Nabarro

UK 200 RESULTS 2010

Nabarro has sought to broaden its offering beyond its traditional property focus, with expansion into corporate, dispute resolution and the public sector.

While it has made headway in a number of non-property-related areas – a panel win for Nationwide, work on the now defunct Building Schools for the Future scheme and acting

for winning bidder General Dynamics on a £2bn Ministry of Defence deal – Nabarro remains exposed to the real estate market. Last year property accounted for almost a third of total revenue. As a result turnover at the firm dropped by 10 per cent over the past financial year, from £126.5m to £113.8m.

Despite the challenges of the recession, real estate continues to be one of the firm’s greatest assets. In fact, the property group actually has more partners now than it did in 2008-09. Land Securities, which Nabarro advised on the £250m sale of Oxford Street retail property Park House to a Libyan investor, continues to be a major client. The firm also worked with Quintain on a £191m rights issue and with Westfield on prelet agreements related to the Stratford development.

Despite the reduction in total revenue Nabarro managed to broadly retain its profit margin, which at 27 per cent is at the higher end for its market. This was as a result of an 8 per cent reduction in total headcount and putting certain capital expenditure on hold.

Average profit per equity partner still fell by 15 per cent, from £375,000 to £320,000 – a reflection of the relatively large (73 per cent) proportion of partners in the equity.

Associates typically enter the partnership as fixed-share partners, remunerated on the basis of a salary plus a share of profit. Some of the 35 fixed-share partners earned more than those partners at the bottom of the equity, who last year made £170,000. It typically takes three years to progress into the equity.

The firm operates a meritocratic remuneration system, with profit share determined one year in advance.

UK 200 RESULTS 2009

Turnover dropped by 10 per cent at Nabarro over the past financial year to £126.5m, but the firm has still retained its position in the top 25 (at 24) after a challenging year in key markets, including corporate and property.

Finance and projects and litigation both saw an upturn, although neither of these groups are large enough to offset that fall in transactional areas. Key clients include Aviva, the Department for Business and Regulatory Reform, Essex County Council, Land Securities, Ryanair and Unite Group. The firm also picked up coveted roles on the United Biscuits and Mercedes Benz UK panels.

Seventy per cent of the firm’s partners are equity, taking home on average £375,000 – 39 per cent less than last year. New partners are typically promoted into the fixed-share role and it takes three years on average to enter the equity. The firm operates an entirely merit-based remuneration system, with most equity partners sitting at around the middle of the equity remuneration, which last year ran from £215,000 to £600,000.

The firm’s remuneration committee appraises performance on a two-year basis along the lines of business development, client care, team performance and specific skills. It appraises partners at the start of the new financial year and completes its assessment by July. There is an additional small bonus pool for the partnership as a whole, which is allocated on the basis of exceptional performance.

The firm’s headquarters remains in the less fashionable London midtown, although the rents are suitably reasonable. Despite launching its European alliance at the end of the 2007-08 financial year with firms in France, Germany, Italy and Spain, Spanish partner firm Rodes y Sala recently pulled out from announcing its decision to merge with Gomez Acebo y Pombo. Nabarro has a referral relationship with that firm too, but given the difficulties in the Spanish market a deal is unlikely to be a priority.