Lendlease (ASX:LLC) has made further progress in its FY26 capital recycling program, signing a binding agreement to sell a 40% stake in The Exchange TRX retail mall and its full 60% interest in the adjacent office tower in Malaysia to the Valiram Family Office for approximately $400 million.
After completion, Lendlease's remaining 20% stake in the retail mall will be transferred to its Investments segment.
The company retains a 60% interest in the residential land plots and adjacent hotel, valued at over $200 million, within its capital release unit.
Advisers have been appointed, alongside joint venture partner TRX City, for the hotel sale, while options for the land plots remain under review.
The transaction is expected to close in the second half of FY26, subject to customary conditions.
Lendlease is targeting $2 billion in capital recycling from the CRU this year, including the TRX sale.
Cash inflows of around $1 billion, initially anticipated in H1 FY26, are now expected in H2 FY26, alongside an additional $1 billion from other CRU initiatives.
Limited H1 transaction activity has led to higher accrued capital balances and elevated financing costs, resulting in a loss for the CRU segment.
The group continues to target 15% gearing by FY26, supported by CRU recycling, a $300 million settlement from The Crown Estate joint venture, and $1 billion of asset recycling across Development and Investments, expected to reduce gearing by roughly 25%.