Mallesons Stephen Jaques has advised the Allco Finance Group on the establishment of a complex international corporate structure for the acquisition of a A$565 million (Euro 333 million) German property portfolio. The seven properties in the portfolio were the first major property acquisition in Europe by Record Realty. Record Realty is managed by Record Funds Management Limited, a wholly owned subsidiary of the Allco Finance Group.

Mallesons’ lawyers in Sydney, Melbourne and London were involved in contract negotiations, advised on risk management throughout and established the corporate and financing structure. This enabled the assets to be transferred from German and UK entities to the Record Realty Australian trust entity.

At Allco’s request, lead partner Andrew Erikson travelled with Allco fund managers to Germany to conduct the contract negotiations and to oversee the work of the German law firm acting on the acquisition to ensure Australian standards for the property, corporate, tax and finance due diligence were met.

Andrew Erikson commented: “This deal is the first step in delivering on Allco’s increased focus on European assets. Investors expect Australian fund managers to take more interest in acquiring European assets as the property investment market in Australia becomes increasingly compressed. Recent favourable tax law changes which are due to take effect from 1 January 2007 will also be likely to make real estate investment trusts (REITs) in the UK popular.”

The Mallesons team included lawyers with expertise in property, taxation, stamp duty, foreign investment, corporate and financing law. Having worked closely with Allco on its Australian property transactions over a sustained period of time, the team were able to apply their detailed knowledge of Allco’s commercial and financing objectives to help close this deal. Earlier this year, Mallesons also advised Allco on the establishment of its first Singapore REIT.

Partners Andrew Erikson, John Canning, Ken Astridge and Hal Bolitho were supported by senior associates Simone Menz and Sally Wallwork and solicitors Jeremy Green and Ulrich Helth.