colliers 2014 law firm workplace trends

Colliers Law Firm Practice Group

PREPARED BY:

Steve Levitas, Principal

Bob Chodos, Principal

2014 LEGAL WORKPLACE TRENDS

P. 1 COLLIERS INTERNATIONAL

LEGAL WORKPLACE TRENDS

WORKPLACE TRENDS

Colliers has been successfully implementing the latest workplace trends and strategies for many of its law firm

clients around the world. Colliers’ partners with our clients to develop and implement workplace strategies that

support the mission of the business, increasing productivity, positively impacting recruiting and retention, leading

to greater profits for the firm. The general trend for all law firm occupiers is planning for a higher employee

density in their space utilization which results in a compression in the overall amount of space the firm occupies.

To achieve this goal law firms are employing innovative planning techniques and strategies which are described

in detail in this section. Colliers mission on every law firm project is to help our client determine which of these

innovative trends are appropriate for the firm’s culture and then develop a strategy which can be implemented to

achieve an optimal real estate solution.

OCCUPIER STRATEGIES

Law firms today are becoming increasingly focused on developing strategies to reduce overhead costs, one of

the most significant of which is occupancy expense, while improving their work place environment. When

deployed, these alternative workplace strategies can have significant cost/savings implications from both capital

expenditure and space utilization perspectives. They can also create distinct cultural challenges to a company’s

operation, which need to be carefully considered.

Some of the more progressive workplace strategies that corporate occupiers are implementing today to increase

space utilization and improve their workplace performance include; open planning for all or most employees

with use of dense benching workstations, access to natural light for all employees, interior offices or

team rooms with glass fronts, free addressing and un-assigned workspace made possible by technology

that permits un-tethering from phones and desktop computers, meeting areas and conference rooms

dispersed throughout the space in much higher ratios, hoteling and universal offices. Some of these

trends would be a fairly radical change for a law firm workplace that is typically perimeter private offices with

limited access to natural light into the interior zones of a floor plate, but the more progressive firms are

embracing some of these techniques to reduce their square foot per Attorney ratios cutting costs but also

improving the quality of the workplace environment for attorneys and support staff.

Balancing these “current state vs. future state” concepts resides at the core of the creation of a functional real

estate strategic plan.


WORKPLACE PERFORMANCE

A key differentiator for the Colliers team is our focus in the area of workplace performance and what really goes

on “in” the real estate, rather than focusing on just traditional real estate transaction metrics, such as occupancy

and capital expenditure costs. Today’s workplace is experiencing massive change, thanks to demographic shifts

in the workforce and advances in technology. The hierarchy-led philosophy created by the Baby Boomer

generation led to a more traditional, silo-based and immobile work space environment. That is rapidly changing

to a future state which is focused on technology, mobility, collaboration, culture and brand, driving space design

and utilization. Progressive companies are asking themselves a key question related to their office space:

“What do you need in the workplace today to leverage these trends and build for the next

generation workforce?”

Given the capital-intensive nature of creating space, this key question is driving a lot of discussion at companies

across the U.S. and around the world. In Europe and Asia, most companies have already embraced and

adopted many of the more progressive occupancy strategies, as custom and high-rent structures have forced

these issues to the forefront.

Colliers’ 80/20

Colliers 80/20 approach is focused on the early stages of the strategy development process at the front end of

the real estate selection process. The goal up front is to establish a team and mindset that is targeting well-

crafted real estate solutions and can positively impact a firm’s 80% revenue engine; e.g. the people and

business processes residing within the office environment, the technology those people use that allows them to

be mobile and collaborative, the brand of the firm and the message the space sends to the firm’s employees,

clients, and visitors about its culture.

THE NEW WORKPLACE: The 80/20 Approach

In addition to cost this project is about:

Real Estate

7.0%

Information

Technology

8.0%

Revenue Engine

80.0%

Operations

5.0%>Productivity

>Knowledge-sharing

>Recruiting/Retention

>Generational shift

>Demographics

People

Brand>The “Blink” factor

>Real estate as brand icon

>Corporate Messaging/Culture

>Work anytime, anywhere

>Cloud – WiFi – Mobile

>Social Media

Technology

>Now vs Future

>Business cycles change often

>Real estate not agile or flexible

Risk


THE NEW WORKPLACE: Critical Trends

The last of these trends is the one that catches the eye of every law firm’s executive director, COO and CFO that

we work with. They continually ask us:

“How do we maximize the use of these offices that I see empty so often, as our employees are

out of the office often meeting with clients on the road or working remotely much more frequently

these days?”

To maximize the use of this inventory of potentially available seats engenders a number of deeper questions that

companies have historically avoided. The idea that a employee might not actually have a fully-assigned seat

within the office at all times can have an impact on the culture of company. However, these are the strategies

that are being deployed by forward-thinking corporations today to leverage their real estate to and improve

employee productivity.

What is driving the need for change in today’s workplace? The changing demographics employee pool in the workplace is the primary driver. The following charts tell the story best.

CRITICAL TRENDS

SHAPING CRE &

WORKPLACE

SPACE REDUCTION

5

75% OF APPS WILL BE IN THE CLOUD (2015)

100b+ GLOBAL MOBILE DEVICES

50% WORKFORCE – Y MILLENIALS (2016 - 2018)

80% WORK HIGHLY COLLABORATIVE (2015)

40% OF WORKSPACE IS OCCUPIED (today)


THE NEW WORKPLACE: Demographic Transformation

The majority of Baby Boomers are expected to retire by 2016 – 2020.

Millennials will become a more dominant workgroup during this transition.

BOOMER1946 - 1965

GENERATION X1965 - 1980

MILLENNIALS 1980 - 2000

TRAIT Optimistic Skepticism Empowered

LEADERSHIP STYLE Consensus Consensus Non-hierarchical

CAREERCompetitive,

change agents

Resourceful, self

manage

Cutting-edge vs

experience

VALUE Opportunity FreedomDiversity and social

responsibility

REWARDSMoney, title and

perks

Transferable benefits,

flexibility and balance

High pay, interesting

work and

work/life balance


WORKPLACE TRENDS

• Space reduction of 15-32% for AMLaw 200 firms that are re-working their space

• 1:4 Admin to Attorney Ratios

• Many firms moving to single size offices

• Hoteling is not widely used other than for Retired Partners and Of-Counsel’s but dedicated offices are not going away any anytime in the near future

• Firms are exploring putting first and second year attorneys in workstations.

• Target Attorney per SF Ratios are 650 SF/Atty or below

• 40 – 50% of office space is occupied at any given time

• Mobility is about options – not giving up desks

• Workplace needs to facilitate untethering from hardline phones and desktop PC’s – wireless environments

Outsourcing:

• 48% outsource E-Discovery

• 35% outsource document review

• 18% outsource legal research

• 8% are offshoring some or all of these functions

• Many firms are near-shoring support functions, (marketing, accounting, HR, etc.)

• Hoteling not widely used by most firms

• Telecommuting – used at varying levels for attorneys – some pilot Programs for staff

• Virtual support – Admin’s from different offices support large numbers of attorneys virtually, 3:50 in one example

• Online knowledge-sharing platforms such as SharePoint, Firmex, Xerdict and Mavenlink becoming more

common

• Many clients requesting E-Billing, software to track expenses - Chrome River

• Document scanning and management systems

• Expanding use of non-attorney Project Managers to run processes for teams working on cases or deals, Six Sigma approach

Space Utilization Strategies today center on:

• Universal office vs. multiple office standards

• Bringing daylight off the perimeter to interior zones – glass front offices

• Use of group zones for war and work room teams

• Using furniture and demountable wall systems to create flexibility


UNDERSTANDING THE POSSIBILITIES

Contemporary and Modern

Below are two examples of what was a typical corporate or professional services environment showing the

prevalent use of glass on the exterior office fronts bringing much-desired natural light into the interior of the

space. The use of demountable wall partitions on both the exterior and interior zones allow offices and

conference/team rooms to be reconfigured as the company’s needs change creating flexibility in otherwise

inflexible real estate


New Workplace

The examples below show the “open” planning design concept that is becoming the standard for many

coporations in America. The open plan concept caters to the Millenial worker and fosters collaboration,

unthethering and mobility in the work place. The 2nd

image shows the bench seating workstations that have

become prevalent in the design for many open plan users and has allowed space requirements to decrease

dramatically versus the traditional workstation.


Amenity Spaces

Cafeteria and food service areas are also being widely used by many law firms to bring their employees together

to create a collaborative environment and for informal and formal meeting spaces. If the employees tend to

cluster around food service areas, that environment should foster collaboration and idea sharing.


Amenity Spaces – Fitness Center

The majority of us spend a large portion of our lives at work, many of us sitting sedentary behind a desk. Many

firms are promoting fitness at work and encouraging coworkers to utilize on-site facilities to stay healthy. Firms

with Corporate Wellness Programs also get the added benefit of lower health insurance premiums.


Conferencing

The use of glass to bring light and air into the conference areas and informal meeting areas dispersed

throughout the space are designed trends that are being widely deployed. The technology is moving toward

wireless environments with the exceptions of video conferencing and telepresence rooms. On-line reservation

systems for the conference rooms allow employees to reserve rooms quickly and efficiently. Larger rooms that

can be used to hold ”all-hands” meetings or training sessions and then be divided into smaller rooms with

moveable partitions are also popular design features.


CONTACT DETAILS

STEVE LEVITAS BOB CHODOS

Principal Principal

Chairman – Law Firm Service Group Chairman – Occupier Advisors

Colliers International Colliers International

DIR +1 312 612 5906 DIR +1 312 612 5902

MOB +1 312 479 2300 MOB +1 312 310 4133

MAIN +1 312-648-6150 MAIN +1 648-9150

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