• Lendlease sells 40% interest in The Exchange TRX retail mall and full 60% interest in adjacent office tower for ~$400 million
• Lendlease continues to target $2 billion of capital recycling from Capital Release Unit (CRU) in FY26
• Delays in transaction timing across CRU and IDC segments expected to increase forecast Group gearing by ~10% at 1H FY26

Lendlease today announced further progress on its FY26 capital recycling initiatives, with a binding agreement exchanged for the ~$400 million sale to a Malaysian investor, the Valiram Family Office, of a 40% interest in The Exchange TRX retail mall and its full 60% interest in the adjacent office tower in Malaysia. Following completion, Lendlease's remaining 20% interest in the fully operational retail mall will move into the Investments segment. Lendlease also retains a 60% interest in the residential land plots and a 60% interest in the adjacent hotel, with a combined book value of more than $200 million, each held within the Capital Release Unit (CRU). Lendlease continues to target $2 billion of capital recycling from CRU in FY26, including today's announced partial sale of TRX interests. The sale of Lendlease's remaining share of Keyton continues to progress, with exclusive negotiations with a preferred party underway. Cash inflows of ~$1 billion from these transactions that were anticipated in 1H FY26 are now expected in 2H FY26. In addition, a further ~$1 billion of capital recycling and cash inflows from CRU is in progress for 2H FY26. Due to limited transaction activity in 1H FY26, the CRU segment is not expected to generate sufficient transactional earnings to offset its cost base, with delays in capital recycling resulting in higher accrued capital balances and elevated financing and overhead costs, contributing to a loss outcome for the CRU segment for the first half. Delays in transaction timing across CRU and IDC segments, amounting to ~$1.2 billion, are expected to increase forecast Group gearing by ~10 per cent at 1H FY26, resulting in anticipated gearing in the mid to high 30 per cent range.

Lendlease continues to target $2 billion of capital recycling from CRU in FY26, including the announced partial sale of TRX interests. The CRU segment is not expected to generate sufficient transactional earnings to offset its cost base in 1H FY26 due to delays in capital recycling.

Lendlease remains highly active on capital recycling, with more than $3 billion of transactions underway for the second half of the financial year. This includes $2 billion of announced or advanced stage capital recycling initiatives across its segments.