2022 Bright Insight

BRIGHT INSIGHT OVERVIEW

Coming off its best year ever, what can the legal sector do for an encore? That’s the million-dollar question—and part of the answer is rooted in the results and trends that are reflected throughout the 9 th annual edition of Cushman & Wakefield’s Bright Insight report. Other significant questions still remain: How will firms compete for talent in perhaps the fiercest labor market of the last few decades? How will firms respond to attorney and staff expectations about hybrid work flexibility? Law firms are reassessing every aspect of their people, business, and culture, and are laser-focused on the purpose of the office. They’re aligning their work policies with their goals, values and client needs. No doubt these factors will have broad implications for future space requirements, workplace layout, design and functionality and continued investments in technology. The questions are abundant. The answers, however, are not as clear. What we do know is that each firm will discover its own answers. It’s going to be an evolution, a several-year process of experimentation and refinement before the legal sector arrives at the solutions that work best for its people, clients and businesses.

These trends continue to support the preference law firms now have for more efficient buildings and an overall flight to higher quality buildings (new or trophy Class A existing). In addition, overall occupancy in 2021 on a square foot basis by law firms decreased 14%, on average for new leases, and 6% on renewals in all U.S. cities. Relocations also increased because of attractive landlord concessions (tenant improvements and free rent), which peaked at an increase of 54% over 2020. This concession increase minimized out-of-pocket capital costs, making a relocation more financially viable, while also providing the opportunity for a firm to right-size and implement new workplace strategies. No doubt, the sector is continuing to shift at lightning speed, far more dramatically than in the past, and this pace of change is likely to continue. No longer are we seeing a one-size- fits-all model; rather firms are closely evaluating and determining what is right for their own firm, their people, clients and overall future success. We’re seeing an industry correction that many believe was long overdue.

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Legal Sector Advisory Group | ADVISING FOR EXCELLENCE