HMC Capital Partners Fund I on Lendlease
Thesis
Lendlease currently trades at a significant discount to its net tangible assets (NTA) because the market is overly focused on the exit from its non-core CRU segment. However, we see value in the core IDC (Investments, Development, and Construction) business, which is showing positive progress. We believe the stock is poised for a significant re-rate as capital from the CRU segment is recycled, the Australian development pipeline is replenished, and a strong external CEO is appointed.
“It currently trades at a ~40%+ discount to NTA, with market attention focused almost entirely on the exit of the non-core CRU segment, despite continued momentum and improving outlook in its core Investments, Development and Construction (IDC) businesses...We continue to engage with management and the Board of LLC on ways to unlock the value we see in the core IDC business and maintain our view that Lendlease is positioned for a meaningful re-rate.”