When I started working with law firms in Dallas 15 years ago, I can’t think of a situation where I would have been across the table from an early forty-something year old. Now it’s frequent.
Just like in the commercial real estate industry, we’re seeing a shift in demographics of the leadership in firms. The former decision-makers are likely still present and active, but they have recognized the importance of transitioning leadership responsibility and decision making to the future of the firm.
Boomers looking toward retirement, are starting to look at the younger guard as leases expire. They know the decision will be a 10 to 15-year decision, and now they’re making the choice to allow the up-and-comers to lead the process.
It’s been really interesting to hear from that generation of employers–what’s really important to them.
JLL’s recently released Law Firm Perspective provides us an overview of the trends and insights impacting major markets across the U.S. I’d like to share with you my thoughts on how firms are navigating change and capitalizing on opportunities in Dallas.
Cost vs. culture
Priorities vary firm by firm.
Overall, the trend is moving to “one-size” offices, potentially having associates on the interior and getting more efficient and denser in the space. Historically, all attorneys had traditionally been on the glass. Dallas has been a slow market to adopt but we’re starting to see the change.
This shift is happening in large part because firms are coming into Dallas from the East and West Coasts and that’s just the way they do things.
Yet other firms are making the decision to differentiate themselves with two size offices as a recruiting tool.
Competition for talent
What’s drawing all these new firms here are the new corporations coming to North Texas.
The corporate relocation activity and law firm activity aren’t slowing down. People have speculated, “We now have so many more firms, but the same number of attorneys… how does that work?”
It begs the question: Are we on our way to a significant labor shortage?
This further supports the trend of new developments in Uptown to ensure the ability to recruit top talent. However, the alternate strategy is to maintain a low-cost basis to ensure competitive rates. In the end, there is likely sufficient client demand for both strategies to be successful.
New construction and amenities
The new developments and renovations in Uptown and the Arts District have been heavily focused on augmenting building amenities. This is crucial for many employers as the focus on recruitment and retention. However, law firms, which are a large part of the demand in these submarkets, have a slightly different view on building amenities.
Typically, shared conference facilities are not of use as firms require that to be within their premises. While some larger firms provide lunch within their space for employees, walkable eating options for breakfast, lunch, and dinner are key given the hours most attorneys work.
To a large extent, the priorities of the new leaders making real estate decisions for their respective law firms are similar to what was important to their predecessors. They still have a focus on personal space, head-down work, image, and amenities, but now there’s increasing emphasis on attracting and retaining talent in this highly competitive market to increase business and achieve higher profit margins.
It’s important that they remain forward-thinking. Law firms may have different reasons for their different strategies. The health of the overall Dallas economy seems to be supporting all for the time being.
Brooke Armstrong is JLL’s Managing Director/Dallas Office Tenant Rep Lead
