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Real Estate
Cleary Gottlieb’s real estate practice is diversified and global, spanning the full range of transaction types, regions and asset classes. Responding to both the limitations and opportunities presented by the credit crunch, we have recently advised on some of the largest and most high profile real estate acquisitions, dispositions, joint ventures, financings and restructurings. For more than 60 years, Cleary Gottlieb has been a pioneer in real estate law across the globe, providing clients with meaningful solutions to their business needs in fluctuating and complex markets.
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Feb 25, 2010
Cleary Gottlieb represented Goldman Sachs in restructuring the €4.5 billion financings secured by properties leased to the department store chain KarstadtQuelle (later renamed Arcandor). The restructuring became necessary due to the insolvency of the Arcandor Group, including its subsidiaries Karstadt and Quelle. The restructuring closed on February 25. Cleary Gottlieb also represented Goldman Sachs in originating the initial senior and mezzanine financings of these properties in July 2006, comprising a sale-and-lease-back of more than 170 properties.
Cleary Gottlieb's role in the restructuring extended to various aspects of the transaction, including amendments to finance documents and security, changes to intercreditor and syndication arrangements, and lease modifications.
It is expected that Karstadt's insolvency receiver, Hubert Görg, will soon present to Karstadt’s creditors an insolvency plan with the aim of rehabilitating the company. The recent restructuring of finance and lease arrangements was critical to the willingness of the insolvency receiver to proceed with rehabilitation planning.
Dec 31, 2009
Cleary Gottlieb was counsel to Banco Inbursa in its successful restructuring of over $700 million of mortgage and mezzanine debt that had financed the 2007 purchase by Africa Israel, the real estate holding company of Lev Leviev, of the former New York Times Building in Manhattan.
Mar 03, 2010
Cleary Gottlieb represented the lenders in connection with the successful restructuring and extension of €400 million of senior mortgage and mezzanine financings for the Queens Moat hotels group, a joint venture of the Whitehall Funds and Westmont Services. Queens Moat owns hotels across the United Kingdom, Germany and the Netherlands under various brands, including Holiday Inn, Crowne Plaza and Best Western.
Nov 17, 2009
Cleary Gottlieb represented Goldman Sachs on its $400 million loan to subsidiaries of U.S. mall owner Developers Diversified Realty, secured by 27 malls. This financing is the first to be securitized under the Federal Reserve Bank's Term Asset-Backed Securities Loan Facility ("TALF") and potentially signals the reopening of the commercial mortgage-backed securitization market, which has been frozen since the onset of the financial crisis.
Jul 28, 2009
Cleary Gottlieb is representing Nortel Networks on the sale of its wireless infrastructure assets through a bankruptcy auction to Telefonaktiebolaget LM Ericsson for $1.13 billion, an increase of almost $500 million from Nokia Siemens’ original stalking horse bid for these assets. The sale followed a twelve-hour auction that took place in Cleary Gottlieb’s New York office on July 24. It was approved on July 28 after a joint hearing held simultaneously before courts in the United States and Canada.
Nortel has been a client of Cleary Gottlieb for more than 20 years. The firm is currently acting as U.S. bankruptcy counsel to Nortel and affiliates in their U.S. Chapter 11 proceedings, which are closely coordinated with proceedings in Canada, the United Kingdom and France. The firm is also representing Nortel on a stalking horse sale agreement with Avaya for the purchase of Nortel’s global Enterprise Solutions business, including units in North America, the Caribbean, Latin America, Asia, Europe, the Middle East and Africa. This sale is also subject to an auction process and court approval.
In recent years, the firm has represented Nortel in a number of financing and M&A transactions, including the sale of assets related to Nortel’s UMTS access business to Alcatel-Lucent. The firm also advised Nortel on European aspects of its sale to Flextronics of manufacturing operations and related activities in Canada, Brazil, France and Northern Ireland.
Nov 21, 2008
Cleary Gottlieb is representing the German Savings Bank Association (“DSGV”) with respect to back guarantees granted by DSGV and other major German banking associations and financial institutions to the Federal Republic of Germany in connection with a €50 billion rescue package arranged by the German Federal Government and various significant financial institutions for the Hypo Real Estate Group.
In 2007, Cleary Gottlieb advised DSGV on the acquisition of Landesbank Berlin Holding AG (formerly “Bankgesellschaft Berlin”).
Jun 16, 2008
Cleary Gottlieb represented Meraas Capital LLC in its acquisition of a 20% interest in the GM Building through a joint venture with Boston Properties Limited Partnership and US Real Estate Opportunities I, L.P., a Goldman Sachs managed investment fund. The governments of Kuwait and Qatar are the principal investors in US Real Estate Opportunities. The joint venture acquired the GM Building from Harry Macklowe for $2.8 billion, and three other New York office buildings for an additional $1.1 billion.
General Motors developed the GM Building in 1968. It is a landmark 50-story office tower located in the heart of New York’s Plaza District, and it is home to tenants including Weil Gotshal, Estee Lauder and FAO Schwartz. It is also the site of the cutting edge Bohlin Cywinski Jackson designed glass cube that serves as the entrance to the underground Apple Store.
As part of the deal, the joint venture also agreed to purchase three other New York office buildings, 2 Grand Central Tower, 125 West 55th Street and 540 Madison Avenue, for an additional $1.1 billion. The aggregate purchase price for all four assets was $4 billion.
Meraas Capital LLC is an investment company based in Dubai, United Arab Emirates. Meraas is envisaged to become a leading real estate and private equity investment holding company with a multibillion dollar diversified portfolio of investments that include income-producing and long-term strategic assets globally.
Boston Properties is a Public REIT that owns, operates and develops Class A office buildings throughout the United States.
Jan 21, 2009
Cleary Gottlieb represented Grupo Bimbo, S.A.B. de C.V. (Grupo Bimbo) in its acquisition of Weston Foods, Inc., the U.S. bakery division of George Weston Limited, for U.S.$2.38 billion and its acquisition of related financial assets for U.S.$125 million. The transaction closed on January 21, 2009.
Seven banks financed the transaction through a U.S.$1.9 billion dual currency term facility with a three-year tranche, a five-year tranche and a U.S.$900 million dual currency one-year bridge facility that is expected to be taken out in the local bond market. A substantial portion of the commitments were funded in Mexican Pesos, requiring Grupo Bimbo to engage in foreign exchange transactions in between funding and payment to George Weston Limited on the day of closing. This is the largest cross-border acquisition financing in recent months in Latin America.
Grupo Bimbo, which is among the world’s largest baking companies in terms of production and sales volume, has more than 80 plants and 800 distribution centers located in 18 countries throughout the Americas, Europe and Asia. Grupo Bimbo produces over 5,000 products and its direct distribution networks comprise more than 36,500 routes and 96,000 employees.
As a result of this transaction Bimbo Bakeries USA (BBU), Grupo Bimbo’s consolidated U.S. operation, becomes one of the largest baked-goods companies in the country, with a leading position in bread, buns, sweet baked goods and cakes. BBU’s brand portfolio now includes Arnold, Bimbo, Boboli, Brownberry, Entenmann’s, Francisco, Freihoffer’s, Marinella, Mrs Baird’s, Oroweat, Stroehmann, Thomas’ and Tia Rosa.
Counsel in the Largest Real Estate Transaction in History
(Blackstones' $36 Billion Equity Office LBO)
“This team has established itself in real estate financing.”
Chambers Global (2010)
“Cleary Gottlieb operates a global REIT practice, and representing lenders in REIT-related financings accounts for a substantial portion of its workload.”
Chambers Global (2009)
“This team has established itself in real estate financing … The team is strongest on the lender side and the firm’s international reach has been a major asset, with its reputation growing steadily in the Middle East and Latin America.”
“‘This team excels in extraordinary and unusual transactions,’ report clients, who are equally impressed by its thoroughness and speedy responses … ‘They work to get the deal done instead of trying to prove that they are the smartest people in the room.’”
Chambers USA (2009)
“[Cleary Gottlieb’s] New York real estate partners are extremely versatile, with each developing experience of a variety of different transactions across the corporate, finance and dirt spheres through the years, and share among them an ‘unsurpassed ability to work through difficult issues.’”
The Legal 500 - US (2009)
“The group enjoys a wide-ranging practice that encompasses joint ventures, bankruptcy, large-scale M&A and joint ventures, and is commended by market sources for its innovative and creative approach.”
“Cleary Gottlieb operates a global REIT practice, and representing lenders in REIT-related financings accounts for a substantial portion of its workload... Another strength of the firm is representing REITs on capital markets transactions, including CMBS matters.”
Chambers USA (2008)
“The ‘compact yet high-quality’ [real estate] team of top partners ... is renowned for its international client base and its ability to punch above its weight.”
Chambers USA (2007)
Recommended in Real Estate (NY)
PLC Which Lawyer? Yearbook (2008)
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