For those firms, Mipim has become as much a bonding session for international partners as a marketing exercise aimed at the developers, banks and private and institutional investors who descend on Cannes for four days in March. “In a way, it's the first time they've been together,” says Freshfields global head of real estate James George of his Mipim team. “Of course, there are other conferences and cross-border work, but to see the synergies in the group was rewarding.”
Add Baker & McKenzie to the list above and you have the handful of firms capable of providing something on a sliding scale of international real estate service. DLA and Hammond Suddards Edge are also breaking into the market, while Eversheds and Osborne Clarke have some international real estate capability.
Property may not have been a key driver behind the international growth of any of the above, but as an asset, it is now outgrowing domestic markets. The race is on among law firms to keep up with the transformation that is turning property investment into an international business and the increase of real estate opportunities across Europe.
The presence of two Rogers & Wells partners in the Clifford Chance group was particularly telling, and it was not only a sign of solidarity. The amount of money raised by US-based funds for investment into Europe is rising fast. Rogers & Wells may not be known for real estate or property finance, but it does have a funds and securities practice. This leaves Clifford Chance in an excellent position to act for the funds it sets up, such as Europa, when it invests. “It's a true synergy,” says Clifford Chance partner Robert McGregor, who is responsible for the firm's real estate strategy.
Opportunities for cross-border real estate work now abound in the form of international hotel deals, corporate outsourcing, government property transactions and UK and US funds looking at investment in Europe. Exporting techniques, particularly in property finance, and deal types such as outsourcing, offer huge potential, while the new international capability of a handful of firms means that they can take on genuine multinational deals in a way that was unthinkable just five years ago.
Lovells head of real estate Robert Kidby says: “The point is, lawyers don't create markets, they move into existing markets.” He sees no real obstacles to exporting the more complicated property finance techniques, joint ventures, limited partnerships and corporate property concepts. “There is a vacuum in some of the sophisticated areas around the world,” he says. “In Europe, and more expectedly in Asia and Eastern Europe, there hasn't been a history of these techniques being available. In London, we will not advise on the complexities of property in Prague – we've got people in Prague who know about that. But we can advise on property finance techniques.”
Since the Lovells/Boesebeck Droste merger, real estate partner Ingo Winterstein, who heads the Frankfurt office, has seen the amount of work he does for non-German clients climb from 20 to 60 per cent. New international capability has coincided with fresh interest in the German market, and this has been heightened by the prospect of changes that will make Germany's tax regime more appealing to foreign property investment as of 2002.
Winterstein says: “As a property team which is well known in the market, we were used to acting for German clients. The property market in Germany was a local market, and the influence of foreign investors was not as high as in London or the US, but this has changed. The real estate market in Germany is becoming more and more interesting to foreign investors.”
Kidby sees the next challenge for Lovells is for all of its other offices to match the high quality of work undertaken in London and Frankfurt.
Despite a lack of numbers, Lovells is clearly a force to be reckoned with. But perhaps more significant is the fact that A&O – a real estate practice traditionally known for its corporate support work – is also starting to get in on the action. The commitment of new property head Adam Cleal to increase pure property work has been well-documented. Doing that on an international scale is also high up on his list. Even during the past six months, Cleal says that he has seen an increase in demand for proper liaison between A&O's offices for real estate transactions. He points to the firm's appointment by a bidder for the Le Meridien hotels, which cover some 20 jurisdictions.
It would be easy to come away from Mipim heady with the wonders of everybody working together, but in truth there is still a long way to go. The next challenge, according to George, is harmonisation. “Clients want to see a deal done in the same way in each jurisdiction,” he says. n