CMS has acted for a consortium of investors, including APG, on their exit from the European Outlet Mall Fund and spin-off of selected Designer Outlet Mall assets into a newly-formed joint venture. The assets comprised in the new joint venture, valued at c.€3bn, are managed by McArthurGlen and are located across the Netherlands, Italy and Austria.
The transaction required complex cross-border structuring as well as in-depth negotiations with the retained asset manager, all whilst remaining within the constraints applicable to the Luxembourg regulated fund, which was approaching the end of its fixed term.
The transition of the holding structure from that of a fund to a joint venture was achieved by way of a complex, multi-jurisdictional stepped process, with certain residual assets remaining in the fund ahead of the commencement of the fund’s end-of-life liquidation process.
Amanda Howard, CMS Partner and Head of the Funds and Indirect Real Estate team at CMS UK, comments: “We're delighted to have delivered a successful outcome for our clients on this complex transaction. The cross-border nature of the deal, combined with the regulatory and structural challenges of transitioning from a fund to a joint venture, required close collaboration across our pan-European team. This transaction is a testament to the strength and depth of our funds and indirect real estate expertise, and our ability to guide clients through the complex and high value matters in the sector.”
Nick Burt, CMS Tax Partner, comments: “This transaction presented a unique set of tax and structuring challenges, particularly in the context of a Luxembourg regulated fund approaching the end of its life. Our team worked seamlessly across multiple jurisdictions to deliver a robust and efficient solution for our clients, ensuring the successful spin-off of the joint venture assets while navigating the complexities of cross-border tax and regulatory requirements.”
The multi-jurisdictional CMS team included Amanda Howard, David Broome, Michelle Arbuckle, Katriona Dunn and Oliver Vercoe (Funds and Indirect Real Estate, London); Nick Burt and Emma Tuppen (Tax, London); Gérard Maitrejean, Adrien François and Julie Butlingaire (Corporate, Luxembourg); Benjamin Bada (Funds, Luxembourg); Frédéric Feyten and Alejandro Dominguez (Tax, Luxembourg); Peter Ollesch, Tobias Schneider (Corporate, Germany); Tobias Schneider and Tillman Kempf (Tax, Germany); Edoardo Marangoni (Corporate, Italy); Federico Raffaelli and Luca Scibelli (Tax, Italy); Sibylle Novak and Thomas Aspalter (Tax, Austria); Martijn van der Bie (Corporate, Netherlands); and Anton Louwinger and Etienne Cox (Tax, Netherlands).
