Workspace Trends 2016 exec summary

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  • The Lawyer | 12 September 2016 The Lawyer | 12 September 201610 11

    Cover story UK 200: Workspace Trends executive summary

    Matt Byrne and Kim Tasso

    technology and trends such as the rise of co-work-ing and remote or flexible workers radically changing the way lawyers and business services professionals live and work.

    Crucially these trends are also having a signifi-cant impact on firms real estate strategies, not least the amount and types of space firms require.

    This years UK 200 real estate-focused report, re-named Workspace Trends to reflect these changing dynamics in the UK market, includes more insights into these trends than ever. It spot-lights a wide range of UK firms including Bird & Bird, Fieldfisher and Freshfields Bruckhaus Deringer, US firms such as Ropes & Gray, and barristers chambers such as Atkins Chambers.

    In short, while this years report extends the traditional data-led and primarily benchmarking coverage of law firms property costs and usage it also includes detailed insights into how firms are attempting to make their real estate future proof.

    Take Ropes & Gray. In London the US firm has grown from 60 to 150 lawyers in just four years. In October 2015 it moved 235 staff from offices sub-let from Taylor Wessing in New Street Square to 45,210sq ft across two floors in the new Land Securities building at 60 Ludgate Hill, just around the corner from the Old Bailey. It has since taken a further 15,000sq ft on the fifth floor as the firm continues to expand.

    Real estate partner Iain Morpeth and senior office administration manager Deborah Eastwood were key members of the team that planned the move.

    Our two biggest offices are in New York and Boston, says Morpeth, but London has been growing at a fast pace and we were crammed into our previous accommodation in New Street

    This is an executive summary of the UK 200: Workspace Trends 2016 report

    puts it, workplace environment, worklife balance, and your workspace are now all critical issues. Do you really need to come into an office to do your job? A lot of people these days are looking for something more than just a place to go to. The issue for us is how to be more attractive.

    Warmbold says the new generation of profes-sionals are looking for more flexibility in their hours, not necessarily 9-5, and more flexibility in where they can work.

    Its not about reducing the hours, says Warm-bold, and so long as we get the output it shouldnt matter. This is the issue were all looking at today.

    Warmbold highlights the example of one senior professional services individual who was recently able to take six weeks with his family as they went on holiday to Portugal.

    He was with his family for six weeks but was only on holiday for two of those weeks, says Warmbold. He had uber flexibility. Will that guy ever leave his company with that amount of flexi-bility? If thats the way our people want to work, we have to provide the environment to let them do it.

    Inner spaceWorkplace strategy has jumped to the top of the agenda at many firms over the past 12 to 18 months, with elements such as the use of new

    The new space age

    Wellness, a clunky-sounding term if ever there was one, is the new buzzword in real estate circles. It has become shorthand for

    how future-proof your office is.And in turn, that means whether your office has

    the right configuration of shared space, cellular but adaptable office units, open plan, tech, airi-ness and quite possibly pool tables surrounded by graffiti artwork.

    Clearly the reason is not simply bragging rights. This trend, which is topping many a managing partners agenda, is not just about making sure that instead of having space for armies of para-legals crunching data and documents, your office is capable of accommodating the AI- powered robo-adviser of the (not too distant) future. It is really about ensuring that your office is attractive to the current and next generation of professionals.

    This is the single biggest property-related issue facing all major law firm leadership teams today. And crucially, unlike many other legal market trends, this is an issue that is anything but restricted to suppliers of legal services.

    As Karl Warmbold, director of facilities and property at DWF (which won the most innovative use of office environment prize at the 2015 Law-yer Business Leadership Awards for innovations in its Fenchurch Street Walkie Talkie building) t

    Our biggest design decisions were on the communal client areasBambos Georgiou

    The 2016 edition examines the data, trends and innova-tions behind firms efforts to make their offices future proof.

    The Lawyer UK 200: Workspace Trends report

    To purchase the full report contact Richard Edwards on +44 (0) 207 970 4672 or email

    The feature staircase (above) was incredibly important to promote circulation and it really makes a statementDeborah Eastwood

    Maximising value is still high on firms workplace agendas but having state-of-the-art, inspirational offices fit for 21st century workers and clients is the new holy grail

    In association with

    Square. Were now the third largest office globally, even though just 25 per cent of our work is US linked.`

    Eastwood says the firm trialled a number of flexible and agile office arrangements in its old premises and it became clear that there was a pref-erence for cellular offices, but with plenty of com-mon areas for people to connect.

    We have standard sized two-person offices and, on the corners, three person offices, says Eastwood. Support staff are in an open-plan configuration. The feature staircase was incredibly important to promote circulation and it really makes a statement.

    At Bird & Bird over the summer the IP and tech-focused firm has moved into 147,000sq ft of new-build space over 12 floors at 12 New Fetter Lane. The building allows for 25 per cent growth and as the firms head of London Nicholas Perry points out, both lawyer work areas and client spaces have been redesigned.

    Old buildings often have spaces that cant be used productively and so there is wasted space, says Perry. Weve made a conscious decision to make every square foot work for us in the new building.

    The base build configuration is for a two-per-son workstation, but Bird & Bird achieves more flexibility by having moveable partitions and fur-niture solutions throughout the building that can be moved easily over a weekend to provide differ-ent configurations.

    It gives us the flexibility to make up team spaces as and when required for example, to create a temporary team space for those involved in a major tender exercise, adds Perry. There was a clear view of our direction of travel to have greater communication and collaboration.

    DWFs Warmbold confirms that this flexibility was key to the design both of the firms Walkie Talkie space and its Glasgow office, where


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    Under 15m15m-25m25m-50m50m-100mOver 100m

    Average annual UK workspace cost per person, segmented by UK revenue

    cost per partner cost per qualified lawyer cost per fee earner cost per staff member

  • The Lawyer | 12 September 201612

    Cover story UK 200: Workspace Trends executive

    number of firms that ever. Nowhere else is such a detailed analysis of the UK law firm real estate market available.

    The sample this year includes 105 firms with a combined fee income of 4.4bn and over 34,000 staff spending over 258m on 7 million square feet of offices in the UK. A third of this space (2.5 million sq ft) is in London.

    Where we have several years data from partic-ipating firms, it is possible to look at three-year trends which show a steady increase in the average cost per square foot from 36.71 in 2014 to 38.93 in 2016.

    The percentage change on 2015 is 1.03 per cent and on 2014 it is 6.05 per cent, suggesting that there has been a slowdown in the growth of average cost per square foot among the UKs larg-est law firms.

    The average percentage revenue allocated to real estate cost is 6.6 per cent with 39 per cent of the sample spending between 5 per cent and 7 per cent. What is interesting is that 8 per cent are pay-ing over 9 per cent of their revenues on real estate a very significant investment.

    Looking at the distribution of cost per square foot we can see that the majority of firms (57 per cent) are paying less than 40 per square foot. The average across the entire sample is 41 per sq ft. Just over a third (36 per cent) of firms in the sample are paying between 40 and 80 per sq ft. Only 6 per cent of the firms in the sample are paying more than 80 per sq ft.

    Highest users of spaceWhile the average amount of space used by the sample is 68,605sq ft there are significant differ-ences between the largest and smallest users of space.

    Last year, among those that provided data, the top five highest users of space with a combined total of 1,821,129sq ft were:

    Eversheds 572,000sq ftDWF 344,000sq ftClyde & Co 343,000sq ft CMS 295,000sq ftBLP 264,000sq ft

    the total space DWF now utilizes has reduced from 32,000sq ft to 18,000 (in London, where previously DWF operated out of two buildings, total space has reduced from 52,000sq ft to 43,000sq ft).

    We recognise teams often need to be together but the whole team doesnt necessarily need to sit together all of the time, says Warmbold. So, for example, if you have a team of eight we will allo-cate them a set of desks on a permanent basis but less than they need. So they could, for example, book four desks if half o