Manage a law firm for long enough and you will inevitably face the following question: What do we do with this office space? Walking past a sign in our building lobby recognizing our firm’s 20 years as a tenant reminded us that we last faced that question five years ago, before COVID. Our office embarked on a six-month renovation that made significant changes to our space. There were many decisions to be made given the changes in our firm and in the practice of law in the 15 years since we moved into the space. How much space did we need? What functionalities were important? Are we renovating for the current occupants, those to come or some combination of both? What can we do to the office space to help lure new talent? In this post-COVID world, these questions are top of the mind for all law firms.
We brought these questions about the trends in renovations of law firm offices to our friends at STO Building Group, a longtime builder of law offices for top 100 Am Law firms across the country. They had several insights worth sharing.
“Data is showing that law firms are spending exponentially more on A/V systems and amenity spaces, which is changing what a law office looks like,” says Sarah Hoff, vice president of Client Strategy at STO Building Group. “It sounds simple, but people will want to be in the office if it helps them get their work done more easily and they enjoy the space.”
Hoff says the productivity component is driving many office design decisions, from higher-end A/V systems to a wider variety of working spaces. Spaces that used to be reserved for large conference rooms and private offices are now being broken into smaller meeting areas with sophisticated collaboration tools and individual workspaces with larger computer monitors—all giving employees more effective technology than most can get at home.
Attractive amenities can draw employees to the office. The pandemic has driven a “flight to quality” in which firms are looking for more modern, higher-end spaces. Hoff explained that contractors are currently building office spaces that feature amenity areas typically seen in a luxury hotel. Sustainability and wellness are also high on the expectation list. Outdoor spaces, more natural light, clean air and wellness rooms are becoming popular features in the offices.
With the flight to quality idea in mind, Hoff says now is the time to leverage spending on office construction to maximize the space. Hoff explained that the trend with tenants is moving away from short-term renewals to executing more new leases. “What was once a paint-and-carpet upgrade is now a paint/carpet/audiovisual upgrade and reconfiguration.”
We know that attorneys rely less and less on paper and administrative support, reducing the need for filing cabinets, copy rooms and secretarial bays. Private offices also don’t have the same allure as they did in the past. These trends are translating in law firms to reallocating space for the amenity and collaboration areas or reducing the footprint altogether to focus on upgraded spaces.
Another trend that Hoff noted is the emergence of separate “showcase” spaces and “working” offices as law firms followed their tech clients to emerging markets. Many large law firms are moving back-of-house departments to smaller cities that have a lower cost of living and real estate, while using a smaller office footprint in the client-facing, marquee offices in large urban areas.
Hoff’s firm is also seeing additional trends affecting office renovations that are less tied to the space design and functionality.
Mitigating risk. Post-COVID instability in the economy and supply chain still lingers. While the supply chain for construction materials is beginning to stabilize, lead times remain long, and labor challenges remain. Hoff sees many specialty subcontractors who took advantage of PPP loans to keep afloat facing default on those loans. As a result, finding qualified, solvent subcontractors is taking longer and requiring more due diligence.
Softening costs. David Hamilton, vice president of Purchasing at STO Building Group, told us that construction costs are finally softening. Law firms interested in beginning projects now can potentially leverage those savings.
Hoff recommends engaging your construction team early to help mitigate your risk and better understand the impacts of these trends on your decision making.
Yes, law office renovations are expensive, disruptive and fraught with decisions that can be difficult to navigate among a group of lawyers with varying opinions. However, the benefits to efficiency and morale will make the effort worthwhile. Good luck with your projects. Let us know about your experiences.
