Posted 26 February, 2015 OBI BLOG
Since OBI launched five years ago, probably the most active part of the office market has been the legal sector. Throughout the economic downturn, there remained a decent level of activity, when we worked on deals including that of McGrigors before its merger with Pinsent Masons, and George Davies, now part of Mills & Reeve. The rest of the market has caught up, but over the last couple of years it was largely the law firms making the running, taking up large floorplates in what’s been a market of dwindling supply, and increasing a sense of urgency elsewhere – the message to occupiers has become clear: if you want a choice of offices, better get your skates on.
Key Manchester deals have included Browne Jacobson, Berwin Leighton Paisner, and most significantly Slater & Gordon, represented by OBI in acquiring their largest UK office with 105,000 sq ft at 58 Mosley Street. The momentum has continued with DLA confirming in December that it will take 44,880 sq ft at One St Peter’s Square. Addleshaw Goddard, Shoosmiths and Squire Patton Boggs might be the next to make a move.
The story really lies in the way law firms are changing. They are conscious that the law firms of old are, however unfairly, often seen as conservative and middle of the road, an issue that other parts of the professional services world will be familiar with.
Time and again we’ve spoken with principals who’ve stressed that the days of partners cloistering themselves in oak-panelled rooms, complete with huge desks and Don Draper-style drinks cabinets, , are long gone. The war for talent is fought every bit as keenly in this sector and the smarter operators know that that’s a turn-off.
In fact, law firms are as open-minded about the workplace as anyone we work with. They want to be open-plan, they want to improve lines of communication, they want a modern-looking space, and a mix of meeting spaces. It’s still important, of course, to have the options of private and confidential areas, given the work involved. But the space has to be welcoming for clients and visitors too, and firms are going the extra mile – all power to those like Pannone Corporate, who are really going for it with a spectacular new space at The Chapel in Castlefield – this strong independent Manchester firm is showing how a firm’s choice of real estate can reflect and strengthen further its brand and culture.
The whole landscape is changing – following legislative change, accountancy firms can now work in the legal services field, and EY have joined PwC and KPMG in what’s already a busy market. And Manchester continues to attract new entrants in various ways, whether it’s a firm like Nabarro picking up a local senior team; a firm merging with a well-respected regional boutique (Field Fisher Waterhouse and Heatons); or launching from a strong base elsewhere, like TLT.
Already this year, global firm Latham & Watkins have announced a new Manchester office, while rumours are hotting up on the imminent arrival of one of the “Magic Circle” firms in the city. The market may be crowded, but the reason for that is simple – there’s a lot of work to go for and business to be won. Let battle commence.