Shimao Founder Sells Sydney Office Tower to Lendlease for $1.6B Residential Project

The founder of Chinese developer Shimao Group has sold a central Sydney office tower to Australian builder Lendlease, which plans to redevelop the site into a luxury residential project with a gross end value of more than A$2.5 billion ($1.6 billion).

Hui Wing Mau, an Australian citizen who also goes by the Mandarin name Xu Rongmao, had acquired the 28-storey building at 175 Liverpool Street in 2014 from Singapore sovereign fund GIC for over A$390 million (then $339 million) with an eye towards a residential conversion.

Lendlease’s design for the 3,750 square metre (40,365 square foot) site features two residential towers with up to 300 apartments for sale and 2,000 square metres of retail and commercial space, according to a Wednesday notice. Tom Mackellar, CEO for development at Lendlease, said the buy aligns with the strategic objectives of the ASX-listed group, which continues to pare back its global operations in favour of domestic growth.

“Centrally located overlooking Hyde Park with views of Sydney’s iconic landmarks, 175 Liverpool Street demonstrates how exceptional developments that redefine the city can be realised through our deep residential expertise,” Mackellar said.

Mitsubishi Estate Courted

Construction of 175 Liverpool Street is scheduled to begin in 2027. Lendlease is developing the project alongside joint venture partners, the company said Wednesday without elaborating. A sell-down of up to 50 percent of the development is expected in the coming weeks.

According to a report in The Australian newspaper, Lendlease has been courting a frequent collaborator, Japanese property giant Mitsubishi Estate, to back the project. The pair previously teamed up on deals including the A$800 million purchase of Sydney mixed-use project One Circular Quay from China’s AWH Investment Group and the A$1.7 billion development of the One Sydney Harbour residences in Barangaroo.

“The acquisition of 175 Liverpool Street builds on Lendlease’s success in Sydney’s luxury residential market, including the completion of One Sydney Harbour — which set a new sales record for a penthouse — and sales at One Circular Quay surpassing A$2 billion,” the group said.

The transaction with the Shimao supremo follows Lendlease’s May announcement of the sale of six UK development assets into a 50:50 joint venture between the Aussie builder and a property firm owned by the British monarch, with the group anticipating a profit in the range of A$10 million to A$30 million on the disposal of its half-stakes.

Lendlease’s A$2.5 billion in capital recycling initiatives during fiscal 2025 have included the sale of its Capella Capital infrastructure arm to Japan’s Sojitz Corporation for A$235 million, the disposal of a A$170 million half-stake in its Asia life sciences unit to private equity giant Warburg Pincus in a deal closed last July, and a A$516 million exit from its US military housing business.

Restructuring in Sight

Hui Wing Mau is offloading his Sydney prize just as Hong Kong-listed Shimao puts the finishing touches on a restructuring of more than $11 billion in offshore debt, according to a Wednesday stock filing.

“The company currently expects all restructuring conditions to be satisfied on or prior to 21 July 2025 and that the restructuring effective date will occur on 21 July 2025,” said Jason Hui, who succeeded his father as Shimao’s chairman last September.

For the first half of 2025, the Shanghai-based developer’s contracted sales fell 21 percent year-on-year to RMB 13.5 billion ($1.9 billion), covering a sold area of 1.1 million square metres. The average selling price dropped 6.3 percent year-on-year to RMB 12,192 per square metre.