Westfield Corporation
General counsel: Leon Shelley
Team size: 14
Major law firms used: Linklaters, Ashurst, Herbert Smith Freehills, Berwin Leighton Paisner, Greenberg Traurig, DAC Beachcroft
Since Leon Shelley joined Westfield Corporation in 2005, the Australian shopping centre operator has sold around half its portfolio globally. In the UK, it has shed eight centres to concentrate on its flagship strategy – two sites in London with a third planned for Croydon. This is not a hard-luck story, however. Westfield has seen its revenues grow year on year and has recently completed a £600m extension to Westfield London in Shepherd’s Bush.
Shelley, now director of corporate and general counsel (GC) for the UK and Europe, says the company was prescient in spotting the shift in the retail market. ‘Retailers will always need flagship stores in capital cities and other strategically-strong demographic locations. We got ahead of the market by focusing on these prime assets.’ A further sign of Westfield’s growth is its ongoing development of the new £1.4bn complex in Croydon, part of a long-term plan to regenerate the area.
Westfield’s proposed merger with French property investor Unibail-Rodamco is an indicator of how retail is changing, says Shelley. ‘Over the last decade there has been a shift in power toward major retail brands who take a very strong negotiating position against shopping centre owners and landlords. The wave of mergers we are seeing is an attempt by owners to take some power back.’
‘We don’t carry any passengers here – it is one of the reasons our lawyers are held in such high esteem.’
Bricks-and-mortar retail is facing an even bigger threat: e-commerce. Last year Westfield relaunched its technology division, OneMarket, to focus on bringing shopping centre owners together, including those operated by its rivals. ‘[Amazon’s] advantage is in the number of potential customers it has access to,’ says Shelley. ‘To ensure we stay meaningful as an industry we need to recognise that and get in the game now. By working together we hope that shopping centres will be able to compete with online retailers on a more even playing field.’
The legal team’s ability to keep on top of these numerous trends caught the attention of nominators. Ashurst’s global head of real estate, Hugh Lumby, comments: ‘One of the great teams I’ve worked with in the course of my long career is Westfield. They are absolutely phenomenal. Leon Shelley deserves to be recognised as a standout figure in the market, but his entire team displays the same qualities. They have led the company through a whole series of very complicated real estate deals. It is rare to see a legal team driving a business forward and taking difficult decisions, but like all successful businesses, Westfield has put its lawyers at the front to facilitate deals.’
The team’s ability to engage with the business has been fostered by Shelley’s approach to management. ‘If a junior lawyer asks me a question, I refuse to answer. Instead, I say: “Come back with an answer and I will tell you if that answer is correct.” It’s a very good way of training people to be independent. We don’t carry any passengers here and it is one of the reasons why our lawyers are held in such high esteem. They are embedded in the business, sitting in the development, leasing and construction teams. I would go so far as to say that some of our development lawyers are better developers than the developers employed by other companies in this sector!’
Standout figures within the team include deputy GC Amanda Beattie, described as a ‘brilliant lawyer’ by Lumby, and GC for leasing Philip Sorensen: in Shelley’s words a ‘seasoned negotiator’ who has been instrumental in the Westfield Milan project, Italy’s largest retail and leisure destination.
Balfour Beatty
General counsel: David Mercer
Team size: 32
Major law firms used: Pinsent Masons
It feels an age since global infrastructure group Balfour Beatty announced its seventh profit warning in a couple of years, had its chief executive quit and was in the midst of merger talks with rival construction group Carillion. But this was little more than three years ago. Carillion recently spectacularly collapsed. Balfour Beatty, meanwhile, in March announced it had more than doubled its underlying profit for the 2017 financial year to £196m, while having an order book worth £11.4bn.
Behind this has been the admired in-house legal team led by David Mercer, who was promoted to group GC and head of legal in mid-2015, replacing Chris Vaughan. A trio of leaders below Mercer, however, are also credited for their work: associate GCs Terry Styant and Mike Dallas, and deputy GC and head of group legal and compliance Keely Hibbitt. Pinsent Masons head of client strategy Alastair Morrison observes: ‘Within the function you’ve got a really high-quality team that’s been able to work through a range of different issues.’
Morrison knows the team well, given his firm’s longstanding sole-supplier mandate with the FTSE 250 company that kicked off in 2013 and was this year re-signed until 2020. The latest partnership has introduced new pricing structures for greater flexibility, such as variable fixed-price arrangements for routine projects, rather than a single capped fee for all business-as-usual matters, as was the case previously. Pinsents’ routine work will also generate credits that can be offset against legal spend on more complex work also handled by the firm. These credits can also be used for advice on the design and implementation of legal process technology.
Mercer says of the deal: ‘We’ve unlocked significant value for Balfour Beatty through our partnership approach and remain committed to driving continuous improvement. We are now working together on tech-led innovation, blending legal service provision, in-house engagement and business system integration that is changing the way we do business and helping us to lead in this challenging market, not least in extracting maximum value from every legal pound spent.’
Morrison credits Mercer and the in-house team for its role in seeing Balfour Beatty come out of its rough patch: ‘The team has stuck with David through that period. He’s seen a lot of different things over his career and was the right person to guide them through this. He’s a guy who has got bags and bags of experience; he’s very calm and a good relationship person but also a strategic thinker as well.’
BAE Systems
General counsel: Philip Bramwell
Team size: 250
Major law firms used: Allen & Overy, Linklaters, Eversheds Sutherland, Freshfields Bruckhaus Deringer
‘This is, you will be pleased to know, a very, very, heavily regulated industry,’ defence multinational BAE Systems group GC Philip Bramwell says. ‘We have, from the boardroom down, no appetite for breaching laws or regulations.’
Bramwell, a veteran lawyer of more than 30 years, including time as GC at mobile operator O2, is enjoying his longest-ever stint in the same job after becoming BAE GC in 2007. This tenure has led to the development of a mature legal department, numbering around 250 people, split between lawyers and regulatory experts. The department is spread across the world, chiefly in the key markets of the UK, US, Australia, India and Saudi Arabia. This spread, for a company that employs more than 80,000 people overall, makes cohesion within the legal department an absolute must.
This, Bramwell believes, is achieved through a clear understanding of legal value-add, influenced by US academic Constance Bagley’s work, ‘Winning Legally: The Value of Legal Astuteness’. This is characterised as investing in the business to make it more ‘legally astute’, otherwise in-house demands will constantly be proportionate to the scale of the business, ‘the ultimate objective of which is to create a business that has a better knowledge of law and regulations than its competitors and is able to use that to its competitive advantage’.
‘This is, you will be pleased to know, a very, very, heavily regulated industry.’
Bramwell tracks this with monthly value-add reports from his lawyers around the world, detailing things they have done that add to the company’s knowledge above and beyond the day job: in November, for instance, the team spent about 300 hours delivering online training to 5,000 people at the company. The ‘dream’ is to keep the business aware of legal developments, risks and regulations so that it in turn generates less work for the in-house department and improves efficiency overall. ‘The key with large multinational legal departments is controlling costs worldwide.’
BAE might spend seven years trying to win a contract for £5bn, but the classified nature of many of the headline projects the team has worked on means Bramwell cannot talk about them. He points to global chief counsel of compliance and regulation, Joanna Talbot, as worthy of mention, while head of labour law Victoria Halliday had an enormous workload not only because of a management restructure but with implementing the first phase of GDPR compliance.
Bramwell expects the drive for efficiency to dominate for the foreseeable future, particularly for a company that ultimately supplies armed forces at the expense of the taxpayer. The team is not at the bleeding edge of technological development, as many solutions on the market are hosted in the Cloud, which presents security issues for BAE. ‘Although we look on enviously at what the banks and others are doing, and what the start-ups are doing, we’ve not yet found a package that will add a lot of value. It’s a bit frustrating really.’
PERSPECTIVES: Philip Bramwell, group general counsel, BAE Systems
How is your legal team structured?
If you’re a Western defence company, you’re basically dealing with the Five Eyes nations [Australia, Canada, New Zealand, the UK and US]. BAE Systems is the most global of the defence companies, so our legal department reflects that. We number about 250 overall – half lawyers and half regulatory experts. The basic principle of the organisation of the legal function around the world is to have the lawyers as close to their client base as we can get them, so it’s a blend of commercial generalists and making sure that we’ve got geographies covered where we have multiple lines.
How has it evolved?
It will flex from time to time, even in a mature legal department. An area like cyber security is big for us now; it wasn’t five years ago. Broadly, our concept of operation remains the same. We have a clear sense of legal community globally and all meet once a year.
What is that concept of operation?
We have a very clear understanding of legal value-add, influenced by the work of American academic Constance Bagley, which splits in-house work into three prongs. The first is latent demand from people in your organisation looking for legal advice: that’s good we want to be in demand, but it’s self-diagnosed. That’s the pull dimension, whereas the push dimension is the work we do to enhance and protect the value of the enterprise, work across the business to meet standards set by the board, which has no appetite for compliance or regulatory failures. Bagley says there has to be a third dimension, however, or else it’s a zero-sum game. If you don’t invest in making the business what she calls more ‘legally astute’ – more aware of the laws and regulations that affect it – then you will in perpetuity have a constant level of demand that’s proportionate to the scale of the business and it will not learn to be smarter.
How do you measure that?
Those three dimensions inform the way that we manage and think about legal value-add and also the way that we articulate to management what we are delivering. I get third dimension legal value-add reports monthly from my lawyers around the world that say: ‘These are three, four things we’ve done over the last month that are adding value above and beyond the day job.’ It might be two hours of training to 100 people on a piece of regulation, which reduces our risk of violations. Training is a classic example of somewhere we want to make a very heavy investment. Keeping managers aware of legal developments, legal risk, regulatory risk, means they in turn generate less work for us. That’s the dream.
It’s about front-footing problems?
Front-footing: that’s a better way of putting it. I’ll steal that.
How do you manage the three dimensions effectively?
I have to make a business case like anyone else looking for investment, so when I need more headcount I go to the chief executive and say we’re altering a few things, but we’re probably looking at a few extra heads and if we don’t we’re going to face big external legal bills. Is my team drinking from the firehose or are they going to have sufficient capacity to get out in the business with their non-specialist colleagues and raise the state of awareness in the business? I’ve never been refused when I’ve made a business case.
How have the demands on in-house teams changed?
We’re very fortunate to take associates and senior associates from top-flight law firms around the world and we benefit from that enormously. If you get a great gene pool then you will have an adaptable and hugely-able legal department, and I believe that’s what we’ve got. We have people willing to uproot and take themselves off to other sides of the world, making huge sacrifices with young families. I think international career experience is going to be important for those who want to reach management levels in the legal departments in global companies, I spent a decade overseas in my career and it helps you in a number of things. First of all it helps you to put your own home country in context. You talk to people and socialise with people who are not your countrymen and don’t know anything about your country. The UK thinks it’s the centre of the universe. Years later, as a GC, you have some empathy with what people are going through in overseas assignments: it’s a non-trivial thing to ask someone to do. Looking forwards – certainly for the Millennials that we’re recruiting – getting them international experience is really important.
Network Rail
General counsel: Stuart Kelly
Team size: 26
Major law firms used: Eversheds Sutherland, Addleshaw Goddard
Network Rail GC Stuart Kelly’s second stint at the UK railway infrastructure owner, and subsequent promotion to its top legal job in early 2017, has come with what he describes as a more focused alignment of the legal team and the business’s needs – a ‘massive shift from a decade ago’. Kelly believes this is the engine behind his 26-strong legal team and has led to legal becoming more embedded within the organisation.
Such an approach is highlighted by Network Rail’s longest-ever panel review process, kick-started in early 2018 for work that could be worth up to £70m over five years from next April. This panel review is Kelly’s first since being promoted from deputy group GC following the departure of Suzanne Wise in March last year to Japan Tobacco International.
Network Rail’s new panel is expected to cover a full range of legal services to support the in-house team on its corporate functions and route businesses between 2019 and 2024. The £70m will be spread among a small number of suppliers Network Rail expects will provide innovative approaches to ensure value for money. The tender document says: ‘We would like to encourage prospective bidders who are forward thinking, committed to innovation and who are open to alternative ways of delivering our requirement for a full legal service.’ The review will be led by Network Rail routes businesses GC Dan Kayne, who, along with group and Europe GC Steve Davey, was recently promoted and earns praise both internally and externally for his work.
Ian Gray, Eversheds: ‘Stuart Kelly is an understated individual who is incredibly well organised.’
Kelly says Network Rail will spend longer working on its new panel than the company has ever done before, aligning it with a new five-year corporate strategy for the overall business: ‘The whole organisation has been on a journey towards more devolution from the centre – it has been quite political – and we’ve evolved to match that corporate devolution.’
Network Rail is also working with a legal software start-up Apperio, which boasts online food delivery company Deliveroo as a client, and is implementing new data systems ahead of its new panel in 2019, which Kelly describes as the beginning of the firm’s technological journey.
Another key project is the disposal of Network Rail’s commercial property portfolio, which could be worth more than £1bn. About 5,500 properties were put up for sale in England and Wales in a bid to provide a significant cash injection to the railway owner, which is spending £130m on infrastructure investment every week. This work is being led by Network Rail property GC Cathy Crick. ‘It’s one of our biggest transactions. This is an extraordinary disposal that has dominated their workload,’ Kelly says.
Kelly draws praise from Eversheds Sutherland executive partner Ian Gray, who comments: ‘Stuart is an understated individual who is incredibly well-organised. He has a challenging brief, which attracts a lot of attention. Despite this, it feels like he is running that very well.’
Rolls-Royce
General counsel: Mark Gregory
Team size: 60
Major law firms used: Slaughter and May, Debevoise & Plimpton
‘We’re not the “Department of No”; we’re not the “Deal Prevention Unit”; and we don’t sit in our ivory tower with the big book of law,’ says Rolls-Royce GC Mark Gregory about how his in-house legal team operates. ‘We understand the business and can give proactive business partnering. We do have to play the governance role – staying independent and objective – but that isn’t an excuse to avoid giving practical and solution-focused advice as part of an integrated team.’
Gregory was only appointed GC in late 2015, rising from head of legal and commercial at the FTSE 100 British engineering heavyweight to replace Robert Webb QC, but is already credited for his role in driving cultural change and business simplification at Rolls-Royce. It has been a challenging time to land such a role, too, with the business, which last year reported revenue in excess of £16bn, dealing with probes, profit warnings, leadership changes and shareholder activism.
The most high-profile have been investigations into bribery and corruption by the Serious Fraud Office, US Department of Justice and Brazil’s Ministério Público Federal, resulting in deferred prosecution agreements announced in early 2017 and penalties totalling £671m. This was managed by a small central team working with external counsel, Gregory says. Meanwhile, in 2016, US activist investor ValueAct Capital secured a place on the company’s board after building its stake in the company following profit warnings a year earlier.
‘We do have to play the governance role, but that isn’t an excuse to avoid giving practical and solution-focused advice.’
Eversheds Sutherland co-head of global company commercial Keri Rees says Gregory led his team during a very challenging period for the business while supporting its focus on transformation and reducing costs. He credits the team for tightening management of external legal spend, lifting operational excellence and aligning and integrating the function with the business: ‘Mark and his team are playing a crucial role in the evolution of Rolls-Royce as it moves on from such challenges, and looks to drive culture change and business simplification. [They] have also implemented new models of working that align to the business’s wider strategy to become a leading technology company and drive digital technology.’
Gregory adds that, similar to many other in-house teams, Rolls-Royce expects the legal arm to be more than lawyers and instead partners willing to stick their necks out. It also faces the ongoing challenge of cost and efficiency, transparency and accountability. Collaboration is key, while the company’s chief executive has charged legal with setting an example in innovation. A chief operations officer, Deborah D’Aubney, has been working in the last few months to help drive this change, but Gregory admits the team is behind on technology: ‘I see that as an opportunity to leapfrog: one of the group strategic priorities is around driving a ‘digital first’ mindset and we’re embracing that. There’s lot of exciting technology out there that we can embrace to drive commoditisation, automation and simplification.’
Lendlease
General counsel: Mark Packer
Team size: Eight
Major law firms used: CMS Cameron McKenna Nabarro Olswang
The real estate sector has not traditionally been home to large teams of in-house lawyers. As such, the eight-strong UK-based legal team at Australian construction, property and infrastructure group Lendlease is relatively large for the market. Even so, says GC Mark Packer, the amount of work the team gets through is genuinely impressive.
‘Competitors may work on one or two projects, but we are doing everything from investment to development to construction at the same time. There isn’t another team in this sector that is handling so much complex work on a regular basis.’
In the past year, that work has included supporting the delivery of Google’s new King’s Cross headquarters, negotiating commercial agreements for the International Quarter in Stratford, LendLease’s £2.4bn joint venture development with London Continental Railways, securing a role as contractor on Scape Group’s £7bn National Construction framework, and forming a £1.5bn build-to-let partnership with CPP Investment Board to develop private rental and affordable homes at Lendlease’s Elephant Park development in Elephant & Castle.
‘There isn’t another team in this sector that is handling so much complex work on a regular basis.’
Packer and his team have also been increasingly busy in Italy, where a spate of new ventures have seen Lendlease become the country’s largest property developer. These projects include acting as contractor to the €2bn Milano Santa Giulia development, a green and residential district under construction in the south-east periphery of Milan, and as preferred bidder to redesign Milan’s 100-hectare 2015 world expo site. Lendlease has also entered into a joint venture agreement to work on Rome’s new Pescaccio shopping centre – one of a number of urban regeneration schemes Packer’s team is now working on.
In these matters Packer has been supported chiefly by Amy Cashman, who joined the UK team from Lendlease’s Australian office in 2016 and is tipped as a rising star in the sector. He has also been able to draw on the experience of Joanna Brown, one of the most experienced members of the team and a well-known figure in the real estate community. Brown moved from her native Australia to join the London office shortly after it was established and has been a key figure in some of Lendlease’s most high-profile matters in the City, including its Greenwich Peninsula development, now owned by Hong Kong-based developer Knight Dragon, and the initial bid for work on the redevelopment of Battersea Power Station. She is now leading on the company’s Elephant & Castle scheme.
The core of the team, however, is formed of lawyers with similar levels of experience: Ruby Jhita, previously a Lendlease secondee, joined from Nabarro in 2016. Senior construction lawyer Peter Duncan joined from Heathrow in 2014 shortly after legal counsel for Europe Tom Grundy had joined from Eversheds. ‘Having people at the same level of experience and seniority helps to make a team entrepreneurial,’ says Packer. ‘They know they are competing for face time with senior business leaders, which produces a friendly rivalry across the team. I can’t think of a better way to encourage career development.’
British Airways
General counsel: Andrew Fleming
Team size: 26
Major law firms used: Slaughter and May, Baker McKenzie, Addleshaw Goddard, DLA Piper and Linklaters
You do not have to be an aviation geek to join the lean British Airways (BA) in-house legal team, but head of legal and company secretary Andrew Fleming believes the combination of the airline’s brand and the nature of the work attracts strong talent regardless, allowing him to be picky about who he hires: ‘That’s an advantageous starting point. The nature of the industry we work in, the whole variety and unpredictability of the work, makes it really challenging, but that also keeps it interesting for everyone.’
Fleming – head of legal since the £5bn merger of BA and Spanish carrier Iberia in 2011 – has a 26-strong in-house legal team covering employment, commercial, regulatory, litigation and competition, mostly based in the UK with a team of four in New York. One partner at a major global firm says the BA team is constantly moving from one big, high-profile issue to another: ‘There’s quite a lot of crisis management that it handles very effectively.’
Tom Cassels, Linklaters: ‘It’s a very lean team that is always stretched, but that isn’t reflected in the quality of their work.’
In the last year or so, the BA team faced industrial action, the acquisition of take-off and landing slots at Gatwick Airport and the closure of its largest pension scheme. One of the more high-profile issues was the long-running mixed-fleet industrial action in 2017, resulting in strikes by some BA cabin crew before a pay deal was reached in October. The acquisition of the slots at Gatwick followed the collapse of low-cost airline Monarch, which was secured for an undisclosed sum. Meanwhile, BA’s largest defined-benefit pension scheme closed to future accrual to be replaced with a new flexible benefits scheme.
Fleming highlights head of employment Navdeep Deol for his work on employment matters, and head of regulatory, competition and litigation Elizabeth Hichens for her work in the acquisition of the Monarch Airlines slots. Competition lawyer Natasha Franklin, meanwhile, is also well regarded.
The team is open-minded about doing things differently, but innovation and technology will be more of a focus for this year. That said, it was a relatively early adopter of e-billing in late 2011 and has implemented other process-efficiency tools. Fleming believes the team is a true trusted adviser to the broader BA business: ‘Being really smart and good at the law bit has become a given and it has been increasingly about how you can put that into effect. It’s about having an intimate familiarity with the business, really understanding how you make money and what your brand is built on.’
Linklaters partner Tom Cassels says Fleming is extremely bright and willing to challenge external counsel in a constructive way. He adds: ‘It’s a very lean team that is always stretched, but that isn’t reflected in the quality of their work. They manage outside counsel well.’
WeWork
General counsel: Peter Greenspan
Team size: Four (EMEA)
Major law firms used: DLA Piper, Covington & Burling
The disruption of traditional industries by tech-backed companies is a familiar story by now. Even so, the rapid rise of shared workspace provider WeWork has caught many in the commercial real estate sector off guard. Founded in 2010, the New York-based company is already valued at over $20bn, making it one of the top ten start-ups globally.
In the UK, WeWork’s rise has been just as spectacular. After entering the market in 2014, it is already the largest occupier of office space in central London. In spite of this rise, WeWork’s business model is incredibly simple: it rents space off a landlord and leases it on for more money. Nor is it the first company to follow this model. The likes of IWG and The Office Group have been doing the same thing for decades. However, says Jonathan Wainstein, real estate counsel for EMEA, the market was due a shake up.
‘Offices are among the most inefficiently-used spaces around. Most companies tend to rent far more space than they need because the decision is based either on what other similarly-sized companies are renting or a hunch. No-one uses technology to analyse how buildings are actually being used. WeWork is taking a much more sophisticated approach, using technology that helps find the right-sized office for a business. Only by mapping how different companies like to use space can we learn the best way to organise the buildings we occupy.’
Wainstein works as part of a four-person EMEA, Israel and Australia real estate legal team led by associate GC Nicholas DiChiara. As with most tech-backed companies, WeWork has proved to be a good bet for its lawyers. Its first GC, former Wilmer Cutler Pickering Hale and Dorr partner Jen Berrent, was given additional responsibility as chief culture officer before being appointed as the company’s chief operating officer in 2017. The GC role has since been filled by former deputy GC, Peter Greenspan.
While it has challenged vested interests, WeWork is hardly playing David to the Propco Goliath. JPMorgan Chase & Co and Goldman Sachs were early investors, while venture capital outfit Softbank Group has sunk $4.4bn into the company so far. Is WeWork a credible long-term threat to the incumbents? Mat Oakley, head of European commercial research at Savills, thinks so. ‘Every industry in the world seems to be heading toward a small number of leviathans that dominate the market. WeWork will be one of the leviathans in the real estate space. It will be difficult for a traditional landlord to move its feet quickly enough or for an emerging competitor to gain enough momentum to challenge them.’
Land Securities Group
General counsel: Tim Ashby
Team size: Six
Major law firms used: Berwin Leighton Paisner, Eversheds Sutherland, CMS Cameron McKenna Nabarro Olswang
Land Securities Group GC Tim Ashby describes his comparatively-small in-house team as typical for the real estate sphere, but the magnitude of the work it completes is anything but ordinary.
Ashby and head of legal Alex Peeke modestly recount their involvement in the £1.3bn sale of the iconic Walkie Talkie skyscraper last year. Mayer Brown, Berwin Leighton Paisner (BLP) and CMS Cameron McKenna Nabarro Olswang advised as Landsec sold the building at 20 Fenchurch Street to Hong Kong investors LKK Health Products Group, but Ashby and Peeke argue that credit is due to predecessor Sally MacGregor, who was responsible for setting up the initial joint venture to own the building with Canary Wharf in 2010.
Peeke says: ‘We continue to look after the building, making sure [the tenants’] experience stays the same. This is a continuous project.’
Outside of the Walkie Talkie sale, another major acquisition in 2017 saw Landsec open Westgate shopping centre in a £440m joint venture with The Crown Estate.
Landsec’s deputy head of legal services Ian Petts was instrumental in getting the Westgate deal over the line, with Ashby saying: ‘It was a long process with masses of work and it has been run confidently. Ian Pett stands out.’
Despite the relatively-small team, Landsec has substantial tech ambitions, with Ashby revealing that he is actively looking and having conversations with law firms about how machine learning could improve the company’s document management systems. Furthermore, an office move 12 months ago has instigated an electronic drive. Ashby says: ‘We are not sitting here with filing cabinets – we are 90% paperless.’
Ashby contends that Landsec’s ratio of work done internally compared to externally mirrors the company’s wider peer group. ‘All of our work is done externally. There’s no deal that we do without a firm. We would get a legal team of 60-70 lawyers to do everything. All of our peer group run the same model as us. There’s no cost benefit in changing it.’
Landsec currently operates a core property panel comprising three firms: BLP, Eversheds Sutherland and CMS. On the corporate side, Magic Circle outfits Slaughter and May and Allen & Overy are the regular advisers.
The Crown Estate
General counsel: Rob Booth
Team size: 20
Major law firms used: Berwin Leighton Paisner, CMS Cameron McKenna Nabarro Olswang, Hogan Lovells
The young, bright GC and company secretary of The Crown Estate, Rob Booth, has ‘gone from being one to watch to being a big player’ since taking over from well-regarded former GC Vivienne King in 2016, one law firm leader says. ‘He’s really stepped up to that role.’ Booth and his lean team of five lawyers have certainly stepped up: supporting more than £2bn worth of property trading at The Crown Estate in the last two years, overhauling its offshore wind portfolio, devolving its operations in Scotland and restructuring the entity, which is governed by an Act of Parliament.
Booth sits in the middle of the legal function, with four senior legal counsel below him who each manage one of the estate’s portfolios: central London; regional; energy, infrastructure and minerals; and rural and coastal. The overall portfolio is worth more than £13bn, with central London by far the largest, making up about £8bn of that in super-prime West End property.
‘We are there to assist the business to be the best that it can be.’
One of Booth’s first tasks when he took on the GC role was to rewrite a lot of the estate’s governance. He took the opportunity to change the structure of his legal team at the same time. He describes this process as effectively ripping up the estate’s terms of reference and replacing it with a more modern structure that has been embedded over the past 18 months: ‘It’s one of those moments as a Crown Estate GC where you know in six months either there’s a happy stakeholder or you’re packing your possessions into a box. My possessions are still on my desk.’
The restructuring also gave Booth an opportunity to restructure his panel, which he believes is as good as any on the market. The Crown Estate’s heavily-outsourced legal spend will be between £10m and £15m this year, and there is a requirement for panel firms to be very bespoke and transparent. Booth has also divided the work between strategic and portfolio mandates, which he says has resulted in improved performance. One legal consultant says The Crown Estate is the best legal team they saw last year: ‘The maturity of how they’re managing the supply base – they’ve really thought it through in terms of what they’re trying to get out of the law firms. I’ve been very impressed by that.’ Booth sees his team’s role existing beyond simply aiding transactional flow: ‘We are there to optimise, to shape and to assist the business to be the best that it can be.’
Booth prefers firms come to him with technological innovation than for him to have to commit to any specific system, particularly as he considers the legal technology market too immature to offer something that tips the scale. ‘I’m very happy to sit back and utilise what the firms are using. I’m a Millennial, so I’m not about buying stuff; I’m all about rent.’