Changing work environment is affecting space needs for law firms
A national survey of the legal sector by Cushman & Wakefield shows that law firms are basing real estate decisions on the changing priorities of the workplace. For a growing number of firms that means smaller, more collaborative spaces in unconventional locations.
“The legal sector is quickly coming to terms with the changing workplace environment. Finding and keeping talent is the priority, and the way law firms are structured and organized is changing,” Sherry Cushman, executive managing director and head of Cushman & Wakefield's Legal Sector Advisory Group (LSAG), said in a statement.
The survey of more than 400 decision-making representatives of law firms across the United States — from boutique to mega-firms— provides insights and trends about the business, financial and operational drivers affecting the legal sector. The survey was conducted in partnership with ALM Legal Intelligence.
The recruiting and retention of associate talent is a prime consideration. A LSAG national survey of more than 200 young lawyers revealed that the priorities of today’s associates have shifted over the years. At the top of a list of top 10 important personal factors was work/life balance and mentoring by a senior attorney as opposed to more traditional factors such as reputation of firm, areas of practice and compensation potential.
According to Cushman & Wakefield, this fundamental priority shift is impacting the way law firms look at real estate workplace solutions while also being challenged by generations that work differently. The challenge to satisfy the desires of the baby boomers – while accommodating the younger and future generations – poses many issues for firms. The survey concludes that the key to being successful is through flexible workplace strategies that can adapt over time, but also support the expansion of technology and new workplace strategies.
Data from the survey indicate that of firms that negotiated a relocation of their lease in the past year, 12 percent relocated into a smaller space, while only 4 percent increased in size, signaling a shift to more collaborative work environments and standardization of office sizes and implementation of paper management systems.
Brian K. Berkey, a senior vice president with Cushman & Wakefield | Thalhimer in Richmond, sees these trends playing out in the Richmond area. “In an effort to accommodate the changing work environment, we have seen several law firms relocate to less conventional buildings in emerging areas such as Shockoe Slip, Shockoe Bottom and Rocketts Landing,” he said in a statement.
He also noted that several downtown Richmond firms recently used their lease expiration as an opportunity to gain real estate efficiencies. McGuireWoods will vacate more than 240,000 square feet this fall. The firm is leaving the James Center for a smaller space in the new Gateway Plaza building that is currently under construction.
Law firms Hunton & Williams and Troutman Sanders recently downsized their respective spaces when they extended their leases. Hunton & Williams is staying put in the east tower of Riverfront Plaza, but opted to scale back from more than 300,000 square feet to about 260,000 square feet.
Troutman Sanders decided to stay at Riverside on the James, but consolidated from five to four floors.