2018亚太地区法律机构展望报告（英文版）_26页_2mb

Law Firm Trends and Outlook Report 2018 Summary

Core Content

This report provides an overview of the current trends and outlook for the legal sector across key Asia Pacific cities, including Beijing, Brisbane, Hong Kong, Melbourne, and Shanghai. It highlights the impact of mergers, competition, cost pressures, and the increasing importance of workplace innovation and culture on the legal industry's real estate and operational strategies.

Main Trends and Key Insights

1. Mergers and Market Consolidation

• Law firm mergers are reshaping the legal landscape, especially in Asia Pacific, with firms seeking to expand internationally and improve service delivery.
• Mergers have led to changes in office accommodation and lawyer mobility, particularly during the integration phase.
• The trend of decentralisation is evident, with firms moving from traditional central locations to more cost-effective and flexible areas, such as Quarry Bay in Hong Kong.

2. Workplace Innovation and Flexibility

• The legal sector is increasingly adopting flexible workspace configurations to enhance productivity and attract talent.
• Work-life balance and a sense of purpose are becoming key priorities for legal professionals, prompting firms to rethink their office environments.
• Some firms are experimenting with open-plan layouts, shared spaces, and office sharing to reduce overheads and increase efficiency.

3. Talent Demand and Retention

• Legal talent is in high demand in specific sectors and niches, particularly those related to real estate, infrastructure, aviation, and structured finance.
• Mandarin language skills are becoming more important due to China's growing influence in the region.
• Firms are also focusing on offering clear career paths and transparency in promotion and relocation opportunities to retain talent.

4. Non-Traditional Legal Hubs

• Non-traditional legal hubs are emerging as an alternative to traditional office spaces, offering competitive commercial terms and cost savings.
• These hubs are particularly attractive for firms looking to reduce real estate costs and enhance operational flexibility.

5. Impact of Technology and AI

• Advances in technology and the adoption of Artificial Intelligence are expected to drive innovation in the legal sector.
• These technologies will indirectly influence space requirements due to increased automation and efficiency in legal operations.

6. Market Dynamics and Real Estate Costs

• Real estate typically accounts for 10–15% of overheads, making cost control and space efficiency a priority.
• Firms are increasingly using data and analytics to make informed decisions on office space and talent management.

Key Locations and Market Outlook

Beijing

• Preferred Locations: Chaoyang CBD, including buildings like China World Trade Centre and CP Center.
• Market Outlook: Expected to see increased Grade A office supply and rising vacancy rates in the CBD by 2021.
• Legal Sector Activity: International firms are downsizing, while domestic firms are expanding, contributing to the growth of the legal sector.
• Market Data: 6.8% of Grade A CBD buildings are occupied by law firms, with a vacancy rate of 4.8%.

Brisbane

• Preferred Locations: Golden Triangle and Eagle Street for large firms, with the North Quarter preferred for specialized practices.
• Market Outlook: Vacancy rates have increased, but the market remains tenant-driven. New developments may offer opportunities for firms to upgrade.
• Legal Sector Activity: A trend of larger firms merging with smaller ones has increased sub-lease space availability.
• Market Data: 4.0% of Grade A* buildings are occupied by law firms, with a vacancy rate of 13.2%.

Hong Kong

• Preferred Locations: Central remains the main hub, but decentralisation to areas like Quarry Bay and Aberdeen is on the rise.
• Market Outlook: Strong rental growth is expected in 2018, with limited supply on Hong Kong Island.
• Legal Sector Activity: A shift towards more efficient space utilisation and decentralised shared service centres is observed.
• Market Data: 6.8% of Grade A CBD buildings are occupied by law firms, with a vacancy rate of 2.3%.

Melbourne

• Preferred Locations: Collins Street and the Eastern CBD for prestige and accessibility.
• Market Outlook: Supply is limited, leading to upward pressure on rents. Pre-commitment activity is high, with many new developments leased early.
• Legal Sector Activity: Legal firms are securing large premises in Premium Grade developments, with a focus on brand image and client access.
• Market Data: 6.8% of Grade A* buildings are occupied by law firms, with a vacancy rate of 4.6%.

Shanghai

• Preferred Locations: Jing’an District for international firms, with Lujiazui and Xintiandi as secondary locations.
• Market Outlook: Vacancy rates are high, leading to negative rental growth in 2017. Stability is expected in 2018, with opportunities for cost control.
• Legal Sector Activity: International firms are adopting more efficient layouts, while domestic firms are expanding and upgrading.
• Market Data: 1.9% of Grade A CBD buildings are occupied by law firms, with a vacancy rate of 13.9%.

Conclusion

The legal sector in Asia Pacific is undergoing significant transformation driven by mergers, competition, and the need for cost efficiency. Firms are rethinking their office strategies to align with modern work practices and the expectations of new generations of legal professionals. The integration of technology and the rise of non-traditional legal hubs are also influencing the real estate landscape, prompting a shift in location preferences and space utilisation. As the market continues to evolve, firms must remain agile and forward-thinking in their approach to both talent acquisition and office management.