Because the stock performances of many property companies have been badly damaged by the increased trend towards investment in high-tech shares, the purse strings are being tightened. And some of the first to feel the pinch have been the law firms which advise those in the sector.
Consolidation, downsizing and buyouts are additional factors which have to be taken into consideration. As a result, there is a trend towards reducing panels to cut administrative costs. In March, for example, serviced office provider Regus announced it was slashing its property panel from 50 firms to just two.
The human touch is considered an important factor during the process of selecting firms. Slough Estates, for example, has stuck with the same firms for 80 years – Nabarro Nathanson for property and Lovells for corporate.
The property market is booming and many top firms have expanded their property teams during the last year. The leading players in the London market include Berwin Leighton, Linklaters & Alliance, Ashurst Morris Crisp, SJ Berwin, Herbert Smith, Nabarro Nathanson and Clifford Chance.
There is no doubt that there is plenty of work for firms in this sector. The problem is being able to meet the demands for increasingly higher levels of service, often at a lower cost, in an area which is traditionally known for its low returns.