Have you ever thought about investing in property projects in major European cities such as London and Milan?
One ASX listed company that is doing just that is Lendlease Group (ASX: LLC).
The international property and infrastructure group has over $20 billion worth of development projects in Europe including the recently secured $9 -$12 billion Euston Station project in London.
Here are a few things that are working in Lendlease's favour:
Business model
Lendlease has a vertically integrated business model that allows it to generate revenue from all the stages of the property life cycle including development, construction and funds management.
Long term trends
I like how Lendlease has aligned its business around long-term trends affecting its industry such as urbanisation, sustainable buildings and innovative designs. I think that demonstrates their understanding of where the world is going and how best to profit from those trends.
Work culture
Lendlease is consistently voted among the best companies to work for in Australia. It's such an underrated thing because it's intangible but great businesses rely on highly motivated staff to deliver day in day out. When a company is highly ranked as a best place to work, it helps them hire and retain the best talent in the market.
Risks
There are some headwinds that could affect investors in Lendlease and other infrastructure shares such as Transurban Group (ASX: TCL), Scentre Group (ASX: SCG) and Sydney Airport Holdings Pty Ltd (ASX: SYD).
These include changes in local laws and regulations, interest rates and a downturn in property prices.
Foolish Takeaway
I think Lendlease has a high quality pipeline of projects and the necessary experience to extract value from those projects. It's not the type of company that's going to be the best performing ASX listed share but I think will provide steady returns over the long run.
Even though I like Lendlease, I think there are even better blue-chip stocks on the ASX. Our experts have identified these three companies as the top 3 ASX blue chip shares to buy in 2018.
