Lend Lease takes major stake in Dome plan


The Bluewater shopping development in Kent, U.K. is a Lend Lease project

By CNN's Geoff Hiscock
Asia business editor

SYDNEY, Australia (CNN) -- Australian property group Lend Lease will be the major shareholder in the massive $5.8 billion redevelopment project for London's Millennium Dome and Greenwich Peninsula.

It holds 51 percent of Meridian Delta, the joint venture consortium chosen by the U.K. government late Tuesday to breathe new life into the Dome and develop the surrounding peninsula on the River Thames.

Lend Lease's joint venture partner is the British developer Quintain Estates and Development, which will hold 49 percent.

In a statement to the Australian Stock Exchange Wednesday morning, Lend Lease said its proposal envisaged a 25-year partnership with the U.K. government to develop 5000 new homes, about 325,000 square meters of commercial floor space, and a regeneration of the area around the Dome as a restaurant and leisure/retail precinct.

Lend Lease said the first profits from land sales were likely in 2004-05.

Partnering with U.S. operator

It said Meridian Delta is partnering with the U.S. stadium operator Anschutz Entertainment Group, which will finance, develop and manage a $320 million, 20,000-seat sports and entertainment arena inside the Dome.

The U.S. group is controlled by billionaire Philip Anschutz, who owns the Los Angeles Lakers.

The $1.4 billion Dome was built as tourist attraction in 2000 to mark the millennium, but failed to achieve its targets and has been a major embarrassment to the government of Tony Blair.

Lend Lease, which operates in 40 countries, has had its own difficulties in 2000-01.

In August it reported a 95 percent drop in net profit for the year to June 2001 to about $76 million (Aust. $151.4 million), attributing the decline to problems in the group's real estate investments arm in the U.S.

Share price dropped

Its share price dropped from a high of A$23.59 in October 2000 to a low of A$9.56 on September 17 this year.

It traded Wednesday at A$11.99, up 22 cents or 1.87 percent from Tuesday's close.

Lend Lease chief executive David Higgins said last month the company was still budgeting for a profit in 2001-02 of about $107 million (Aust. $210 million).

The company's biggest development successes include the Bluewater shopping complex in Kent, England, and the Sydney 2000 Olympic village in Australia.