23 October 2000
When the recession of the early 1990s made property about as uncool as a 1980s wardrobe, Nabarro Nathanson was one firm that refused to be swayed by fashion. But like batwing T-shirts and diamanté, property is back with a vengeance. City firms have rediscovered the sector in new and more profitable guises, allied to cutting-edge finance expertise. Nabarros now has a property practice most City firms would kill for. But how will it fare as the competition hots up? Can it compete with the real estate capabilities of the magic and outer circles?
Nabarros' senior partner and all-round property guru David Bramson is on the brink of retirement. The firm has also lost many of its rising stars in rapid succession during the past two years. Nick Cheffings and Dion Panambalana both left for Lovells' ambitious property practice, Mark Kingston went in-house to US-based Tishman Speyer Properties, Alan Samson went to Gibson Dunn & Crutcher, Donna Stringer to Weil Gotshal & Manges and Andrew Bond to Altheimer & Gray. There have been some replacements, but the firm may feel its losses all over again when Bramson's generation retires.
Yet Nabarros is still impressive. Hiring Royal Bank of Canada investment banker Laurence Gergel for the newly-created post of property finance director was an innovative move that has raised a few eyebrows among property department heads. And there is no doubt that Nabarros' head of property finance Amanda Howard, who was instrumental in the hire, herself appears on many a headhunting wish list in the City.
So if Nabarros has property finance cornered, what about the growing international outlook of property clients?
In August, property partners Kevin Stimpson, Simon Staite and Nick Collins closed a pan-European deal for longstanding client Henderson Investors - the acquisition of a euro400m property portfolio scattered throughout Italy, Spain, Portugal and Eastern Europe. Nabarros project-managed the deal alongside lawyers in each of the jurisdictions, including teams fielded by Carnelutti in Italy, top Spanish firm Uria & Menendez and its Portuguese associate Morais Leitao & Galvao Teles. The line-up is impressive, but Nabarros cannot call those firms "best friends"; rather, the link-ups were based on personal relationships with individual partners. Beyond its small Brussels office and associated offices of Cabinet Lipworth in Paris and Key & Dixon in Dubai, Nabarros gets nul points in the international capability contest. Henderson-style pan-European deals are promised, but the strategy begs an important question: what happens if and when those attractive European players are snapped up in international mergers and alliances?
An international network of Nabarros offices was taken firmly off the gameplan in the mid-1990s when resources were in short supply. The firm ended its five-year presence in Warsaw, transferring what was left of the office to Allen & Overy. Nabarros also pulled out of Dubai, and any possibility of a partnership with one-time associate Weil Gotshal was stamped out when the US firm set up shop in London. Suffering from a case of badly burnt toes, the firm now argues that it can do without the risk of its own international offices. Instead of waiting for another European-wide recession, Nabarros preferred to go into hibernation - only rousing in the past few months to express an interest in setting up an international referral network. Nabarros claims that two German firms are already signed up, but the relationships are not exclusive. One can only conclude that Nabarros' reticence in naming the two firms is in itself revealing.
Only time will tell whether such caution will pay off. In the current climate, the Nabarros line seems at once timid and bizarre, given that so many others see their international offices as a key part of recession-proofing tactics. It is difficult not to wonder what the future could hold with just a little more ambition and daring.