Westfield Group CG: Talking shop
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Simon Tuxen, group general counsel for global shopping centre developer Westfield, says he still feels the wow factor about its latest creation.
The 13 September was a special day for Simon Tuxen. It was then that the lawyer stood alongside Westfield Group chairman Frank Lowy to celebrate the gala opening of Westfield Stratford City shopping centre.
The £1.8bn retail project is the largest urban shopping centre in Europe and is renowned for being the de facto ’gateway’ to the London 2012 Olympic Games. For Tuxen, a lawyer of almost three decades’ practice experience who has seen a lot of impressive architecture around the world, the latest project still has the wow factor.
“Standing in front of this phenomenal complex, looking at its enormous scale and exceptional architectural design will leave you in awe and admiration,” enthuses Tuxen, recalling the feeling when he first saw the finished project after years of development.
The taste of satisfaction is further sweetened when he looks back at the tremendous amount of work and huge challenges that were involved in transforming what was once an industrial wasteland into its current glamorous incarnation. He has seen the project through from its inception in 2004 when Westfield acquired the brownfield site via its takeover of property company Chelsfield.
The development and construction of the shopping centre and the Olympic park for next year’s Games are so interlinked that the project has become hugely complicated.
“Facilitating and coordinating many development projects on the same site and negotiating with the Olympic organisers and council over arrangements have created much more complexity for the lawyers,” says Tuxen. “But in the end, it’s been an enormously satisfying project.”
As group general counsel Tuxen is based in Sydney but travels frequently to countries where Westfield has significant portfolios and investments. Under his leadership are 30 in-house lawyers across the group, most of whom are senior lawyers. In each one of the three main regions where the company operates, Australia, the US and the UK, there are separate teams of eight or nine in-house lawyers headed by a regional general counsel.
For the Stratford City project, Tuxen has been involved in major decision-making processes and key transactions, but the lion’s share of the legal work was executed by a nine-lawyer in-house team led by UK and Europe general counsel Leon Shelley.
“The local teams operate independently, with local management for local deals and operational matters while I, in head office, tend to focus on key issues, the ones that are most contentious, and large transactions,” explains Tuxen. “There’s also a compliance overlay, as I need to coordinate with regional teams to ensure consistency in compliance across regions.”
Generally, Tuxen spends more than half his time on major transactions or important cases, trying to understand and work through key issues with his lawyers and other executive members. He also spends a significant amount of time on compliance and dealing with any issues directors might have, as he serves as the group’s company secretary and is a member of the executive committee.
As Westfield is expanding, making corporate transactions and raising funds, Tuxen often enlists outside counsel for legal support. His onlyrule of thumb about what to outsource is value creation.
“We’ll outsource in the areas where we feel external firms can provide the greatest value,” he says. “Sometimes value is added by using fixed-fee retail leasing services and sometimes external firms can add tremendous value in transactions that require certain expertise and HR capabilities we don’t have in-house.”
In the case of Westfield’s £871.5m sale of a 50 per cent stake in the Stratford City project to two overseas pension funds, the company’s UK management instructed Freshfields Bruckhaus Deringer, SJ Berwin and Ashurst to advise on tax, corporate, and retail components of the transaction respectively. For the centre’s leasing agreements, Beachcroft and SNR Denton were engaged to take on a large proportion of the work.
Tuxen says Westfield does not have a formal panel of external counsel, but prefers finding the right individual partner to work on a specific transaction or case. It negotiates an appropriate price and fee arrangements on a case-by-case basis. Internally, there is a small in-house team consisting of mainly senior lawyers.
“We have to think carefully about what we can do to add greatest value to Westfield’s interests,” says Tuxen.
For example, his in-house team does not handle high-volume leasing work, except for dealing with the company’s larger tenants.
“Our philosophy is to focus on high-value work and serve as project coordinators, managing the relationship with external firms,” concludes Tuxen.
Name: Simon Tuxen
Company: Westfield Group
Position: Group general counsel and company secretary
Industry: Shopping centre development
Reporting to: Co-chief executives Steven Lowy and Peter Lowy
Global portfolio: 124 shopping centres with total assets valued at more than A$59bn (£38.6bn)
Employees: More than 4,000
Global legal capability: 30
External law firms: Ashurst, Beachcroft, Freshfields Bruckhaus Deringer, SJ Berwin, SNR Denton
Annual legal spend: A$50m-plus