The Lawyer’s new China Elite report contains the most detailed research available on the PRC legal market and contains unparalleled insight into the country's leading law firms. They vary in size, practice focus and geographic coverage, but they all share one common quality – ambition... Read more
This year, The Lawyer’s annual ranking of the largest UK law firms by turnover is available as an interactive, digital benchmarking tool. For the first time this will allow you to manipulate each data set against the metrics of your choice.
Partners quids in after sale and leaseback deal in Bristol
In a groundbreaking deal, Osborne Clarke has made a £9m gross profit and effectively saved itself six years rent in Bristol by building its own offices and then entering a sale and leaseback deal. The firm bought two and a half acres of land freehold at 2 Temple Back East in Bristol and undertook the design and construction of the building with itself in the role of developer. The firm's equity partners went joint and several for an initial borrowing of £17m to cover the site acquisition, building costs and professional fees, and went on to sell the freehold for £26m. Managing partner Leslie Perrin said: "We agreed a funding plan from the Bank of Scotland to cover the site purchase, building costs and all other professional costs as an overdraft and agreed a long-term funding plan, more like a mortgage, if we needed it, so we had complete flexibility. We could choose to do a sale and leaseback or continue to own the building, choosing between paying rent or paying a mortgage." Osborne Clarke opted to start marketing the building for sale shortly before moving in this summer, when it judged the market to be at its height, so has not needed to call for the longterm money. "We simply sold while we still had the overdraft in our control," said Perrin. By happy coincidence, the successful bidder was a property fund run by Osborne Clarke client Close Brothers. Perrin said: "We agreed that we should behave at arm's-length and we did have other bidders for the property. The fact is that the Close offer was the best offer. It had fewest conditions." The innovative approach gave Osborne Clarke the ability to realise a profit on its investment and rent the property it had designed itself. In the 'open working' design, even managing partner Leslie Perrin doesn't have his own office. The firm is paying a full market rent of £23 per square foot, but is effectively getting six years rent free because of the profit it has made. In practice, the profit has been used to replace various loans that the firm had. Profit will be distributed to partners over a 10-year period so that the burden on the firm will be minimal. "There are long-term tax benefits for the partnership," said Perrin.