LENDLEASE GROUP — Capital/Financing Update 2008

Sep 30, 2008

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ASX Release

1 October 2008

SUPPORTS RECAPITALISATION OF BBC

International investment and specialised fund and asset manager Babcock & Brown today confirms its support for the announcement by Babcock & Brown Communities (ASX: BBC) regarding a proposed recapitalisation of BBC by Lend Lease Corporation Limited (Lend Lease).

On 28 August Babcock & Brown indicated that based on the interest expressed by third parties in relation to the potential acquisition of all of the issued securities in BBC, and to facilitate the making of offers for the whole of BBC, it agreed to sell its rights to manage BBC for $17.5 million in cash. The agreement was designed to facilitate the price discovery process that BBC announced as part of the strategic review process being carried out by the Board of Directors of BBC. As part of this process, Babcock & Brown has now also committed to sell its 85 million securities in BBC in two tranches to Lend Lease at an average price of $0.58 per security.

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As a result of the announcement, Babcock & Brown will receive $43.4 million over the next week and a further $23.4 million by mid December if the proposal is approved by BBC security holders.

Babcock & Brown’s role in facilitating the outcome announced by BBC today reflects its focus on moving quickly to remove the uncertainty for BBC investors following Babcock & Brown’s decision to narrow the focus of its business activities, including its funds management activities, to areas where it has an established leading franchise and proven track record.

Michael Larkin, CEO of Babcock & Brown said, “We are extremely pleased that the Board of BBC has been able to negotiate the announced restructure with Lend Lease in a relatively short period of time. Consistent with our strategy, the sale of our holding and management rights will tighten the focus of the Group’s activities.

“Babcock & Brown remains committed to having both listed and unlisted managed funds in areas of core focus.”

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ENDS

For further information please contact:

Kelly Hibbins Babcock & Brown +61 2 9229 1800 kelly.hibbins@babcockbrown.com

About Babcock & Brown

Babcock & Brown is an international investment and specialised fund and asset management group with longstanding capabilities in structured finance and the creation, syndication and management of asset and cash flow-based investments. Babcock & Brown was founded in 1977 and is listed on the Australian Securities Exchange.

Babcock & Brown operates from 31 offices across Australia, North America, Europe, Asia, United Arab Emirates and Africa and has in excess of 1,500 employees worldwide. Babcock & Brown has four operating divisions including real estate, infrastructure, operating leasing, corporate and structured finance. The company has established a funds management platform across the operating divisions that has resulted in the creation of a number of focused investment vehicles in areas including real estate, renewable energy and infrastructure.

For further information about Babcock & Brown please see our website: www.babcockbrown.com