Expansion squeezes firms out of the City

By Paula RohanLondon law firms which are looking to expand face being pushed out of the City owing to a lack of office space, and risk losing up to two-thirds of their workforce, two pieces of research have concluded.Chartered surveyors and commercial property consultants Kinney Green questioned 18 top firms, and found that more than half expect to expand by up to 18% over the next two years.

These include Berwin Leighton Paisner, which is looking for around 230,000 sq ft of office space.

All the firms said they will need at least 10% more space, and may have to leave the prestigious Square Mile - as Clifford Chance is doing - for areas such as Docklands to avoid high rents.However, most firms said they considered a City location to be of prime importance, with 50% rating it as a 'very important' factor in recruiting staff.But international property advisers GVA Grimley, which interviewed 200 lawyers, bankers, and media and marketing professionals who work in the capital, found that moving from the City was unpopular with employees.

GVA Grimley's findings revealed that while 84% of lawyers prefer a private office as opposed to the more cost-effective open-plan option used by other professionals, on average a quarter would be put off by the idea of moving from the City to achieve this.

This figure rose for east London locations like Stratford, with 65% saying they would consider leaving their job to avoid such a move.

The most common worry cited was increased travelling time.GVA Grimley's London regional senior partner, Stephen Robinson, said law firms may have to increase salaries if they want their workforce to survive moves intact.

'In the current employment market, a good lawyer will not find it hard to get an alternative job working more centrally or somewhere with better facilities,' he said.

'Possibly, high property costs, like rising salary bills, are just an inevitable burden law firms must bear if they are to remain competitive.'Charles Pollock, property partner in Simmons & Simmons, who moved into City Point last year, said he sees lack of space in the City as a growing problem.

'For a larger law firm trying to relocate, there is definitely a difficulty,' he said.

Clifford Chance will move to the Docklands in 2003 to cater for an extra 50% required space.

Amanda Burton, chief operating manager for London at Clifford Chance, said the firm does not anticipate problems with staff but has yet to focus fully on the issue.