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Stay or Go? Hogan Lovells and Mayer Brown Decide Differently

Renovate or relocate?

That’s the question faced by many firms when contemplating whether to renew a longstanding office lease or move. Existing space often doesn’t comport with the newer ways lawyers and staff use an office. But with rents often a law firm’s second biggest expense after compensation, the decision is complicated.

On top of the economic concerns, tastes have changed. Big corner offices have become passe, as most firms opt for a more egalitarian setup. Libraries and big secretarial spaces are relics of a pre-digital age, replaced by areas for group meetings or places to work that can more resemble a Starbucks than a utilitarian conference room.

And most firms, whether they stay put or move, are using less space.

“Virtually everyone is taking less space, typically 10 to 15 percent less,” said Doug Zucker, the head of the law firm practice at the design firm Gensler. “Even though rents are on the upswing, if you can reduce your square footage you can keep rent costs the same.”

It’s not always clear that an older space can be renovated economically to accommodate current needs. Hogan Lovells and Mayer Brown are two of the firms that confronted these issues and came to different conclusions.

Hogan Lovells has occupied space in the same building in Washington since 1987, when the firm was called Hogan & Hartson.  Emily Yinger, the managing partner for the Washington offices of Hogan Lovells, said her firm weighed all its options. The current location was so good that no one wanted to relinquish it for a new building.

As a result, the 500 lawyers and 550 support staff are living through a multistage renovation of their eight floors, Yinger said.

“We started planning the renovation three years ago,” she said. “We talked to space consultants about how other professional service firms were using space differently, how could we be more efficient and how, going forward, we could make the space more flexible so we could adapt to future changes.”

As at many other firms, the changes include reducing the firm’s footprint, Yinger said. “We’re giving up roughly a third of our space, although we are planning for future growth.”

For Mayer Brown’s New York office, the partners decided that relocation made more sense. The firm has about 225 lawyers in midtown Manhattan and plans to grow. It will also decrease its space from 210,000 to about 190,000 square feet, New York managing partner Richard Spehr said Wednesday.

“We contemplated staying, but we would have had to renovate space which hadn’t been renovated since the 1980s,” he said. “This would have required us to move off premises for some time, creating very significant disruption.”

In addition, Spehr said, they wanted to move from Broadway and 52nd Street, and an opportunity arose to lease in “what we perceived to be a more elite address, the McGraw-Hill Building.”

Spehr, like Yinger, declined to disclose lease costs. Spehr said only that “it made economic sense to move.”

Mayer Brown has already moved into its new space, while Hogan Lovells has one floor out of eight completed. Both have enhanced conference areas and communal spaces.

Office size has also changed for both firms. Spehr said Mayer Brown decided to have two sizes — one for partners and another for associates. Hogan Lovells made all attorneys’ offices equal, Yinger said.

“When we first announced that everyone would have a 165-square foot office, there was some fear,” Yinger said.

“But there were so many other amenities that lawyers would get: more collaborative space, huddle rooms and a big seating area where you can pull in and work. Because of those amenities, at the end of the day the notion of single-size offices was OK with everyone.”

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