LSAG Legal Briefs - Vol 2

Each of the top ten largest leases of the first three quarters of 2019 occupied more than 110,000 square feet, with the largest occupancy topping 218,000 square feet. In two of the largest U.S. transactions, Akin Gump Strauss Hauer & Feld (218,399 sf) and Hunton Andrews Kurth (144,000 sf), each renewed leases in their existing offices located in Midtown Manhattan. In Boston, Foley Hoag extended its lease for 15 years, reconfigured its footprint, and contracted from 200,000+ square feet to 165,000 square feet equal to 82.5% of its overall space leased. The lease renewal included a re-design of the office into a more collaborative space featuring more open space, glass, and light. King & Spalding also downsized its Washington, D.C. office by 22.6%, shedding nearly 43,000 square feet as part of its 146,994-square-foot renewal. The largest new lease rounds out the top five, with Cooley LLP inking a new transaction in the North Financial District of San Francisco for 127,672 square feet. More than 300 employees will move to its new location at Three Embarcadero Center in 2021, where the new space near the top of the building will allow for panoramic views of the city and bay. This is the only large 2019 lease in the U.S. where a tenant expanded its square footage. All other 100,000+ sf transactions so far this year involved either no change of total square footage leased or a decrease in the total square footage leased. In conclusion, the U.S. legal sector real estate market continues to be on fire with law firms relocating more often than renewing as well as a strong shift in the overall workplace and expansion of technology. Continued densification of square footage as well as application of new workplace strategies including expanded remote working and hoteling are being implemented. The anticipated 2025 millennial shift of over 56% of the U.S. prime work force taking over and the desires that the younger generation have today. With law firm leases spanning 10 to 20 years, a much closer evaluation of the millennial impact is being taken into consideration while still balancing the desires of the older generation attorneys.

The U.S. legal sector real estate market continues to be on fire with law firms relocating more often than renewing, as well as a strong shift in the overall workplace

and expansion of technology.

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