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Lendlease pushes Northern expansion in bid for major projects

Lendlease is on a major drive to expand into the North of England, targeting five core sectors in the region.

The contractor’s executive general manager for UK regions Simon Gorski told Construction News the group was targeting major projects across the public, higher education, retail and commercial sectors, alongside smaller volumes in residential and healthcare.

“The sort of things we’re looking at are the sophisticated, complex partnerships and programmes that we can deliver with clients,” he said.

“We’re not a volume bidder or builder, trying to be all things to all people. We’re about having relatively few, good-quality relationships with clients.”

Lendlease launched a North-west office in Salford Quays this summer, after having reduced its operations in the region for a number of years.

It has already started to bid for major projects regionally and won an £80m deal with Liverpool John Moores University earlier this year to redevelop a former Royal Mail sorting office into a mixed-use university building.

Mr Gorski said his firm would have less focus on “smaller” jobs in higher education, instead focusing on major projects in the sector.

“Doing a smaller university job – £10m or £20m – on a new build is fairly straightforward, but when you do a major conversion that can be a third of somebody’s campus, that’s a challenge,” he said.

The contractor has been named on a two-firm shortlist in Scotland alongside Multiplex for Glasgow university’s £1bn Gilmorehill Campus expansion, as revealed by Construction News earlier this week.

“If you describe what ‘perfect Lendlease’ is, it’s that [Glasgow] scheme,” Mr Gorski said.

He added that a similar approach would apply to the firm’s bidding activity in the commercial sector.

Lendlease would be “unlikely” to bid for commercial schemes in the North-west between £10m and £30m, he said.

“It starts becoming a bit more commoditised and there are 20-30 organisations that can do it.”

The commercial sector is one of Lendlease’s core sectors in London, with wins including a £103m job to deliver an office scheme in Hammersmith this month, but it “won’t be anywhere near as big” for Lendlease in the North as it is in London, Mr Gorski said.

“But there’s no doubt if [a well-known client was] coming to market with a big, sophisticated commercial opportunity, we want to be part of that conversation,” he added.

“It won’t always be right for us, but we want [clients] to be thinking that Lendlease is one of two or three organisations that could do this [type of job].”

In the public sector, Lendlease will continue to focus on major frameworks, such as its current deals with the Ministry of Defence and the Ministry of Justice, the latter of which includes the construction of a £200m prison in Wrexham.

The organisation is also eyeing the government’s new ‘super prisons’ programme when it comes to market.

“As probably the number one provider now [for the MoJ], it’s important to me that we are involved,” he said.

However, the residential market will be less of a focus regionally for Lendlease compared with London.

The company is working on the residential-led £1.5bn regeneration of Elephant & Castle in the capital and has been shortlisted as a development partner for Haringey Council’s £2bn redevelopment programme, which will deliver at least 5,000 homes to the area.

Mr Gorski said smaller residential volumes might “top out the work that we’re doing in other sectors”, but would not be a focus.

“If you go around Manchester now there are a lot of tower cranes, and many of them are around residential schemes, but that’s not really the market we want to be in,” he said.

He was unfazed about competition in the Northern market, particularly in Manchester, where clients have an “appetite” for new contractors.

“When I started back in this part of the world around 18 months ago, and started to re-engage with clients that we’ve worked with in the past, it was very clear that they felt there was an appetite for another big organisation to be back in this space,” he said.

“When I talk to major organisations, whether it’s in Manchester or elsewhere, they want to know whether we have the people in [Lendlease] who can come and work on their projects.

“I’m saying names that everyone’s familiar with, plus new talent is coming through, and [clients] are really reassured by that.”

He added that the new North-west office was about “finding somewhere closer to the action”, and that it was meant to demonstrate “investment to the market”.

We’ve taken a long-term lease here and have committed to [the North],” he said.

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