Property Prices affecting London’s Law Firms
4 March 2016 by Lucinda Stacey
Following on from our last blog ‘Is London falling out of favour with property investors’, a recent article has been published stating London’s law firms are feeling the pressure. Many UK firms are downsizing and even relocating to save on the ever-increasing London rent.
According to the real estate advisor CBRE, rents for London’s 100 largest law firms rose 7% last year to an average £43 per square foot. Interestingly, whilst UK firms reduced their office space by 9% between 2012 and 2015, during the same period, international firms expanded by 12%. A number of US law firms are closing smaller, less profitable offices in other European cities to focus their attention on London.
Examples of law firms who are reorganising their offices and reducing space include CMS Cameron McKenna, Ince & Co and BLM who have changed from traditional cubical-style offices, where each person has their own space, to open plan offices. Figures show that this requires 20% less space per head, CBRE found which results in an average saving in rent of £21,800 per lawyer.
The senior director of CBRE’s central London tenant advisory group, Frances Warner Lacey, commented that “Property overheads are the second largest cost after salaries for law firms, so as they face rising competition and pressure on fees, real estate costs are one area where savings can be made.”
If you are interested in this article and are looking at ways to save money and need advice relating to your lease, please contact us on 01206 835300.
To read the blog mentioned above, just click here: Is London falling out of favour with property investors?