- The NWDA’s new panel gives a welcome local boost
- Leeds winds down as Liverpool and Manchester muscle in
- Irwin Mitchell lands in Manchester with PI focus
In-house: 6 Feb
Management: 13 Feb
The bar: 20 Feb
Regional: 27 Feb
The North West, as anyone in and Liverpool Manchester will tell you, is in the grips of regeneration fever. New buildings are springing up across the region; cranes dominate Manchester’s skyline.
So the recent announcement of the North West Development Agency’s (NWDA) new panel is timely. Unlike many recent panel announcements, the NWDA’s list of outside counsel has actually got bigger, growing from four firms to six. This is despite legal services head Steven Zdolyny’s aim of keeping external spend down.
Celebrations were in order for retained advisers Eversheds, Mace & Jones and Wigan firm Platt & Fishwick. Meanwhile Beachcroft Wansbroughs, Hammonds and Warrington firm Forshaws are cracking open the champagne to celebrate new NWDA panel places. Zdolyny purposefully picked two large, two medium and two small firms to allow choice and competition for whatever work comes up.
The panel was bad news for Addleshaw Goddard though. The firm first started doing work for the NWDA in 1998, when the eight regional development agencies were established. It was reappointed to the panel in 2001 – but not this time: the firm lost out because it was simply too expensive for the NWDA.
The selection could not have come at a better time for Hammonds, which is on its way back up in Manchester, as in all of its offices after its annus horribilis last year. The Manchester office remained fairly stable during 2005, with its major loss being construction partner Nigel Proctor to Addleshaws. Salaried litigation partner Michael Isaacs has also just left Hammonds for the same destination. But Hammonds is fighting back and has recently hired Addleshaws legal director Jackie Heeds, plus an associate, to start rebuilding its construction team. Panel wins such as the NWDA can only help that process.
Money in Manchester
The financial year-end will be awaited eagerly by North West firms after half-year results showed encouraging growth across the region. Brabners Chaffe Street led the way with a turnover rise of more than 20 per cent. The firm looks likely to break the psychologically important £20m barrier for the first time in 2006. Brabners is ploughing ahead with expansion in a quiet, understated sort of way, carrying out small corporate and property deals for clients such as Royal Bank of Scotland (RBS).
The rest of the region also reported rises in income. Cobbetts and Hill Dickinson both look set to better last year’s results, each firm billing more than £24m in the first half of the year. Halliwells is on course for another record year of growth, aiming for £60m.
The extra income is coming from a buoyant corporate market. Firms at both ends of the spectrum – from Eversheds’ 380-strong Manchester office down to the smaller commercial practices – are busy doing deal after deal. Development and property work are, of course, strong, but M&A and corporate finance are also going well. Eversheds reports transactions worth several hundred million pounds in the past months and other firms are also closing significant deals. Indeed, Manchester could well be challenging Leeds as the legal business centre of the North. It seems only a few years since Yorkshire’s biggest town was trumpeted as a new financial capital, attracting millions in investment as the banks moved in. Now the growth across the Pennines has stagnated as attention returns to the North West. RBS recently moved into brand-new headquarters in Manchester’s Spinningfields development, an area that is fast becoming the Canary Wharf of the North. A new Civil Justice Centre and magistrates’ court are being built in Spinningfields too; next year Halliwells will be the biggest law firm to take up residence in the area.
Manchester is not the only North West city doing well at the moment: Liverpool, although perhaps a decade behind its larger neighbour, is beginning to catch up and is providing ample opportunities for law firms. Weightmans and Brabners are both long-established Liverpool firms, and the bulk of their business still comes from the city.
The dynamics in Liverpool are changing, though. The arrival of Halliwells in January 2005 and its subsequent series of focused raids on DLA Piper Rudnick Gray Cary’s Liverpool office has shaken the market up. Halliwells now has more partners than DLA Piper in the city, and questions continue to be asked about DLA Piper’s commitment to Liverpool.
One North West firm is streets ahead of the rest when it comes to revenue generation: Liverpool-based Silverbeck Rymer has just four partners, but its 172 fee-earners bring in £16.4m per year. That equates to revenue per partner of £4.1m, unparalleled by any other firm in the UK. The key to Silverbecks’ success is no secret – it deals with volume insurance claims, and a lot of them. Corporate and commercial firms cannot hope to compete with that model, and most will not want to.
North West attracts Irwin Mitchell
Personal injury (PI) firms have always done well in the North West. Pannone & Partners, Weightmans and Rowe Cohen are all local firms with significant PI practices. Now Manchester is being invaded by the UK’s biggest PI specialist, Irwin Mitchell.
The firm admitted in January that it has plans to open a new office in Manchester in the spring, staffing it with existing Irwin Mitchell lawyers who have ties to the area. Managing partner Howard Culley says the plan is to undertake claimant PI and clinical negligence work, thus setting Irwin Mitchell up in direct competition with firms such as Pannones.
But the incumbent specialists probably should not get too worried just yet. Although Irwin Mitchell is easily the largest claims-handling solicitors firm in the country, Culley admits that Manchester will be a small office. He compares it to the firm’s Newcastle operation, cold-started in 2002. In February 2004 Irwin Mitchell invested in extra space for Newcastle, which at that time had 10 lawyers. Office head John Davis said at the time that he planned to quadruple the size of Newcastle in two years; two years on, the firm has three partners and eight solicitors practising in the North East.
Irwin Mitchell’s imminent arrival is not the only change in the Manchester PI market. In November Pannones completed a speedy merger with local two-partner firm Johnson Yates, adding around £1m of work to its £33.5m turnover. Johnson Yates has been a victim of its own success. Formed in early 2005 by David Johnson and Gregory Yates, the firm amassed too much work to handle in only a few months and needed the support of Pannones to survive.
Rather conveniently, Johnson Yates’s Manchester office is just across the road from Pannones, making it unnecessary to merge premises for the time being. If only all mergers were so mutually beneficial.