Lovells bags role on sale of Moscow hotel and offices

Lovells has landed a role advising the vendors on a major real estate deal in Moscow, with the transaction being led out of London.

A team led by real estate funds partner James McDonald advised a joint venture consortium led by Otkritie Financial Corporation and Deutsche Bank Real Estate Group on the forward sale of four office buildings and a hotel to German real estate investment company KanAm Grund Kapitalanlagegesellschaft. KanAm was advised by Baker & McKenzie Geneva-based partner Adrian Moore.

According to McDonald, Lovells won the instruction after advising the consortium, known as Discovery, when it borrowed the cash to finance the deal last year.

McDonald said the transaction was complicated by the multijurisdictional nature of the deal. “Discovery holds four Cypriot special purpose vehicle companies and security was taken by Deutsche Bank as part of the deal,” he said. “It was interesting dealing with the Russian real estate requirements – there are eccentricities such as you can own a building but not necessarily the land on which it stands.”

The development – which will provide more than 100,000sq m of office accommodation and a 170-room hotel in the Paveletskaya district of central Moscow – will be one of the largest schemes in Moscow when it completes in the third quarter of 2009.

McDonald worked alongside Moscow corporate partner Suren Gortsunyan, Frankfurt banking partner Olaf Grabowski and London banking partner Andrew Welbourn. Morant gave advice on Cayman Islands issues with Antis Trintafyllides & Sons giving Cypriot advice.