Australia’s Lendlease Appoints John Gillam as Chairman

Australian developer Lendlease announced on Monday that it has appointed John Gillam, former chief executive of Aussie retailer Bunnings, as the group’s new director and chairman-elect, as current chairman Michael Ullmer prepares to step down from the beleaguered property company.

Gillam has been appointed to the board immediately and will commence his role as chairman following Lendlease’s annual general meeting on 15 November.

Currently non-executive chair of global agricultural innovator Nufarm, Gillam has parallel roles at veterinary care network VetPartners Group and at leisure facility management company BlueFit. He is also a director of the not-for-profit Clontarf Foundation.

These non-executive roles follow Gillam’s 20-year career at Perth-based conglomerate Wesfarmers, where he was CEO of household hardware company Bunnings from 2004 to 2016, Gillam will, in his new role, support group CEO Tony Lombardo and his team as they attempt to turn around the company and appease its disgruntled shareholders.

Commenting on Gillam’s appointment, outgoing chairman Ullmer said: “The board has been mindful of the skills and experience required to guide Lendlease through a critical period of change and to maintain its execution momentum.”

He added that Gillam will bring “an external perspective that will add new energy and urgency to our key strategic priorities and continue the ongoing board renewal process.”

A Difficult Year

Lendlease is appointing Gillam five months after Ullmer announced he would step down as chairman of the company in the midst of shareholder unrest over the property firm’s financial performance.

Having joined the board in December 2011, Ullmer has overseen a turbulent time in the company’s history. From the start of the pandemic until last May, the company’s stock lost more than 55 percent of its value.

Back in May, Lendlease’s biggest investor, Sydney-based superannuation fund Aware Super, which holds close to a 9 percent stake in the company, called for the Lendlease chairman Michael Ullmer to swiftly depart the embattled company’s board, pointing to him as an impediment to the company’s turnaround, and urged it to seek an external replacement.

Lendlease’s troubles continued in May when the company was handed a A$112 million ($74.9 million) tax bill.

Lendlease was subsequently forced to sell its overseas construction businesses in a $3 billion disposal plan.

A New Strategy

In its May 2024 strategy update, Lendlease committed to a business overhaul and set up a

Capital Release Unit in an effort to free up A$4.5 billion of net capital, with A$2.8 billion targeted by 30 June 2025.

The initial batch of divestments included military housing in the US, and the sale of community and retirement living properties. It is now ready for an exit in Ardor Gardens, Lendlease’s China-based senior living community.

In announcing Gillam’s appointment, Lendlease noted the A$1.3 billion sale of 12 masterplanned community projects to Stockland and stated that it is progressing a sale process for its UK construction business. The company said it will also sell its interest in the Kuala Lumpur-based 70-acre development The Exchange TRX.

Investors Unimpressed

Following the announcement of Gillam’s appointment, Lendlease shares, which have gained nearly 17 percent since the company laid out its turnaround plans in May, were trading down 1.4 percent, at A$6.88 where it remained at closing on Wednesday.

A task for Gillam now will be to try to reassure shareholders, including its largest investor, investment management firm Allan Gray, that the company will follow through on its turnaround plans.

The company has stated that, by the second half of 2025, its Capital Release Unit will begin divesting international projects, as well as unsold apartments in overseas projects, with those sales estimated to bring in A$1.7 billion in total.

Lendlease chairman-elect Gillam said: “It’s a privilege to be appointed chairman of Lendlease at such a pivotal time in its history.

“I look forward to commencing work with the board and Tony very soon to help deliver on the refreshed strategy, including examining options to bolster and accelerate implementation.”