BAKER & McKENZIE has helped longstanding client Babcock & Brown to restructure its international joint venture (JV) with real estate group, the GPT Group (GPT).
Through the advice of partners Hal Lloyd and Steven Glanz, Babcocks agreed to an updated version of the JV for a further five years, giving it greater management and responsibility over the sale and acquisition of property assets located throughout the world.
“Because both of the parties were located in Australia, this is where the transaction was done, but it involves property in a number of European jurisdictions and in the United States, and potentially in other places including Japan,” Lloyd said.
“It’s an example of how Australian companies are taking capital raised here and investing internationally, which made the deal a bit unusual.”
Since 2005 the JV has invested in more than $6 billion worth of assets, including the residential, retail, office and light industrial sectors. It is anticipated that the fund will grow to approximately $9 billion when the total committed capital of $2.2 billion is fully invested.
Lloyd said the structure of the initial JV between GPT and Babcocks was altered to allow both parties to move to the next stage.
“GPT are using it as a platform to start an asset management business in Europe, and Babcock & Brown are taking more responsibility for managing this JV, and all the assets in it,” Lloyd said.
“So they will be taking a more controlling role, if you like, in what assets get acquired and what gets sold, and we’ll benefit from how they perform in the management role.”
Allens Arthur Robinson advised GPT on the transaction.