INTERNATIONAL: Australian developer LendLease lands $15 billion project with Google; shares surge

PHOTO: FILE PHOTO: The Google logo is pictured at the entrance to the Google offices in London

(Reuters) – Australia’s LendLease Group <LLC.AX> on Thursday said it secured a contract with Alphabet Inc’s <GOOGL.O> Google to develop $15 billion worth of residential and retail space in Silicon Valley, sending the builder’s stock to a more than eight-month high.

The deal is a significant boon for LendLease, coming at a time when Australian developers navigate the domestic property market’s worst downturn in a generation, characterized by a drop in building approvals and tighter consumer spending.

It is also a major win for LendLease’s strategy to expand abroad, and will see it reinforce its core role as a residential developer after being hobbled by its engineering division.

“It’s an important deal and the client is very well known and it’s likely to be a very innovative development,” said Michael McCarthy, chief market strategist at CMC Markets

“So in reputation terms, it’s a positive for the company and it may very well attract further attention, in particular attention from international players.”

The announcement sent LendLease’s share price up in morning trade by as much as 5.3% to A$14.84, its highest since Nov. 8.