Dive Brief:
- Australian contractor and developer Lendlease and joint venture partner Aware Super have broken ground on 1 Java Street in Brooklyn, the company announced Monday. It will become New York state’s largest geothermal residential building and the company’s first for-rent multifamily project in the city, according to a release.
- Lendlease said that the 834-unit residential development along the East River in Brooklyn will be fully electric and use no natural gas.
- The project completion is slated for late 2025. When finished, 30% of units will be set aside as affordable housing. It will also include 13,000 square feet of retail space and feature a public waterfront display, which will be improved as part of the project.
Dive Insight:
With design by New York City-based architecture firm Marvel, 1 Java Street will comprise five buildings interconnected on a full city block. That will include:
- Two towers — one 37 stories tall, one 20 stories tall — facing the East River.
- One six-story building facing Java Street.
- One six-story building facing West Street.
- One 10-story building facing India Street.
The project is the sixth developed and operated under Lendlease and Aware Super’s joint venture Americas multifamily portfolio. The project was announced in October 2020, with an estimated cost of AU$1 billion (about $661 million) at the time.
Economic headwinds
Despite the 1 Java Street announcement, Lendlease is facing challenges on the opposite coast of the country, at a $15 billion mixed-use project for Google. CNBC reported last week that the tech giant has halted work on the San Jose, California, project, which would have spanned 80 acres and included multiple types of housing units.
Though Lendlease said in a statement to CNBC it remained “committed” to working with Google, the contractor laid off 67 employees in February.
Lendlease has dealt with financial struggles since the COVID-19 pandemic began. During its most recent earnings call, the company reported a loss of AU$141 million ($98.2 million USD at the time), which it largely attributed to a U.K. law forcing it to pay hundreds of millions of dollars to remediate residential properties.
On top of that, inflation and supply chain issues continue to squeeze Lendlease’s construction growth, but during the last earnings call, CEO Tony Lombardo said that its AU$9.6 billion in backlog lined up with its target range for growth.
