Lendlease Group · ASX:LLC
Lendlease — Investor Presentation (2004)
40 slides from Lendlease's investor presentation, 2004
Slide 1: 1
1
Slide 2: Americas – Chief Executive Officer Ron Oakley
Americas Chief Executive Officer Ron Oakley 2
Slide 3: Agenda
Agenda 1. Overview 2. The Business 3. Our Competitive Advantages 4. Growth Outlook 5. Summary 3
Slide 4: Overview
Lend Lease 1. Overview
Slide 5: Key Facts
Key Facts • Lend Lease Americas businesses – Bovis Lend Lease – Actus Lend Lease – REI / King of Prussia • Bovis Lend Lease – Strong diversified construction management business • Actus Lend Lease well positioned in US military housing privatization • Strong record - consistent returns above cost of
Slide 6: Market Position
Market Position • Healthcare No. 1 • Multi-Unit Residential No. 1 • Military Housing No. 1 • Government Offices No. 4 • Hotels / Motels No. 5 • Pharmaceutical Plants / R&D Labs No. 5 • Senior Living (estimated, not ENR) No. 5 • Commercial / Office No. 6 Source: 2003 ENR (McGraw Hill) 6
Slide 7: Actus Lend Lease Competitors and Our Position
Actus Lend Lease Competitors and Our Position Miller Valentine 2% Landmark 2% Actus Other Clark 4% Actus American Eagle Picerne 6% 25% Forrest City Lincoln Hunt 5% GMH Lincoln GMH Clark American Eagle 16% Hunt 17% Picerne Landmark 5% 12% Miller Valentine Forrest City 6% Other 7
Slide 8: The Business
Lend Lease 2. The Business
Slide 9: Bovis Lend Lease United States
Bovis Lend Lease United States Boston Ithaca Chicago New York Princeton Columbus Washington San Francisco Raleigh Charlotte Nashville Los Angeles Atlanta Hawaii Dallas Orlando Miami 9
Slide 10: Current Sector Portfolio
Current Sector Portfolio GPM % of Total by Sector Type of Activity Education & Multi-sites CM Agency Government 8% Actus 11% 15% 20% Health & Life Sciences General 18% Building PM 39% 17% CM Risk DB 47% Military 3% Housing Consulting 20% 2% Majority of projects cost reimbursable/negotiated 10
Slide 11: Time Warner Centre – New York
Time Warner Centre – New York Time Warner Center, New York, NY Client: Columbus Center Developer: The Related Companies, L.P.; Apollo Real Estate Advisors, L.P; The Palladium Company Type of Work: Mixed Use: Time Warner HQ; Mandarin Hotel; Retail, Residences and Parking; Jazz Theater Scope of Work:
Slide 12: Bloomberg Tower, New York
Bloomberg Tower, New York 731 Lexington Avenue, New York, NY Client: Vornado Realty Trust Type of Work: Mixed Use: Retail, commercial and residential spaces Scope of Work: 1,387,825 sqf, 52-floor above grade, 101 residential units Construction Service: Construction Management, GMP Total Contract Amo
Slide 13: Proposed Trump Tower, Chicago
Proposed Trump Tower, Chicago Trump International Hotel & Tower - Chicago, IL Client: Trump Organization (401 North Wabash Venture LLC) Type of Work: Mixed Use Scope of Work: 2,491,360 sf, 90-story tower (1125’ tall) with 462 condominiums and 224 hotel rooms Construction Service: Preconstruction wit
Slide 14: Duke University Medical Centre, North Carolina
Duke University Medical Centre, North Carolina Duke University Medical Center – Durham, NC Client: Duke University Medical Center Type of Work: Various Healthcare facilities Scope of Work: Over 919,000 sf of space, Eye Institute, Children’s Hospital, Duke Clinic, Vivarium, Student Health Clinic, Med
Slide 15: BP Global Alliance – United States
BP Global Alliance – United States BP Global Alliance, United States Client: BP Type of Work: Retail Service Stations and other improvements to BP Facilities Globally Scope of Work: Retail site development services for BPAmoco's Global service station network. Non-retail and new markets for BP conti
Slide 16: Actus Lend Lease Mainland Projects
Actus Lend Lease Mainland Projects Fort Lewis & McChord AFB Fort Drum Parsippa ny Napa Travis AFB NAS Fort Langley NPGS Monterey Lemoore McConnel Knox AFB AFB Nellis Fort Cambell Vandenberg Cannon AFB AFB Fort Bragg AFB Fort Twenty-nine Nashville Palms Altus AFB Hawai Irwin i Davis-Monthan Camp AFB
Slide 17: Fort Hood, Texas
Fort Hood, Texas Fort Hood Family Housing LP – Kileen, Texas Client: U.S. Army Type of Work: Military Housing Scope of Work: Construct and renovate approximately 5,900 homes; Construct multiple new community centers and recreational facilities; Includes asset, property and maintenance management Val
Slide 18: Actus Flow of Returns
Actus Flow of Returns • Development fees - received at financial close • Design & Construction fees • Asset management fees – over 50 year contract life • Equity returns - over 50 year contract life 18
Slide 19: King of Prussia Mall, Pennsylvania
King of Prussia Mall, Pennsylvania King of Prussia Mall - King of Prussia, PA Built: The Plaza 1961; The Court 1981 Square footage: 2.8 million Purchased: 50% 1996 US$110M Joint Owner: Kingmark Associates Largest enclosed US retail shopping mall 8 department stores 400 specialty shops 40 restaurants
Slide 20: Our Competitive Advantages
3. Our Competitive Advantages 20
Slide 21: Our Competitive Advantages
Our Competitive Advantages • Respected brands • Great people • Good market position and geographic presence • Consistent performance • Proven operational discipline and risk management 21
Slide 22: Strength of Bovis Lend Lease US Business Model
Strength of Bovis Lend Lease US Business Model • Strong financial position • Bonding capacity • Varied market sector mix • Low risk delivery model • High repeat customer base - 80%+ • Local/global expertise 22
Slide 23: Competitive Performance – Bovis Lend Lease US
Competitive Performance – Bovis Lend Lease US 70 Lend Lease Americas 60 Skanska 50 MPBT (US$m) Turner 40 30 20 Hunt Corp 10 Abrams 0 1 2 3 2001 2002 2003 Turner Turnover is 2X that of Lend Lease 23
Slide 24: Lend Lease Americas Proven Profit Growth
Lend Lease Americas Proven Profit Growth US $ Millions 180 GPM 160 140 120 Overhead 100 80 60 40 MPAT 20 0 1999 2000 2001 2002 2003 Note: excludes discontinued REI businesses 24
Slide 25: Summary Financial Profile
Summary Financial Profile (A$m) 2002 2003 (1) Net Profit After Tax BLL Americas 51.9 56.5 Actus Lend Lease 3.4 4.2 REI 13.0 14.4 Other (5.5) (0.6) Total 62.8 74.5 ROCE – BLL 14.0% 15.3% (1) Before Group overheads, amortisation and treasury • 59% of expected 2005 GPM from BLL already secured 25
Slide 26: Growth Outlook
Lend Lease 4. Growth Outlook 26
Slide 27: US Sector Growth Trends
US Sector Growth Trends • Base business will grow with the market BLL Market Segments 50 45 40 35 30 25 20 15 10 5 0 ily il ce ls e n a ar io e ffi am et ot c at R O th H tif uc l ul ea Ed M H 2003 2004 2005 2006 2007 27
Slide 28: Growth Opportunities
Growth Opportunities • Significant opportunity for growth exists in: – Healthcare – Federal Markets – Sports (New York Metropolitan Area) – Community Development 28
Slide 29: Healthcare Construction Values
Healthcare Construction Values $20 $18 $16 US$s in Billions $14 $12 $10 $8 $6 $4 $2 $0 2000 2001 2002 2003 2004 2005 2006 2007 2008 Source: McGraw Hill – FW Dodge 29
Slide 30: Bovis Lend Lease Healthcare Track Record
Bovis Lend Lease Healthcare Track Record Building Trends Current Bovis Projects Mega Hospitals • Cornell University Medical Center • Long Island Jewish Medical Center • Mission Saint Joseph Hospital • New York Presbyterian Hospital Specialty Facilities • Athens Regional Medical Center • Duke Univers
Slide 31: New York Metropolitan Area Sports Opportunities
New York Metropolitan Area Sports Opportunities • Nine (9) professional sports franchises representing the NFL, NHL, NBA and MLB • Nine (9) new stadium/arena construction and renovation programs planned • Major convention center expansion planned (Jacob Javits Center) • First NASCAR track in the Nor
Slide 32: Total Anticipated Sports Construction Spend – NY Area
Total Anticipated Sports Construction Spend – NY Area Brooklyn Nets Arena / Atlantic Yards $2.5b Destiny USA $2.2b MSG Mixed-Use Development $2b Jacob Javits Center Expansion $1.2b New York Jets Stadium $1.2b BLL/Hunt 1of 2 - Award Date 2/05 New Madison Square Garden $500m Newark Arena $355m BLL/Hun
Slide 33: US Government Construction Budget
US Government Construction Budget Federal Government Agency US $ 2003 2004 2005 Key Notes FHA has budget of $33.6 B for FY Department of Transportation $33.8 B $36.9 B $38.6 B 05 Department of Defense $10.6 B $9.2 B $9.3 B Department of Housing and Distributed to cities/states for $4.9 B $4.9 B $4.6
Slide 34: US Privatised Sector Construction Opportunities
US Privatised Sector Construction Opportunities Federal/State and Local Government • Dept. of Defence – Military Housing • Higher Education – Student Housing • Higher Education – Public Campuses • K-12 Education • Transportation – Bus/Toll Roads • Aviation • Correctional Facilities • Energy • Water
Slide 35: Actus Military Housing Projects (Operations & Pipeline)
Actus Military Housing Projects (Operations & Pipeline) 2004 2005 Complete 2006 Fort Hood 5,912 units Construction On-Going: First Renovations Mar 2002, First Converted April 2002, First New Homes August 2002 $220M (Brks 13,500) Complete 2008 Beaufort Tri-Command 1,718 units Construction On-Going: F
Slide 36: Growth Opportunities – Other Military Opportunities
Growth Opportunities – Other Military Opportunities • Seven projects in pipeline and obtainable over next twelve months • Military Barracks privatisation (commencing 2005/2006) • Military Base Realignment and Closure (BRAC) • Other opportunities under evaluation: – Continuation of military housing p
Slide 37: Base Realignment & Closure (BRAC)
Base Realignment & Closure (BRAC) • US Congress authorized another round of base closures FY2005 - approx 80 bases • Actus or LL opportunity to be master developer – Community retain land – Actus sell parcels to third party developers or to itself – Share proceeds with community • US President actio
Slide 38: Summary
Lend Lease 5. Summary 38
Slide 39: Summary
Summary • Established market position at relatively low capital cost • Strong market positions in key American markets • Longer term earnings security from Actus and King of Prussia • Track record of profit growth since acquisition of Bovis by Lend Lease • Potential to develop Urban Communities busi
Slide 40: Q&A
Q&A 40