Lend Lease Reaches Financial Close on Third Phase of the U.S. Army Lodging Privatization Program

  Lend Lease Reaches Financial Close on Third Phase of the U.S. Army Lodging
                            Privatization Program

Public-private community developer secures $465 million for additional
development, renovation of U.S. Army guest lodging

PR Newswire

NEW YORK, May 1, 2013

NEW YORK, May 1, 2013 /PRNewswire/ --Lend Lease, an infrastructure and
property solutions provider and leader in public-private community
development, has reached financial close on the third phase of the Department
of the Army's Privatization of Army Lodging (PAL) program, and secured $465
million in project debt to continue delivering hotels for Service members,
their Families and all government travelers through the Program. This latest
project includes approximately 3,800 hotel rooms on 18 military installations
throughout the United States. Over the next eight years, Lend Lease will
deliver 1,018 new Candlewood Suites® brand hotel rooms to these installations
and renovate an additional 2,745 hotel rooms to Holiday Inn Express® brand
standards. In total, through all three phases, the circa $1.0 billion PAL
program will have resulted in the development and/or renovation of over 11,000
rooms across 39 military installations nationwide. 

Selected through a competitive process as the developer for the only
Department of Defense lodging privatization program, Lend Lease is the
exclusive asset manager, developer and design builder for the Army's entire
lodging portfolio. InterContinental Hotels Group (IHG), one of the world's
largest hotel groups, is the PAL hotel operator.

"Since the Privatization of Army Lodging program's inception, Lend Lease has
delivered exceptional results and demonstrated a deep understanding of the
program's mission," said Rhonda Hayes, Chief, Capital Ventures Directorate of
the Office of the Assistant Secretary of the Army, Installations, Energy &
Environment. "The results speak for themselves, with new and renovated branded
hotels that offer Service members and their Families the lodging experience
that they both desire and deserve, and at a cost that is less than the
government lodging per diem. The knowledge and expertise that Lend Lease and
IHG bring to the PAL program not only validates their positions as industry
leaders, but also remains key to the initiative's long-term success."

PAL debuted in 2009, with Lend Lease assuming ownership of on-post hotel
facilities at 10 installations. In 2010, the company was asked to implement
the second phase of the program to renovate, develop, operate and sustain
hotels at an additional 11 installations. Lend Lease was offered the third
phase of the PAL program in October 2011.

Throughout the current PAL portfolio, existing facilities are receiving
extensive renovations and upgrades to include bringing select hotels up to the
standards required to operate under the Holiday Inn Express® brand. To date,
Lend Lease has delivered six Holiday Inn Express® hotels, a combined 1,277
Holiday Inn Express® brand rooms. In addition, there are currently five
Candlewood Suites® hotels under construction, including a 310-room Candlewood
Suites® on Joint Base San Antonio that, once complete, will be the largest in
the world.

"Lend Lease is proud to continue delivering the Privatization of Army Lodging
program," said Marc Sierra, Lend Lease (US) Public Partnerships Managing
Director. "By leveraging the government's assets and raising private funds, we
are truly creating the new standard in on-post hotels."

A 2003 internal Army lodging study found that more than 80% of the existing
lodging inventory needed to be recapitalized, costing the government more than
$1.2 billion and taking 20 years to complete. The PAL program saves Army
travel dollars by offering official travelers rooms at a 25% discount to
lodging per diem costs. Lend Lease will assume responsibility of the hotels
until 2059. All hotel revenue after the payment of operating expenses is
required to be spent on construction, renovation and sustainment costs to
ensure quality hotels today and in the years ahead.

Operating under the name IHG Army Hotels, guests enjoy new and enhanced
services and amenities, including complimentary breakfast, concierge services,
weekly social activities, courtesy shuttles, and the opportunity to earn
points for their stays with IHG's Priority Club® Rewards, soon to be renamed
IHG® Rewards Club this July, guest loyalty program. To date, IHG Army Hotels
has awarded more than 447 million points to Service members for use in
off-post hotels nationwide. Hotel reservations can be made on-line at
www.ihgarmyhotels.com.

About Lend Lease

Lend Lease is a leading international property and infrastructure group.
Listed on the Australian Securities Exchange and with circa 19,000 employees
worldwide, the firm's capabilities span the property and infrastructure
spectrum.

In the US, Lend Lease's public partnership business is the nation's leader in
public/private community development. With a focus on creating sustainable
value, Lend Lease creates communities that regenerate our environment, enrich
people's lives and foster economic growth. Lend Lease has worked extensively
with the Department of Defense through the Military Housing Privatization
Initiative (MHPI), a program that provides for the transfer of military
housing assets to private sector companies. With over 40,000 residential
units, 192 apartments and more than 11,600 hotel rooms in its portfolio, Lend
Lease will finance, develop, build, renovate and operate these sites for at
least 50 years.

We create innovative and sustainable property solutions, forging partnerships
and delivering maximum benefits to clients, investors and communities. Safety
is our number one priority and Lend Lease is committed to operating Incident &
Injury Free wherever we have a presence.

www.lendlease.com

SOURCE Lend Lease

Website: http://www.lendlease.com
Contact: Elena Daniel, Director, Media and Analytics, Lend Lease,
+1-847-283-6044, elena.daniel@lendlease.com, or Mary Costello, Senior Vice
President, Head of Corporate Affairs, Lend Lease, +1-212-592-6946,
mary.costello@lendlease.com, or Jason Michael, Senior Public Relations
Strategist, Cohn Marketing, +1-303-839-1415, x28, or Cell, +1-314-323-1425,
jason@cohnmarketing.com
 
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