entered into any separate Deeds of 
Indemnity with a Director or Officer of an unrelated entity.

No indemnity has been granted to an auditor of the Company in their capacity as auditor of the Company.

Governance

105

In accordance with the Corporations Act 2001, Rule 12 of the Constitution also permits the Company to purchase and maintain 
insurance or pay or agree to pay a premium for insurance for Officers against any liability incurred as an Officer of the Company or of a 
related body corporate. This may include a liability for reasonable costs and expenses incurred in defending proceedings, whether civil 
or criminal, regardless of their outcome. Due to confidentiality obligations and undertakings of the policy, no further details in respect of 
the premium or policy can be disclosed.

f. Environmental Regulation
The Group is subject to various state and federal environmental regulations in Australia.

The Directors are not aware of any material non compliance with environmental regulations pertaining to the operations or activities 
during the period covered by this report. In addition, the Lendlease Group is registered and publicly reports the annual performance 
of its Australian operations under the requirements of the National Greenhouse and Energy Reporting (NGER) Act 2007 and Energy 
Efficiency Opportunities (EEO) Act 2006.

All Lendlease businesses continue to operate an integrated Environment, Health and Safety Management System, ensuring that non 
compliance risks and opportunities for environmental improvements are identified, managed and reported accordingly.

g. Non Audit Services
During the year, KPMG, the Company’s auditor, performed certain other services in addition to its statutory duties.

The Board has considered the other services provided during the year by the auditor and, in accordance with written advice provided 
by resolution of the Audit Committee, is satisfied that the provision of those services during the year by the auditor is compatible with, 
and did not compromise, the auditor independence requirements of the Corporations Act 2001 for the following reason:

• All other services were subject to the corporate governance procedures adopted by the Group and the Audit Committee is satisfied

that those services do not impact the integrity and objectivity of the auditor.

The other services provided do not undermine the general principles relating to auditor independence as set out in APES 110 Code of 
Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or 
decision making capacity for the Group, acting as an advocate for the Group or jointly sharing risks and rewards.

A copy of the Lead Auditor's Independence Declaration, as required under Section 307C of the Corporations Act 2001, is included at 
the end of the Directors’ Report.

Details of the amounts paid to the auditor of the Company, KPMG, and its related practices for audit and other services provided during 
the year are set out below:

Audit and Other Assurance Services

Audit services

Other assurance services

Total audit and other assurance services

Non audit services

Total audit, non audit and other assurance services

Consolidated

June 2022

$000s

June 2021

$000s

7,004

882

7,886

70

7,956

7,019

822

7,841

438

8,279

h. Rounding Off
Lendlease Corporation Limited is a company of the kind referred to in the ASIC Corporations (Rounding in Financial/Directors' Reports) 
Instrument 2016/191 dated 24 March 2016 and, in accordance with that Instrument, amounts in the Consolidated Financial Statements 
and this report have been rounded off to the nearest million dollars unless specifically stated to be otherwise.

This report is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the Directors.

M J Ullmer, AO

Chairman
Sydney, 22 August 2022

A P Lombardo

Global Chief Executive Officer
Sydney, 22 August 2022

 
106

Lendlease Annual Report 2022

     KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation. Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001      To the Directors of Lendlease Corporation Limited I declare that, to the best of my knowledge and belief, in relation to the audit of Lendlease Corporation Limited for the financial year ended 30 June 2022 there have been: i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and ii. no contraventions of any applicable code of professional conduct in relation to the audit.      PAR_SIG_01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_01      KPMG Eileen Hoggett  Partner  Sydney  22 August 2022  Financial Statements

107

Financial StatementsMilan  Milan Innovation DistrictArtist’s impressionSection D. Risk Management

24. Financial Risk Management

25. Hedging

26. Fair Value Measurement

27. Contingent Liabilities

Section E. Basis of Consolidation

28. Consolidated Entities

29. Employee Benefit Vehicles

30. Parent Entity Disclosures

31.

Related Party Information

Section F. Other Notes

32.

Intangible Assets

33. Discontinued Operations

34. Defined Benefit Plans

35. Employee Benefits

36. Reserves

37.

Impact of New and Revised Accounting Standards

38. Other Significant Accounting Policies

Directors’ Declaration

Directors' Declaration

Independent Auditor’s Report

151

153

154

155

156

157

158

158

160

161

164

166

172

172

172

174

175

108

Lendlease Annual Report 2022

Table of Contents

Consolidated Financial Statements

Income Statement

Statement of Comprehensive Income

Statement of Financial Position

Statement of Changes in Equity

Statement of Cash Flows

Notes to Consolidated Financial Statements

Section A. Performance

1.

2.

3.

4.

5.

6.

7.

8.

9.

Segment Reporting

Dividends/Distributions

Earnings Per Share/Stapled Security (EPS/EPSS)

Revenue from Contracts with Customers

Share of Profit of Equity Accounted Investments

Other Income

Other Expenses

Finance Revenue and Finance Costs

Taxation

10.

Events Subsequent to Balance Date

Section B. Investment

11.

12.

Inventories

Equity Accounted Investments

13. Other Financial Assets

Section C. Liquidity and Working Capital

14. Cash and Cash Equivalents

15. Notes to Statement of Cash Flows

16.

17.

Borrowings and Financing Arrangements

Issued Capital

18. Capital Management

19.

Liquidity Risk Exposure

20. Commitments

21.

Loans and Receivables

22. Trade and Other Payables

23. Provisions

109

110

111

112

113

115

122

123

124

126

126

127

129

130

133

134

135

140

141

142

142

144

145

145

146

147

148

150

Lendlease Corporation Limited (the Company) is incorporated and domiciled in Australia. The consolidated financial report of the 
Company for the financial year ended 30 June 2022 comprises the Company and its controlled entities including Lendlease Trust (LLT) 
(together referred to as the consolidated entity or the Group). The Group is a for profit entity and is an international property and 
investments group. Further information about the Group’s primary activities is included in Note 1 ‘Segment Reporting’.

Shares in the Company and units in LLT are traded as one security under the name of Lendlease Group on the Australian Securities 
Exchange (ASX). The Company is deemed to control LLT for accounting purposes and therefore LLT is consolidated into the Group’s 
financial report. The issued units of LLT, however, are not owned by the Company and are therefore presented separately in the 
consolidated entity Statement of Financial Position within equity, notwithstanding that the unitholders of LLT are also the shareholders 
of the Company.

The consolidated financial report was authorised for issue by the Directors on 22 August 2022.

Consolidated Financial Statements
Income Statement
Year Ended 30 June 2022

Revenue from contracts with customers

Other revenue

Cost of sales

Gross profit

Share of profit of equity accounted investments

Other income

Other expenses

Results from operating activities from continuing operations

Finance revenue

Finance costs

Net finance costs

(Loss)/Profit before tax from continuing operations

Income tax benefit/(expense) from continuing operations

(Loss)/Profit after tax from continuing operations

Profit after tax from discontinued operations

(Loss)/Profit after tax

(Loss)/Profit after tax attributable to:

Members of Lendlease Corporation Limited

Unitholders of Lendlease Trust

(Loss)/Profit after tax attributable to securityholders

External non controlling interests

(Loss)/Profit after tax

Basic/Diluted Earnings per Lendlease Group Stapled Security 
(EPSS) from Continuing Operations

Shares excluding treasury shares

Shares on issue

Basic/Diluted Earnings per Lendlease Group Stapled 
Security (EPSS)

Securities excluding treasury shares

Securities on issue

(cents)

(cents)

(cents)

(cents)

Financial Statements

109

June 2022

June 20211

$m

8,822

142

(8,135)

829

181

358

(1,429)

(61)

9

(125)

(116)

(177)

51

(126)

27

(99)

(239)

140

(99)

-

(99)

(18.4)

(18.3)

(14.5)

(14.4)

$m

9,022

121

(8,435)

708

100

487

(884)

411

9

(146)

(137)

274

(68)

206

16

222

128

94

222

-

222

30.2

30.0

32.5

32.3

Note

4

5

6

7

8

8

9.a

33

33

33

3

3

1. June 2021 results have been re-presented for discontinued operations during the period. Refer to Note 33 'Discontinued Operations' for further details.

The accompanying notes form part of these consolidated financial statements.

110

Lendlease Annual Report 2022

Consolidated Financial Statements continued
Statement of Comprehensive Income
Year Ended 30 June 2022

(Loss)/Profit after Tax

Other Comprehensive Income/(Loss) after Tax

Items that may be reclassified subsequently to profit or loss:

Movements in hedging reserve

Movements in foreign currency translation reserve

Total items that may be reclassified subsequently to profit or loss2

Items that will not be reclassified to profit or loss:

Movements in non controlling interest acquisition reserve

Movements in defined benefit plans remeasurements

Total items that will not be reclassified to profit or loss

Total comprehensive income after tax

Total comprehensive (loss)/income after tax from continuing operations 
attributable to:

Members of Lendlease Corporation Limited

Unitholders of Lendlease Trust

Total comprehensive income after tax from discontinued operations attributable to:

Members of Lendlease Corporation Limited

Total comprehensive income after tax attributable securityholders

External non controlling interests

Total comprehensive income after tax

Note

9.b

9.b

9.b

9.b

June 2022

June 20211

$m

(99)

136

63

199

(5)

44

39

139

(40)

150

27

137

2

139

$m

222

15

(108)

(93)

6

11

17

146

48

84

16

148

(2)

146

1. June 2021 results have been re-presented for discontinued operations during the period. Refer to Note 33 'Discontinued Operations' for further details.
2. Includes Other comprehensive income of $214 million (June 2021: Other comprehensive loss of $70 million) relating to share of other comprehensive income of equity 

accounted investments.

The accompanying notes form part of these consolidated financial statements.

Statement of Financial Position
As at 30 June 2022

Current Assets

Cash and cash equivalents

Loans and receivables

Inventories

Other financial assets

Current tax assets

Other assets

Total current assets

Non Current Assets

Loans and receivables

Inventories

Equity accounted investments

Investment properties

Other financial assets

Deferred tax assets

Property, plant and equipment

Intangible assets

Defined benefit plan asset

Other assets

Total non current assets

Total assets

Current Liabilities

Trade and other payables

Provisions

Borrowings and financing arrangements

Other financial liabilities

Income tax payable

Total current liabilities

Non Current Liabilities

Trade and other payables

Provisions

Borrowings and financing arrangements

Other financial liabilities

Deferred tax liabilities

Total non current liabilities

Total liabilities

Net assets

Equity

Issued capital

Treasury securities

Reserves

Retained earnings

Total equity attributable to members of Lendlease Corporation Limited

Total equity attributable to unitholders of Lendlease Trust

Total equity attributable to securityholders

External non controlling interests

Total equity

The accompanying notes form part of these consolidated financial statements.

Financial Statements

111

June 2022

June 2021

Note

$m

14

21

11

13

21

11

12

13

9.c

32

34

22

23

16.a

22

23

16.a

9.c

17

36

$m

1,662

1,741

1,469

7

9

62

1,297

2,033

1,459

24

-

51

4,864

4,950

1,896

2,320

4,379

482

1,181

144

272

1,225

282

56

12,237

17,101

4,557

720

-

28

49

5,354

1,988

68

2,357

102

262

4,777

10,131

6,970

1,891

(77)

184

3,078

5,076

1,867

6,943

27

6,970

1,871

2,404

3,758

467

1,080

115

594

1,456

243

62

12,050

17,000

4,839

575

555

14

-

5,983

1,760

80

1,802

23

401

4,066

10,049

6,951

1,888

(79)

3

3,327

5,139

1,788

6,927

24

6,951

112

Lendlease Annual Report 2022

Consolidated Financial Statements continued
Statement of Changes in Equity
Year Ended 30 June 2022

Balance as at 1 July 2020

Total Comprehensive Income
Profit for the financial year

Other comprehensive income (net of tax)

Total comprehensive income

Other Comprehensive Income (Net of Tax)
Net investment hedge

Effect of foreign exchange movements

Effective cash flow hedges

Defined benefit plans remeasurements

Other comprehensive income (net of tax)

Transactions with Owners of the Company
Capital contributed by non controlling interests

Distribution Reinvestment Plan (DRP)

Share issue via institutional placement (net of 
transaction costs)

Share issue via Security Purchase Plan (net of 
transaction costs)

Dividends and distributions

Treasury securities acquired

Treasury securities vested

Fair value movement on allocation and vesting 
of securities
Transfer as a result of asset disposal2

Other movements

Total other movements through reserves

Balance as at 30 June 2021
Balance as at 1 July 2021

Total Comprehensive Income
Profit for the financial year

Other comprehensive income (net of tax)

Total comprehensive income

Other Comprehensive Income (Net of Tax)
Net investment hedge

Effect of foreign exchange movements

Effective cash flow hedges

Defined benefit plans remeasurements

Other comprehensive income (net of tax)

Transactions with Owners of the Company
Capital contributed by non controlling interests

Distribution Reinvestment Plan (DRP)

Dividends and distributions

Treasury securities acquired

Treasury securities vested

Fair value movement on allocation and vesting 
of securities
Transfer as a result of asset disposal2

Other movements

Total other movements through reserves

Issued 
Capital

$m

1,889

-

-

-

-

-

-

-

-

-

3

(3)

(1)

-

-

-

-

-

-

(1)

1,888
1,888

-

-

-

-

-

-

-

-

-

3

-

-

-

-

-

-

3

Treasury 

Securities1 Reserves

Members of 
Lendlease 
Corporation 
Limited

Unitholders 
of 
Lendlease 
Trust

External 
Non 
Controlling 
Interests

$m

5,151

128

(64)

64
-

12

(102)

15

11

(64)

-

3

(3)

(1)

(77)

(50)

39

16

(3)

-

(76)

5,139
5,139

(239)

226

(13)

(16)

62

136

44

226

-

3

(55)

(25)

27

23

(24)

1

(50)

$m

1,756

$m

25

94

(10)

84

-

(10)

-

-

(10)

-

1

-

-

(54)

-

-

-

-

1

(52)

1,788
1,788

140

10

150

-

10

-

-

10

-

1

(71)

-

-

-

-

(1)

(71)

-

(2)

(2)

-

(2)

-

-

(2)

1

-

-

-

-

-

-

-

-

-

1

24
24

-

2

2

-

2

-

-

2

1

-

-

-

-

-

-

-

1

5,076

1,867

27

Retained 
Earnings

$m

3,265

128

11

139

-

-

-

11

11

-

-

-

-

(77)

-

-

-

-

-

(77)

3,327
3,327

(239)

44

(195)

-

-

-

44

44

-

-

(55)

-

-

-

-

1

(54)

3,078

Total 
Equity

$m

6,932

222

(76)

146

12

(114)

15

11

(76)

1

4

(3)

(1)

(131)

(50)

39

16

(3)

1

(127)

6,951
6,951

(99)

238

139

(16)

74

136

44

238

1

4

(126)

(25)

27

23

(24)

-

(120)

6,970

$m

65

-

(75)

(75)

12

(102)

15

-

(75)

-

-

-

-

-

-

-

16

(3)

-

13

3
3

-

182

182

(16)

62

136

-

182

-

-

-

-

-

23

(24)

-

(1)

184

$m

(68)

-

-

-

-

-

-

-

-

-

-

-

-

-

(50)

39

-

-

-

(11)

(79)
(79)

-

-

-

-

-

-

-

-

-

-

-

(25)

27

-

-

-

2

Balance as at 30 June 2022

1,891

(77)

1. Opening balance for number of treasury securities 1 July 2021 was 6 million (1 July 2020: 4 million) and closing balance at 30 June 2022 was 6 million.
2. These movements in reserves were transferred to profit and loss in the financial year.

The accompanying notes form part of these consolidated financial statements.

Statement of Cash Flows
Year Ended 30 June 2022

Cash Flows from Operating Activities

Cash receipts in the course of operations

Cash payments in the course of operations

Interest received

Interest paid in relation to other corporations

Interest paid in relation to lease liabilities

Dividends/distributions received

Income tax paid in respect of operations

Net cash (used in)/provided by operating activities

15

Cash Flows from Investing Activities

Sale/redemption of investments

Acquisition of investments

Sale of investment properties

Acquisition of/capital expenditure on investment properties

Net loan drawdowns from associates and joint ventures

Disposal/(acquisition) of consolidated entities (net of cash disposed/acquired and 
transaction costs)

Disposal of property, plant and equipment

Acquisition of property, plant and equipment

Acquisition of intangible assets

Net cash provided by/(used in) investing activities

Cash Flows from Financing Activities

Proceeds from borrowings

Repayment of borrowings

Dividends/distributions paid

Increase in capital of non controlling interests

Repayment of lease liabilities

Net cash used in financing activities

Other Cash Flow Items

Effect of foreign exchange rate movements on cash and cash equivalents

Net (decrease)/increase in cash and cash equivalents

Cash and cash equivalents at beginning of financial year

Cash and cash equivalents at end of financial year

14

Financial Statements

113

June 20221

June 20211

Note

$m

$m

8,893

(9,606)

9,531

(8,916)

3

(129)

(17)

109

(88)

(835)

846

(985)

82

(71)

(13)

709

69

(10)

(75)

552

2,457

(2,387)

(114)

2

(64)

(106)

24

(365)

1,662

1,297

6

(128)

(20)

80

(85)

468

573

(301)

-

(110)

(13)

(266)

22

(53)

(68)

(216)

3,503

(3,470)

(121)

2

(60)

(146)

(6)

100

1,562

1,662

1. Balances include cash flows relating to both continuing and discontinued operations. Net cash flows relating to discontinued operations have been disclosed in Note 33 

‘Discontinued Operations’.

The accompanying notes form part of these consolidated financial statements.

114

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements
Basis of Preparation
The consolidated financial report is a general purpose financial report which:

• Has been prepared in accordance with Australian Accounting Standards (AASBs) adopted by the Australian Accounting Standards 

Board, and the Corporations Act 2001

• Complies with International Financial Reporting Standards (IFRSs) adopted by the International Accounting Standards Board

• Is presented in Australian dollars ($). At June 2022, all values have been rounded off to the nearest million dollars unless otherwise 

indicated, in accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191

• Has re-presented comparative financial information in the Income Statement, Statement of Comprehensive Income and related 

Notes for discontinued operations during the year. The comparative information in the Statement of Financial Position, Statement 
of Changes in Equity, Statement of Cash Flows and related Notes have not been re-presented. Refer to Note 33 ‘Discontinued 
Operations’ for further details

• Is prepared under the historical cost basis except for the following assets and liabilities, which are stated at their fair value: 

derivative financial instruments, fair value through profit or loss investments, investment properties, and liabilities for cash settled 
share based compensation plans. Recognised assets and liabilities that are hedged are stated at fair value in respect of the risk 
that is hedged. Refer to the specific accounting policies within the Notes to the Consolidated Financial Statements for the basis of 
valuation of assets and liabilities measured at fair value.

Significant accounting policies have been:

• Included in the relevant notes to which the policies relate, while other significant accounting policies are discussed in Note 38 

‘Other Significant Accounting Policies’

• Consistently applied to all financial years presented in the consolidated financial statements and by all entities in the Group, except 

as explained in Note 37 ‘Impact of New and Revised Accounting Standards’.

The preparation of a financial report that complies with AASBs requires management to make judgements, estimates and assumptions.

• This can affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual 

results may differ from these estimates

• Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively

• The significant accounting policies highlight information about accounting judgements in applying accounting policies that have the 
most significant effects on reported amounts and further information about estimated uncertainties that have a significant risk of 
resulting in material adjustments within the next financial year

• These significant accounting estimates and judgements have been considered in the context of the COVID pandemic and the 

impact of the other economic conditions.

The Group presents assets and liabilities in the Statement of Financial Position as current or non current.

• Current assets include assets held primarily for trading purposes, cash and cash equivalents, and assets expected to be realised in, 
or intended for sale or use in, the course of the Group’s operating cycle or within the next 12 months. All other assets are classified
as non current

• Current liabilities include liabilities held primarily for trading purposes, liabilities expected to be settled in the course of the Group’s 
operating cycle and those liabilities due within one year from the reporting date. All other liabilities are classified as non current.

At 30 June 2022, the Group is in a net current deficit (current liabilities exceeds current assets) but does not anticipate a significant 
liquidity risk in the next 12 months. This is due to the Group’s strong financial profile, which includes significant committed undrawn 
facilities and low gearing ratios.

The financial statements are prepared on a going concern basis. In preparing the financial statements, including assessing the going 
concern basis of accounting, the Group has considered the ongoing COVID pandemic and other economic conditions.

The Group has:

• $2,647 million in undrawn facilities. See Note 16 ‘Borrowings and Financing Arrangements’

• $1,297 million in cash and cash equivalents. See Note 14 ‘Cash and Cash Equivalents’.

Following this assessment, the Group is well placed to manage its financing and future commitments over the next 12 months from the 
date of the financial statements.

 
Financial Statements

115

Section A. Performance

In addition to the statutory result, Operating Earnings before Interest, Tax, Depreciation and Amortisation (Operating EBITDA) 
and Operating Profit after Tax (Operating PAT) are the key measures used to assess the Group’s performance. This section 
of the Financial Report focuses on disclosure that enhances a user’s understanding of Operating EBITDA and Operating PAT. 
Segment Reporting below provides a breakdown of profit and revenue by the operational activity and region. The key line items 
of the Income Statement, along with their components, provide detail behind the reported balances. Group performance will 
also impact the earnings per stapled security and dividend payout, therefore disclosure on these items has been included in 
this section. Further information and analysis on performance and allocation of resources can be found in the Performance and 
Outlook section of the Directors’ Report.

1. Segment Reporting

Accounting Policies

The Group’s segments are Investments, Development, Construction and Non core. The Group has identified these operating 
segments based on the distinct products and services provided by each segment, the distinct target return profile and allocation 
of resources for each segment, and internal reports that are reviewed and used by the Global Chief Executive Officer and 
Managing Director (the Chief Operating Decision Maker) in assessing performance, determining the allocation of resources, 
setting operational targets, and managing the Group.

The Group has presented the segments around business activity due to the Group's business model being broadly consistent in all 
regions. Additional disclosure has also been included for Operating EBITDA, Operating PAT and Statutory Profit by region.

The Group reports Operating EBITDA and Operating PAT as its primary earnings metrics, in addition to the statutory result. 
Operating PAT is defined as Statutory profit adjusted for non-cash backed property related revaluation increases or decreases 
of Investment property, Other financial assets and Equity accounted investments that are classified in the Investments segment, 
other non-cash adjustments or non-trading items such as impairment losses relating to goodwill and other intangibles, and non-
trading items such as restructuring costs. Operating EBITDA is before Interest, Tax, Depreciation and Amortisation. Operating 
EBITDA and Operating PAT includes revaluation increases or decreases of Investment properties under construction that are 
classified in the Development segment.

The Chief Operating Decision Maker receives information and assesses segment performance under these metrics. Operating 
EBITDA and Operating PAT are used to measure performance as management believes that such information is the most relevant 
in evaluating the results of certain reportable segments relative to other entities that operate within these industries. The Group 
does not consider corporate activities to be an operating segment.

The operating segments are as follows:

Investments
Operates across all four geographic regions. Services include owning and/or managing investments. The segment includes an 
investment management platform and the Group’s ownership interests in residential, office, retail, industrial, retirement and 
infrastructure investment assets.

Development
Operates in all four geographic regions. Its products and services include the development of inner city mixed use developments, 
apartments, communities, retirement, retail, commercial assets and social and economic infrastructure. Construction margin earned on 
development projects is recognised in this segment.

Construction
Operates across all four geographic regions. Its products and services include the provision of project management, design and 
construction services, predominantly in the commercial, residential, mixed use, defence and social infrastructure sectors.

Non core
Non core includes the provision of project management, design and construction services in the Australian infrastructure sector. These 
products and services represent the retained Engineering and retained Services projects. The discontinued operations referenced 
throughout the financial statements are included in this segment. Discontinued operations represent the Services business sold during 
the period and the Engineering business sold in the prior period, excluding the projects retained by the Group. Refer to Note 33 
‘Discontinued Operations’ for further detail.

116

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
1. Segment Reporting continued
1.a. Business Segment Information

Financial information regarding the performance of each reportable segment and a reconciliation of these reportable segments to the 
financial statements are included below:

Investments

Development1

Construction

Total Core Segments

Non Core

Total Segments

Total Core Segments

Corporate Activities

Total Core

Non Core

Total Group

TOTAL SEGMENT RESULTS

RECONCILIATION OF CORE AND NON CORE SEGMENTS TO STATUTORY PROFIT

30 June 2022

Revenue

Construction services

Investment services

Development services

Sale of development properties

Total revenue from contracts with customers - 
continuing operations

Other revenue

Total revenue from external customers - 
continuing operations

Construction services – discontinued operations

Total revenue from external customers

Cost of sales – continuing operations

Cost of sales – discontinued operations

Gross profit

Share of profit of Equity accounted investments2

Other income2

Other expenses3

Operating EBITDA

Finance revenue

Finance expenses

Depreciation and amortisation

Operating profit before tax4

Operating income tax expenses

Operating profit after tax

Investments segment revaluations (pre-tax):

Investment properties

Financial assets

Equity accounted investments

Impairment losses relating to intangibles (pre-tax)5

Restructuring costs (pre-tax):

Development impairments

Tenancy impairments

Redundancy costs

Other restructuring costs

Total adjustments4

Income tax benefit/(expense) on adjustments

Statutory profit/(loss) after tax

$m

-

279

-

-

279

67

346

-

346

(46)

-

300

120

188

(111)

497

1

(1)

(9)

488

(127)

361

4

59

11

(6)

-

-

-

-

68

(4)

425

$m

-

-

928

610

1,538

35

1,573

-

1,573

(1,328)

-

245

42

85

(191)

181

6

(5)

(11)

171

(60)

111

-

-

-

-

(289)

-

-

-

(289)

66

(112)

$m

6,572

-

-

-

6,572

7

6,579

-

6,579

(6,266)

-

313

6

22

(210)

131

-

(4)

(36)

91

(23)

68

-

-

-

-

-

-

-

-

-

-

68

$m

6,572

279

928

610

8,389

109

8,498

-

8,498

(7,640)

-

858

168

295

(512)

809

7

(10)

(56)

750

(210)

540

4

59

11

(6)

(289)

-

-

-

(221)

62

381

1. The Development segment includes $73 million (June 2021: $88 million) of revaluation gains from Equity accounted investments and $nil million (June 2021: $4 million) of 

revaluation gains from Investment properties classified as Development.

2. Excludes Investments segment revaluations.
3. Excludes depreciation and amortisation, Impairment losses relating to intangibles and Restructuring costs.
4. Operating profit before tax of $344 million (June 2021: $275 million) plus Investment segment revaluations (pre-tax) of $74 million (June 2021: $19 million), less impairment losses 
relating to intangibles (pre tax) of $83 million (June 2021: $nil) and restructuring costs (pre tax) of $484 million (June 2021: $nil), reconciles to Loss before tax from continuing 
operations of $177 million (June 2021: profit of $274 million) as disclosed in the Income Statement and Profit before tax for discontinued operations of $28 million (June 2021: 
$20 million) as disclosed in Note 33 ‘Discontinued Operations’.

5. Relates to Digital intangible assets deemed not recoverable.

The Non core segment operating profit after tax includes overhead costs associated with managing the completion of the remaining retained projects 
from the sale of the Engineering and Services businesses and other residual exit related matters. Corporate Activity costs are not allocated to the Non 
core segment given these costs relate to supporting the growth and operations of the Core segments.

$m

433

433

433

351

784

(467)

(320)

(3)

2

16

(21)

(6)

(17)

(23)

(1)

(24)

-

-

-

-

-

-

-

-

-

-

-

-

-

(25)

(25)

7

(42)

$m

7,005

279

928

610

8,822

109

8,931

351

9,282

(8,107)

(320)

855

170

311

(533)

803

7

(10)

(73)

727

(211)

516

4

59

11

(6)

(289)

(25)

-

-

(246)

69

339

$m

6,572

279

928

610

8,389

109

8,498

8,498

(7,640)

-

-

858

168

295

(512)

809

7

(10)

(56)

750

(210)

540

4

59

11

(6)

(289)

-

-

-

(221)

62

381

$m

$m

433

8,822

-

-

-

-

-

-

5

-

-

2

-

-

-

-

33

33

-

33

(28)

(185)

(180)

(115)

(90)

(383)

119

(264)

(77)

(104)

(56)

(10)

(247)

73

(438)

6,572

279

928

610

8,389

142

8,531

8,531

(7,668)

-

-

863

168

295

(697)

629

9

(125)

(146)

367

(91)

276

4

59

11

(83)

(289)

(104)

(56)

(10)

(468)

135

(57)

$m

433

433

351

784

(467)

(320)

(3)

2

16

(21)

(6)

(17)

(23)

(1)

(24)

-

-

-

-

-

-

-

-

-

-

-

-

-

(25)

(25)

7

(42)

$m

7,005

279

928

610

142

8,964

351

9,315

(8,135)

(320)

860

170

311

(718)

623

9

(125)

(163)

344

(92)

252

4

59

11

(83)

(289)

(129)

(56)

(10)

(493)

142

(99)

Financial Statements

117

Investments

Development1

Construction

Total Core Segments

Non Core

Total Segments

Total Core Segments

Corporate Activities

Total Core

Non Core

Total Group

TOTAL SEGMENT RESULTS

RECONCILIATION OF CORE AND NON CORE SEGMENTS TO STATUTORY PROFIT

30 June 2022

Revenue

Construction services

Investment services

Development services

Sale of development properties

Total revenue from contracts with customers - 

continuing operations

Other revenue

Total revenue from external customers - 

continuing operations

Construction services – discontinued operations

Total revenue from external customers

Cost of sales – continuing operations

Cost of sales – discontinued operations

Share of profit of Equity accounted investments2

Gross profit

Other income2

Other expenses3

Operating EBITDA

Finance revenue

Finance expenses

Depreciation and amortisation

Operating profit before tax4

Operating income tax expenses

Operating profit after tax

Investment properties

Financial assets

Equity accounted investments

Restructuring costs (pre-tax):

Development impairments

Tenancy impairments

Redundancy costs

Other restructuring costs

Total adjustments4

Investments segment revaluations (pre-tax):

Impairment losses relating to intangibles (pre-tax)5

Income tax benefit/(expense) on adjustments

Statutory profit/(loss) after tax

$m

279

279

67

346

-

-

-

-

-

346

(46)

300

120

188

(111)

497

1

(1)

(9)

488

(127)

361

4

59

11

(6)

-

-

-

-

68

(4)

425

1,573

(1,328)

6,579

(6,266)

$m

928

610

1,538

35

1,573

-

-

-

-

-

-

-

-

-

-

-

245

42

85

(191)

181

6

(5)

(11)

171

(60)

111

(289)

(289)

66

(112)

$m

6,572

6,572

6,579

313

6

22

(210)

131

-

(4)

(36)

91

(23)

68

-

-

-

7

-

-

-

-

-

-

-

-

-

-

-

-

68

$m

6,572

279

928

610

8,389

109

8,498

8,498

(7,640)

-

-

858

168

295

(512)

809

7

(10)

(56)

750

(210)

540

4

59

11

(6)

(289)

-

-

-

(221)

62

381

1. The Development segment includes $73 million (June 2021: $88 million) of revaluation gains from Equity accounted investments and $nil million (June 2021: $4 million) of 

revaluation gains from Investment properties classified as Development.

2. Excludes Investments segment revaluations.

3. Excludes depreciation and amortisation, Impairment losses relating to intangibles and Restructuring costs.

4. Operating profit before tax of $344 million (June 2021: $275 million) plus Investment segment revaluations (pre-tax) of $74 million (June 2021: $19 million), less impairment losses 

relating to intangibles (pre tax) of $83 million (June 2021: $nil) and restructuring costs (pre tax) of $484 million (June 2021: $nil), reconciles to Loss before tax from continuing 

operations of $177 million (June 2021: profit of $274 million) as disclosed in the Income Statement and Profit before tax for discontinued operations of $28 million (June 2021: 

$20 million) as disclosed in Note 33 ‘Discontinued Operations’.

5. Relates to Digital intangible assets deemed not recoverable.

$m

433

-

-

-

433

-

433

351

784

(467)

(320)

(3)

2

16

(21)

(6)

-

-

(17)

(23)

(1)

(24)

-

-

-

-

-

(25)

-

-

(25)

7

(42)

$m

7,005

279

928

610

8,822

109

8,931

351

9,282

(8,107)

(320)

855

170

311

(533)

803

7

(10)

(73)

727

(211)

516

4

59

11

(6)

(289)

(25)

-

-

(246)

69

339

$m

6,572

279

928

610

8,389

109

8,498

-

8,498

(7,640)

-

858

168

295

(512)

809

7

(10)

(56)

750

(210)

540

4

59

11

(6)

(289)

-

-

-

(221)

62

381

$m

$m

-

-

-

-

-

33

33

-

33

(28)

-

5

-

-

(185)

(180)

2

(115)

(90)

(383)

119

(264)

-

-

-

(77)

-

(104)

(56)

(10)

(247)

73

(438)

6,572

279

928

610

8,389

142

8,531

-

8,531

(7,668)

-

863

168

295

(697)

629

9

(125)

(146)

367

(91)

276

4

59

11

(83)

(289)

(104)

(56)

(10)

(468)

135

(57)

$m

433

-

-

-

433

-

433

351

784

(467)

(320)

(3)

2

16

(21)

(6)

-

-

(17)

(23)

(1)

(24)

-

-

-

-

-

(25)

-

-

(25)

7

(42)

$m

7,005

279

928

610

8,822

142

8,964

351

9,315

(8,135)

(320)

860

170

311

(718)

623

9

(125)

(163)

344

(92)

252

4

59

11

(83)

(289)

(129)

(56)

(10)

(493)

142

(99)

118

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
1. Segment Reporting continued
1.a. Business Segment Information continued

Investments

Development1

Construction

Total Core Segments

Non Core

Total Segments

Total Core Segments

Corporate Activities

Total Core

Non Core

Total Group

TOTAL SEGMENT RESULTS

RECONCILIATION OF CORE AND NON CORE SEGMENTS TO STATUTORY PROFIT

30 June 2021

Revenue

Construction services

Investment services

Development services

Sale of development properties

Total revenue from contracts with customers - 
continuing operations

Other revenue

Total revenue from external customers - 
continuing operations

Construction services – discontinued operations

Total revenue from external customers

Cost of sales – continuing operations

Cost of sales – discontinued operations

Gross profit

Share of profit of Equity accounted investments2

Other income2

Other expenses3

Operating EBITDA

Finance revenue

Finance expenses

Depreciation and amortisation

Operating profit before tax4

Operating income tax expenses

Operating profit after tax

Investments segment revaluations (pre-tax):

Investment properties

Financial assets

Equity accounted investments

Total adjustments4

Income tax benefit/(expense) on adjustments

Statutory profit/(loss) after tax

$m

-

282

-

-

282

65

347

-

347

(25)

-

322

53

26

(125)

276

1

(2)

(9)

266

(53)

213

(1)

45

(25)

19

7

239

$m

-

-

496

1,434

1,930

31

1,961

-

1,961

(1,738)

-

223

56

412

(222)

469

4

(2)

(14)

457

(115)

342

-

-

-

-

-

$m

6,398

-

-

-

6,398

-

6,398

-

6,398

(6,082)

-

316

14

7

(164)

173

-

(4)

(35)

134

(34)

100

-

-

-

-

-

342

100

$m

6,398

282

496

1,434

8,610

96

8,706

-

8,706

(7,845)

-

861

123

445

(511)

918

5

(8)

(58)

857

(202)

655

(1)

45

(25)

19

7

681

1. The Development segment includes $73 million (June 2021: $88 million) of revaluation gains from Equity accounted investments and $nil million (June 2021: $4 million) of 

revaluation gains from Investment properties classified as Development.

2. Excludes Investments segment revaluations.
3. Excludes depreciation and amortisation, Impairment losses relating to intangibles and Restructuring costs.
4. Operating profit before tax of $344 million (June 2021: $275 million) plus Investment segment revaluations (pre-tax) of $74 million (June 2021: $19 million), less impairment losses 
relating to intangibles (pre tax) of $83 million (June 2021: $nil) and restructuring costs (pre tax) of $484 million (June 2021: $nil), reconciles to Loss before tax from continuing 
operations of $177 million (June 2021: profit of $274 million) as disclosed in the Income Statement and Profit before tax for discontinued operations of $28 million (June 2021: 
$20 million) as disclosed in Note 33 ‘Discontinued Operations’.

The Non core segment operating profit after tax includes overhead costs associated with managing the completion of the remaining retained projects 
from the sale of the Engineering and Services businesses and other residual exit related matters. Corporate Activity costs are not allocated to the Non 
core segment given these costs relate to supporting the growth and operations of the Core segments.

$m

412

-

-

-

-

412

412

1,032

1,444

(570)

(969)

(95)

(47)

(139)

(59)

(197)

16

(181)

2

1

1

-

-

-

-

-

-

(181)

$m

6,810

282

496

1,434

9,022

96

9,118

1,032

10,150

(8,415)

(969)

766

125

446

(558)

779

6

(8)

(117)

660

(186)

474

(1)

45

(25)

19

7

500

$m

6,398

282

496

1,434

8,610

96

8,706

8,706

(7,845)

-

-

861

123

445

(511)

918

5

(8)

(58)

857

(202)

655

(1)

45

(25)

19

7

681

$m

$m

25

25

-

25

-

5

-

(20)

(2)

(164)

(161)

4

(138)

(90)

(385)

107

(278)

-

-

-

-

-

-

-

-

-

-

6,398

282

496

1,434

8,610

121

8,731

8,731

(7,865)

-

-

866

123

443

(675)

757

9

(146)

(148)

472

(95)

377

(1)

45

(25)

19

7

403

$m

412

-

-

-

-

412

412

1,032

1,444

(570)

(969)

(95)

(47)

(139)

(59)

(197)

16

(181)

2

1

1

-

-

-

-

-

-

$m

6,810

282

496

1,434

9,022

121

9,143

1,032

10,175

(8,435)

(969)

771

125

444

(722)

618

10

(146)

(207)

275

(79)

196

(1)

45

(25)

19

7

222

(278)

(181)

Financial Statements

119

Investments

Development1

Construction

Total Core Segments

Non Core

Total Segments

Total Core Segments

Corporate Activities

Total Core

Non Core

Total Group

TOTAL SEGMENT RESULTS

RECONCILIATION OF CORE AND NON CORE SEGMENTS TO STATUTORY PROFIT

30 June 2021

Revenue

Construction services

Investment services

Development services

Sale of development properties

Total revenue from contracts with customers - 

continuing operations

Other revenue

Total revenue from external customers - 

continuing operations

Construction services – discontinued operations

Total revenue from external customers

Cost of sales – continuing operations

Cost of sales – discontinued operations

Share of profit of Equity accounted investments2

Gross profit

Other income2

Other expenses3

Operating EBITDA

Finance revenue

Finance expenses

Investments segment revaluations (pre-tax):

Depreciation and amortisation

Operating profit before tax4

Operating income tax expenses

Operating profit after tax

Investment properties

Financial assets

Equity accounted investments

Total adjustments4

Income tax benefit/(expense) on adjustments

Statutory profit/(loss) after tax

$m

282

282

65

347

-

-

-

-

-

347

(25)

322

53

26

(125)

276

1

(2)

(9)

266

(53)

213

(1)

45

(25)

19

7

239

$m

496

1,434

1,930

31

1,961

1,961

(1,738)

223

56

412

(222)

469

4

(2)

(14)

457

(115)

342

-

-

-

-

-

-

-

-

-

$m

6,398

6,398

6,398

6,398

(6,082)

316

14

7

(164)

173

-

(4)

(35)

134

(34)

100

-

-

-

-

-

-

-

-

-

-

-

$m

6,398

282

496

1,434

8,610

96

8,706

8,706

(7,845)

-

-

861

123

445

(511)

918

5

(8)

(58)

857

(202)

655

(1)

45

(25)

19

7

681

1. The Development segment includes $73 million (June 2021: $88 million) of revaluation gains from Equity accounted investments and $nil million (June 2021: $4 million) of 

revaluation gains from Investment properties classified as Development.

2. Excludes Investments segment revaluations.

3. Excludes depreciation and amortisation, Impairment losses relating to intangibles and Restructuring costs.

4. Operating profit before tax of $344 million (June 2021: $275 million) plus Investment segment revaluations (pre-tax) of $74 million (June 2021: $19 million), less impairment losses 

relating to intangibles (pre tax) of $83 million (June 2021: $nil) and restructuring costs (pre tax) of $484 million (June 2021: $nil), reconciles to Loss before tax from continuing 

operations of $177 million (June 2021: profit of $274 million) as disclosed in the Income Statement and Profit before tax for discontinued operations of $28 million (June 2021: 

$20 million) as disclosed in Note 33 ‘Discontinued Operations’.

342

100

$m

412

-

-

-

412

-

412

1,032

1,444

(570)

(969)

(95)

2

1

(47)

(139)

1

-

(59)

(197)

16

(181)

-

-

-

-

-

(181)

$m

6,810

282

496

1,434

9,022

96

9,118

1,032

10,150

(8,415)

(969)

766

125

446

(558)

779

6

(8)

(117)

660

(186)

474

(1)

45

(25)

19

7

500

$m

6,398

282

496

1,434

8,610

96

8,706

-

8,706

(7,845)

-

861

123

445

(511)

918

5

(8)

(58)

857

(202)

655

(1)

45

(25)

19

7

681

$m

$m

-

-

-

-

-

25

25

-

25

(20)

-

5

-

(2)

(164)

(161)

4

(138)

(90)

(385)

107

(278)

-

-

-

-

-

(278)

6,398

282

496

1,434

8,610

121

8,731

-

8,731

(7,865)

-

866

123

443

(675)

757

9

(146)

(148)

472

(95)

377

(1)

45

(25)

19

7

403

$m

412

-

-

-

412

-

412

1,032

1,444

(570)

(969)

(95)

2

1

(47)

(139)

1

-

(59)

(197)

16

(181)

-

-

-

-

-

(181)

$m

6,810

282

496

1,434

9,022

121

9,143

1,032

10,175

(8,435)

(969)

771

125

444

(722)

618

10

(146)

(207)

275

(79)

196

(1)

45

(25)

19

7

222

120

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
1. Segment Reporting continued
1.a. Business Segment Information continued
The following table provides information on the Return on invested capital for the Investments and Development segment. Construction 
is excluded from the table below on the basis that its main operational metric is EBITDA margin.

JUNE 2022

JUNE 2021

Investments
$m

Development
$m

Net assets

Less: Cash and cash equivalents

Less: Other financial liabilities

Less: Borrowings and 
financing arrangements

Invested capital at end of year

Invested capital at half year

Invested capital at beginning of year

Average invested capital

Operating profit after tax1

Return on invested capital2

3,789

(140)

1

7

3,657

3,931

3,633

3,740

361

9.7%

5,262

(91)

-

206

5,377

5,018

4,416

4,937

111

2.2%

Remaining 
Group
$m

(2,081)

(1,066)

129

Total 
Group
$m

6,970

(1,297)

130

2,144

2,357

Remaining 
Group
$m

(916)

(1,722)

35

Total 
Group
$m

6,951

(1,662)

37

2,237

2,357

Investments
$m

Development
$m

3,653

(29)

2

7

3,633

3,584

3,670

3,629

213

5.9%

4,214

89

-

113

4,416

4,991

4,778

4,728

342

7.2%

1. Operating profit after tax per segment has been derived from the tables on the previous pages.
2. Return on Invested Capital is calculated using the Operating Profit after Tax divided by the arithmetic average of beginning, half year and year end invested capital.

The following table provides information on the Group's Return on equity:

Equity attributable to securityholders at end of year

Equity attributable to securityholders at half year

Equity attributable to securityholders at beginning of year

Average equity attributable to securityholders

Core operating profit after tax

Operating return on equity1

Statutory profit after tax

Statutory return on equity2

June 2022

June 2021

$m

6,943

6,654

6,927

6,841

276

4.0%

(99)

(1.4)%

$m

6,927

6,953

6,907

6,929

377

5.4%

222

3.2%

1. Operating return on equity is calculated using the Core operating profit after tax divided by the arithmetic average of beginning, half year and year end securityholders’ equity.
2. Statutory return on equity is calculated using the Statutory profit after tax divided by the arithmetic average of beginning, half year and year end securityholders’ equity.

The following table provides a reconciliation of Core operating earnings per stapled security to the Total Group statutory earnings per 
stapled security:

Core operating earnings per stapled security

Non core operating earnings per stapled security

Total Segment operating earnings per stapled security

Total adjustments (after tax) to reconcile to statutory profit1

Total Group statutory earnings per stapled security

CENTS PER STAPLED SECURITY

Note

June 2022

June 2021

40.1

(3.5)

36.6

(51.0)

(14.4)

54.8

(26.3)

28.5

3.8

32.3

3

1. The total adjustments (after tax) is calculated using the Total adjustments of $(493) million (June 2021: $19 million) and Income tax benefit/(expense) on adjustments of 

$142 million (June 2021: $7 million) divided by the weighted average number of stapled securities on issue.

Financial Statements

121

The following tables set out other financial information by reportable segment:

JUNE 2022

JUNE 2021

Material Non 
Cash Items1

Non Current 
Segment Assets2

Group Total 
Assets

Material Non 
Cash Items1

Non Current 
Segment Assets2

Group Total 
Assets

$m

57

(294)

(1)

(238)

(26)

(264)

(278)

(542)

$m

$m

2,638

6,201

1,494

10,333

7

10,340

290

10,630

4,093

7,940

3,847

15,880

304

16,184

917

17,101

$m

52

(12)

(6)

34

(23)

11

46

57

$m

$m

2,737

5,416

1,509

9,662

273

9,935

677

10,612

3,954

6,975

3,627

14,556

948

15,504

1,496

17,000

Core

Investments

Development

Construction

Total core segments

Non core

Total segments

Corporate activities

Total

1. Material Non Cash Items relates to impairments and provisions raised or written back, unrealised foreign exchange movements and fair value gains or losses.
2. Excludes deferred tax assets, financial instruments and defined benefit plan assets.

1.b. Geography Segment Information

The following table sets out further information on Operating EBITDA, Operating PAT and Statutory Profit by region:

OPERATING
EBITDA

OPERATING
PAT

TOTAL
ADJUSTMENTS

TAX ON
ADJUSTMENTS

STATUTORY
PROFIT

June 
2022

June 
2021

June 
2022

$m

496

115

26

172

809

(180)

629

(6)

623

$m

644

54

60

160

918

(161)

757

(139)

618

$m

344

80

13

103

540

(264)

276

(24)

252

June 
2021

$m

448

47

65

95

655

(278)

377

(181)

196

June 
2022

$m

(139)

(1)

(78)

(3)

(221)

(247)

(468)

(25)

(493)

June 
2021

$m

40

(22)

-

1

19

-

19

-

19

June 
2022

$m

58

-

3

1

62

73

135

7

142

June 
2021

$m

-

6

-

1

7

-

7

-

7

June 
2022

June 
2021

$m

263

79

(62)

101

381

(438)

(57)

(42)

(99)

$m

488

31

65

97

681

(278)

403

(181)

222

Australia

Asia

Europe

Americas

Total region

Corporate activities

Total core

Non core

Total Group

The following table sets out Non current assets by region:

Australia

Asia

Europe

Americas

Total segment

Corporate activities

Total

1. Excludes deferred tax assets, financial instruments and defined benefit plan assets and is based on the geographical location of assets.

NON CURRENT ASSETS1

June 2022

June 2021

$m

4,577

1,794

1,629

2,340

10,340

290

10,630

$m

5,007

1,388

1,471

2,069

9,935

677

10,612

122

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
1. Segment Reporting continued
1.b. Geography Segment Information continued
The operating segments generate revenue in the following regions:

REVENUE1

Investments
$m

Development
$m

Construction
$m

Total Core 
Segments
$m

193

82

18

54

347

164

77

14

93

348

962

31

523

63

1,579

1,239

11

511

204

1,965

3,186

261

899

2,233

6,579

2,868

262

861

2,407

6,398

4,341

374

1,440

2,350

8,505

4,271

350

1,386

2,704

8,711

Non Core
$m

784

-

-

-

784

1,444

-

-

-

1,444

Total 
Segments
$m

Corporate 
Activities
$m

Statutory 
Result
$m

5,125

374

1,440

2,350

9,289

5,715

350

1,386

2,704

10,155

35

-

-

-

35

30

-

-

-

30

5,160

374

1,440

2,350

9,324

5,745

350

1,386

2,704

10,185

June 2022

Australia

Asia

Europe

Americas

Total

June 2021

Australia

Asia

Europe

Americas

Total

1. Comprised of Revenue from contracts with customers from continuing operations of $8,822 million (June 2021: $9,022 million), other revenue from continuing operations 
of $142 million (June 2021: $121 million), finance revenue from continuing operations of $9 million (June 2021: $9 million), revenue from contracts with customers from 
discontinued operations of $351 million (June 2021: $1,032 million), and finance revenue from discontinued operations of $nil (June 2021: $1 million) as disclosed in Note 
33 'Discontinued Operations'. June 2021 results have been re-presented for discontinued operations during the period. Refer to Note 33 'Discontinued Operations' for 
further details.

No revenue from transactions with a single external customer amounts to 10 per cent or more of the Group’s revenue.

2. Dividends/Distributions

Parent Company Interim Dividend

December 20212

December 2020 – paid 17 March 2021

Lendlease Trust Interim Distribution

December 2021 – paid 16 March 2022

December 2020 – paid 17 March 2021

Parent Company Final Dividend

June 2022 – declared subsequent to reporting date3

June 2021 – paid 15 September 2021

Lendlease Trust Final Distribution

June 2022 – provided for and payable 21 September 2022

June 2021 – paid 15 September 2021

Total

COMPANY/TRUST1

Cents

June 2022

June 2021

Per Share/Unit

-

11.2

5.0

3.8

5.7

7.9

5.3

4.1

$m

-

-

35

-

39

-

36

-

110

$m

-

77

-

26

-

55

-

28

186

1. The current and prior period distributions were unfranked. The current period final dividend was 75 per cent franked, with the balance sourced from the conduit foreign 

income account. The December 2020 interim dividend was 50 per cent franked, with the balance sourced from the conduit foreign income account. The prior period final
dividend was not franked.

2. No interim dividend was declared by the Company for 31 December 2021.
3. No provision for this dividend has been recognised in the Statement of Financial Position at 30 June 2022, as it was declared after the end of the reporting period.

Dividend Franking
The amount of franking credits available for use as at 30 June 2022 in subsequent reporting periods is $41 million (30 June 2021: 
$7 million), based on a 30 per cent tax rate.

 
Financial Statements

123

3. Earnings Per Share/Stapled Security (EPS/EPSS)

Accounting Policies

The Group presents basic and diluted EPS/EPSS in the Income Statement. This is a key performance measure for the Group. 
Refer to further details in the Managing and Measuring Value - Financial section of this Annual Report.

Basic EPS/EPSS is determined by dividing Profit/(loss) after tax attributable to members of the Company and Group (excluding 
any costs of servicing equity other than ordinary shares/securities) by the weighted average number of ordinary shares/securities 
outstanding during the financial year, adjusted for bonus elements in ordinary shares/securities issued during the financial year.

Diluted EPS/EPSS is determined by adjusting the Profit/(loss) after tax attributable to members of the Company and Group, and 
the weighted average number of ordinary shares/securities outstanding for the effects of all dilutive potential ordinary shares/
securities. The Group currently does not have any dilutive potential ordinary shares/securities. Dilution occurs when treasury 
shares and employee share options are included in outstanding shares.

The issued units of Lendlease Trust (LLT) are presented separately within equity, and therefore the profit attributable to LLT is 
excluded from the calculation of basic and diluted earnings per Company share presented in the Income Statement.

Basic/Diluted Earnings Per Share (EPS)1

(Loss)/profit attributable to members of Lendlease 
Corporation Limited (Company)

Weighted average number of ordinary shares

Basic/Diluted EPS

Basic/Diluted Earnings Per Stapled Security (EPSS)1

(Loss)/profit attributable to securityholders of 
Lendlease Group

Weighted average number of stapled securities

Basic/Diluted EPSS2

$m

m

cents

$m

m

cents

JUNE 2022

JUNE 2021

Shares/ 
Securities 
Excluding 
Treasury 
Securities

Shares/ 
Securities on 
Issue

Shares/ 
Securities 
Excluding 
Treasury 
Securities

Shares/ 
Securities on 
Issue

(239)

683

(35.0)

(99)

683

(14.5)

(239)

689

(34.7)

(99)

689

(14.4)

128

683

18.7

222

683

32.5

128

688

18.6

222

688

32.3

1. Balances include both continuing and discontinued operations. Earnings per share/stapled security for continuing and discontinued operations have been separately disclosed 

in Note 33 ‘Discontinued Operations’.

2. Details of the Group's Core operating earnings per stapled security is disclosed in Note 1 'Segment Reporting'.

124

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
4. Revenue from Contracts with Customers

Accounting Policies

Provision of Construction and Development services
Construction services include project management, design and construction services predominantly in the commercial, 
residential, mixed use, defence and social infrastructure sectors. Development services include development fees earned on 
development of inner city mixed use developments, retirement, retail, commercial assets and social and economic infrastructure.

Contracts with customers to provide Construction or Development services can include either one performance obligation or 
multiple performance obligations within each contract. The Group assesses each of its contracts individually and where there are 
separate performance obligations identified, the transaction price is allocated based on the relative standalone selling prices of 
the services provided. Typically, the Construction or Development services in contracts are not considered distinct as the services 
are highly interrelated and an integrated bundle of services and therefore are accounted for as a single performance obligation.

The transaction price for each contract may include variable consideration in the form of contract variations or modifications, and 
contract claims (collectively, ‘Modifications’). Variable consideration may also include performance or other incentive fees. The 
transaction price is the amount of consideration to which the Group expects to be entitled to receive in exchange for transferring 
promised goods or services to a customer per the contract.

Variable consideration is only included in the transaction price for a contract to the extent it is highly probable that a significant 
reversal of that revenue will not occur, which is an area of accounting judgement. Factors considered in assessing whether the 
estimated revenue associated with Modifications should be recognised include the following:

i.

Status of negotiations with customers

ii. The contract or other evidence provides a legal basis for the Modifications

iii. Additional costs incurred were caused by circumstances that were unforeseen at the contract date and for which entitlement 

contractually exists

iv. Modification related costs are identifiable, measurable, and considered reasonable in view of the work performed

v. Evidence supporting the Modification is objective and verifiable, which may include independent third-party advice

vi. Commercial and market factors specific to the Modifications

vii. Historical experience in resolving Modifications.

This assessment is reviewed each reporting period or when facts and circumstances change during the reporting period.

Revenue is recognised over time, typically based on an input method using an estimate of costs incurred to date as a percentage 
of total estimated costs. These contracts are typically executed on the customer’s land so they control the assets as they are 
being built or the customer benefits from the service as the work is performed. Differences between amounts recognised as 
revenue and amounts billed to customers are recognised as contract assets or liabilities in the Statement of Financial Position.

The measurement of revenue is an area of accounting judgement. Management uses judgement to estimate:

i.

Progress in satisfying the performance obligations within the contract, which includes estimating contract costs expected to 
be incurred to satisfy performance obligations

ii. The probability of the amount to be recognised as variable consideration for approved variations and claims where the final

price has not been agreed with the customer.

Revenue is invoiced based on the terms of each individual contract, which may include a periodic billing schedule or achievement 
of specific milestones. Invoices are issued under commercial payment terms which are typically 30 days from when an invoice 
is issued.

A provision for loss making contracts is recorded for the difference between the expected costs of fulfilling a contract 
and the expected remaining economic benefits to be received where the forecast remaining costs exceed the forecast 
remaining benefits.

Provision of Investment services

Investment services include funds management, asset management, leasing and origination services.

Each contract with a customer to provide Investment services is typically one performance obligation with revenue recognised 
over time as services are rendered. Typically, our performance obligation is to manage a client’s capital and/or property for a 
specified period of time and is delivered as a series of daily performance obligations over time.

The transaction price for each contract may include variable consideration in the form of performance fees. Variable 
consideration is only included in the transaction price for a contract to the extent it is highly probable that a significant reversal of 
that revenue will not occur. The Group assesses probability of receiving variable consideration using a combination of commercial 
and market factors, and historical experience.

Revenue is invoiced either monthly or quarterly based on the terms of each individual contract. Invoices are issued under 
commercial payment terms which are typically 30 days from when an invoice is issued.

 
Financial Statements

125

Accounting Policies continued

Sale of Development Properties
The Group develops and sells residential land lots and built form products, including residential apartments, commercial and retail 
buildings. Sales of residential land lots and apartments typically are recognised at a point in time, with each contract treated as a 
single performance obligation to transfer control of an asset to a customer. Residential land lots and apartments are recognised 
on settlement with the customer.

The sale of retail, commercial and mixed use assets may include land, construction, development management and investment 
service components. Where there are multiple components within one contract, the transaction price is allocated based on the 
standalone selling prices of each component, typically using the residual approach, and revenue is recognised based on the 
policies noted above. Sales of commercial and retail buildings are recognised when the customer obtains control of the asset 
based on the specific terms and conditions of the sales contract.

The Group discounts deferred proceeds to reflect the time value of money where the period between the transfer of control of 
a development property and receipt of payment from the customer exceeds one year. Deferred proceeds from customers are 
recognised in trade and other receivables where the right to receive payment is unconditional. Deposits received in advance from 
customers are recognised as a contract liability until the performance obligation has been met.

The measurement of revenue from the sale of development properties is an area of accounting judgement as it requires 
management to exercise judgement in valuing the individual components of a development property sale, given the due 
consideration to cost inputs, market conditions and commercial factors. The recognition and determination of when control 
passes requires management judgement and is considered an area of accounting judgement.

Proceeds from the sale of residential land lots and apartments are received upon settlement, which typically occurs between 
6-12 weeks following practical completion on the asset. Proceeds from the sale of retail, commercial and mixed use assets are 
received in accordance with the specific terms of each contract.

The Group may enter a PLLACes (Presold Lendlease Apartment Cash Flows) transaction for certain residential apartment 
buildings from time to time. This involves the Group receiving an upfront cash inflow from third party investors (investors) 
in exchange for selling the investors the rights to the cash proceeds that are due from customers once the apartments are 
completed. When customers settle their apartments the Group does not receive any cash proceeds nor does it pay any amounts 
to the investors as the customers pay the investors directly. On entry into a PLLACes transaction the cash inflow is disclosed as 
an operating cash inflow in the Statement of Cash Flows which typically occurs over a year in advance of the revenue recognition 
from the sale of the apartments. At the same time, an Other payables – PLLACes is also recognised within Trade and Other 
Payables and is derecognised as revenue once settlement of the apartments occurs.

Revenue from the provision of services

Core Construction services

Non core Construction services

Construction services

Investment services

Development services

Total revenue from the provision of services

Revenue from the sale of development properties

Total revenue from contracts with customers2

June 2022

June 20211

$m

6,572

433

7,005

279

928

8,212

610

8,822

$m

6,398

412

6,810

282

496

7,588

1,434

9,022

1. June 2021 results have been re-presented for discontinued operations during the period. Refer to Note 33 'Discontinued Operations' for further details.
2. Further information on revenue by geography and by segments is included in Note 1 ‘Segment Reporting’.

 
126

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
5. Share of Profit of Equity Accounted Investments

Accounting Policies

Investments in associates and joint ventures are accounted for using the equity method. The share of profit recognised under 
the equity method is the Group’s share of the investment’s profit or loss based on ownership interest held. Associates (including 
partnerships) are entities in which the Group, as a result of its voting rights, has significant influence, but not control or joint 
control, over the financial and operating policies. A joint venture is a joint arrangement whereby the parties that have joint control 
of the arrangement have rights to the net assets of the arrangement.

For associates, this is from the date that significant influence commences until the date that significant influence ceases, and for 
joint ventures, this is from the date joint control commences until the date joint control ceases.

Associates1,2

Share of profit

Joint Ventures1,2

Share of profit

Total share of profit of equity accounted investments

Note

12.a

12.b

June 2022

June 2021

$m

54

127

181

$m

8

92

100

1. Reflects the contribution to the Group’s profit, and is after tax paid by the Equity accounted investment vehicles themselves, where relevant. However, for various Equity 

accounted investments, the share of tax is paid by the Group and is included in the Group’s current tax expense.

2. Share of profit from Associates and Joint Ventures includes $7 million gain (June 2021: $2 million loss) and $4 million gain (June 2021: $23 million loss), respectively, in 

revaluation gains and losses recognised in the Investments segment adjustment in Note 1 ‘Segment Reporting’. Share of profit from Associates and Joint Ventures include 
$7 million (June 2021: $nil) and $66 million (June 2021: $88 million gain), respectively, in revaluation gains in the Development segment.

6. Other Income

Accounting Policies

Net gains or losses on sale/transfer of investments, including consolidated entities and Equity Accounted Investments are 
recognised when an unconditional contract is in place.

Net gains or losses on fair value remeasurements are recognised in accordance with the policies stated in Note 13 ‘Other 
Financial Assets’.

Net gain on sale/transfer of investments

Consolidated entities

Asset management contract sale2

Other financial assets at fair value

Equity accounted investments

Investment properties

Other assets and liabilities

Total net gain on sale/transfer of investments

Net gain on fair value measurement

Investment properties3

Fair value through profit or loss assets4

Total net gain on fair value measurement

Other

Total other income

June 2022

June 20211

$m

2

167

-

86

12

13

280

4

65

69

9

358

$m

375

-

1

4

-

7

387

3

61

64

36

487

1. June 2021 results have been re-presented for discontinued operations during the period. Refer to Note 33 'Discontinued Operations' for further details.
2. During the financial year, the Group disposed of a 28 per cent interest in the asset management income stream of the Group's Military Housing portfolio, recording a net gain 

on sale pre-tax of $167 million.

3. Net gain on fair value measurements for Investment properties includes $4 million gain (June 2021: $1 million loss) recognised in the Investments segment adjustments in Note 1 

‘Segment Reporting’.

4. Net gain on fair value measurements for Fair value through profit or loss assets includes $59 million gain (June 2021: $45 million gain) recognised in the Investments segment 

adjustments in Note 1 ‘Segment Reporting’.

Financial Statements

127

7. Other Expenses

Accounting Policies

Other expenses in general are recognised as incurred.

Employee Benefit Expenses
Employee benefits are expensed as the related service by the employee is provided and includes both equity and cash based 
payment transactions. Employee benefits recognised in the Income Statement are net of recoveries.

For cash bonuses, the Group recognises an accrued liability for the amount expected to be paid. This is based on a formula that 
takes into consideration the profit attributable to the Group’s securityholders after certain adjustments. Refer to Note 35a ‘Short 
Term Incentive (STI)’ for further detail.

Share Based Compensation
The Group operates equity settled share based compensation plans that are linked to Lendlease’s security price. The fair value of 
the equity received in exchange for the grant is recognised as an expense and a corresponding increase in equity, in the Equity 
Compensation Reserve. The total amount to be expensed over the vesting period is determined by reference to the fair value of 
the securities granted.

The fair value is primarily determined using a Monte-Carlo simulation model. Refer to Note 35j ‘Amounts Recognised in the 
Financial Statements’ for further detail. Management considers the fair value assigned to be an area of estimation uncertainty as it 
requires judgements on Lendlease’s security price and whether vesting conditions will be satisfied.

At each balance sheet date, the Group revises its estimates of the entitlement due. It recognises the impact of revision of 
original estimates on non market conditions, if any, in the Income Statement, and a corresponding adjustment to equity over the 
remaining vesting period. Changes in entitlement for equity settled share based compensation plans are not recognised if they fail 
to vest due to market conditions not being met.

Superannuation Accumulation Plan Expense
All employees in the Australia region are entitled to benefits on retirement, disability or death from the Group’s superannuation 
accumulation plan. The majority of these employees are party to a defined contribution plan and receive fixed contributions 
from the Group. The Group has no further payment obligations once the contributions have been paid. The contributions are 
recognised as an employee benefit expense when they are due. The Group also operates a defined benefit superannuation plan, 
membership of which is now closed. Refer to Note 34 ‘Defined Benefit Plans’ for further detail.

Impairment
The carrying amounts of the Group’s assets, subject to impairment tests, are reviewed at each balance sheet date to determine 
whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. The 
calculation of this recoverable amount is dependent on the type of asset. The material assets’ accounting policies will contain 
further information on these calculations.

An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. Impairment losses 
are recognised in the Income Statement.

Reversals of Impairment
Impairment losses on assets can be reversed (other than goodwill) when there is a subsequent increase in the recoverable 
amount. The increase could be due to a specific event, the indication that impairment may no longer exist or there is a change in 
estimates used to determine the recoverable amount.

An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that 
would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

Lease Expense
Short term lease and low value lease payments, including outgoings, are recognised in the Income Statement on a straight line 
basis over the term of the lease.

Depreciation and Amortisation
Depreciation on owned assets is charged to the Income Statement on a straight line basis over the estimated useful lives of items 
of property, plant and equipment. Amortisation is provided on leasehold improvements over the remaining term of the lease. 
Most plant is depreciated over a period not exceeding 20 years, furniture and fittings over three to 15 years, motor vehicles over 
four to eight years and computer equipment over three years.

Right-of-use assets are depreciated using the straight line method from the commencement date to the earlier of the end of the 
useful life of the right-of-use asset or the end of the lease term.

128

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
7. Other Expenses continued

June 2022

June 20211

Profit before income tax includes the following expense items:

Total Employee Benefit Expense

Less: Recoveries through projects2

Net employee benefit expense

Superannuation accumulation plan expense

Net defined benefit plans expense

Restructuring expenses:3

Development impairments

Tenancy impairments - Core4

Tenancy impairments - Non core4

Redundancy costs

Other restructuring costs

Expenses include other impairments raised/(reversals) relating to:

Loans and receivables

Property inventories

Equity accounted investments

Intangible assets5

Other assets

Lease expense (including outgoings)

Depreciation on right-of-use assets

Depreciation on owned assets

Amortisation

Net foreign exchange (gain)/loss

Other

Total Other Expenses6

$m

1,927

(1,371)

556

77

(1)

289

104

25

56

10

2

12

(15)

83

-

30

54

35

67

2

43

$m

1,848

(1,333)

515

77

-

-

-

-

-

-

-

(13)

1

2

6

32

63

65

55

4

77

1,429

884

1. June 2021 results have been re-presented for discontinued operations during the period. Refer to Note 33 'Discontinued Operations' for further details.
2. Expense recovered through projects.
3. Expenses resulting from the revised strategy announcement and business review undertaken by the Global CEO during the financial year.
4. Refer to Note 22 'Trade and Other Payables' for further details.
5. Refer to Note 32 'Intangible Assets' for further details.
6. Prior year balances have been adjusted to reflect updated and additional information to assist the users of the financial statements.

Auditors’ Remuneration

Amounts received or due and receivable by the auditors of Lendlease Group and its consolidated 
entities for:

Audit services

Other assurance services

Total audit and other assurance services

Non audit services1

Total audit, other assurance and non audit services

June 2022

June 2021

$000s

$000s

7,004

882

7,886

70

7,956

7,019

822

7,841

438

8,279

1. Non audit services include amounts charged for work relating to financial, regulatory and asset due diligence of the Group and its consolidated entities.

Financial Statements

129

8. Finance Revenue and Finance Costs

Accounting Policies

Finance revenue is recognised as it is earned using the effective interest method, which applies the interest rate that discounts 
estimated future cash receipts over the expected life of the financial instrument. The discount is then recognised as finance
revenue over the remaining life of the financial instrument.

Finance costs include interest, amortisation of discounts or premiums relating to borrowings and amortisation of costs incurred in 
connection with the arrangement of new borrowings facilities. Costs incurred in connection with the arrangement of borrowings 
are capitalised and amortised over the life of the borrowings. Finance costs are expensed immediately as incurred unless they 
relate to acquisition and development of qualifying assets. Qualifying assets are assets that take more than six months to prepare 
for their intended use or sale. Finance costs related to qualifying assets are capitalised.

Finance Revenue

Other corporations

Other finance revenue

Total interest finance revenue

Interest discounting

Total finance revenue

Finance Costs

Interest expense in relation to other corporations

Interest expense in relation to lease liabilities

Less: Capitalised interest finance costs1

Total interest finance costs

Non interest finance costs

Total finance costs

Net finance costs

June 2022

June 2021

$m

$m

3

3

6

3

9

113

17

(25)

105

20

125

(116)

4

4

8

1

9

127

20

(18)

129

17

146

(137)

1. The weighted average interest rate used to determine the amount of interest finance costs eligible for capitalisation was 3.6 per cent (30 June 2021: 3.6 per cent), which is the 

effective interest rate.

 
130

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
9. Taxation

Accounting Policies

Income tax on the profit or loss for the financial year comprises current and deferred tax. Income tax is recognised in the Income 
Statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity. Under 
current Australian income tax law, LLT is not liable for income tax, including capital gains tax, to the extent that unitholders are 
attributed the taxable income of LLT.

Current tax is the expected tax payable on the taxable income for the financial year, using applicable tax rates (and tax laws) at 
the balance sheet date in each jurisdiction, and any adjustment to tax payable in respect of previous financial years.

Deferred tax is the expected tax payable in future periods as a result of past transactions or events and is calculated by 
comparing the accounting balance sheet to the tax balance sheet. Temporary differences are provided for any differences in the 
carrying amounts of assets and liabilities between the accounting and tax balance sheets. The following temporary differences
are not provided for:

• The initial recognition of taxable goodwill

• The initial recognition of assets or liabilities that affect neither accounting nor taxable profit

• Differences relating to investments in subsidiaries to the extent that they are not likely to reverse in the foreseeable future.

Measurement of deferred tax is based on the expected manner of realisation or settlement of the carrying amount of assets and 
liabilities, using applicable tax rates (and tax laws) at the balance sheet date.

Recognition of deferred tax assets is only to the extent it is probable that future taxable profits will be available so as the related 
tax asset will be realised. Deferred tax assets may include the following:

• Deductible temporary differences

• Unused tax losses

• Unused tax credits.

Management considers the estimation of future taxable profits to be an area of estimation uncertainty as a change in any of 
the assumptions used in budgeting and forecasting would have an impact on the future profitability of the Group. The Group 
prepares financial budgets and forecasts, covering a five year period, which are reviewed on a regular basis. These forecasts 
and budgets form the basis of future profitability to support the carrying value of the deferred tax assets. The performance 
of the Group is influenced by a variety of general economic and business conditions, which are outside the control of the 
Group, including the level of inflation, interest rates, exchange rates, commodity prices, ability to access funding, oversupply and 
demand conditions and government fiscal, monetary and regulatory policies.

Presentation of deferred tax assets and liabilities can be offset if there is a legally enforceable right to offset current tax liabilities 
and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity or on different tax entities, 
but are intended to be settled on a net basis or to be realised simultaneously.

Tax Consolidation
The Company is the head entity of the Australian Tax Consolidated Group comprising all the Australian wholly owned 
subsidiaries, excluding LLT. As a consequence, all members of the Australian Tax Consolidation Group are taxed as a single entity.

 
9.a. Income Tax Expense

Recognised in the Income Statement

Current Tax Expense

Current year

Adjustments for prior years

Current year tax losses (recognised)/written off

Total current tax expense

Deferred Tax Expense

Origination and reversal of temporary differences

Temporary differences recovered/recognised

Recognition of prior year net tax losses

Change in tax rate

Total deferred tax (benefit)

Income Tax Expense

Total income tax (benefit)/expense from continuing operations

Total income tax expense from discontinued operations1

Total income tax (benefit)/expense2

Reconciliation of Effective Tax Rate

(Loss)/profit before tax

Income tax using domestic corporate tax rate 30%

Adjustments for prior year

Non assessable and exempt income3

Non allowable expenses4

Net write off of tax losses through income tax expense

Temporary differences recognised through income tax expense5

Utilisation of capital losses on disposal of assets

Effect of tax rates in foreign jurisdictions6

Other7

Income tax (benefit)/expense2

Deferred Tax Recognised Directly in Equity

Relating to:

Hedging reserve

Impact of adoption of new accounting standard

Defined benefit plans remeasurements

Foreign currency translation reserve

Non controlling interest acquisition reserve

Total deferred tax recognised directly in equity

Financial Statements

131

June 2022

June 2021

$m

$m

200

3

(51)

152

(222)

17

19

(16)

(202)

(51)

1

(50)

(149)

(45)

3

(45)

5

34

17

(56)

(9)

46

(50)

39

-

6

11

-

56

132

(4)

40

168

(65)

7

(7)

(31)

(96)

68

4

72

294

88

(4)

(40)

7

39

7

(13)

(26)

14

72

2

4

41

(6)

3

44

1. Refer to Note 33 ‘Discontinued Operations’ for further detail.
2. Represents income tax benefit from continuing operations of $51 million and income tax expense from discontinued operations of $1 million. June 2021 results have been 

re-presented for discontinued operations during the period. Refer to Note 33 'Discontinued Operations' for further details.

3. Includes Lendlease Trust Group profit.
4. Includes accounting expenses for which a tax deduction is not allowed permanently.
5. Includes temporary differences not recognised in the current year that are written off to income tax expense in the current period and temporary differences that arose in a 

previous year but were not recognised until the current period.

6. The Group operates in a number of foreign jurisdictions for trading purposes which have significantly lower tax rates than Australia such as the United Kingdom and Singapore 

and higher tax rates such as the United States of America (blended federal, state and local rate) and Japan. This also includes the effect of changes in tax rates.

7. Includes additional tax expense associated with the capital gain on divestment of assets.

JUNE 2022

Tax 
(Expense)/ 

JUNE 2021

Tax 
(Expense)/ 

Before Tax

Benefit Net of Tax

Before Tax

Benefit Net of Tax

9.b. Tax Effect Relating to Other Comprehensive Income

Movements in hedging reserve

Movements in foreign currency translation reserve

Movements in non controlling interest acquisition reserve

Movements in defined benefit plans remeasurements

Total other comprehensive income net of tax

$m

175

74

(5)

50

294

$m

(39)

(11)

-

(6)

(56)

$m

136

63

(5)

44

238

$m

17

(114)

6

52

(39)

$m

(2)

6

-

(41)

(37)

$m

15

(108)

6

11

(76)

132

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section A. Performance continued
9. Taxation continued

9.c. Deferred Tax Assets and Liabilities

Recognised Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities are attributable to the following:

JUNE 2022

JUNE 2021

Assets

$m

Liabilities

$m

Assets

$m

Liabilities

$m

Loans and receivables

Inventories

Other financial assets

Other assets

Equity accounted investments

Investment properties

Property, plant and equipment

Intangible assets

Net defined benefit plans

Trade and other payables

Provisions

Borrowings and financing arrangements

Other financial and non financial liabilities

Unused revenue tax losses recognised

Unused capital tax losses recognised

Items with a tax base but no carrying value

Total deferred tax assets/(liabilities)

Deferred tax set off

Net deferred tax assets/(liabilities)

6

66

-

68

23

-

54

4

11

159

151

94

41

134

-

41

852

(708)

144

(74)

(315)

(54)

(13)

(363)

(9)

(11)

(11)

(68)

(13)

-

(13)

-

-

-

(26)

(970)

708

(262)

June 2022

Movement in temporary differences during the financial year:

Loans and receivables

Inventories

Other financial assets

Other assets

Equity accounted investments

Investment properties

Property, plant and equipment

Intangible assets

Net defined benefit plans

Trade and other payables

Provisions

Borrowings and financing arrangements

Other financial and non financial liabilities

Unused revenue tax losses recognised

Unused capital tax losses recognised

Items with a tax base but no carrying value

Total deferred tax assets/(liabilities)

1 July
2021

$m

(90)

(282)

(40)

108

(405)

(17)

28

(18)

(51)

170

117

54

20

99

9

12

(286)

Recognised 
in Income

Recognised 
in Equity

$m

$m

$m

22

9

(11)

(53)

103

(1)

15

11

-

(26)

42

31

21

36

(9)

12

202

-

-

-

-

(39)

-

-

-

(9)

-

-

(11)

-

3

-

-

(56)

-

24

(3)

-

1

9

-

-

3

2

(8)

7

-

(4)

-

(9)

22

1

89

9

112

12

-

40

1

16

180

117

62

20

99

9

38

805

(690)

115

Other/
Foreign 
Exchange

(91)

(371)

(49)

(4)

(417)

(17)

(12)

(19)

(67)

(10)

-

(8)

-

-

-

(26)

(1,091)

690

(401)

30 June
2022

$m

(68)

(249)

(54)

55

(340)

(9)

43

(7)

(57)

146

151

81

41

134

-

15

(118)

Financial Statements

133

1 July
2020

$m

Recognised 
in Income

Recognised 
in Equity

Other/
Foreign 
Exchange

$m

$m

$m

30 June
2021

$m

(51)

(389)

(49)

91

(399)

(57)

14

(21)

(13)

190

135

49

16

157

-

34

(293)

(35)

98

-

24

(16)

36

14

2

1

(2)

(33)

8

2

2

9

(14)

96

-

-

-

-

10

-

(4)

-

(41)

-

-

(6)

-

-

-

(3)

(44)

(4)

9

9

(7)

-

4

4

1

2

(18)

15

3

2

(60)

-

(5)

(45)

(90)

(282)

(40)

108

(405)

(17)

28

(18)

(51)

170

117

54

20

99

9

12

(286)

9.c. Deferred Tax Assets and Liabilities continued

June 2021

Movement in temporary differences during the financial year:

Loans and receivables

Inventories

Other financial assets

Other assets

Equity accounted investments

Investment properties

Property, plant and equipment

Intangible assets

Net defined benefit plans

Trade and other payables

Provisions

Borrowings and financing arrangements

Other financial and non financial liabilities

Unused revenue tax losses recognised

Unused capital tax losses recognised

Items with a tax base but no carrying value

Total net deferred tax (liabilities)/assets

Unrecognised Deferred Tax Assets

Deferred tax assets have not been recognised in respect of the following items:

Unused revenue tax losses

Unused capital tax losses

Net deductible temporary differences

Total unrecognised deferred tax assets

June 2022

June 2021

$m

74

102

69

245

$m

54

132

72

258

Of the unrecognised deferred tax assets of $245 million, only $31 million expires between 2023 to 2037. The remainder of the 
unrecognised deferred tax assets have no expiry date.

10. Events Subsequent to Balance Date

On 14 July 2022, Lendlease and Mitsubishi Estate Asia formed a joint venture to acquire the One Circular Quay development in Sydney 
for approximately $800 million in up front and deferred consideration, with an additional $50 million payment subject to certain project 
outcomes. Mitsubishi Estate currently holds a 19.9 per cent interest in the joint venture. Subject to the satisfaction of certain conditions, 
this will increase to 66.7 per cent and Lendlease’s ownership will reduce to 33.3 per cent. Lendlease will receive an acquisition 
fee on settlement, earn development management and construction management fees, equity returns on its capital and potentially 
performance fees.

On 9 August 2022, the Group exchanged contracts with a third party to acquire a further 13 per cent interest in the asset management 
income stream of the Group’s Military Housing portfolio, through the existing DoD Asset Management Holdings joint venture. The 
Group received $86 million in consideration on financial close, generating an estimated pre tax gain on sale of $73 million.

There were no other material events subsequent to the end of the financial reporting period.

134

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section B. Investment

Investment in the Development pipeline, joint ventures in property projects, the retirement sector, and more passive assets, such 
as property funds, drive the current and future performance of the Group. This section includes disclosures for property such as 
Inventories and indirect property assets such as Equity Accounted Investments and Other Financial Assets contained within the 
Statement of Financial Position.

11. Inventories

Accounting Policies

Development Properties

Property acquired for development and sale in the ordinary course of business is carried at the lower of cost and Net Realisable 
Value (NRV).

The cost of development properties includes expenditure incurred in acquiring the property, preparing it for sale and borrowing 
costs incurred.

The NRV is the estimated selling price, less the estimated costs of completion and selling expenses. Management considers the 
estimation of both selling prices and costs of completion to be an area of estimation uncertainty, as these estimations take into 
consideration market conditions affecting each property and the underlying strategy for selling the property.

The recoverable amount of each property is assessed at each balance date and accounting judgement is required to assess 
whether a provision is raised where cost (including costs to complete) exceeds NRV.

Inventories are expensed as cost of sales in the Income Statement. Management uses accounting judgement in determining 
the following:

• The apportionment of cost of sales through sales revenue

• The amount of cost of sales, which includes costs incurred to date and final forecast costs

• The nature of the expenditure, which may include acquisition costs, development costs, borrowing costs and those costs 

incurred in preparing the property for sale.

Construction Contract Assets

The gross amount of Construction and Development Work in Progress consists of costs attributable to work performed, including 
recoverable pre contract and project bidding costs and emerging profit after providing for any foreseeable losses. In applying the 
accounting policies on providing for these losses, accounting judgement is required.

Construction contract assets are presented as part of inventories for all contracts in which revenue recognised (costs incurred 
plus recognised profits) exceed progress billings. If progress billings and/or recognised contract losses exceed revenue 
recognised, then the difference is presented in Trade and other payables as a Construction contract liability.

Current

Development properties1

Construction contract assets

Other

Total current

Non Current

Development properties1

Total non current

Total inventories

Note

21.a

June 2022

June 2021

$m

792

664

3

1,459

2,320

2,320

3,779

$m

894

565

10

1,469

2,404

2,404

3,873

1. The Group has considered the impacts of the COVID pandemic and other economic conditions on its recoverability assessment of inventories at 30 June 2022. As part of 

its semi annual review of development property projects, the Group has considered sales volumes in the short term, production timeframes, and potential increased costs for 
its projects. The carrying value of the Group’s projects has not been materially impacted during the period due to their long dated nature, except for those projects impacted 
by the revised strategy announcement and business review undertaken by the Global CEO during the financial year. The Development impairment expense of $289 million 
(30 June 2021: $nil) and Property inventories impairment expense of $12 million (30 June 2021: $13 million reversal) as disclosed in Note 7 'Other Expenses', have been 
recorded net against the inventories balance. Refer to Note 7 ‘Other Expenses’ for further detail.

Financial Statements

135

12. Equity Accounted Investments

Accounting Policies

Equity Accounted Investments (Associates and Joint Ventures)
As outlined in Note 5 ‘Share of Profit of Equity Accounted Investments’, investments in Associates and Joint Ventures are equity 
accounted. The share of investment recognised under the equity method is the Group’s share of the investment’s net assets 
based on ownership interest held.

Investments in associates and joint ventures are carried at the lower of the equity accounted carrying amount and the recoverable 
amount. When the Group’s share of losses exceeds the carrying amount of the equity accounted investment (including assets that 
form part of the net investment in the associate or joint venture entity), the carrying amount is reduced to nil and recognition of 
further losses is discontinued except to the extent that the Group has obligations in respect of the associate or joint venture.

Dividends from associates and joint ventures represent a return on the Group’s investment and, as such, are applied as a 
reduction to the carrying value of the investment. Unrealised gains arising from transactions with equity accounted investments 
are eliminated against the investment in the associate or joint venture to the extent of the Group’s interest in the associate 
or joint venture. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no 
evidence of impairment. Other movements in associates’ and joint ventures’ reserves are recognised directly in the Group’s 
consolidated reserves.

Development - Investment Property
Investments in this category hold investment property that is under construction and is subject to periodic revaluations. These 
revaluations represent development profit earned and are recognised in the Development segment.

Development - Inventory

Investments in this category contain inventory under development and are held at cost. Revenue is recognised once the inventory 
settles with the customer and is recognised in the Development segment.

Service Concession Arrangements (SCAs)
The Group equity accounts its investment in project companies with SCAs through Public Private Partnerships (PPPs). These 
arrangements provide facilities management and maintenance services with terms generally of 25 to 30 years. They also 
incorporate contractual obligations to make available the individual assets for their prescribed use and, where necessary, overhaul 
or replace major items of plant and equipment related to the assets with payment obtained through periodic draw downs from 
the relevant government authorities.

Joint Operations
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets 
and obligations for the liabilities relating to the arrangement.

Investments in joint operations are accounted for by recognising amounts on a line by line basis in accordance with the 
accounting standards applicable to the particular assets, liabilities, revenues and expenses in relation to the Group’s interest in the 
joint operation.

Associates

Investment in associates

Less: Impairment

Total associates

Joint Ventures

Investment in joint ventures

Less: Impairment

Total joint ventures

Total equity accounted investments

Note

12.a

12.a

12.b

12.b

June 2022

June 2021

$m

598

-

598

3,806

(25)

3,781

4,379

$m

444

(3)

441

3,356

(39)

3,317

3,758

136

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section B. Investment continued
12. Equity Accounted Investments continued

12.a. Associates

Australia

Investments

Lendlease Communities Fund 1

Lendlease Sub Regional Retail Fund1

Lendlease Real Estate Partners 4

Other

Total Australia

Asia

Investments

Lendlease Global Commercial REIT

Lendlease Asian Retail Investment Fund 1

Lendlease Asian Retail Investment Fund 2

Lendlease Asian Retail Investment Fund 3

Total Asia

Americas

Investments

Other

Total Americas

Total Group

Less: Impairment

Total associates

INTEREST

SHARE OF PROFIT

NET BOOK VALUE

June 2022

June 2021

June 2022

June 2021

June 2022

June 2021

%

%

$m

$m

$m

$m

-

10.0

33.3

26.2

48.7

39.8

-

20.8

10.0

-

25.9

48.7

39.4

15.1

-

6

1

-

7

30

-

6

8

44

3

3

54

-

54

-

1

-

-

1

4

-

(1)

1

4

3

3

8

-

8

-

25

34

5

64

485

4

41

-

530

4

4

598

-

598

3

25

-

5

33

249

4

32

123

408

3

3

444

(3)

441

1. Although the Group has a 10 per cent ownership interest in Lendlease Sub Regional Retail Fund, it holds at least 20 per cent of the voting rights over the fund and has 

significant influence over the investment. As a result, the Group applies equity accounting for its ownership interest.

12.b. Joint Ventures

Australia

Investments
Lendlease Retirement Living Trust

Lendlease DTC Industrial Trust

Other

Development
Development - Investment Property

Circular Quay Tower

Victoria Cross

Development - Inventory

Melbourne Quarter R1

North East Link

Frankston Hospital

One Sydney Harbour R1 Trust

One Sydney Harbour R2 Trust

Other Development

Total Australia

INTEREST

SHARE OF PROFIT

NET BOOK VALUE

June 2022

June 2021

June 2022

June 2021

June 2022

June 2021

%

%

$m

$m

$m

$m

25.1

50.0

-

75.0

50.0

20.0

50.0

75.0

75.0

50.0

-

20.0

75.0

50.0

-

-

75.0

75.0

63

(6)

-

31

-

1

(1)

-

1

-

2

91

40

-

(1)

15

2

5

-

-

-

-

-

61

526

161

-

-

153

35

153

88

240

205

15

952

-

-

150

132

64

-

-

111

146

25

1,576

1,580

Financial Statements

137

INTEREST

SHARE OF PROFIT

NET BOOK VALUE

June 2022

June 2021

June 2022

June 2021

June 2022

June 2021

%

%

$m

$m

$m

$m

25.0

30.0

49.0

15.0

60.0

25.0

30.0

49.0

-

60.0

20.0

20.0

50.0

50.0

50.0

50.0

50.0

50.0

37.5

50.1

50.1

50.0

25.0

42.5

42.5

50.1

25.0

50.0

40.0

-

50.0

50.0

50.0

50.0

50.0

37.5

50.1

50.1

-

25.0

42.5

42.5

50.1

20.2

50.0

40.0

50.0

50.0

-

9

-

-

-

9

9

-

-

4

15

(1)

(4)

(3)

(1)

19

7

4

-

2

-

-

5

7

-

-

2

(25)

-

6

8

127
-

127

54

181

-

(16)

(1)

-

-

(17)

4

-

-

13

17

-

(3)

(4)

(3)

24

2

(1)

-

-

-

-

-

20

-

-

-

(11)

-

14

24

92
-

92

8

100

3

392

49

18

501

963

173

14

106

78

103

72

14

25

8

593

91

89

88

4

4

27

107

93

39

40

35

14

38

3

358

24

-

388

773

177

15

-

52

67

31

21

39

7

409

83

79

82

-

-

23

99

82

18

31

23

41

32

5

674

3,806
(25)

3,781

598

4,379

1

594

3,356
(39)

3,317

441

3,758

12.b. Joint Ventures

Asia

Investments
CDR JV Limited (313@somerset)

Paya Lebar Quarter

Development
Development - Investment Property

Certis and Lendlease Property Trust

Lendlease Life Science and Innovation Partners
The Exchange TRX1

Total Asia

Europe

Investments
LRIP LP2

Other

Development
Development - Investment Property

IQL Office LP

LRIP 2 LP

MSG South

Milano Innovation District

Stratford City Business District Limited (International 
Quarter London)

Development - Inventory

Victoria Drive Wandsworth

Other Development

Total Europe

Americas

Investments
845 Madison

Americas Residential Partnership

Clippership Wharf Multifamily Holdings

720 S Wells Holdings

DoD Asset Management Holdings

Other

Development
Development - Investment Property

60 Guest Street

Americas Residential Partnership

211 North Harbor Drive Venture

445 East Waterside

SB Polk Street

1 Java Holdings

La Cienega

Development - Inventory

277 Fifth Avenue

Other Development

Construction
Lendlease Turner Joint Venture

Total Americas

Total Group
Less: Impairment

Total joint ventures

Total associates

Total equity accounted investments

1. Investment includes both investment property and residential inventory.
2. During the year, LRIP LP was transferred from Development segment to the Investments segment subsequent to project completion.

138

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section B. Investment continued
12. Equity Accounted Investments continued
12.c. Material Associates and Joint Ventures Summarised Financial Information

The table below provides summarised financial information for those associates and joint ventures that are material to the Group. 
Material associates and joint ventures have been determined by comparing individual investment net book value with the total equity 
accounted investment carrying value and share of profit, along with consideration of relevant qualitative factors. The information 
disclosed reflects the amounts presented in the financial statements of the relevant joint ventures and associates and, where indicated, 
the Group’s share of those amounts. They have been amended to reflect adjustments made by the Group when using the equity 
method, including fair value adjustments and differences in accounting policies. The nature and principal activities of the material 
associates and joint ventures is investment in property assets.

Income Statement2

Revenue and other income

Cost of sales

Other expenses

Unrealised fair value gains/(losses)

Finance costs

Income tax (benefit)/expense

Profit/(loss) for the financial year

Other comprehensive 
(expense)/income

Total comprehensive income

LENDLEASE GLOBAL 
COMMERCIAL REIT

LENDLEASE 
RETIREMENT 
LIVING TRUST

PAYA 
LEBAR QUARTER1

THE EXCHANGE
TRX

June 2022

June 2021 June 2022

June 2021 June 2022

June 2021 June 2022

June 2021

$m

173

(27)

(15)

52

(16)

-

167

(41)

126

$m

81

(22)

(20)

(31)

(10)

-

(2)

9

7

$m

240

(45)

(68)

54

(21)

(1)

159

34

193

$m

188

(24)

(60)

(13)

(23)

1

69

8

77

$m

193

(41)

(18)

11

(55)

(1)

89

-

89

$m

151

(44)

(18)

11

(52)

(2)

46

-

46

$m

56

(45)

(4)

45

(3)

9

58

10

68

$m

44

(34)

(7)

35

(1)

(9)

28

5

33

Group's ownership interest

26.2%

25.9%

25.1%

50.0%

30.0%

30.0%

60.0%

60.0%

Group's total share of:

Profit/(loss) for the financial year

Other adjustments

Total profit/(loss) for the 
financial year

Other comprehensive 
income/(expenses)

Total comprehensive 
income/(expenses)

44

(14)

30

11

41

(1)

5

4

(10)

(6)

63

-

63

11

74

40

-

40

5

45

27

(18)

9

23

32

14

(30)

(16)

(9)

(25)

35

(35)

-

18

18

17

(17)

-

(17)

(17)

1. Prior period balances have been reclassified to reflect updated management information.
2. The underlying investments in the material associate and joint ventures are office, retail and retirement living investment properties measured at fair value. At 30 June 2022, 

valuations were undertaken on the underlying assets. The carrying value of the investments are considered recoverable as it correlates with the net assets of the associate and 
joint ventures, which have been valued at 30 June 2022.

The table below provides summarised financial information for those associates and joint ventures that are individually immaterial to 
the Group:

Income Statement

Aggregate amounts of the Group's share of:

Profit from continuing operations

Other comprehensive income/(expense)

Aggregate amounts of Group's share of total comprehensive income/
(expense) of individually immaterial equity accounted investments

ASSOCIATES

JOINT VENTURES

June 2022

June 2021

June 2022

June 2021

$m

24

6

30

$m

4

(10)

(6)

$m

55

145

200

$m

68

(46)

22

Financial Statements

139

LENDLEASE GLOBAL 
COMMERCIAL REIT

LENDLEASE 
RETIREMENT 
LIVING TRUST1

PAYA 
LEBAR QUARTER

THE EXCHANGE
TRX

June 2022

June 2021 June 2022

June 2021 June 2022

June 2021 June 2022

June 2021

$m

48

23

71

$m

245

9

254

$m

41

59

100

$m

44

28

72

$m

122

93

215

$m

107

95

202

$m

63

45

108

$m

41

6

47

3,754

1,409

7,826

7,441

3,129

2,960

1,522

1,213

16

19

-

52

-

38

-

2

-

3

-

4

-

20

-

4

3,789

1,461

7,864

7,443

3,132

2,964

1,542

1,217

-

312

44

356

1,200

19

1,219

2,285

-

-

24

24

536

11

547

1,144

5,054

4,835

-

78

-

56

5,132

4,891

777

-

777

742

-

742

2,055

1,882

-

-

43

43

1,813

33

1,846

1,458

-

-

55

55

1,733

86

1,819

1,292

Statement of Financial Position

Current assets

Cash and cash equivalents

Other current assets

Total current assets

Non current assets

Investment properties

Equity accounted investments

Other non current assets

Total non current assets

Current liabilities

Resident liabilities

Financial liabilities (excluding 
trade payables)

Other current liabilities

Total current liabilities

Non current liabilities

Financial liabilities (excluding 
trade payables)

Other non current liabilities

Total non current liabilities

Net assets

Reconciliation to Carrying Amounts

Opening net assets 1 July

1,144

1,037

1,882

1,805

1,292

1,297

Total comprehensive income/(loss) for 
the financial year

Acquisition/contributions

Distributions

Foreign currency translation for the 
financial year

Closing net assets

% ownership

Group's share of net assets

Other adjustments

Carrying amount at end of the 
financial year

126

1,003

(74)

86

2,285

26.2%

599

(114)

7

197

(47)

(50)

1,144

25.9%

296

(47)

485

249

193

-

(20)

-

2,055

25.1%

516

(3)

513

77

-

-

-

89

6

-

71

1,882

50.0%

941

(2)

1,458

30.0%

437

(45)

939

392

46

14

-

(65)

1,292

30.0%

388

(30)

358

1. The carrying amount at the end of the financial year differs to Note 12b ‘Joint Ventures’ due to an impairment of $13 million.

Material joint ventures had $154 million (June 2021: $141 million) in capital expenditure commitments.

-

113

49

162

532

-

532

956

658

68

172

-

58

956

-

96

30

126

444

-

444

694

603

33

91

-

(33)

694

60.0%

60.0%

574

(73)

501

416

(28)

388

140

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section B. Investment continued
12. Equity Accounted Investments continued
The table below provides summarised financial information for those associates and joint ventures that are individually immaterial to 
the Group:

Statement of Financial Position

Aggregate carrying value of individually immaterial equity 
accounted investments

13. Other Financial Assets

ASSOCIATES

JOINT VENTURES

June 2022

June 2021

June 2022

June 2021

$m

113

$m

195

$m

2,387

$m

2,046

Accounting Policies

Financial Assets at fair value through profit or loss on initial recognition are measured at fair value (generally transaction price) 
and subsequently stated at fair value. Transaction costs are recorded as expenses when they are incurred. Any gain or loss arising 
from a change in fair value is recognised in the Income Statement.

Financial Assets at amortised cost are presented within Note 21 ‘Loans and Receivables’.

Current Measured at Fair Value

Fair Value Through Profit or Loss - Designated at Initial Recognition

Derivatives

Total current

Non Current Measured at Fair Value

Fair Value Through Profit or Loss - Designated at Initial Recognition

Lendlease International Towers Sydney Trust

Lendlease One International Towers Sydney Trust

Australian Prime Property Fund - Industrial

Australian Prime Property Fund - Commercial

Australian Prime Property Fund - Retail

Military Housing Projects Initiative

Parkway Parade Partnership Limited

Other investments

Derivatives

Total non current

Total other financial assets

1. Refer to Note 26 ‘Fair Value Measurement’ for details on basis of determining fair value and valuation technique.

13.a. Fair Value Reconciliation

The reconciliation of the carrying amount for Level 3 financial assets is set out as follows:

Carrying amount at beginning of financial year

Disposals

Net gains recognised in Income Statement

Other movements

Carrying amount at end of financial year

Fair Value

June 2022

June 2021

Level1

Level 2

Level 3

Level 3

Level 3

Level 3

Level 3

Level 3

Level 3

Level 3

Level 2

$m

24

24

174

62

136

412

59

216

68

22

32

$m

7

7

165

57

120

386

56

201

65

20

10

1,181

1,205

1,080

1,087

June 2022

June 2021

$m

1,070

(7)

65

21

1,149

$m

1,068

(39)

61

(20)

1,070

The potential effect of using reasonably possible alternative assumptions for valuation inputs would not have a material impact on 
the Group.

Financial Statements

141

Section C. Liquidity and Working Capital

The ability of the Group to fund the continued investment in the development pipeline, invest in new opportunities and meet 
current commitments is dependent on available cash, undrawn debt facilities and access to third party capital. This section 
contains disclosures on the financial assets, financial liabilities, cash flows and equity that are required to finance the Group’s 
activities, including existing commitments and the liquidity risk exposure associated with financial liabilities. The section also 
contains disclosures for the Group’s trading assets, excluding inventories, and the trading liabilities incurred as a result of trading 
activities used to generate the Group’s performance.

14. Cash and Cash Equivalents

Accounting Policies

Cash and cash equivalents include cash on hand, deposits held at call with banks, bank overdrafts and other short term highly 
liquid investments that are readily convertible to known amounts of cash within three months and which are subject to an 
insignificant risk of changes in value.

Bank overdrafts (if applicable) are shown as a current liability on the Statement of Financial Position and are shown as a reduction 
to the cash balance in the Statement of Cash Flows.

Cash

Short term investments1

Total cash and cash equivalents

June 2022

June 2021

$m

1,128

169

1,297

$m

1,303

359

1,662

1. Short term investments earned variable rates of interest which averaged 0.5 per cent per annum during the financial year (30 June 2021: 0.5 per cent).

142

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section C. Liquidity and Working Capital continued
15. Notes to Statement of Cash Flows

June 2022

June 2021

Reconciliation of Profit after Tax to Net Cash Provided by Operating Activities

(Loss)/profit after tax (including external non controlling interests)

Amortisation and depreciation

Net gain on sale of investments, plant and equipment

(Reversal)/impairment of equity accounted investments

Impairment/(reversal) of inventories

Impairment of loans and receivables

Impairment of intangible assets

Tenancy impairments

Impairment of property, plant and equipment

Net unrealised foreign exchange loss/(gain) and currency hedging costs

Net fair value gain on investments

Share of profit of equity accounted investments

Dividends/distributions from equity accounted investments

Fair value gain on investment properties

Other

Net cash provided by operating activities before changes in assets and liabilities

Changes in Assets and Liabilities Adjusted for Effects of Purchase and
Disposal of Consolidated Entities and Operations During the Financial Year

Decrease/(increase) in receivables

(Increase)/decrease in inventories

Decrease/(increase) in other assets

Increase in net defined benefit plans

Decrease in payables

Decrease in operating derivatives assets/liabilities

Increase in deferred tax items

Decrease in current tax

Increase in other provisions

Net cash provided by operating activities1

1. Balances include cash flows relating to both continuing and discontinued operations.

16. Borrowings and Financing Arrangements

$m

(99)

163

(280)

(15)

294

2

83

129

-

31

(65)

(181)

68

(4)

(58)

68

11

(426)

17

(54)

(514)

53

(203)

58

155

(835)

$m

222

207

(388)

2

(13)

-

2

-

7

(38)

(61)

(100)

155

(3)

(41)

(49)

(1,021)

1,457

(26)

(80)

(119)

40

(5)

20

251

468

Accounting Policies

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently measured at 
amortised cost using the effective interest rate method. Under the amortised cost method the difference between the amount 
initially recognised and the redemption value is recorded in the Income Statement over the period of the borrowing on an 
effective interest basis. Borrowings are referred to in this section using their redemption value when describing the terms 
and conditions.

16.a. Borrowings – Measured at Amortised Cost

Current

Commercial notes

Total current

Non Current

Commercial notes

Bank credit facilities

Total non current

Total borrowings

Financial Statements

143

June 2022

June 2021

$m

-

-

2,082

275

2,357

2,357

$m

555

555

1,682

120

1,802

2,357

The Group has net debt of $1,060 million (30 June 2021: $695 million) and is 7.3 per cent (30 June 2021: 5.0 per cent) geared at the 
balance sheet date. The Group's gearing is calculated as net debt to total tangible assets, less cash.

16.b. Finance Facilities

The Group has access to the following lines of credit:

Commercial Notes

Facility available

Amount of facility used

Amount of facility unused

Bank Credit Facilities

Facility available

Amount of facility used

Amount of facility unused

Bank Overdrafts

Facility available and amount unused

Commercial notes include:

June 2022

June 2021

$m

$m

2,082

(2,082)

-

2,798

(275)

2,523

2,237

(2,237)

-

3,264

(120)

3,144

124

124

• £300 million of guaranteed unsecured notes issued in October 2006 in the UK bond market with a 6.125 per cent per annum 

coupon matured and was repaid in October 2021

• US$400 million of guaranteed unsecured senior notes issued in May 2016 in the US Reg. S market with a 4.5 per cent per annum 

coupon maturing in May 2026

• S$300 million of guaranteed unsecured senior notes issued in April 2017 in the Singapore bond market with a 3.9 per cent coupon 

maturing in April 2027

• $500 million of guaranteed unsecured Green senior notes issued in October 2020 in the Australian bond market with a 3.4 per cent 

coupon maturing October 2027

• $80 million of unsecured senior medium term notes issued as an A$ private placement in December 2018 with a 5.4 per cent per 

annum coupon maturing in December 2028

• $300 million of guaranteed unsecured Green senior notes issued in March 2021 in the Australian bond market with a 3.7 per cent 

coupon maturing March 2031

• £250 million of guaranteed unsecured Green senior notes issued in December 2021 in the Sterling bond market with a 3.5 per cent 

coupon maturing in December 2033.

Bank credit facilities include:

• $1,800 million syndicated cash advance facility with Tranche A $900 million and Tranche B $900 million. Tranche A $900 million and 

Tranche B were cancelled during the financial year

• $300 million syndicated loan facility was repaid and cancelled during the financial year

• £400 million club bank facility maturing in March 2023 was undrawn as at 30 June 2022

• $235 million A$ syndicated loan facility was repaid and cancelled during the financial year

• US$300 million sustainability linked loan maturing in July 2024 was undrawn as at 30 June 2022

• CNY928 million bank facility maturing in January 2025 was drawn to $188 million as at 30 June 2022

• S$300 million sustainability linked loan maturing in February 2025 was drawn to $63 million as at 30 June 2022

• $800 million sustainability linked loan with Tranche A $400 million maturing in November 2025 was undrawn as at 30 June 2022 

and Tranche B $400 million maturing in November 2026 was undrawn as at 30 June 2022

• €200 million sustainability linked loan maturing in July 2026 was undrawn as at 30 June 2022.

The bank overdraft facilities may be drawn at any time and are repayable on demand.

The Group has not defaulted on any obligations in relation to its borrowings and financing arrangements.

144

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section C. Liquidity and Working Capital continued
16. Borrowings and Financing Arrangements continued

June 2022

Within one year

Between one and five years

More than five years

Total

June 2021

Within one year

Between one and five years

More than five years

Total

INTEREST EXPOSURE

CURRENCY

Fixed
$m

Floating
$m

-

1,097

1,190

2,287

555

644

1,151

2,350

-

63

7

70

-

-

7

7

Total
$m

-

1,160

1,197

2,357

555

644

1,158

2,357

A$
$m

-

-

756

756

-

-

855

855

US$
$m

-

580

-

580

-

531

-

531

£
$m

-

17

441

458

555

-

7

562

CNY
$m

-

188

-

188

-

113

-

113

S$
$m

-

375

-

375

-

-

296

296

Total
$m

-

1,160

1,197

2,357

555

644

1,158

2,357

16.c. Movement in Borrowings and Financing Arrangements

Balance at beginning of financial year

Net proceeds from borrowings

Effect of foreign exchange rate movements

Other movements

Balance at end of financial year

17. Issued Capital

Accounting Policies

Note

16.a

June 2022

June 2021

$m

2,357

70

24

(94)

$m

2,395

33

(49)

(22)

16.a

2,357

2,357

Issued Capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognised as a 
deduction from equity.

When share capital recognised as equity is repurchased, the amount of the consideration paid, including directly attributable 
costs, is recognised as a change in equity. Repurchased shares are typically classified as treasury shares and are recognised as a 
deduction from equity.

LENDLEASE CORPORATION LIMITED

LENDLEASE TRUST

June 2022

June 2021

June 2022

June 2021

No. of 
Shares

(m)

No. of 
Shares

(m)

$m

No. of Units

No. of Units

$m

(m)

$m

(m)

$m

689

1,888

688

1,889

689

1,537

688

1,536

-

-

-

3

-

-

1

-

-

3

(3)

(1)

-

-

-

1

-

-

1

-

-

1

-

-

689

1,891

689

1,888

689

1,538

689

1,537

Issued capital at beginning 
of financial year, net of 
prior period share buyback

Distribution Reinvestment 
Plan (DRP)

Share issue via 
institutional placement
(net of transaction costs)

Share issue via Security 
Purchase Plan
(net of transaction costs)

Issued capital at end of 
financial period

17.a. Issuance of Securities

As at 30 June 2022, the Group had 689 million stapled securities on issue, equivalent to the number of Lendlease Corporation shares 
and Lendlease Trust (LLT) units on issue as at that date. The issued units of LLT are not owned by the Company and are therefore 
presented separately in the Consolidated Statement of Financial Position within equity.

Financial Statements

145

17.b. Security Accumulation Plans

The Group’s Distribution Reinvestment Plan (DRP) was reactivated in February 2011. The last date for receipt of an election notice for 
participation in the DRP is 30 August 2022. The issue price is the arithmetic average of the daily volume weighted average price of 
Lendlease Group stapled securities traded (on the Australian Securities Exchange) for the period of five consecutive business days 
immediately following the record date, commencing on 30 August 2022, for determining entitlements to distribution. If that price is less 
than 50 cents, the issue price will be 50 cents. Stapled securities issued under the DRP rank equally with all other stapled securities 
on issue.

17.c. Terms and Conditions

Issued capital for Lendlease Corporation Limited comprises ordinary shares fully paid. A stapled security represents one share in the 
Company stapled to one unit in LLT. Stapled securityholders have the right to receive declared dividends from the Company and 
distributions from LLT and are entitled to one vote per stapled security at securityholders’ meetings. Ordinary stapled securityholders 
rank after all creditors in repayment of capital.

The Group does not have authorised capital or par value in respect of its issued stapled securities.

18. Capital Management

The Group assesses capital management as part of its broader strategic plan. The Group focuses on interrelated financial parameters, 
including Return on Equity, earnings growth and borrowing capacity. The Group also monitors its gearing ratio, leverage ratio, interest 
coverage ratio and weighted average cost of debt and maturity profile. These are all taken into account when the Group makes 
decisions on how to invest its capital and evaluate its existing investments.

The Group’s capital includes total equity, borrowings and other interest bearing liabilities. When investing capital, the Group’s objective 
is to deliver strong total securityholder returns and to maintain an investment grade credit rating by maintaining an appropriate financial
profile. The Moody’s/Fitch long term credit ratings at 30 June 2022 are Baa3/BBB- respectively (June 2021: Baa3/BBB-).

The capital structure of the Group can be changed by equity issuance, paying distributions to securityholders, the Distribution 
Reinvestment Plan and changing the level of debt. For further information on how the Group allocates and manages capital, refer to 
details of the Portfolio Management Framework in the Managing and Measuring Value - Financial section and Performance and Outlook 
section of this Annual Report.

19. Liquidity Risk Exposure

Further information on liquidity risk is disclosed in Note 24 ‘Financial Risk Management’. As disclosed in Note 27 ‘Contingent Liabilities’, 
in certain circumstances, the Company guarantees the performance of particular Group entities in respect of their obligations including 
bonding and bank guarantees. Issued bank guarantees have cash collateralisation requirements if the bank guarantee facility is not 
renewed by the provider.

At 30 June 2022, the Group does not anticipate a significant liquidity risk in relation to the following financial liabilities. This is due to 
the Group’s strong financial profile, as supported by the significant committed undrawn facilities and low gearing ratio. Refer to Note 14 
‘Cash and Cash Equivalents’ and Note 16 ‘Borrowings and Financing Arrangements’.

The Group has provided collateral of $nil (June 2021: $nil) against letter of credit facilities.

 
146

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section C. Liquidity and Working Capital continued
19. Liquidity Risk Exposure continued
The following are the contractual cash flow maturities of financial liabilities including estimated interest payments:

June 2022

Non Derivative Financial Liabilities

Trade and other payables1

Lease liabilities

Borrowings and financing arrangements

Total

Derivative Financial Liabilities

(Outflow)

Inflow

Total

June 2021

Non Derivative Financial Liabilities

Trade and other payables1

Lease liabilities

Borrowings and financing arrangements

Total

Derivative Financial Liabilities

(Outflow)

Inflow

Total

Carrying 
Amount

Contractual 
Cash Flows

Less Than 
One Year

One to Two 
Years

Two to Five 
Years

More Than 
Five Years

Note

$m

$m

$m

$m

$m

$m

22

22

16.a

22

22

16.a

5,101

408

2,357

7,866

-

130

130

5,156

474

2,357

7,987

-

37

37

5,117

450

2,878

8,445

(1,286)

1,415

129

5,172

526

2,719

8,417

(1,127)

1,164

37

3,549

86

140

3,775

(1,163)

1,190

27

3,793

80

690

4,563

(990)

1,001

11

914

92

197

1,203

(24)

45

21

770

115

76

961

(23)

22

(1)

637

204

913

1,754

(67)

124

57

580

206

668

1,454

(61)

73

12

17

68

1,628

1,713

(32)

56

24

29

125

1,285

1,439

(53)

68

15

1. Trade and other payables are presented excluding lease liabilities. The carrying amount of trade and other payables excludes $958 million of current and $78 million of non 

current amounts (June 2021: $902 million of current and $67 million of non current) in relation to items where there is no future cash outflow or liquidity risk.

Other contractually committed cash flows the Group is exposed to are detailed in Note 20 ‘Commitments’.

20. Commitments

20.a. Capital Expenditure

At balance date, capital expenditure commitments agreed or contracted but not provided for in the 
financial statements are as follows:

Due within one year

Due between one and five years

Due later than five years

Total

20.b. Investments

At balance date, capital commitments existing in respect of interests in equity accounted investments 
and other investments contracted but not provided for in the financial statements are as follows:

Due within one year

Due between one and five years

Due later than five years

Total

June 2022

June 2021

$m

$m

-

-

-

-

4

-

-

4

June 2022

June 2021

$m

$m

1,131

1,222

8

2,361

794

2,027

72

2,893

Financial Statements

147

June 2022

June 2021

$m

76

162

-

238

$m

5

227

-

232

20.c. Investment Properties

At balance date, capital commitments existing in respect of the purchase, construction or development 
of investment properties, contracted but not provided for in the financial statements, are as follows:

Due within one year

Due between one and five years

Due later than five years

Total

21. Loans and Receivables

Accounting Policies

Loans and receivables, which include trade and other receivables, are non derivative financial assets with fixed or determinable 
payments that are not equity securities. They arise when the Group provides money, goods or services directly to a debtor 
with no intention of trading the receivable. Contract debtors represent receivables where the right to receive payment from 
customers remains conditional. Other receivables include receivables related to investment management, property development 
and miscellaneous items.

Loans and receivables are carried at amortised cost using the effective interest method, which applies the interest rate that 
discounts estimated future cash receipts over the term of the loans and receivables. Cash flows relating to short term trade and 
other receivables are not discounted if the effect of discounting is immaterial. The discount, if material, is then recognised as 
revenue over the remaining term.

The Group assesses provision for impairment of loans and receivables based on expected loss, and books a provision if material. 
The Group considers reasonable and supportable information that is relevant and available. This includes both quantitative and 
qualitative information and analysis, based on the Group’s historical impairment experience, credit assessment of customers and 
any relevant forward looking information. The amount of the provision is recognised in the Income Statement.

Retentions receivable on construction contracts represent deposits held by the Group until the satisfaction of conditions 
specified in the contract are met.

Current

Trade receivables

Less: Impairment

Related parties

Retentions

Contract debtors

Accrued income

Other receivables

Total Current

Non Current

Trade receivables

Related parties

Less: Impairment

Retentions

Other receivables

Total non current

Total loans and receivables

Note

21.a

21.a

June 2022

June 2021

$m

726

(13)

713

208

259

291

82

480

$m

602

(12)

590

185

279

247

78

362

2,033

1,741

2

589

(5)

586

71

1,239

1,896

3,929

-

570

(4)

566

70

1,235

1,871

3,612

As at the reporting date, $603 million of the trade receivables were current (30 June 2021: $478 million) and $123 million were past 
due (30 June 2021: $124 million). Of the past due amount, $110 million was not impaired (30 June 2021: $112 million). ‘Past due’ is 
defined under accounting standards to mean any amount outstanding for one or more days after the contractual due date. Of the total 
trade debtors, 7.7 per cent (30 June 2021: 6.5 per cent) are aged greater than 90 days. Other than trade debtors, no other loans and 
receivables are considered past due at 30 June 2022 (30 June 2021: $nil).

148

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section C. Liquidity and Working Capital continued
21. Loans and Receivables continued

Provision for Impairment

Carrying amount at beginning of financial year

Bad and doubtful debts impairment loss net of provisions written back

Utilised bad and doubtful debts impairment provision

Other movements (including foreign exchange rate movements)

Carrying amount at end of financial year

June 2022

June 2021

$m

$m

16

3

-

(1)

18

18

-

(1)

(1)

16

Total impairment as a percentage of total loans and receivables

0.5%

0.4%

The credit quality of all loans and receivables, including those neither past due nor impaired, is assessed and monitored on an ongoing 
basis. As the majority of the Group’s customers are government entities for the Construction business and are institutional investors 
in the Development and Investment businesses, no additional risk has been identified. Impairment as noted above was immaterial at 
30 June 2022. The impairment provision relates to specific loans and receivables that have been identified as being impaired, including 
related party loans where the Group’s interest in a development was via an equity accounted investment.

21.a. Contract Assets

Current

Contract debtors1

Construction contract assets2

Accrued income

Total contract assets

Note

11

June 2022

June 2021

$m

291

664

82

1,037

$m

247

565

78

890

1. Movements in contract debtors during the financial year relate primarily to additional work performed not yet transferred into Trade receivables as the right to receive payment 

from the customer has not become unconditional.

2. Movements in construction contract assets during the financial year relate primarily to revenue recognised on construction contracts with customers in excess of billings raised 

during the financial year.

22. Trade and Other Payables

Accounting Policies

Trade Creditors
Liabilities are recognised for amounts to be paid in the future for goods or services received, whether or not billed to the Group. 
Trade and other payables are settled in the normal course of business. Trade and other payables are carried at amortised cost 
using the effective interest method, which applies the interest rate that discounts estimated future cash outflows over the term 
of the trade and other payables. Cash flows relating to short term trade and other payables are not discounted if the effect of 
discounting is immaterial. The discount, if material, is then recognised as an expense over the remaining term.

Construction Contract Liabilities
Construction contracts where the total progress billings issued to clients (together with foreseeable losses, if applicable) on a 
project exceed the revenue recognised (costs incurred to date plus recognised profit) on the contract are recognised as a liability.

Retentions
Retentions are amounts payable for the purpose of security and for the provision of defects in accordance with contract terms. 
Release of retention amounts are in accordance with contractual terms.

Unearned Income
Primarily relates to unearned income and deposits received in advance on presold apartments. These amounts will be recognised 
as income in line with the ‘Sale of development properties’ accounting policy in Note 4 ‘Revenue from Contracts with Customers’.

Lease Liabilities
Lease liabilities are measured at the present value of the lease payments discounted using the interest rate implicit in the lease. 
The Group uses its incremental borrowing rate as the discount rate.

Current

Trade and accrued creditors

Construction contract liabilities

Related parties

Retentions

Deferred land payments

Unearned income

Lease liabilities

Other

Total current

Non Current

Trade and accrued creditors1

Retentions

Deferred land payments

Unearned income

Lease liabilities

Other1

Total non current

Total trade and other payables

Financial Statements

149

June 2022

June 2021

$m

2,316

1,327

197

344

126

38

77

132

$m

2,243

1,379

263

386

278

27

67

196

4,557

4,839

June 2022

June 2021

$m

366

51

330

77

331

833

1,988

6,545

$m

316

47

366

67

407

557

1,760

6,599

Note

22.a

22.a

Note

22.a

1. Prior period balances have been reclassified from Other to Trade and accrued creditors to reflect updated management information.

As a result of the revised strategy announcement and business review undertaken by the Global CEO during the financial year, the 
Group assessed its right of use assets. The Group calculated its remaining recoverable right of use assets using a discounted cashflow 
model with a discount rate of 3.6 per cent. This resulted in a tenancy impairment expense of $104 million in Corporate Activities and 
$25 million in the Non core segment. As at 30 June 2022, the Group recognised right-of-use assets of $188 million (30 June 2021: 
$325 million) within Property, Plant and Equipment. Refer to Note 1 'Segment Reporting' and Note 7 'Other Expenses' for further details.

22.a. Contract Liabilities

Current

Unearned income1

Construction contract liabilities2

Total current

Non Current

Unearned income1

Total non current

Total contract liabilities

June 2022

June 2021

$m

38

1,327

1,365

77

77

1,442

$m

27

1,379

1,406

67

67

1,473

1. Movements in Unearned income relates primarily to residential presales settled during the financial year and deposits received for development properties.
2. Movements in Construction contract liabilities relate primarily to revenue recognised during the period in excess of billings raised on construction contracts with customers. 

This balance also contains provisions previously incurred on retained Engineering projects that are in progress.

During the year, the Group recognised $482 million in revenue from contracts that held a contract liability balance at the beginning of 
the financial year. The total transaction price relating to the Group’s Unearned income on the Group’s development contracts at June 
2022 is $439 million relating primarily to various UK and Australian projects. The difference between the Unearned income amount 
noted in the table above and this amount primarily relates to the remaining development value of apartments versus the deposit amount 
received. Revenue from these contracts is expected to be realised as control over each asset is transferred to the customer.

The total transaction price allocated to unsatisfied performance obligations on the Group’s construction contracts as at June 2022 is 
$14.8 billion. This includes new work secured during the financial year. Of the total construction backlog, 54 per cent is expected to be 
realised within the next 12 months to June 2023 (June 2021: 44 per cent to June 2022), 30 per cent to June 2024 (June 2021: 31 per 
cent to June 2023) and the remaining 16 per cent realised post June 2024 (June 2021: 25 per cent post June 2023).

150

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section C. Liquidity and Working Capital continued
23. Provisions

Accounting Policies

Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable 
that the Group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the 
reporting date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using 
the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the 
effect of the time value of money is material).

Management considers this is an area of estimation uncertainty as these calculations involve a number of key assumptions 
including the expected future cash outflow and the timing of the outflow to determine the provision.

Employee Benefits
Includes amounts for employee annual leave and long service leave entitlements.

Development Projects
Includes amounts for costs to close out development projects, including defects and residual guarantees. The timing of any 
expected outflows of economic benefits is dependent on market factors, such as lease up rates in specific markets, and 
negotiations with customers.

Construction Projects
Includes amounts for claims and litigation related to legacy construction projects. The timing of any expected outflows of 
economic benefits is dependent on the progression of negotiations and litigation with claimants, which are ongoing at period end.

Other
Includes amounts related to various litigation and commercial matters.

Balance as at 1 July 2021

Provisions made during the year

Provisions used during the year

Provisions reversed during the year

Balance as at 30 June 2022

Current provisions

Non current provisions

Total provisions

Employee 
Benefits

Development 
Projects1

Construction 
Projects

Other

Total

$m

194

54

(81)

(3)

164

147

17

164

$m

143

59

(42)

(30)

130

86

44

130

$m

266

208

(64)

(26)

384

377

7

384

$m

52

75

(1)

(16)

110

110

-

110

$m

655

396

(188)

(75)

788

720

68

788

1. The Development impairment expense of $289 million (30 June 2021: $nil) and Property inventories impairment expense of $12 million (30 June 2021: $13 million reversal) as 

disclosed in Note 7 'Other Expenses', have been recorded net against the inventories balance. Refer to Note 7 ‘Other Expenses’ for further detail.

Financial Statements

151

Section D. Risk Management

The Group’s activities expose it to a variety of financial risks. The Group’s overall financial risk management strategy focuses on 
the unpredictability of financial markets and seeks to minimise adverse effects on the Group’s performance. Treasury policies 
have been approved by the Board for managing this risk. This section contains disclosures of financial risks the Group is exposed 
to and how the Group manages these risks. The impact of contingent liabilities is also considered in this section.

24. Financial Risk Management

The Group operates across numerous jurisdictions and markets. The Lendlease Asset and Liability Committee oversees the 
management of the Group’s treasury risks, within the parameters of a Board approved Treasury Policy, and maintains a Group wide 
framework for financial risk management and reviews issues of material risk exposure within the scope of the Treasury Policy. A 
summary of key risks identified, exposures and management of exposures is detailed in the table below:

Risks Identified

Foreign Currency

Definition
The risk in local currency terms 
that the value of a financial
commitment or a recognised 
asset or liability will fluctuate 
due to changes in foreign 
currency exchange rates

Exposures
•

Foreign currency earnings

• Net investments in 
foreign operations

• Transactions settled in 

foreign currency

Management of Exposures
•

Physical financial instruments, including 
natural hedges from matching foreign 
assets and liabilities

• Derivative financial instruments, mainly 

foreign exchange contracts

• Contracting out

•

•

Speculative trading is not permitted

Policies in place so that customers 
and suppliers are appropriately 
credit assessed

•

Further information on exposures 
is detailed in Note 24a ‘Foreign 
Currency Risk Exposure’

• Recoverability of loans 

and receivables

• Recoverability of other financial

assets and cash deposits

• Treasury Policy sets out credit limits for 

•

•

•

•

•

•

•

Further information on exposures 
is detailed in Note 24b ‘Credit 
Risk Exposure’

Insufficient levels of committed 
credit facilities

Settlement of financial liabilities

Further information on exposures 
is detailed in Note 19 ‘Liquidity 
Risk Exposure’

Financial assets, mainly cash 
at bank

Financial liabilities, 
mainly borrowings and 
financing arrangements

Further information on exposures 
is detailed in Note 24c ‘Interest 
Rate Risk Exposure’

each counterparty based on minimum 
investment grade ratings

• Maintaining sufficient levels of cash 

and committed credit facilities to meet 
financial commitments and working 
capital requirements

• Managing to funding portfolio 
benchmarks as outlined in the 
Treasury Policy

• Timely review and renewal of 

credit facilities

•

Physical financial instruments

• Derivative financial instruments, mainly 

interest rate swaps

• Managing to hedging limits in respect 
of recourse funding as outlined in the 
Treasury Policy

•

Speculative trading is not permitted

• All traded and/or non traded 

financial instruments measured 
at fair value

• Material investments within the portfolio 
are managed on an individual basis. The 
Group’s portfolio is monitored closely as 
part of capital recycling initiatives

Credit

The risk that a counterparty 
will not be able to meet its 
obligations in respect of a 
financial instrument, resulting in 
a financial loss to the Group

Liquidity

The risk of having insufficient 
funds to settle financial liabilities 
as and when they fall due

Interest Rate

The risk that the value of a 
financial instrument or cash flow 
associated with the instrument 
will fluctuate due to changes in 
market interest rates

Equity Price

The risk that the fair value of 
either a traded or non traded 
equity investment, derivative 
equity instrument, or a portfolio 
of such financial instruments, 
increases or decreases in 
the future

 
 
152

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section D. Risk Management continued
24. Financial Risk Management continued
24.a. Foreign Currency Risk Exposure

The net asset exposure by currency is detailed below.

June 2022

Net asset exposure (local currency)

2,456

876

699

740

378

628

1,499

June 2021

Net asset exposure (local currency)

3,248

743

572

607

307

653

1,204

45

42

A$m

US$m

£m

S$m

€m

CNYm

MYRm

Other m1

1. Other currency is translated and disclosed in AUD.

Sensitivity Analysis
The sensitivity analysis of the Group’s Australian dollar denominated Income Statement and Statement of Financial Position to foreign 
currency movements is based on a 10 per cent fluctuation (June 2021: 10 per cent fluctuation) on the average rates during the financial
year and the spot rate at balance date, respectively. This analysis assumes that all other variables, in particular interest rates, remain 
constant, and excludes the effects of the foreign exchange contracts.

A 10 per cent movement in the average foreign exchange rates would have impacted the Group’s Profit after tax as follows:

USD

GBP

SGD

EUR

CNY

MYR

10% WEAKENING LEADS TO INCREASE/
(DECREASE) IN PROFIT AFTER TAX

10% STRENGTHENING LEADS TO INCREASE/
(DECREASE) IN PROFIT AFTER TAX

June 2022

$m

June 2021

$m

June 2022

$m

June 2021

$m

9

(7)

4

(1)

(1)

-

4

7

(1)

3

4

-

-

13

(8)

8

(4)

-

1

1

(2)

(6)

1

(2)

(3)

-

1

(9)

A 10 per cent movement in the foreign exchange spot rates at balance date would have impacted the Group’s net assets as follows:

USD

GBP

SGD

EUR

CNY

MYR

10% WEAKENING LEADS TO INCREASE/
(DECREASE) IN NET ASSETS

10% STRENGTHENING LEADS TO INCREASE/
(DECREASE) IN NET ASSETS

June 2022

June 2021

June 2022

June 2021

$m

143

145

89

68

15

54

514

$m

102

107

66

52

15

43

385

$m

(117)

(116)

(73)

(55)

(12)

(44)

(417)

$m

(96)

(91)

(54)

(42)

(12)

(35)

(330)

 
Financial Statements

153

24.b. Credit Risk Exposure

• The maximum exposure to credit risk at balance date on financial instruments recognised in the Statement of Financial Position 

(excluding investments of the Group) equals the carrying amount, net of any impairment

• The Group is not exposed to any significant concentrations of credit risk on either a geographic or industry specific basis

• Credit risk on financial instruments is managed under a Board approved credit policy that determines acceptable counterparties. 
Derivative counterparties and cash deposits are limited to recognised financial intermediaries with a minimum investment grade 
credit rating as determined by a recognised rating agency

• Refer to Note 21 ‘Loans and Receivables’ for information relating to impairment on loans and receivables

• In certain circumstances, the Group will hold either financial or non financial assets as collateral to further mitigate the potential 
credit risk on selected transactions. During the current and prior year, the Group did not hold financial or non financial assets as 
collateral. At any point in time, the Group will hold other collateral such as bank guarantees and performance bonds to mitigate 
potential credit risk as a result of default by a counterparty or otherwise.

24.c. Interest Rate Risk Exposure

The Group’s exposure to interest rate risk on its financial assets and liabilities is set out as follows:

Fixed Rate

Financial assets

Financial liabilities

Variable Rate

Financial assets

Financial liabilities

CARRYING AMOUNT

June 2022

June 2021

$m

172

(2,547)

(2,375)

1,266

(1,352)

(86)

$m

147

(2,657)

(2,510)

1,612

(1,136)

476

Sensitivity Analysis
At 30 June 2022, it is estimated that an increase of one percentage point in interest rates would have increased the Group’s equity and 
Profit after tax by $6 million (June 2021: $3 million increase in the Group’s equity and Profit after tax). A one percentage point decrease 
in interest rates would have decreased the Group’s equity and Profit after tax by $6 million (June 2021: $3 million decrease in the 
Group’s equity and Profit after tax). The increase or decrease in interest income/(expense) is proportional to the increase or decrease in 
interest rates. Interest rate derivatives have been included in this calculation.

25. Hedging

Accounting Policies

The Group uses derivative financial instruments to hedge its exposure to foreign exchange and interest rate risks arising 
from operating, financing and investing activities. Derivative financial instruments are recognised initially at fair value on 
the date a derivative contract is entered into and subsequently remeasured at fair value. Hedge accounting recognises the 
offsetting effects on profit or loss of changes in the fair value of the derivative financial instruments and the hedged item. The 
accounting for hedges that meet the criteria for hedge accounting are classified as either fair value hedges, cash flow hedges or 
investment hedges.

The Group has minimal hedges designated at fair value. The Group primarily uses forward foreign exchange contracts as cash flow 
hedges for highly probable sale, purchase and dividend transactions. The Group also uses forward foreign exchange contracts to hedge 
cross border intercompany loans and transactions which mainly net off in the Income Statement. Interest rate swaps and interest rate 
options are used to manage the Group’s exposure to interest rates arising from borrowings. These are primarily treated as cash flow 
hedges and are mainly on borrowings within equity accounted investments.

The Group has foreign exchange derivative contracts primarily held in GBP, USD, EUR, SGD and CNY at reporting date to hedge 
specific foreign currency exposures. The total gross payable exposure is $1,663 million (June 2021: payable $1,045 million).

There are 31 foreign currency contracts that will mature in more than one year (June 2021: 62 foreign currency contracts).

154

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section D. Risk Management continued
26. Fair Value Measurement

Accounting Policies

The accounting policies for financial instruments held at fair value are included in Note 13 ‘Other Financial Assets’ and Note 
25 ‘Hedging’.

Management considers the valuation of assets at fair value including financial instruments to be an area of estimation uncertainty. 
While this represents the best estimation of fair value at the reporting date, the fair values may differ if there is volatility in market 
prices or foreign exchange rates in future periods.

All financial instruments recognised in the Statement of Financial Position, including those instruments carried at amortised cost, are 
recognised at amounts that represent a reasonable approximation of fair value, with the exception of the following borrowings:

Liabilities

Current

Commercial notes

Non Current

Commercial notes

JUNE 2022

JUNE 2021

Carrying Amount

Fair Value

Carrying Amount

Fair Value

Note

16.a

16.a

$m

-

$m

-

2,082

1,996

$m

$m

555

1,682

565

1,838

The fair value of commercial notes has been calculated by discounting the expected future cash flows by the appropriate government 
bond rates and credit margin applicable to the relevant term of the commercial note.

26.a. Basis of Determining Fair Value

The determination of fair values of financial assets and liabilities that are measured at fair value are summarised as follows:

• The fair value of unlisted equity investments, including investments in property funds, is determined based on an assessment of 

the underlying net assets, which may include periodic independent and Directors’ valuations, future maintainable earnings and any 
special circumstances pertaining to the particular investment. Fair value of unlisted equity investments has also taken the COVID 
pandemic and other economic conditions into consideration to determine fair value at 30 June 2022. This included valuations of 
underlying investment properties at balance date

• The fair values of other financial assets and financial liabilities (excluding derivative instruments) are determined in accordance with 
generally accepted valuation techniques; these include the use of recent arm’s length transactions, reference to other assets that 
are substantially the same, and discounted cash flow analysis

• The fair value of derivative instruments comprises forward foreign exchange contracts, which are valued using forward rates 
at balance date, and interest rate swap contracts, which are measured at the present value of future cash flows estimated 
and discounted based on applicable yield curves derived from quoted interest rates and include consideration of counterparty 
risk adjustments.

26.b. Fair Value Measurements

The different levels for valuation method have been defined as follows:

• Level 1: The fair value is determined using the unadjusted quoted price for an identical asset or liability in an active market for 

identical assets or liabilities

• Level 2: The fair value is calculated using predominantly observable market data other than unadjusted quoted prices for an 

identical asset or liability

• Level 3: The fair value is calculated using inputs that are not based on observable market data.

During the financial year, there were no material transfers between Level 1, Level 2 and Level 3 fair value hierarchies.

Financial Statements

155

27. Contingent Liabilities

The Group has the following contingent liabilities, being liabilities in respect of which there is the potential for a cash outflow in excess 
of any provision where the likelihood of payment is not considered probable or cannot be measured reliably at this time:

• There are a number of legal claims and exposures that arise from the normal course of the Group’s business. Such claims and 
exposures largely arise in respect of claims for defects (including under both contract and legislation), claims for breach of 
performance obligations or breach of warranty or claims under indemnities. In some claims:

– There is uncertainty as to whether a legal obligation exists;

– There is uncertainty as to whether a future cash outflow will arise in respect to these items; and/or

– It is not possible to quantify the potential exposure with sufficient reliability.

This particularly applies in larger more complex projects, in claims involving a number of parties or in claims made a number of years 
after completion of a project.

Where it is probable there will be liabilities from such claims and the potential exposure can be quantified with sufficient reliability, a 
provision has been made for anticipated losses arising from such claims.

• In certain circumstances, the Company guarantees the performance of particular Group entities in respect of their obligations. This 
includes bonding and bank guarantee facilities used primarily by the Construction business as well as performance guarantees for 
certain of the Company’s subsidiaries.

• Securities Class Action 

On 18 April 2019, Lendlease Corporation and Lendlease Responsible Entity (Lendlease Group) were served with a shareholder class 
action proceeding filed in the Supreme Court of New South Wales on 18 April 2019 by David William Pallas and Julie Ann Pallas as 
trustees for the Pallas Family Superannuation Fund, represented by Maurice Blackburn. On 7 August 2019, Lendlease Corporation 
and Lendlease Responsible Entity (Lendlease Group) were served with a shareholder class action proceeding filed in the Supreme 
Court of New South Wales on 6 August 2019 by Martin John Fletcher, represented by Phi Finney McDonald. On 21 November 2019 
the Supreme Court ordered consolidation of the two class actions into a single proceeding. The consolidated proceeding alleges 
that Lendlease was in breach of its continuous disclosure obligations under the Corporations Act 2001 and made representations 
about its Engineering and Services business that were misleading or deceptive or likely to mislead or deceive. It is currently not 
possible to determine the ultimate impact of these claims, if any, on Lendlease Group. Lendlease Group denies the allegations and 
intends to vigorously defend this proceeding.

156

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section E. Basis of Consolidation

This section provides information on how the Group structure affects the financial position and performance of the Group as a 
whole. The disclosures detail the types of entities and transactions included in the consolidation and those excluded.

28. Consolidated Entities

Accounting Policies

The Group consolidation comprises all subsidiaries controlled by the Company. Control exists when the Company:

• Has the power to direct the relevant activities such as key operating, financial and investing decisions

• Has exposure or rights to variable returns from its involvement with the investee such as dividends, loans and fees

• Has the ability to use its power over the investee to affect the amount of returns.

In assessing control, potential voting rights that are presently exercisable or convertible are taken into account. Management uses 
accounting judgement in determining whether the Group controls an entity by applying the above control criteria and reviewing 
the substance of its relationship with the entity.

The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences 
until the date that control ceases. The financial statements of subsidiaries are prepared for the same reporting period as the parent 
company, using consistent accounting policies with adjustments made to bring into line any dissimilar accounting policies that 
may exist.

External non controlling interests are allocated their share of total comprehensive income and are presented within equity in the 
consolidated Statement of Financial Position, separately from the equity of securityholders.

The material consolidated entities of the Group listed below were wholly owned during the current and prior year. Refer to the following 
section for details on the disposal of entities.

Parent Entity

Lendlease Corporation Limited

Australia

Capella Capital Lendlease Pty Limited

Capella Capital Partnership

Lendlease Building Pty Limited

Lendlease Building Contractors Pty Limited

Lendlease Communities (Australia) Limited

Lendlease Development Pty Limited

Lendlease Finance Limited

Europe

Lendlease Construction (Europe) Limited

Lendlease Construction Holdings (Europe) Limited

Lendlease Europe Finance plc

Lendlease Europe Limited

Lendlease Residential (CG) Limited

Lendlease (Elephant & Castle) Limited

Asia

Lendlease Japan Inc.

Lendlease Singapore Pte. Limited

Lendlease Infrastructure Investments Pty Limited

Americas

Lendlease International Pty Limited

Lendlease Real Estate Investments Limited

Lendlease Responsible Entity Limited

Lendlease Trust1

Lendlease (US) Capital, Inc.

Lendlease (US) Construction, Inc.

Lendlease (US) Construction LMB, Inc.

Lendlease (US) Public Partnerships, LLC

Lendlease (US) Public Partnerships Holdings LLC

Lendlease Development, Inc.

1. Lendlease Trust is a consolidated entity of the Group as the parent entity is deemed to control it. The parent entity has no ownership interest in Lendlease Trust.

During the current and prior year, there were no acquisitions of material consolidated entities.

During the current and prior year, the following disposals of material consolidated entities occurred.

June 2022

Lendlease (US) Asset Management LLC

Lendlease Services Pty Limited

June 2021

One Sydney Harbour R1 Trust

Lendlease Construction Australia Holdings Pty Limited1

Lendlease (US) Telecom Holdings LLC

Lendlease Renaissance I

One Sydney Harbour R2 Trust

1. Includes the sale of Lendlease Engineering Pty Limited.

29. Employee Benefit Vehicles

Ownership 
Interest Disposed
%

100.0

100.0

25.0

100.0

100.0

50.0

25.0

Date Disposed

20 April 2022

1 November 2021

1 July 2020

9 September 2020

15 October 2020

29 June 2021

29 June 2021

Financial Statements

157

Consideration 
Received/Receivable
$m

173

331

43

197

390

27

50

The Company sponsors a number of employee benefit vehicles, including employee security plans and employee security ownership 
vehicles. These vehicles, while not legally controlled, are currently required to be consolidated for accounting purposes.

29.a. Employee Security Plans

As at 30 June 2022, employees own approximately 0.9 per cent (June 2021: 0.9 per cent) of the issued capital of the Group through 
various active Lendlease employee security plans and ownership vehicles, details of which are outlined below:

• Australia: Employee Share Acquisition Plan (ESAP): ESAP was established in December 1988 for the purpose of employees 
acquiring securities in the Group and is funded by Lendlease subscriptions, and employee salary sacrifice contributions

• Americas: US Rabbi Trust (Rabbi Trust) was established in 2004 and updated in 2005 for the acceptance of employee profit 

share contributions used to acquire Group securities for US based employees. This part of the plan is not currently accepting 
new contributions

• Employee Share Acquisition Plan (STI) (ESAP STI): ESAP STI was established in July 2014 for the purpose of acquiring and 

allocating securities granted as the deferred component of Short Term Incentive (STI) awards, which are funded by Lendlease 
subscriptions. Securities are currently allocated to employees across Australia, Singapore, Malaysia, the United Kingdom and the 
United States.

Eligibility
The eligibility rules for each plan are determined by reference to the regulatory, legal and tax rules of each country in which the 
Group operates.

Distributions and/or Voting Rights
Generally, employees in the various operating security plans are entitled to distributions and voting rights for allocated securities. The 
plans reflect this intention subject to regulatory, legal and tax constraints. The trustee may exercise these rights in accordance with any 
fiduciary or governance rules pertaining to the deed or trust laws in the legal and tax jurisdiction within which the trust operates.

29.b. Employee Security Ownership Vehicles

In addition to the plans discussed above, Lendlease has an employee security ownership vehicle, Lendlease Retirement Benefit 
Fund (RBF):

• RBF was established in 1984 with shareholder approval for the benefit of employees. RBF holds Lendlease securities. The Lendlease 

securities in RBF are not available for allocation to employees other than in the event of a change of control of the Group and, 
in accordance with RBF’s trust deed, the capital of the trust is not available to the Group. The RBF trustee has discretion as to 
the distribution of the RBF funds. In 1992, a deed poll was executed which allows for the distribution of the income of RBF to the 
Company to fund employee benefit activities through the Lendlease Foundation. As a result of changes to the constitution and 
governance structure of the RBF trustee on 22 June 2017, Lendlease currently does not have control of RBF and therefore RBF is 
currently not required to be consolidated for accounting purposes

• The RBF arrangement is subject to periodic review to assess its ongoing role and operation.

158

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section E. Basis of Consolidation continued
30. Parent Entity Disclosures

The following summarises the financial information of the Group’s parent entity, Lendlease Corporation Limited (the Company), as at 
and for the financial year ended 30 June 2022.

Results

Profit/(Loss) after tax

Other comprehensive income after tax

Total comprehensive income/(loss) after tax

Financial Position

Current assets

Non current assets

Total assets

Current liabilities

Non current liabilities

Total liabilities

Net assets

Issued capital

Treasury securities

Reserves

Retained earnings

Total equity

COMPANY

June 2022

June 2021

$m

111

-

111

1,790

2,934

4,724

1,092

-

1,092

3,632

1,891

(77)

222

1,596

3,632

$m

(273)

1

(272)

1,452

2,938

4,390

843

-

843

3,547

1,888

(79)

198

1,540

3,547

In respect of the contingent liabilities of the Group disclosed in Note 27 ‘Contingent Liabilities’, the Company participates in the 
provision of guarantees to Group entities.

31. Related Party Information

31.a. Consolidated Entities

Intragroup balances and transactions, and any unrealised gains or losses arising from intragroup transactions, are eliminated in 
preparing the consolidated financial statements. Investments in subsidiaries are carried at their cost of acquisition less impairments 
in the Company’s financial statements.

Lendlease Corporation Limited provides financing and treasury services, which includes working capital facilities and long term 
financing to certain subsidiaries. Interest is earned or incurred only on long term loans provided to or drawn with subsidiaries based 
on project specific risks and returns. Outstanding balances arising from working capital facilities and long term financing are typically 
unsecured and repayable on demand.

In addition, guarantees are provided to particular Group entities in respect of their obligations. These include bonding and bank 
guarantee facilities used primarily by the Construction business as well as performance guarantees for certain Development business 
commercial built form developments. Guarantee fees are charged under normal terms and conditions.

The following represents the transactions that occurred during the financial year and the balances outstanding at year end between 
Lendlease Corporation Limited and its consolidated entities:

Transactions

Guarantee fees

Dividend income

Interest income

Interest expense

Outstanding Balances (Net of Provisions Raised)

Receivables

Payables

COMPANY

June 2022

June 2021

$000s

$000s

29,240

209,601

7,938

42,969

664,196

905,198

27,557

105,261

18,666

62,435

432,805

739,327

Financial Statements

159

Transactions that occurred during the financial year between entities in the Lendlease Group included:

• Provision of project management, design services, construction management services to development projects

• Provision of development management services

• Provision of investment management services

• Provision of payroll, transaction and management services

• Receipt and payment of superannuation contributions

• Reimbursement of expenses made on behalf of subsidiaries

• Loan advances and repayments between subsidiaries

• Premium payments and receipts for the Group’s insurance policies

• Dividends received or due and receivable from subsidiaries.

31.b. Associates and Joint Ventures

Interests held in associates and joint ventures by the Group are set out in Note 12 ‘Equity Accounted Investments’.

Transactions between the Group and its associates and joint ventures principally relate to:

• Investments: provision of property and infrastructure investment management, property management and asset 

management services

• Development: development management services, infrastructure bid and advisory services and the sale and purchase of 

development properties with Lendlease managed funds

• Construction: provision of project management, building and construction services.

There were $nil non interest bearing loans provided to joint ventures at 30 June 2022 (June 2021: $nil).

Except as noted above, transactions and outstanding balances are typically on normal terms and conditions.

Revenue earned by the Group during the financial year as a result of transactions with its associates and joint ventures is as follows:

Revenue

Associates

Joint ventures

Total

June 2022

June 2021

$000s

$000s

55,635

1,333,517

1,389,152

41,841

1,259,392

1,301,233

Other transactions and outstanding balances with associates, joint ventures and other related parties have been disclosed in Note 4 
‘Revenue from Contracts with Customers’, Note 6 ‘Other Income’, Note 7 ‘Other Expenses’, Note 8 ‘Finance Revenue and Finance 
Costs’, Note 12 ‘Equity Accounted Investments’, Note 13 ‘Other Financial Assets’, Note 21 ‘Loans and Receivables’ and Note 22 
‘Trade and Other Payables’. Transactions with joint operations are included in the consolidated Income Statement and Statement of 
Financial Position.

31.c. Key Management Personnel

The key management personnel compensation is as follows:

Short term employee benefits1

Post employment benefits

Security based payments

Other long term benefits

Total

June 2022

June 2021

$000s

14,376

282

6,691

77

21,426

$000s

17,708

278

13,152

126

31,264

1. Short term employee benefits for the year ended 30 June 2021 includes termination benefits of $1,900,385.

Information regarding Directors’ and senior executives’ remuneration is provided in the Remuneration Report within the 
Directors’  Report.

160

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section F. Other Notes

32. Intangible Assets

Accounting Policies

Goodwill represents the excess of the purchase price over the fair value of the Group’s share of the net identifiable assets and 
contingent liabilities of the acquired business at the date of acquisition. Goodwill on acquisition of subsidiaries is included in 
intangible assets as goodwill. Goodwill on acquisition of associates is included in the carrying value of investments in associates.

Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Goodwill is not amortised. 
Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

For the purposes of impairment testing, goodwill is allocated to cash generating units (CGUs) (or groups of CGUs) that are 
expected to benefit from the business combination in which the goodwill arose. CGUs are an identifiable group of assets that 
generate cash associated with the goodwill. Management considers this is an area of estimation uncertainty as these calculations 
involve an estimation of the recoverable amount of the CGU to which the goodwill is allocated. The Construction CGUs use the 
value in use basis, which requires the Group to estimate the future cash flows expected to arise from the CGUs and a suitable 
discount rate in order to calculate the recoverable amounts.

Management agreements and other intangible assets acquired by the Group are stated at cost less accumulated amortisation 
and impairment losses (see Note 7 ‘Other Expenses’). Amortisation is charged to the Income Statement on a straight line basis 
over the estimated useful lives of the intangible assets, ranging from three to 20 years.

Goodwill

Management agreements

Other intangibles1

Total intangible assets

Note

32.a

June 2022

June 2021

$m

1,056

24

145

1,225

$m

1,200

33

223

1,456

1. During the second half of the financial year, the Group performed a review of its Digital assets of $115 million that resulted in a change in product offering. As the Group 

changed its product offering, it had to determine the recoverable amount of the remaining Digital assets. This was calculated using a value in use with a discount rate of 20 per 
cent, resulting in an impairment expense of $77 million. The impairment expense was charged to the Corporate Activities. At 30 June 2022, the remaining Digital assets was 
$38 million (30 June 2021: $66 million).

32.a. Goodwill

Development

Construction

Total goodwill

Reconciliations of the carrying amounts for each category of goodwill are as follows:

Development

Carrying amount at beginning of financial year

Effect of foreign exchange rate movements

Carrying amount at end of financial year

Construction

Carrying amount at beginning of financial year

Disposals

Effect of foreign exchange rate/other movements

Carrying amount at end of financial year

Note

32.b

June 2022

June 2021

$m

33

1,023

1,056

30

3

33

1,170

(151)

4

1,023

$m

30

1,170

1,200

32

(2)

30

1,181

-

(11)

1,170

32.b. Goodwill Allocation

Goodwill relating to the Construction business is allocated to CGUs identified as set out below.

Construction

Australia Core

Australia Non core

Europe

Americas

Asia

Total construction goodwill

Financial Statements

161

June 2022

June 2021

$m

573

-

238

204

8

1,023

$m

573

151

251

187

8

1,170

32.c. Impairment Tests and Key Assumptions Used – Construction

The recoverable amount of the Construction CGUs is determined based on value in use (VIU) calculations. For the Construction CGUs, 
the assumptions used for determining the recoverable amount of each CGU are based on past experience and expectations for the 
future, utilising both internal and external sources of data and relevant industry trends.

No impairment arose as a result of the review of goodwill for the Construction CGUs for the financial year ended 30 June 2022. 
Based on information available and market conditions at 30 June 2022, a reasonably foreseeable change in the assumptions made in 
this assessment would not result in impairment of Construction goodwill. The foreseeable change in the assumptions took the COVID 
pandemic and other economic conditions into consideration.

The following describes the key assumptions on which management has based its cash flow projections when determining VIU relating 
to the Construction CGUs:

Cash Flows
The VIU calculations use pre tax cash flow projections based on actual operating results, and financial forecasts covering a five 
year period which have been approved by management. These forecasts are based on management estimates to determine income, 
expenses, capital expenditure and cash flows for each CGU.

Growth Rate
The terminal value growth rate used to extrapolate the cash flows beyond the five year period is 3.0 per cent (June 2021: 3.0 per cent). 
The growth rate reflects the forecast long term average growth rate for each CGU and the countries in which they operate.

Discount Rate
The discount rates applied to the cash flow projections vary between 9.2 per cent and 11.0 per cent (June 2021: between 8.9 per cent 
and 12.4 per cent). The Group’s weighted average cost of capital is used as a starting point for determining the discount rate, with 
appropriate adjustments for the risk profile relating to the relevant CGUs and the countries in which they operate. The discount rates 
used are pre tax.

33. Discontinued Operations

Accounting Policies

Discontinued operations relate to a component of the Group including its corresponding assets and liabilities that have been 
classified as held for sale and represent a separate major line of business or geographical area of operation. The group of assets 
and their corresponding liabilities (together referred to as a Disposal Group), may only be classified as held for sale once the 
following criteria are met:

• The carrying amount will be recovered principally through a sale transaction rather than through continuing use

• The sale must be highly probable.

A Disposal Group is measured at the lower of its carrying amount and fair value less costs to sell. Where fair value is lower than 
the carrying amount, the difference is recognised as an impairment loss within the Income Statement.

The results of discontinued operations are presented separately in the Income Statement and Statement of Comprehensive 
Income. Comparatives have also been re-presented for the Income Statement, Statement of Comprehensive Income and 
corresponding Notes to separately disclose the results of discontinued operations from continuing operations.

162

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section F. Other Notes continued
33. Discontinued Operations continued
On 25 February 2019, the Group announced that its Engineering and Services businesses are no longer a required part of the Group’s 
strategy. Management at that time committed to a plan to exit from Non core operations of Engineering and Services.

On 19 December 2019, the Group entered into an agreement with Acciona to sell its Engineering business and on 9 September 2020 
the Group completed the sale. The agreed purchase price for the sale of the Engineering business was $160 million which was adjusted 
by $37 million at completion, resulting in total estimated proceeds of $197 million. $163 million has been received by 30 June 2022. 
Acciona has not paid the balance of the final deferred payment which was due on 30 June 2021, claiming various amounts should 
be set off against that payment. This is disputed by Lendlease and legal proceedings are ongoing to seek recovery of payments due 
by Acciona.

On 21 July 2021, the Group entered into an agreement with Service Stream to sell the Services business and on 1 November 2021 the 
Group completed the sale. The agreed purchase price for the sale of the Services business was $310 million which was adjusted by 
$21 million at completion, resulting in total estimated proceeds of $331 million. $317 million has been received by 30 June 2022. As a 
result of the sale, the 30 June 2021 results have been re-presented to include the Services business as part of discontinued operations.

The discontinued operations represent the Services business sold in the current year and the Engineering business sold in the prior year, 
excluding the projects retained by the Group.

The major classes of assets and liabilities sold are as follows:

Assets and Liabilities Sold

Cash and cash equivalents

Loans and receivables

Inventories

Other assets

Total assets sold

Trade and other payables

Other liabilities

Total liabilities sold

Net assets and liabilities sold

Net proceeds from sale

Transaction and separation costs

Gain on sale

SERVICES

ENGINEERING

1 November 2021

9 September 2020

$m

3

84

145

276

508

121

97

218

290

331

(25)

16

$m

411

187

34

215

847

610

50

660

187

197

(10)

-

The results of the discontinued operations representing the Services and Engineering business for the current and prior period are 
as follows:

Results from Discontinued Operations

Revenue from contracts with customers

Cost of sales

Gross profit

Other income

Gain on sale

Other expenses

Profit/(Loss) before tax for discontinued operations

Income tax (expense)/benefit

Total profit after tax for discontinued operations as 
presented in the Income Statement

SERVICES

ENGINEERING

TOTAL

1 July to
1 November 2021

12 months
June 20211

1 July to
9 September 2020

12 months
June 20211

$m

351

(320)

31

-

16

(19)

28

(1)

27

$m

749

(697)

52

1

-

(32)

21

(7)

14

$m

283

(272)

11

1

-

(13)

(1)

3

2

$m

1,032

(969)

63

2

-

(45)

20

(4)

16

1. June 2021 results have been re-presented for discontinued operations during the period.

Financial Statements

163

Basic/Diluted Earnings Per Share (EPS) from 
Continuing Operations

(Loss)/Profit from continuing operations attributable to 
members of Lendlease Corporation Limited (Company)

Weighted average number of ordinary shares

Basic/Diluted EPS from continuing operations

Basic/Diluted Earnings Per Share (EPS) from 
Discontinued Operations

Profit from discontinued operations attributable to 
members of Lendlease Corporation Limited (Company)

Weighted average number of ordinary shares

Basic/Diluted EPS from discontinued operations

Basic/Diluted Earnings Per Security (EPSS) from 
Continuing Operations

(Loss)/Profit from continuing operations attributable to 
securityholders of Lendlease Group

Weighted average number of stapled securities

Basic/Diluted EPSS from continuing operations

Basic/Diluted Earnings Per Security (EPSS) from 
Discontinued Operations

Profit from discontinued operations attributable to 
securityholders of Lendlease Group

Weighted average number of stapled securities

Basic/Diluted EPSS from discontinued operations

$m

m

cents

$m

m

cents

$m

m

cents

$m

m

cents

Shares/Securities Excluding 
Treasury Securities

Shares/Securities on
Issue

June 2022

June 20211

June 2022

June 20211

(266)

683

(38.9)

27

683

3.9

(126)

683

(18.4)

27

683

3.9

112

683

16.4

16

683

2.3

206

683

30.2

16

683

2.3

(266)

689

(38.6)

27

689

3.9

(126)

689

(18.3)

27

689

3.9

112

688

16.3

16

688

2.3

206

688

30.0

16

688

2.3

1. June 2021 results have been re-presented for discontinued operations during the period.

The net cash flows for discontinued operations, representing the Services and Engineering business for the current and prior period are 
as follows:

SERVICES

ENGINEERING

TOTAL

1 July to 
1 November 2021

12 months
June 20211

1 July to 
9 September 2020

12 months
June 20211

Cash Flows from Discontinued Operations

Net cash inflow/(outflow) from operating activities

Net cash inflow/(outflow) from investing activities

Net cash outflow from financing activities

Net increase/(decrease) in cash and cash equivalents

$m

16

4

(2)

18

$m

92

(27)

(3)

62

$m

(39)

(1)

-

(40)

$m

53

(28)

(3)

22

1. June 2021 results have been re-presented for discontinued operations during the period.

164

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section F. Other Notes continued
34. Defined Benefit Plans

Accounting Policies

Group companies operate pension plans. The plans are generally funded through payments to insurance companies or trustee 
administered funds as determined by periodic actuarial calculations.

A defined benefit plan is a pension plan that defines the amount of pension benefit an employee will receive on retirement, 
usually dependent on one or more factors such as age, years of service and compensation.

The asset or liability recognised in the Statement of Financial Position in respect of defined benefit plans is the present value of 
the defined benefit obligation i.e. ‘the pension liability’ at the balance sheet date less the fair value of plan assets. The present 
value of the pension liability is determined by discounting the estimated future cash outflows using interest rates of high quality 
corporate or government bonds, that:

• Are denominated in the currency in which the benefits will be paid

• Have terms to maturity approximating the terms of the related pension liability.

The defined benefit obligation is calculated at least annually by independent actuaries using the projected unit credit method, 
which in simplistic terms proportions the benefit based on service. Management considers the valuation of defined benefit 
plans undertaken by the actuaries to be an area of estimation uncertainty as a number of key assumptions must be adopted to 
determine the valuation.

Actuarial losses/(gains) will arise where there is a difference between previous estimates and actual experience, or a change 
to assumptions in relation to demographic and financial trends. These actuarial losses/(gains) are recognised in the period they 
occur, directly in other comprehensive income as remeasurements. They are included in retained earnings in the Statement of 
Changes in Equity and in the Statement of Financial Position.

Past service costs are recognised immediately in the Income Statement.

Lendlease Superannuation Plan

Lendlease UK Pension Scheme

Total net defined benefit plan asset

34.a. Lendlease UK Pension Scheme

Note

34.a

June 2022

June 2021

$m

-

282

282

$m

-

243

243

Lendlease Construction Holdings (Europe) Limited (UK Construction) sponsors a funded defined benefit pension scheme (the Scheme) 
for qualifying UK employees. The Scheme is administered by a separate board of Trustees which is legally separate from UK 
Construction. The Scheme’s Trustees are composed of representatives of both the employer and employees. The Trustees are required 
by law to act in the interest of all relevant beneficiaries and are responsible for the investment policy with regard to the assets plus the 
day to day administration of the benefits.

The Scheme is a funded defined benefit scheme, with the final salary section providing retirement benefits based on final salary and the 
index linked section providing retirement benefits based on career average salary. A separate section, the Personal Investment Section, 
provides retirement benefits on a defined contribution basis. The UK Construction’s contributions to members’ Personal Investment 
Fund accounts are not included in these disclosures.

The final salary section closed to future accruals on 31 August 2008 and the index linked section closed to future accruals on 
31 January 2012. There were no Scheme amendments affecting defined benefits payable, curtailments or settlements during the 
year. UK Construction pays four per cent of members’ basic salaries to cover the Scheme’s expected administration costs and costs of 
benefits payable on death in service. Following the triennial valuation for 31 March 2020, deficit repair contributions are not required to 
be paid as the scheme is in an actuarial surplus.

The defined benefit plan is exposed to actuarial risk and market (investment) risk. The following information provides additional detail 
on risk:

i. Statement of Financial Position Amounts

The amounts recognised in the Statement of Financial Position are determined as follows:

Defined benefit obligations

Fair value of plan assets

Net defined benefit plan asset

June 2022

June 2021

$m

$m

(902)

1,184

282

(1,272)

1,515

243

ii. Reconciliation of Defined Benefit Obligations

Defined benefit obligations at beginning of financial year

Included in Income Statement

Interest cost

Remeasurements Included in Other Comprehensive Income

Actuarial loss/(gain) arising from:

Financial assumptions

Experience adjustments

Demographic assumptions

Other

Benefits paid

Effect of foreign exchange rate movements

Defined benefit obligations at end of financial year

iii. Reconciliation of the Fair Value of Plan Assets

Fair value of plan assets at beginning of financial year

Included in Income Statement

Interest income

Administration costs

Remeasurements Included in Other Comprehensive Income

Actuarial return on plan assets excluding interest income

Other

Contributions by Group companies

Benefits paid

Effect of foreign exchange rate movements

Fair value of plan assets at end of financial year

iv. Expense Recognised in the Income Statement

Net interest cost

Administration costs

Net defined benefit plan income

v. Fair Value of Plan Assets

Plan assets comprise:

Investment funds

Infrastructure

Government index linked bonds

Other assets

Fair value of plan assets at end of financial year

Financial Statements

165

June 2022

June 2021

$m

1,272

24

(332)

15

14

(34)

(57)

902

1,515

28

(3)

(254)

5

(36)

(71)

1,184

(4)

3

(1)

430

107

608

39

1,184

$m

1,324

19

(45)

(19)

(21)

(33)

47

1,272

1,481

22

(2)

(44)

31

(33)

60

1,515

(3)

2

(1)

431

87

956

41

1,515

The investment funds target an absolute level of return. The plan assets can be categorised as Level 1, where the fair value is 
determined using an unadjusted quoted price for an identical asset, or Level 2, where the fair value is derived either directly or indirectly 
from observable inputs, or Level 3, where inputs are unobservable (i.e. for which market data is unavailable). At year end, approximately 
$1,077 million (June 2021: $1,428 million) and $107 million (June 2021: $87 million) of total plan assets were categorised as Level 2 and 
Level 3, respectively. UK Construction and Trustees have agreed to a long term strategy for reducing investment risk as and when 
appropriate. This includes an asset–liability matching policy which aims to reduce the volatility of the funding level of the pension plan 
by investing in assets that perform in line with the liabilities of the plan so as to protect against inflation being higher than expected. 
The current targeted benchmark allocation is 22.5 per cent growth assets and 77.5 per cent matching assets (June 2021: 67.5 per cent 
growth assets and 32.5 per cent matching assets).

vi. Principal Actuarial Assumptions

Discount rate (%)

RPI inflation (%)

Average pension increase in payments (%)

Future mortality (years):

Male

Female

June 2022

June 2021

3.8

3.5

2.7

25.3

26.8

2.0

3.5

2.7

25.3

26.3

166

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section F. Other Notes continued
34. Defined Benefit Plans continued
The liabilities are calculated using a discount rate set with reference to corporate bond yield. If assets underperform this yield, this will 
create a deficit.

A decrease in corporate bond yield will increase the value placed on the Scheme’s liabilities, although this will be partially offset by an 
increase in the value of the Scheme’s corporate bond holdings. The majority of the Scheme’s benefit obligations are linked to inflation 
and higher inflation will lead to higher liabilities, although in most cases this will be capped to protect against extreme inflation. The 
majority of the assets are either unaffected by or loosely correlated with inflation, meaning that an increase in inflation will also increase 
the deficit. The majority of the Scheme’s obligations are to provide benefits for the life of the member, so increases in life expectancy 
will result in an increase in the liabilities. The mortality assumptions are based on standard mortality tables which allow for expected 
future mortality improvements. The assumption is that a member aged 63 will live for a further 25.3 years (June 2021: 25.3 years) if they 
are male and 26.8 years if they are female (June 2021: 26.3 years).

At 30 June 2022, the weighted average duration of the defined benefit obligation was 16 years (June 2021: 18 years).

vii. Sensitivity Analysis
Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, 
would have affected the defined benefit obligations by the amounts shown below:

0.1%
Increase in 
Discount Rate
$m

0.1%
Decrease in 
Discount Rate
$m

0.1%
Increase
RPI Inflation
and Pension
Payment
$m

0.1%
Decrease
RPI Inflation
and Pension
Payment
$m

1 Year
Increase in
Future Mortality
$m

1 Year
Decrease in
Future
Mortality
$m

June 2022

Defined benefit obligations

June 2021

Defined benefit obligations

(14)

(22)

14

23

11

17

(11)

(13)

22

37

(21)

(38)

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely 
that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Non pensioner benefits are linked to RPI in the period up to retirement. Once in payment, pension increases are linked to RPI but with 
a zero per cent floor and different caps applying to different periods of pensionable service. The inflation sensitivity reflects a change in 
RPI inflation and the associated increases in payment.

35. Employee Benefits

Detailed information regarding the Group’s Executive Reward strategy is provided in the Remuneration Report within the Directors’ 
Report. The key incentive plans are as follows:

• Short Term Incentive (STI)

• Short Term Award (STA)

• Long Term Incentive (LTI)

• Long Term Award (LTA)

• Restricted Securities Award (RSA)

• Executive Deferred Award (ED Award)

• Deferred Equity Award (DEA)

• Pro Rata CEO Grant

• Google Development Ventures (GDV) Incentive.

35.a. Short Term Incentive (STI)

The STI plan is an annual incentive plan whereby a number of employees receive benefits which are dependent upon the achievement 
of both Lendlease financial and non financial targets, and individual goals. The total value of the potential benefit varies by individual 
and is tested against relevant market levels for each role.

• The STI plan typically comprises a cash component, which is paid in September following year end. For more senior employees, 

where the potential benefit is typically higher, the plan also includes a deferred component

• Deferral periods are generally for one or two years. The deferred component is normally awarded as Lendlease securities and in 
some instances as cash. Securities are held in Lendlease employee security plan trusts on behalf of employees for the deferral 
period (refer to Note 29a ‘Employee Security Plans’). For employees to receive the deferred component in full, they must generally 
be employed by the Group at the time of vesting.

Financial Statements

167

35.b. Short Term Award (STA)

The STA plan is an annual incentive plan which replaced the STI for a limited number of senior executives from 2019. It is designed to 
focus senior executives on priority areas for delivery in the current financial year, including key Group and regional financial targets, 
safety and other non financial targets aligned to the Group’s areas of focus.

Whilst performance is assessed against a set of Group metrics when determining awards, the Board will assess the overall performance 
and contribution of individual senior executives, with a particular focus on safety.

The total value of the potential benefit varies by individual and is set with reference to both internal peers and external market levels. 
For FY20 and FY21, the STA plan has been awarded as cash in September following year end. From FY22 onwards, 50 per cent of 
awarded STA will be a deferred grant of Lendlease securities. The deferred portion will be released in two equal tranches after one and 
two years.

35.c. Long Term Incentive (LTI)

The LTI plan is designed to:

• Motivate executives to achieve the Group’s long term strategic goals and provide reward where the Group delivers better value to 

securityholders than its peers

• Align the interests of executives and securityholders, given that the reward received is linked to the Group’s security price and 

average Return on Equity performance.

Arrangements for LTI Awards

LTI Design

How the LTI Works

Performance Securities

• An annual grant of ‘performance securities’ is made to a limited number of executives

Performance Period 
(applicable to FY20, 
FY21 and FY22 Grants)

Termination 
of Employment

• The Board intends that the awards be settled in Lendlease securities, although the award may be settled in 

cash or other means at the Board’s discretion

• On vesting, each performance security entitles executives to one Lendlease stapled security, or at the Board’s 

discretion, cash or other instruments of equivalent value

•

•

•

In the event of a change in control of the Group, the Board has the discretion to determine whether the 
vesting of some or all performance securities should be accelerated.

100 per cent of the performance securities are assessed over a three year period. If the performance hurdle is 
not fully achieved at this time, those performance securities that have not vested will lapse

If the performance hurdle is not met, the awards are forfeited

• There is no retesting on any portion of the LTI grant.

•

•

•

•

If the executive resigns or is terminated for cause, the unvested LTI is forfeited

If the executive is terminated and if the Board considers vesting would provide a benefit that was 
unwarranted or inappropriate, the Board can adjust unvested LTI prior to the vesting date

For ‘good leavers’, the LTI grant may remain on foot, subject to the original terms

In exceptional circumstances (such as death or total and permanent disability), the Board may exercise 
discretion and settle the award at the time of termination of employment.

Performance Hurdles

Financial Year 2020

•

•

50 per cent subject to Lendlease’s Total Securityholder Return (TSR) compared to the companies in the 
S&P/ASX 100 Index. The S&P/ASX 100 companies are determined at the start of the performance period

50 per cent subject to Average Return on Equity (ROE) hurdle.

Financial Year 2021 onwards

• One third subject to Lendlease’s Total Securityholder Return (TSR) compared to the companies in the 

S&P/ASX 100 index. The S&P/ASX 100 companies are determined at the start of the performance period

• One third subject to Average Operating Return on Equity (Operating ROE) hurdle

• One third subject to compound annual growth rate (CAGR) % in funds under management.

Vesting Schedule –
Relative TSR

(FY20 to FY21)

Measure

Below the 50th percentile

At the 50th percentile

Percentage of performance securities that vest as a 
proportion of maximum opportunity

No vesting

50 per cent vesting

Between the 50th percentile and 75th percentile

Pro rata vesting on a straight line basis between 52 per 
cent and 98 per cent

Vesting Schedule –
Relative TSR

(FY22)

At or above the 75th percentile

Below the 50th percentile

At the 50th percentile

100 per cent vesting

No vesting

40 per cent vesting

Between the 50th percentile and 75th percentile

Pro rata vesting on a straight line basis between 40 per 
cent and 100 per cent

At or above the 75th percentile

100 per cent vesting

168

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section F. Other Notes continued
35. Employee Benefits continued

LTI Design

How the LTI Works

Vesting Schedule –
Average ROE

(FY20)

Vesting Schedule 
- Average 
Operating ROE

(FY21)

Vesting Schedule 
- Average Core 
Operating ROE

(FY22)

Vesting Schedule - 
CAGR % FUM

(FY21)

Vesting Schedule - 
CAGR % FUM

(FY22)

Measure

Percentage of performance securities that vest as a 
proportion of maximum opportunity

10 per cent or less

No vesting

Above 10 per cent or less than 14 per cent

Pro rata vesting on a straight line basis between 0 per 
cent and 100 per cent vesting

At or above 14 per cent

Less than 8 per cent

100 per cent vesting

No vesting

Between 8 per cent and target Operating ROE set by 
the Board

Pro rata vesting on a straight line basis between 20 per 
cent and 50 per cent vesting

At target Operating ROE set by the Board

50 per cent vesting

Between target Operating ROE set by the Board and 11 
per cent

Pro rata vesting on a straight line basis between 50 per 
cent and 100 per cent vesting

At or above 11 per cent

Below threshold

100 per cent vesting

No vesting

At Core Operating ROE for threshold vesting

0 per cent vesting

Between Core Operating ROE for threshold vesting and 
Core Operating ROE for maximum vesting

Pro rata vesting on a straight line basis between 0 per 
cent and 100 per cent vesting1

At or above Core Operating ROE for maximum vesting

100 per cent vesting

Below CAGR for threshold vesting

No vesting

Between CAGR for threshold vesting and CAGR for 
target vesting

Pro rata vesting on a straight line basis between 20 per 
cent and 50 per cent vesting

At CAGR for target vesting

50 per cent vesting

Between CAGR for target vesting and CAGR for 
maximum vesting

Pro rata vesting on a straight line basis between 50 per 
cent and 100 per cent vesting

At CAGR for maximum vesting

Below threshold

At CAGR % for threshold vesting

100 per cent vesting

No vesting

0 per cent vesting

Between CAGR % for threshold vesting and CAGR % 
for maximum vesting

Pro rata vesting on a straight line basis between 0 per 
cent and 100 per cent vesting

At or above CAGR % for maximum vesting

100 per cent vesting

1. Subject to 3 Year Average Annual Core Operating ROE being above the cost of equity determined by the Board.

35.d. Long Term Award (LTA)

The LTA plan replaced the LTI for a limited number of executives from 2019. It was designed to motivate and reward key executives to 
deliver on the Group’s long term strategy and to allow them to share in the value created for securityholders. Specifically, the objectives 
are to:

• Create rewards that are aligned to earnings

• Align the interests of securityholders and our most senior executives

• Promote team behaviours and an enterprise leadership mindset

• Retain the senior executive team.

The intended outcome is that reward and strategy are better aligned.

Financial Statements

169

Arrangements for LTA Awards

LTA Design

How the LTA Works

Performance 
Rights

• An annual grant of ‘performance rights’ is made to a limited number of executives on the Global Leadership Team

• The Board intends that the awards be settled in Lendlease securities, although some or all of the award may be settled 

in cash at the Board’s discretion

Performance 
Period 
(applicable to 
FY20, FY21 and 
FY22 Grants)

Termination of 
Employment

Performance 
Hurdles

•

Performance rights are rights to receive a variable number of Lendlease securities or at the discretion of the Board, 
cash with an equivalent value, upon vesting

• Outcomes against performance hurdles will determine how many Lendlease securities will be received following 

vesting between nil and a maximum number

•

•

In the event of a change in control of the Group, the Board has the discretion to determine whether the vesting of 
some or all performance rights should be accelerated.

100 per cent of the performance rights are assessed over a three year period and the number of Lendlease securities 
that may be delivered on vesting is determined. The first tranche will vest immediately thereafter, and the second, 
third and fourth tranches will be deferred and will vest progressively four, five and six years after the grant date

•

If the performance hurdle is not met, the awards are forfeited

• There is no retesting of the LTA grant.

•

•

•

If the executive resigns and becomes engaged in activities that are competitive with the Group or is terminated for 
cause, the unvested LTA is forfeited

If the executive is terminated and if the Board considers vesting would provide a benefit that was unwarranted or 
inappropriate, the Board has the discretion to lapse some or all performance rights prior to the vesting date

For ‘good leavers’, the LTA grant may remain on foot, subject to the original terms.

Financial Year 2020

•

•

50 per cent subject to Lendlease’s Total Securityholder Return (TSR) compared to the companies in the S&P/ASX 100 
Index. The S&P/ASX 100 companies are determined at the start of the performance period

50 per cent subject to Return on Equity (ROE) hurdle.

Financial Year 2021 onwards

• One third subject to Lendlease’s Total Securityholder Return (TSR) compared to the companies in the S&P/ASX 100 

Index. The S&P/ASX 100 companies are determined at the start of the performance period

• One third subject to Average Operating Return on Equity (Operating ROE) hurdle

• One third subject to compound annual growth rate (CAGR) % in funds under management.

Vesting 
Schedule - 
Relative TSR

(FY20 to FY21)

Vesting 
Schedule - 
Relative TSR

(FY22)

Vesting 
Schedule - 
Average ROE

(FY20)

Vesting 
Schedule - 
Average 
Operating ROE 
(FY21)

Percentage of performance securities that vest as a proportion of 
maximum opportunity

Measure
Below the 50th percentile

At the 50th percentile

Former Group CEO (Steve McCann)
No Vesting

27 per cent vesting

Senior Executive
No Vesting

11 per cent vesting

Between the 50th percentile and 
75th percentile

Pro rata vesting on a straight line basis 
between 27 per cent and 100 per cent

Pro rata vesting on a straight line basis 
between 11 per cent and 100 per cent

At or above the 75th percentile

100 per cent vesting

Below the 50th percentile

At the 50th percentile

Between the 50th percentile and 
75th percentile

At or above the 75th percentile

Less than 10 per cent

No Vesting

100 per cent vesting

No Vesting

40 per cent vesting

Pro rata vesting on a straight line basis 
between 40 per cent and 100 per cent

100 per cent vesting

No Vesting

Between 10 per cent and target ROE set 
by the Board

Pro rata on a straight line basis between 0 
per cent and 63 per cent

Pro rata vesting on a straight line basis 
between 0 per cent and 41 per cent

At target ROE set by the Board

63 per cent vesting

41 per cent vesting

Between target set by the Board and 14 
per cent

Pro rata on a straight line basis between 
63 per cent and 100 per cent

Pro rata vesting on a straight line basis 
between 41 per cent and 100 per cent

At or above 14 per cent

Less than 8 per cent

100 per cent vesting

No Vesting

100 per cent vesting

No Vesting

Between 8 per cent and target Operating 
ROE set by the Board

Pro rata on a straight line basis between 
13 per cent and 63 per cent

Pro rata vesting on a straight line basis 
between 8 per cent and 41 per cent

At target Operating ROE set by the Board 63 per cent vesting

41 per cent vesting

Between target set by the Board and 11 
per cent

Pro rata on a straight line basis between 
63 per cent and 100 per cent

Pro rata vesting on a straight line basis 
between 41 per cent and 100 per cent

At or above 11 per cent

100 per cent vesting

100 per cent vesting

170

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section F. Other Notes continued
35. Employee Benefits continued

Vesting Schedule 
- Average Core 
Operating ROE

(FY22)

Vesting Schedule - 
CAGR % FUM

(FY21)

Vesting Schedule - 
CAGR % in FUM

(FY22)

Percentage of performance securities that vest as a proportion of 
maximum opportunity

Measure

Former Group CEO 
(Steve McCann)

Below threshold

At Core Operating ROE for 
threshold vesting

Between Core Operating ROE for 
threshold vesting and Core Operating 
ROE for maximum vesting

At or above Core Operating ROE for 
maximum vesting

Senior Executive

No vesting

0 per cent vesting

Pro rata vesting on a straight line 
basis between 0 per cent  and 100 
per cent1

100 per cent vesting

Below CAGR for threshold vesting

No Vesting

No Vesting

Between CAGR for threshold vesting 
and CAGR for target vesting

Pro rata on a straight line basis 
between 13 per cent and 63 
per cent

Pro rata vesting on a straight line 
basis between 8 per cent and 41 
per cent

At CAGR for target vesting

63 per cent vesting

41 per cent vesting

Between CAGR for target vesting and 
CAGR for maximum vesting

Pro rata on a straight line basis 
between 63 per cent and 100 
per cent

Pro rata vesting on a straight line 
basis between 41 per cent and 100 
per cent

At CAGR for maximum vesting

100 per cent vesting

100 per cent vesting

Below threshold

At CAGR % for threshold vesting

Between CAGR % for threshold 
vesting and CAGR % for 
maximum vesting

At or above CAGR % for 
maximum vesting

No Vesting

0 per cent vesting

Pro rata vesting on a straight line 
basis between 0 per cent and 100 
per cent

100 per cent vesting

1. Subject to 3 Year Average Annual Core Operating ROE being above the cost of equity determined by the Board.

35.e. Restricted Securities Award (RSA)

The Restricted Securities Award (RSA), previously referred to as the LTA Minimum, is similar to fixed remuneration as it is not subject to 
performance conditions. It is designed to motivate and reward a limited number of key executives to deliver on the Group’s long term 
strategy and to allow them to have a sense of ownership and share in the value created for securityholders. The RSA (and previously 
referred to LTA Minimum) is not continuing from FY22 under the revised Executive Reward Strategy.

Arrangements for RSA Awards

RSA Design

How the RSA Works

Performance Rights

• An annual grant of ‘performance rights’ is made to a limited number of executives on the Global 

Leadership Team

• However, following feedback from proxy-holders and other stakeholders, the RSA will no longer be offered 

from FY22

• The Board intends that the awards be settled in Lendlease securities, although some or all of the award may 

be settled in cash at the Board’s discretion

•

•

Performance rights are rights to receive one Lendlease stapled security, or at the Board’s discretion, cash or 
other instruments of equivalent value

In the event of a change in control of the Group, the Board has the discretion to determine whether the 
vesting of some or all performance rights should be accelerated.

Vesting Period

• The first tranche (i.e. 25%) will vest after three years and the second, third and fourth tranches will vest 

progressively four, five and six years after the grant date.

Termination 
of Employment

•

•

If the executive resigns and becomes engaged in activities that are competitive with the Group or is 
terminated for cause, the unvested RSA is forfeited

If the executive is terminated and if the Board considers vesting would provide a benefit that was 
unwarranted or inappropriate, the Board has the discretion to lapse some or all performance rights prior 
to the vesting date

•

For ‘good leavers’, the RSA grant may remain on foot, subject to the original terms.

Financial Statements

171

35.f. Executive Deferred Award (ED Award)

The Executive Deferred Award (ED Award) is an award that was made to a limited number of executives and senior managers in 
recognition of their role in supporting the Lendlease transformation program.

The ED Award comprises a one off grant of Lendlease deferred securities which vest in three equal tranches, with the final vesting three 
years after grant. Securities are held in Lendlease employee plan trusts for the deferral period. Refer to Note 29a ‘Employee Security 
Plans’ for further details. For employees to receive the deferred components in full, they must generally be employed by the Group at 
the time of vesting.

35.g. Deferred Equity Award (DEA)

The DEA is delivered to Senior Executives as a grant of rights with vesting over two years. The Board determined that an equity award 
was more appropriate than paying cash as a result of COVID. The key objectives of this award are to:

• Recognise the achievement of non financial performance outcomes that support long term value creation

• Consider the balance between motivating, recognising and rewarding executives with securityholder interests

• Provide the Board with additional review points prior to vesting

• Provide a retention element given that executives will be required to wait up to two years for the award to vest.

35.h. Pro Rata CEO Grant

The pro rata CEO Grant is designed to recognise the period served as Global CEO (one month) in FY21 for Anthony Lombardo.

Arrangements for the Pro Rata CEO Grant

Pro Rata CEO Grant

How the Pro Rata CEO Grant Works

Performance Rights

A one-off grant of ‘performance rights’ to reflect time served as Global CEO in FY21 reduced to reflect the length 
of the period and value already granted for FY21

All other terms, including the performance period, performance hurdles, termination rules remain as per the FY21 
LTA Grant referred to above.

35.i. Google Development Ventures (GDV) Incentive

Incentive Design

How the Incentive Works

Performance Rights

• A one-off grant of ‘performance rights’ to Denis Hickey to reward the successful delivery of GDV over the 

Performance Period

Performance Hurdles

Termination 
of Employment

•

•

•

•

•

next three years

3 years from 1 July 2021 to 30 June 2024

70% of Performance Rights will vest based on the achievement of the key milestones for GDV during the 
performance period, including the securing of entitlements and capital plans and the commencement of 
construction for each project

30% of Performance Rights will vest based on customer satisfaction feedback from the client and internal 
stakeholders at key touchpoints in the project life cycle, so that GDV milestones are not only delivered within 
the required timeframes but also to an exceptional standard

In the event of resignation or termination for cause, unvested rights are forfeited

In all other circumstances, the portion of the award that reflects milestones that are already tested and 
achieved during the performance period will remain on foot. The untested portion is forfeited (except in the 
case of redundancy, whereby the untested portion will be continue to be tested against plan milestones and 
vest if applicable following the end of the performance period)

35.j. Amounts Recognised in the Financial Statements

LTI and LTA awards are valued using Monte-Carlo simulation methodology where the security price can be projected based on the 
assumptions underlying the Black-Scholes formula. Retention awards are valued by discounting the security price by the expected 
dividends assumed to be paid from the valuation date until the vesting date (if applicable). The model inputs include the Lendlease 
Group security price, a risk free interest rate, expected volatility and dividend yield. During the financial year ended 30 June 2022, a 
$51 million expense was recognised in the Income Statement in relation to equity settled security based payment awards (June 2021: 
$55 million).

172

Lendlease Annual Report 2022

Notes to Consolidated Financial Statements continued
Section F. Other Notes continued
36. Reserves

Foreign 
Currency 
Translation 
Reserve
$m

38

12

(108)

-

(96)

-

(5)

(5)

(63)

(63)

(16)

67

-

51

-

(15)

(15)

(27)

Hedging 
Reserve
$m

(96)

-

-

15

15

-

2

2

(79)

(79)

-

-

136

136

-

(9)

(9)

48

Non 
Controlling
Interest
Acquisition
Reserve
$m

(98)

Other 
Reserve
$m

106

-

6

-

6

-

-

-

(92)

(92)

-

(5)

-

(5)

-

-

-

-

-

-

-

-

-

-

106

106

-

-

-

-

-

-

-

(97)

106

Equity 
Compensation 
Reserve
$m

Total 
Reserve
$m

115

-

-

-

-

16

-

16

131

131

-

-

-

-

23

-

23

154

65

12

(102)

15

(75)

16

(3)

13

3

3

(16)

62

136

182

23

(24)

(1)

184

Balance as at 1 July 2020

Net investment hedge

Effect of foreign exchange movements

Effective cash flow hedges

Total comprehensive income

Fair value movement on allocation and
vesting of securities

Transfer as a result of asset disposal1

Total other movements through reserves

Balance at 30 June 2021

Balance at 1 July 2021

Net investment hedge

Effect of foreign exchange movements

Effective cash flow hedges

Total comprehensive income

Fair value movement on allocation and 
vesting of securities

Transfer as a result of asset disposal1

Total other movements through reserves

Balance at 30 June 2022

1. These movements in reserves were transferred to profit and loss in the year.

37. Impact of New and Revised Accounting Standards

New Accounting Standards and Interpretations Not Yet Adopted

Accounting Standard

Requirement

Impact on Financial Statements

AASB 2014-10

Amendments to Australian 
Accounting Standards – Sale 
or Contribution of Assets 
between an Investor and its 
Associate or Joint Venture and 
consequential amendments.

AASB 2014-10 amends AASB 10 and AASB 128 to 
clarify the requirements for recording the sale or 
contribution of assets between an investor and its 
associate or joint venture.

The amendment becomes mandatory for 
the June 2026 financial year and will be 
applied prospectively.

38. Other Significant Accounting Policies

38.a. Foreign Currency Translation

Based on preliminary analysis performed, the 
amendments are not expected to have a material 
impact on the Group.

Functional and Presentation Currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic 
environment in which the entity operates (the functional currency). The consolidated financial report is presented in Australian dollars, 
which is the Company’s functional and presentation currency.

Transactions and Balances
Foreign currency transactions are translated into Australian dollars using the exchange rate on the date of the transactions. Assets and 
liabilities denominated in foreign currencies are translated to Australian dollars at balance date.

Foreign exchange gains or losses are recognised in the Income Statement for monetary assets and liabilities such as receivables and 
payables, except for qualifying cash flow hedges and qualifying net investment hedges in foreign operations, which are recognised in 
other comprehensive income. Refer to Note 25 ‘Hedging’ for further detail.

Financial Statements

173

Translation differences on non monetary items, such as equities held at fair value through profit or loss, are reported as part of the fair 
value gain or loss.

Group Entities
The results and Statement of Financial Position of all Group entities that are not presented in Australian dollars (none of which has the 
currency of a hyperinflationary economy) are translated as follows:

• Revenue and expenses are translated at average exchange rates (unless this average is not a reasonable approximation of the 

transaction rate, in which case revenue and expenses are translated at the date of the transactions)

• Assets and liabilities for each Statement of Financial Position presented are translated at the closing rate at balance date

• All resulting exchange differences are recognised in other comprehensive income, in the foreign currency translation reserve.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity 
and translated at the closing rate.

38.b. Goods and Services Tax

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST 
incurred is not recoverable from the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition 
of the asset or as part of the expense.

Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the 
Australian Taxation Office (ATO) is included as a current asset or liability in the Statement of Financial Position. Cash flows are included 
in the Statement of Cash Flows on a gross basis. The GST components of cash flows arising from investing and financing activities 
which are recoverable from, or payable to, the ATO are classified as operating cash flows.

174

Lendlease Annual Report 2022

Directors’ Declaration

In the opinion of the Directors of Lendlease Corporation Limited (the Company):

1. The financial statements and notes and the remuneration disclosures contained in the Remuneration Report in the Directors’ Report 

are in accordance with the Corporations Act 2001, including:

a. Giving a true and fair view of the financial position of the Consolidated Entity as at 30 June 2022 and of its performance for the 

financial year ended on that date; and

b. Complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations 

Regulations 2001.

2. The financial statements and notes also comply with International Financial Reporting Standards as disclosed in the Basis 

of Preparation.

3. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

4. The Directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Global Chief 

Executive Officer and Group Chief Financial Officer for the financial year ended 30 June 2022.

Signed in accordance with a resolution of the Directors:

M J Ullmer, AO

Chairman

A P Lombardo

Global Chief Executive Officer and Managing Director

Sydney, 22 August 2022

 
 
Financial Statements

175

 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation.  Independent Auditor’s Report  To the members of Lendlease Corporation Limited  Report on the audit of the Financial Report  Opinion We have audited the Financial Report of Lendlease Corporation Limited as the deemed parent presenting the stapled security arrangement of Lendlease Group (the Financial Report). In our opinion, the accompanying Financial Report is in accordance with the Corporations Act 2001, including:  • giving a true and fair view of the Lendlease Group’s financial position as at 30 June 2022 and of its financial performance for the year ended on that date; and • complying with Australian Accounting Standards and the Corporations Regulations 2001. The Financial Report of Lendlease Group comprises: • Consolidated Statement of Financial Position as at 30 June 2022; • Consolidated Income Statement, Consolidated Statement of Comprehensive Income, Consolidated Statement of Changes in Equity, and Consolidated Statement of Cash Flows for the year then ended; • Notes including a summary of significant accounting policies; and • Directors’ Declaration. The Lendlease Group consists of the Lendlease Corporation Limited and the entities it controlled at the year-end or from time to time during the financial year and Lendlease Trust.  Shares in Lendlease Corporation Limited and units in Lendlease Trust are jointly traded as a Stapled Security on the Australian Securities Exchange under the name of Lendlease Group. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report.  We are independent of Lendlease Group and Lendlease Corporation Limited in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with these requirements.  176

Lendlease Annual Report 2022

 Key Audit Matters The Key Audit Matters we identified for Lendlease Group are: • Construction Revenue Recognition; • Sale of Development Properties; • Recoverability of Development Property Inventory; and • Asset Valuation. Key Audit Matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Report of the current period.  These matters were addressed in the context of our audit of the Financial Report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Construction Revenue Recognition (A$6,997m) Refer to Note 4 ‘Revenue from Contracts with Customers’ to the Financial Report The key audit matter How the matter was addressed in our audit The Group performs various building, engineering and services construction contract works (projects) for a wide range of customers. The Group contracts in a variety of ways. Each project has a different risk profile based on its individual contractual and delivery characteristics.   Currently, global market conditions are uncertain with disruption to supply chains and inflationary pressures. These conditions, combined with the ongoing impacts of the pandemic, continue to create a challenging operating environment impacting productivity, expected timing of completion and expected costs to complete. Other impacts include projects being put on hold in some markets, with some delays in securing and commencement of new projects.  Construction revenue recognition is a key audit matter as judgement is required to assess the timing of recognition determined by the Group. Revenue on construction contracts is earned over time, typically using costs incurred as a proportion of total forecast costs as the measure of progress.   Estimating total forecast costs to complete during project life is complex and requires judgement. Typical cost estimates include labour, subcontractors, equipment, materials, and project Our procedures included: • Evaluating and testing management’s review and approval of revenue and cost forecasting; • Selecting a sample of contracts for testing using: - Data Analytic routines based on a number of quantitative and qualitative factors, related to size and risk of projects; and - the Group’s project reporting tool. • For the sample selected, we: - conducted visits to a selection of project sites to evidence physical progress; - inquired with key project personnel to assess the project schedule, forecast costs, risks and opportunities, with involvement from KPMG engineering specialists where appropriate; - read relevant contract terms and conditions to evaluate the inclusion of individual characteristics and project risks in the Group’s estimates; - tested a sample of incurred costs to supplier invoices or other underlying documentation; - tested forecast costs for labour, subcontractors, equipment, materials, and project overheads by comparing to actual incurred spend, committed future contracts and current market quotes, with specific consideration of inflation in our assessment of contingency; - tested the variations and claims (including COVID-19 related impacts) recognised within revenue against the criteria for recognition in the accounting standards via inspection and assessment of: Financial Statements

177

 overheads. Changes to these cost estimates could give rise to variances in the amount of revenue recognised. The revenue on construction contracts may also include variations and claims, which fall under either the variable consideration or contract modification requirements of AASB 15. These are recognised on a contract-by-contract basis when evidence supports that it is highly probable that a significant reversal in the amount of revenue recognised will not occur. The assessment of revenue on construction contracts resulting from variations and claims was a focus of our audit due to the audit effort in assessing this across bespoke projects and contracting arrangements. o correspondence between the Group and the customer; o the Group’s legal basis for the variations and claims, including, where necessary, external legal opinions; and o the Group’s analysis of the amounts they consider meet the recognition requirement of highly probable, using our knowledge of the Group’s historical experience in resolving variations and claims, and considering the commercial factors specific to each variation or claim and quality of information underpinning the amounts recognised. Sale of development Properties (A$610m) Refer to Note 4 ‘Revenue from Contracts with Customers’ to the Financial Report The key audit matter How the matter was addressed in our audit The Group develops for sale both built form products (for example residential apartments, and commercial and retail buildings) and residential land lots. It is the Group’s policy for development revenue to be recognised when control transfers to the purchaser, based on an assessment of the contractual terms of sale.  This was a key audit matter due to the volume of transactions that occur across multiple jurisdictions. In addition, the assessment of cost of sales includes judgement as cost allocation for site infrastructure costs is typically based on the proportion of revenue for each unit, lot or building as compared to total forecast project revenue.   Whilst there have been delays in timing of  residential land settlements due to flooding on the east coast of Australia, these do not impact the Group’s revenue recognition policy for residential land lots as revenue is recognised on settlement.   Our procedures included: • Evaluating and testing management’s review and approval of development revenue and cost forecasting; • Selecting a sample of settlements, across multiple jurisdictions, during the year. For the sample selected we: - compared revenue recognised to contractual terms of sale and cash settlements; - assessed the Group’s determination of when control transfers by a detailed analysis of the contractual terms of sale against the criteria in the accounting standards; - assessed the Group’s cost allocation methodology against the requirements of the accounting standards; - tested the application of the cost allocation methodology by comparing allocated costs to revenue recognised in the year relative to the total project revenue; and - assessed total project revenue by comparing expected sales prices to published industry forecasts and comparable sales prices achieved in the year, being alert to the impacts of current challenging market conditions. 178

Lendlease Annual Report 2022

 Recoverability of Development Property Inventory (A$3,110m) Refer to Note 11 ‘Inventories’ to the Financial Report The key audit matter How the matter was addressed in our audit It is the Group’s policy to capitalise development costs into inventory over the life of its projects. Development costs include the purchase of land, site infrastructure costs, construction costs for built form products and borrowing costs.  It is the Group’s policy to carry inventory at the lower of cost and net realisable value. The recoverability therefore of these capitalised development costs is a significant judgement made by the Group, and their assessment is based on forecasts of: • sales prices; and • construction and infrastructure costs to complete the development. Where a development is forecast to be loss making and the inventory is no longer considered to be recoverable, the Group considers it to be impaired and it is their policy for an expense to be recognised.  This was a key audit matter for us due to: • current year Development Property Inventory write-down booked of $289m as a result of the Group’s strategic review of four projects increasing our focus in this area; and • many developments being long term which increases the level of forecasting judgement and audit complexity in assessing estimated sales prices and future costs to complete the development. We considered the heightened risk in estimating future sales prices, the timing of sales, and future costs as a result of current economic conditions. Our procedures included: • Selecting a sample of projects for testing using: - Data Analytic routines based on a number of quantitative and qualitative factors, related to size, duration and risk of projects; and - the Group’s project reporting tool. • For the sample selected, we: - compared expected sales prices to published industry forecasts and comparable sales prices achieved in the year, being alert to the impacts of current challenging market conditions; - tested a sample of forecast construction and infrastructure costs to underlying supplier contracts, historical experience of similar costs, and our industry expectation of cost contingency levels and cost escalation assumptions; and assessed expected sales prices, the volumes of sales expected each period and holding costs in light of current challenging market conditions, using our industry knowledge; - for certain asset portfolios, compared long term market assumptions to our in-house macroeconomic view. • For projects subject to the Group’s strategic review, we challenged key assumptions included in the Group’s internal recoverability assessments, such as expected sales prices and exit costs. We did this using our knowledge of the underlying project and knowledge of the market; and by comparing to relevant external sources, such as legal agreements and valuations. • Assessing disclosures included in the financial report highlighting the key factors in determining recoverability of development property inventory, using our understanding obtained from our testing and against the requirements of the accounting standards.      Financial Statements

179

 Asset Valuation Refer to Note 12 ‘Equity Accounted Investments’ (A$4,379m), Note 13 ‘Other Financial Assets’ (A$1,205m) and Note 26 ‘Fair Value Measurement’ to the Financial Report The key audit matter How the matter was addressed in our audit The Group is required to assess the value of equity accounted investments and other financial assets at each reporting date. The fair value of the properties held by various investment entities directly impacts the Group’s interests in these assets.   Valuations of assets are generally performed by the Group using internal valuation methodologies (discounted cash flow or capitalised income approach) or through the use of external valuation experts. External valuations are obtained on a routine basis by the Group each year, with the remaining investments being valued internally.  Other financial assets are predominantly investments in entities which in turn own commercial and retail property. Accordingly, the Group’s valuation assumptions are predominantly the capitalisation of earnings rates, discount rates, future rental income, and leasing incentives.   Equity accounted investments include the Group’s interest in the retirement living business. The key assumptions used by the Group in determining the value of retirement villages are discount rates, changes in village residents, current units/homes market prices and pricing growth rates.  Whilst interest rates are rising in global markets, real estate valuations have remained relatively stable to date.  The assessment of the valuations of these assets is a key audit matter as they: • contain certain forward-looking assumptions, with higher estimation uncertainty given current economic conditions and the pandemic, which are inherently challenging to audit; Our procedures included: • Selecting a sample of valuations performed by the Group, based on the significance of the asset to the Group’s financial position and performance; • Assessing the scope, competence and objectivity of external valuation experts engaged by the Group for assets valued by external valuation experts; • Assessing the impact of market uncertainty caveats included in valuations performed by the Group’s external valuation experts on the extent of our testing of key assumptions; • Evaluating and testing management’s review and approval of internal valuations based on the Group’s policies for internally valued assets; • Assessing the valuation methodology for consistency with accounting standards and industry practice for the asset’s class; • Working with our real estate valuation specialists, we compare key assumptions with market data published by commercial real estate agents, previous external valuations, our knowledge of the industry, and/or our knowledge of the asset and its historical performance. Key assumptions include: - discount rates - changes in village residents - units/home current market prices - pricing growth rates - capitalisation of earnings rates - future rental income - leasing incentives • Assessing disclosures included in the financial report highlighting the estimates and judgements in determining fair values of the Group’s equity accounted investments and other financial assets. We used our understanding obtained from our testing against the requirements of the accounting standards. 180

Lendlease Annual Report 2022

 and • lead to additional audit effort, often due to the high number of differing assumptions and models, across varying asset classes.  Other Information Other Information is financial and non-financial information in Lendlease Group’s annual reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors of Lendlease Corporation Limited are responsible for the Other Information.  Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report. Responsibilities of the Directors for the Financial Report The Directors of Lendlease Corporation are responsible for: • preparing the Financial Report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001; • implementing necessary internal control to enable the preparation of a Financial Report that gives a true and fair view and is free from material misstatement, whether due to fraud or error; and • assessing the Lendlease Group’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate Lendlease Group or to cease operations, or have no realistic alternative but to do so.  Auditor’s responsibilities for the audit of the Financial Report Our objective is: • to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and  • to issue an Auditor’s Report that includes our opinion.  Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Financial Statements

181

 Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Financial Report. A further description of our responsibilities for the audit of the Financial Report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our Auditor’s Report. Report on the Remuneration Report Opinion In our opinion, the Remuneration Report of Lendlease Corporation Limited for the year ended 30 June 2022, complies with Section 300A of the Corporations Act 2001. Directors’ responsibilities The Directors of Lendlease Corporation Limited are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibilities We have audited the Remuneration Report included in pages 78 to 103 of the Directors’ report for the year ended 30 June 2022.  Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.  KPM_INI_01           PAR_SIG_01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_01        KPMG Eileen Hoggett  Partner  Sydney  22 August 2022  182

Lendlease Annual Report 2022

Chicago  Lakeshore EastArtist's impressionOther Information

183

Other Information184

Lendlease Annual Report 2022

Corporate directory

Annual General Meeting 2022 (AGM)
The Annual General Meeting (AGM) of shareholders of Lendlease 
Corporation Limited and the general meeting of unitholders of 
Lendlease Trust (together, Lendlease Group) will be held at 10am 
on Friday 18 November 2022 at Wesley Conference Centre, 220 
Pitt Street, Sydney, NSW. Securityholders who are not able to 
physically attend the AGM will be able to participate and vote at 
the meeting using technology. We will provide securityholders 
with full details of participation in the Notice of Meetings. 
Lendlease advises that the date of close of Director nominations 
for election at the AGM is Friday 30 September 2022.

Important dates
22 August 2022

26 August 2022

29 August 2022

Full Year results announced

Security price ex distribution

Final distribution record date

21 September 2022

Final distribution payable

18 November 2022

Annual General Meeting

13 February 2023

Half Year results announced

17 February 2023

Security price ex distribution

20 February 2023

Interim distribution record date

8 March 2023

Interim distribution payable

Please note that the timing of events can be subject to change. A 
current calendar is available online at www.lendlease.com

Entity Details
Lendlease Corporation Limited ABN 32 000 226 228 
Incorporated in NSW Australia

Lendlease Responsible Entity Limited ABN 72 122 883 185 AFS 
Licence 308983 as responsible entity for Lendlease Trust ABN 39 
944 184 773 ARSN 128 052 595

Registered Office
Level 14, Tower Three 
International Towers Sydney 
Exchange Place 
300 Barangaroo Avenue 
Barangaroo NSW 2000

Contact
T: +61 2 9236 6111 
F: +61 2 9252 2192

www.lendlease.com

Share Registry Information
Computershare Investor Services Pty Limited ABN 48 078 279 
277 GPO Box 242, Melbourne Victoria 3000 Australia

T: 1800 230 300 (within Australia) 
T: +61 3 9946 4460 (outside Australia)

www.computershare.com.au

Other Information

185

Securityholder information

Dispute resolution
There is a dispute resolution 
mechanism that covers complaints by 
securityholders. For more information, 
please contact Lendlease Investor 
Relations at +61 2 9236 6111 or email 
us investorrelations@lendlease.com

Distribution and Share Accumulation 
Plan issue price history
For historical distribution and Share 
Accumulation Plan Issue Price 
information, please see the below link 
to our website www.lendlease.com/au/
investor-centre/distribution-and-tax

Securities exchange listing and code
Lendlease Group is listed on the 
Australian Securities Exchange and trades 
under the code LLC.

Key sources of information 
for securityholders
We report the following to 
securityholders each year:

In the United States, Lendlease 
securities are traded on the ‘over 
the counter’ market in the form of 
sponsored American Depositary Receipts 
(ADRs) under the symbol LLESY. Each 
ADR represents one ordinary security. 
Information about ADRs is available from 
the depositary, The Bank of New York 
Mellon www.adrbny.com

Voting rights
Each stapled security in Lendlease 
Group and each ADR entitles the 
holder to one vote. Rights to Lendlease 
Group securities granted under Lendlease 
Group’s employee equity incentive plans 
do not carry voting rights.

Share Accumulation Plan
The Share Accumulation Plan is 
designed to be a convenient way for 
securityholders with a registered address 
in Australia or New Zealand to build 
their securityholdings without incurring 
transaction costs. The laws of other 
countries make it difficult for us to 
offer securities in this way. Lendlease 
securityholders are able to reinvest their 
distributions to acquire more Lendlease 
securities through the Distribution 
Reinvestment Plan (DRP) or the Share 
Election Plan (SEP). Securityholders may 
also make contributions of between $500 
and $2,500 to acquire new Lendlease 
securities under the Share Purchase Plan 
(SPP). Together the DRP, SEP and SPP 
constitute the Share Accumulation Plan.

The rules of each of these plans are 
set out in the Share Accumulation Plan 
Information Sheet. Copies are available 
on the Lendlease website. Please note 
that the Share Election Plan and the Share 
Purchase Plan are currently suspended.

• Annual Report

• Half Year Financial Report

• March and September 
distribution statements.

Electronic communications
Securityholders have the option of 
receiving the following communications 
and all other Company related 
information electronically:

• Annual Report

• Distribution statements

• Notice of Annual General Meetings.

Lendlease makes the Annual Report 
available in an online version. A hard 
copy of the Annual Report will only be 
sent to those securityholders who elect 
to receive it in that form. In addition, 
securityholders may elect to receive 
notification when the Annual Report is 
available online.

Securityholders who wish to register 
their email address should go to the 
website of the Lendlease share registry 
www.investorcentre.com/ecomms

For registry contact details, see page 184.

Privacy legislation
Under Chapter 2C of the Corporations 
Act 2001, a securityholder’s information 
(including their name, address and details 
of securities held) is required to be 
included in Lendlease’s public register. 
This information must continue to be 
included in Lendlease’s public register 
for seven years after a person ceases 
to be a securityholder. These statutory 
obligations are not altered by the Privacy 
Amendment (Private Sector) Act 2000. 
Information is collected to administer the 
securityholder’s holding and if some or 
all of the information is not collected, 
then it may not be possible to administer 
the holding. Lendlease’s privacy policy is 
available on its website.

186

Lendlease Annual Report 2022

Security information at a glance at 1 August 2022 (comparative 1 August 2021)

Number of securityholders

Units issued

Percentage owned by 20 largest securityholders

Interim dividend/distribution

Total dividend/distribution

Dividend payout ratio

2022

65,909

688,906,938

77.03%

2021

70,202

688,585,551

74.89%

5.0 cents per security

15.0 cents per security

16.0 cents per security

27.0 cents per security

40%

49%

Spread of securityholdings as at 1 August 2022 (comparative 1 August 2021)

1 to 1,000 securities

1,001 to 5,000

5,001 to 10,000

10,001 to 100,000

100,001 securities and over

Total number of securityholders

2022

34,856

24,861

4,052

2,094

81

65,944

2021

37,814

25,683

4,318

2,235

98

70,148

Securityholders with less than a marketable parcel

3,798 (representing 
75,210 securities)

3,158 (representing 
50,236 securities)

Securities purchased on market

The following securities were purchased on market during the financial year for the purpose of funding employee incentive awards through 
Lendlease securities.

Stapled Securities

1,753,606

$11.67

Number of Securities Purchased Average Price Paid Per Security

Top 20 securityholders as at 1 August 2022

Rank

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

Name
HSBC Custody Nominees (Australia) Limited

J P Morgan Nominees Australia Pty Limited

Citicorp Nominees Pty Limited

BNP Paribas Nominees Pty Ltd 

National Nominees Limited

LL Employee Holdings Custodian Pty Limited 

Argo Investments Limited

LL Employee Holdings Custodian Pty Limited 

BNP Paribas Nominees Pty Ltd Hub24 Custodial Serv Ltd 

HSBC Custody Nominees (Australia) Limited 

Netwealth Investments Limited 

Custodial Services Limited 

Mutual Trust Pty Ltd

BNP Paribas Nominees Pty Ltd ACF Clearstream

Citicorp Nominees Pty Limited 

BNP Paribas Nominees Pty Ltd 

Colonial First State INV Ltd 

Netwealth Investments Limited 

Colonial First State INV Ltd 

20

Australian Executor Trustees Limited 

Total Top 20 holders of fully paid ordinary shares

Total Remaining Holders Balance

Other Information

187

Units % of Units
37.36

257,386,390

86,436,235

74,288,074

30,670,308

29,838,300

14,075,522

6,980,092

6,026,948

4,323,740

3,776,830

3,013,060

2,138,498

2,039,681

1,955,184

1,833,047

1,544,676

1,243,585

1,085,415

1,012,254

978,038

530,645,877

158,261,061

12.55

10.78

4.45

4.33

2.04

1.01

0.87

0.63

0.55

0.44

0.31

0.30

0.28

0.27

0.22

0.18

0.16

0.15

0.14

77.03

22.97

Substantial securityholders as shown in the Company’s Register at 1 August 2022

Name
Aware Super Pty Limited

State Street Corporation

BlackRock Group

The Vanguard Group

Date of Last Notice Received
4/5/2022

17/12/2021

8/10/2020

29/4/2019

No of Units
58,980,938

42,178,224

34,049,935

33,903,122

% of Issued Capital
8.56

6.12

6.03

6.01

188

Lendlease Annual Report 2022

Glossary

Co-investment: The total market value 
of Lendlease equity invested across 
Lendlease managed funds as at period 
end. Represents the Group’s assessment 
of the market value.

Construction backlog realisation: The 
proportion of Construction backlog 
revenue which is expected to be earned 
across future years.

Construction backlog revenue: Current 
year Construction backlog revenue is 
the total revenue to be earned across 
future periods.

Development pipeline: Estimated 
remaining end value of all of the Group’s 
secured development projects based on 
values as at period end; includes 100 
per cent of joint venture projects and 
therefore will not necessarily correlate 
with the Group’s Profit after Tax.

Distribution payout ratio: Distribution 
divided by Profit after Tax.

Distribution per security: Amount of 
interim and final distribution per stapled 
security from the Company/Trust.

Earnings per security: Profit after Tax 
divided by the weighted average number 
of securities on issue during the year 
(including treasury securities) unless 
otherwise stated.

EBITDA: Earnings Before Interest, Tax, 
Depreciation and Amortisation.

Effective tax rate: Income tax expense as 
a percentage of Profit before Tax.

Face value of a security: The value of a 
Lendlease security at the applicable time.

Funds under management (FUM): The 
total market value of investments across 
Lendlease managed funds.

Gearing: Net debt to total tangible assets 
less cash.

Global Minimum Requirements (GMRs): 
GMRs are Lendlease’s minimum 
environment, health and safety standards 
designed to control the risks across 
our operations.

Good leaver: A senior executive who 
is leaving Lendlease for a reason such 
as retirement, redundancy, or resignation 
where the senior executive is not joining a 
competitor, and who may remain eligible 
for part or all of an incentive opportunity.

Green Star rating: Green Star is a 
national voluntary environmental rating 
system used by the Green Building 
Council of Australia to evaluate the 
environmental design and achievements 
of buildings.

Investments: Includes equity invested 
in Lendlease managed funds and direct 
investment in property and property 
related assets. Represents the Group’s 
assessment of market value.

Investments performance: The 
performance of our Investments business 
which includes our funds under 
management, assets under management, 
co-invested equity in Lendlease managed 
funds and direct investment in property 
and property related assets.

Key Management Personnel (KMP): 
Those executives who have the authority 
and responsibility for planning, directing 
and controlling the activities of the 
Group directly or indirectly (as per 
Accounting Standard AASB 124 Related 
Party Disclosures).

KPIs: Key Performance Indicators.

Long Term Incentive (LTI)/Long Term 
Award (LTA): An incentive scheme which 
provides Lendlease equity (or cash, in 
some circumstances) to participating 
executives that may vest, in whole or 
part, if specified performance measures 
are met over a three or four year period.

Lost Time Injury Frequency Rate (LTIFR): 
An indicator and industry standard 
measuring a workplace injury which 
prevents a worker from returning to 
duties the next day. LTIFR refers to the 
number of lost time injuries within a year, 
relative to the total number of hours 
worked in the financial year.

Market capitalisation: The number of 
securities on issue multiplied by the 
security price at year end.

Net debt: Borrowings, including certain 
other financial liabilities, less cash.

New work secured revenue: Estimated 
revenue to be earned from construction 
contracts secured during the period. 
New work is secured and forms part 
of Construction backlog revenue when 
formal contracts are signed.

Operating Return on Equity (ROE): ROE 
is calculated using annual operating Profit 
after Tax attributable to securityholders 
divided by the arithmetic average of 
beginning, half year and year end 
securityholders’ equity.

People and Culture Committee: The 
Board subcommittee that helps the 
Board fulfil its responsibilities in people 
management and reward policies. It is 
made up entirely of independent Non 
Executive Directors.

Profit after Tax (PAT): Profit after 
Tax attributable to securityholders, 

determined in accordance with Australian 
Accounting Standards.

Public Private Partnerships (PPP): A 
joint procurement arrangement for 
infrastructure development contracts 
between the public and private sectors.

Residential for rent: Residential 
apartments, typically in the form of an 
entire building, that are made available 
for rent as separate dwellings. Lendlease 
and its investment partners maintain 
ownership of these apartments.

Securityholders: An individual or entity 
that owns Lendlease securities.

Senior executive: Employees who hold 
a position at executive level according 
to the Lendlease Career Job Framework. 
This generally includes Regional Business 
Unit Heads, Regional Function Heads and 
in some cases, direct reports to Group 
Function Heads.

Settlements (units): Apartments – cash 
settled in the period on completed 
units in Australia, Europe and Americas, 
and units which have reached practical 
completion in Asia; Communities and 
Retirement – units settled in the period on 
completed land lots or units; Commercial 
– buildings that have achieved practical 
completion during the period.

Short Term Incentive (STI)/Short Term 
Award (STA): Incentives awarded with 
direct reference to financial and non 
financial performance over a one year 
period. Measures are designed to focus 
individuals on priority areas for the 
current financial year.

Total Package Value (TPV): Salary plus 
the value of salary package items such 
as motor vehicles and parking and 
compulsory superannuation contributions 
paid on behalf of an employee.

Total Shareholder Return/Total 
Securityholder Return (TSR): The 
movement in a company’s share/security 
price, dividend yield and any return of 
capital over a specific period. It is often 
expressed as a percentage.

Urban pipeline: Estimated remaining 
end value of all of the Group’s 
secured development projects (excluding 
Communities projects and Retirement 
projects) based on values as at period 
end; includes 100 per cent of joint venture 
projects and therefore will not necessarily 
correlate with the Group’s Profit after Tax.

Weighted average number of securities: 
The time weighted number of securities 
outstanding during the period.

Milan  Milano Santa GiuliaArtist's impressionLevel 14, Tower Three  International Towers Sydney  Exchange Place  300 Barangaroo Avenue  Barangaroo NSW 2000www.lendlease.com @lendlease @lendleasegroup @lendleaseReducing our footprint – page by pageThis report is printed on locally sourced, carbon neutral recycled paper and contains waste paper from Lendlease assets around Australia.