class file for java.lang.invoke.MethodType not found #23

I tried to setup new sample project and it can't compile.

An exception has occurred in the compiler (1.8.0_05). Please file a bug at the Java Developer Connection (http://java.sun.com/webapps/bugreport)  after checking the Bug Parade for duplicates. Include your program and the following diagnostic in your report.  Thank you.
com.sun.tools.javac.code.Symbol$CompletionFailure: class file for java.lang.invoke.MethodType not found

* Exception is:
org.gradle.api.tasks.TaskExecutionException: Execution failed for task ':app:compileDebugJava'.
    at org.gradle.api.internal.tasks.execution.ExecuteActionsTaskExecuter.executeActions(ExecuteActionsTaskExecuter.java:69)
    at org.gradle.api.internal.tasks.execution.ExecuteActionsTaskExecuter.execute(ExecuteActionsTaskExecuter.java:46)
    at org.gradle.api.internal.tasks.execution.PostExecutionAnalysisTaskExecuter.execute(PostExecutionAnalysisTaskExecuter.java:35) 
.
.
.
Caused by: org.gradle.api.internal.tasks.compile.CompilationFailedException: Compilation failed; see the compiler error output for details.
    at org.gradle.api.internal.tasks.compile.jdk6.Jdk6JavaCompiler.execute(Jdk6JavaCompiler.java:47)
    at org.gradle.api.internal.tasks.compile.jdk6.Jdk6JavaCompiler.execute(Jdk6JavaCompiler.java:38)
    at org.gradle.api.internal.tasks.compile.NormalizingJavaCompiler.delegateAndHandleErrors(NormalizingJavaCompiler.java:96)
    at org.gradle.api.internal.tasks.compile.NormalizingJavaCompiler.execute(NormalizingJavaCompiler.java:49)
    at org.gradle.api.internal.tasks.compile.NormalizingJavaCompiler.execute(NormalizingJavaCompiler.java:35)
    at org.gradle.api.internal.tasks.compile.DelegatingJavaCompiler.execute(DelegatingJavaCompiler.java:29)
    at org.gradle.api.internal.tasks.compile.DelegatingJavaCompiler.execute(DelegatingJavaCompiler.java:20)
    at org.gradle.api.internal.tasks.compile.IncrementalJavaCompilerSupport.execute(IncrementalJavaCompilerSupport.java:33)
    at org.gradle.api.internal.tasks.compile.IncrementalJavaCompilerSupport.execute(IncrementalJavaCompilerSupport.java:24)
    at org.gradle.api.tasks.compile.Compile.compile(Compile.java:67)
    at org.gradle.internal.reflect.JavaMethod.invoke(JavaMethod.java:63)
    at org.gradle.api.internal.project.taskfactory.AnnotationProcessingTaskFactory$StandardTaskAction.doExecute(AnnotationProcessingTaskFactory.java:219)
    at org.gradle.api.internal.project.taskfactory.AnnotationProcessingTaskFactory$StandardTaskAction.execute(AnnotationProcessingTaskFactory.java:212)
    at org.gradle.api.internal.project.taskfactory.AnnotationProcessingTaskFactory$StandardTaskAction.execute(AnnotationProcessingTaskFactory.java:201)
    at org.gradle.api.internal.AbstractTask$TaskActionWrapper.execute(AbstractTask.java:533)
    at org.gradle.api.internal.AbstractTask$TaskActionWrapper.execute(AbstractTask.java:516)
    at org.gradle.api.internal.tasks.execution.ExecuteActionsTaskExecuter.executeAction(ExecuteActionsTaskExecuter.java:80)
    at org.gradle.api.internal.tasks.execution.ExecuteActionsTaskExecuter.executeActions(ExecuteActionsTaskExecuter.java:61)
    ... 72 more

Setup is similar as in the doc except:

retrolambda {
    jdk System.getenv("JAVA8_HOME")
    oldJdk System.getenv("JAVA7_HOME")
    javaVersion JavaVersion.VERSION_1_7
}

Environment variables are set to:
/Library/Java/JavaVirtualMachines/jdk1.8.0_05.jdk/Contents/Home
/Library/Java/JavaVirtualMachines/jdk1.7.0_51.jdk/Contents/Home
respectively.

java -version
java version "1.8.0_05"
Java(TM) SE Runtime Environment (build 1.8.0_05-b13)
Java HotSpot(TM) 64-Bit Server VM (build 25.5-b02, mixed mode)

build.gradle

repositories {
    mavenCentral()
}

buildscript {
    repositories {
        mavenCentral()
    }

    dependencies {
        classpath 'com.android.tools.build:gradle:0.11.+'
        classpath 'me.tatarka:gradle-retrolambda:1.3.2'

    }
}

apply plugin: 'retrolambda'
apply plugin: 'android'


android {
    compileSdkVersion 19
    buildToolsVersion "19.1.0"

    defaultConfig {
        applicationId "com.testproject.lambdasandbox"
        minSdkVersion 10
        targetSdkVersion 19
        versionCode 1
        versionName "1.0"
    }
    buildTypes {
        release {
            runProguard false
            proguardFiles getDefaultProguardFile('proguard-android.txt'), 'proguard-rules.pro'
        }
    }
    compileOptions {
        sourceCompatibility JavaVersion.VERSION_1_8
        targetCompatibility JavaVersion.VERSION_1_8
    }
}


retrolambda {
    jdk System.getenv("JAVA8_HOME")
    oldJdk System.getenv("JAVA7_HOME")
    javaVersion JavaVersion.VERSION_1_7
}

dependencies {
    repositories {
        mavenCentral()
    }
    compile fileTree(dir: 'libs', include: ['*.jar'])
    compile 'com.android.support:appcompat-v7:19.+'
    // Latest one on maven central
   //  retrolambdaConfig 'net.orfjackal.retrolambda:retrolambda:1.+'
}

./gradlew --version

------------------------------------------------------------
Gradle 1.10
------------------------------------------------------------

Build time:   2013-12-17 09:28:15 UTC
Build number: none
Revision:     36ced393628875ff15575fa03d16c1349ffe8bb6

Groovy:       1.8.6
Ant:          Apache Ant(TM) version 1.9.2 compiled on July 8 2013
Ivy:          2.2.0
JVM:          1.8.0_05 (Oracle Corporation 25.5-b02)
OS:           Mac OS X 10.9.3 x86_64

That was it, thank you!