diff --git a/gen/functions.cpp b/gen/functions.cpp
index 0c1bd292..6425c38c 100644
--- a/gen/functions.cpp
+++ b/gen/functions.cpp
@@ -772,6 +772,9 @@ void DtoDefineFunction(FuncDeclaration* fd)
     }
 #endif
 
+    FuncGen fg;
+    irfunction->gen = &fg;
+
     DtoCreateNestedContext(fd);
 
 #if DMDV2
@@ -801,12 +804,8 @@ void DtoDefineFunction(FuncDeclaration* fd)
     }
 
     // output function body
-    {
-        FuncGen fg;
-        irfunction->gen = &fg;
-        fd->fbody->toIR(gIR);
-        irfunction->gen = 0;
-    }
+    fd->fbody->toIR(gIR);
+    irfunction->gen = 0;
 
     // TODO: clean up this mess
 
diff --git a/gen/llvmhelpers.cpp b/gen/llvmhelpers.cpp
index 02aafeb6..ea7b553d 100644
--- a/gen/llvmhelpers.cpp
+++ b/gen/llvmhelpers.cpp
@@ -130,6 +130,17 @@ llvm::AllocaInst* DtoRawAlloca(const llvm::Type* lltype, size_t alignment, const
     return ai;
 }
 
+LLValue* DtoGcMalloc(const llvm::Type* lltype, const char* name)
+{
+	// get runtime function
+	llvm::Function* fn = LLVM_D_GetRuntimeFunction(gIR->module, "_d_allocmemory");
+	// parameters
+	LLValue *size = DtoConstSize_t(getTypeAllocSize(lltype));
+	// call runtime allocator
+	LLValue* mem = gIR->CreateCallOrInvoke(fn, size, name).getInstruction();
+	// cast
+	return DtoBitCast(mem, getPtrToType(lltype), name);
+}
 
 /****************************************************************************************/
 /*////////////////////////////////////////////////////////////////////////////////////////
diff --git a/gen/llvmhelpers.h b/gen/llvmhelpers.h
index 0aaa92d1..6d949aa9 100644
--- a/gen/llvmhelpers.h
+++ b/gen/llvmhelpers.h
@@ -45,6 +45,7 @@ void DtoDeleteArray(DValue* arr);
 llvm::AllocaInst* DtoAlloca(Type* type, const char* name = "");
 llvm::AllocaInst* DtoArrayAlloca(Type* type, unsigned arraysize, const char* name = "");
 llvm::AllocaInst* DtoRawAlloca(const llvm::Type* lltype, size_t alignment, const char* name = "");
+LLValue* DtoGcMalloc(const llvm::Type* lltype, const char* name = "");
 
 // assertion generator
 void DtoAssert(Module* M, Loc loc, DValue* msg);
diff --git a/gen/nested.cpp b/gen/nested.cpp
index cd024e85..2366cc5b 100644
--- a/gen/nested.cpp
+++ b/gen/nested.cpp
@@ -68,6 +68,24 @@ static FuncDeclaration* getParentFunc(Dsymbol* sym, bool stopOnStatic) {
     return (parent ? parent->isFuncDeclaration() : NULL);
 }
 
+static void storeVariable(VarDeclaration *vd, LLValue *dst)
+{
+    LLValue *value = vd->ir.irLocal->value;
+#if DMDV2
+    int ty = vd->type->ty;
+    FuncDeclaration *fd = getParentFunc(vd, true);
+    assert(fd && "No parent function for nested variable?");
+    if (fd->needsClosure() && !vd->isRef() && (ty == Tstruct || ty == Tsarray) && isaPointer(value->getType())) {
+        // Copy structs and static arrays
+        LLValue *mem = DtoGcMalloc(DtoType(vd->type), ".gc_mem");
+        DtoAggrCopy(mem, value);
+        DtoAlignedStore(mem, dst);
+    } else
+#endif
+    // Store the address into the frame
+    DtoAlignedStore(value, dst);
+}
+
 static void DtoCreateNestedContextType(FuncDeclaration* fd);
 
 DValue* DtoNestedVariable(Loc loc, Type* astype, VarDeclaration* vd, bool byref)
@@ -206,7 +224,7 @@ void DtoNestedInit(VarDeclaration* vd)
                 val = DtoAlignedLoad(val, (std::string(".frame.") + parentfunc->toChars()).c_str());
             }
             val = DtoGEPi(val, 0, vd->ir.irLocal->nestedIndex, vd->toChars());
-            DtoAlignedStore(vd->ir.irLocal->value, val);
+            storeVariable(vd, val);
         } else {
             // Already initialized in DtoCreateNestedContext
         }
@@ -534,11 +552,15 @@ void DtoCreateNestedContext(FuncDeclaration* fd) {
             unsigned depth = irfunction->depth;
             const llvm::StructType *frameType = irfunction->frameType;
             // Create frame for current function and append to frames list
-            // FIXME: For D2, this should be a gc_malloc (or similar) call, not alloca
-            //        (Note that it'd also require more aggressive copying of
-            //        by-value parameters instead of just alloca'd ones)
             // FIXME: alignment ?
-            LLValue* frame = DtoRawAlloca(frameType, 0, ".frame");
+            LLValue* frame = 0;
+#if DMDV2
+            if (fd->needsClosure())
+                frame = DtoGcMalloc(frameType, ".frame");
+            else
+#endif
+            frame = DtoRawAlloca(frameType, 0, ".frame");
+
             
             // copy parent frames into beginning
             if (depth != 0) {
@@ -602,7 +624,7 @@ void DtoCreateNestedContext(FuncDeclaration* fd) {
                         // passed-in pointer (for 'ref' or 'out' parameters) or
                         // a pointer arg with byval attribute.
                         // Store the address into the frame and set the byref flag.
-                        DtoAlignedStore(vd->ir.irLocal->value, gep);
+                        storeVariable(vd, gep);
                         vd->ir.irLocal->byref = true;
                     }
                 } else if (vd->isRef() || vd->isOut()) {
diff --git a/gen/runtime.cpp b/gen/runtime.cpp
index 30e3f350..7b7bfd99 100644
--- a/gen/runtime.cpp
+++ b/gen/runtime.cpp
@@ -264,6 +264,17 @@ static void LLVM_D_BuildRuntimeModule()
     /////////////////////////////////////////////////////////////////////////////////////
     /////////////////////////////////////////////////////////////////////////////////////
 
+
+    // void* _d_allocmemory(size_t sz)
+    {
+        llvm::StringRef fname("_d_allocmemory");
+        std::vector<const LLType*> types;
+        types.push_back(sizeTy);
+        const llvm::FunctionType* fty = llvm::FunctionType::get(voidPtrTy, types, false);
+        llvm::Function::Create(fty, llvm::GlobalValue::ExternalLinkage, fname, M)
+                ->setAttributes(Attr_NoAlias);
+    }
+
     // void* _d_allocmemoryT(TypeInfo ti)
     {
         llvm::StringRef fname("_d_allocmemoryT");
diff --git a/gen/tollvm.cpp b/gen/tollvm.cpp
index 7bffb3cc..8f1ec314 100644
--- a/gen/tollvm.cpp
+++ b/gen/tollvm.cpp
@@ -778,6 +778,11 @@ size_t getTypePaddedSize(const LLType* t)
     return sz;
 }
 
+size_t getTypeAllocSize(const LLType* t)
+{
+    return gTargetData->getTypeAllocSize(t);
+}
+
 unsigned char getABITypeAlign(const LLType* t)
 {
     return gTargetData->getABITypeAlignment(t);
diff --git a/gen/tollvm.h b/gen/tollvm.h
index 575bb981..76d543ec 100644
--- a/gen/tollvm.h
+++ b/gen/tollvm.h
@@ -95,6 +95,7 @@ LLConstant* getNullValue(const LLType* t);
 size_t getTypeBitSize(const LLType* t);
 size_t getTypeStoreSize(const LLType* t);
 size_t getTypePaddedSize(const LLType* t);
+size_t getTypeAllocSize(const LLType* t);
 
 // type alignments
 unsigned char getABITypeAlign(const LLType* t);