News

Predicting the Future of the Business of Law

By Tracy Schorn

October 25, 2017

The Washington Business Journal and the Antonin Scalia Law School at George Mason University hosted “The Business of Law” on October 12,  a panel discussion on D.C.’s changing legal landscape.The Washington Business Journal and the Antonin Scalia Law School at George Mason University hosted “The Business of Law” on October 12, a panel discussion on D.C.’s changing legal landscape. From left to right, James MacGregor of the Washington Business Journal (moderator); John Niehoff, partner, Baker Tilly; Joshua D. Wright, professor, Antonin Scalia Law School; Elizabeth Cooper, international director for Jones Lang LaSalle Brokerage, Inc.; Barry F. Levin, managing partner, Saul Ewing Arnstein & Lehr LLP.

How can lawyers best prepare themselves for an ever-changing legal landscape? Will rents fall with a glut of law offices in the D.C. real estate market? And will robots someday do our jobs?

These were just a few of the questions raised at the October 12 “The Business of Law” panel discussion hosted by the Washington Business Journal and the Antonin Scalia Law School at George Mason University. Panelists included John Niehoff, partner at Baker Tilly Virchow Krause, LLP; Joshua D. Wright, professor at Antonin Scalia Law School; Elizabeth Cooper, international director for Jones Lang LaSalle Brokerage, Inc.; and Barry F. Levin, managing partner at Saul Ewing Arnstein & Lehr LLP. Washington Business Journal market president and publisher James MacGregor served as moderator.

Takeaways from the hour-long discussion:

Real Estate 

In 2007 law firms were 28 percent of the real estate stock in Washington, D.C. Today it is 23 percent, and Cooper predicts that by 2024, that number will be down to 19 percent.

What to do in a contracting market? Realize that the era of the gargantuan, overbuilt law firm is over, said Cooper. The future is flexibility and “right-sizing” spaces for greater efficiency. Real estate is the second largest expense for law firms, said Cooper, and with so many pressures to be profitable, rent and office size are one area where firms are looking to cut costs.

“Rents will fall,” predicted Cooper. “We have too much supply” of older, less-efficient work spaces. Cooper said she tells firms to be open to repositioning themselves out of the city to save money, but “firms don’t pioneer. They won’t go across the river. You can only reduce so much. There is only so much right-sizing that can happen.”

Cooper also advises firms to pay attention to termination rights on leases, so they’re not stuck with a sublease. “Know what you want so you can get out,” she said.

Overall, Cooper was bullish about the future, and predicted that growth in the national economy would be a boon for the legal profession in D.C. 

Changing Law Practice 

With online legal providers like LegalZoom and Rocket Lawyer taking a chunk of market share from solo and small-to-midsize firms, “Clients are focused on ‘are we getting value?’” Levin said.

The solution to that challenge is knowing your client’s needs, and specializing to meet those needs. “We don’t want be ‘an intergalactic’ firm. It’s not what clients want,” said Levin.

For Niehoff, there are three future areas he sees changing the legal profession: growth through specialization, operations of efficiencies (such as changing fee structures), and competition changes from technology. 

Artificial Intelligence 

Speaking of technology, are robots going to eat our proverbial lunch? No, said the panelists. Law firms “will adapt.”

Lawyers should “embrace” the change, said Niehoff. “It will be huge. Like another tool, like Westlaw was to law books.” But he warned adapting to AI is going to be a “bumpy ride.”

Wright advised lawyers to position themselves as specialists to “compete against those technologies.” AI will replace some legal work, but “it depends on the lawyer skills.” If it’s esoteric enough, presumably robots can’t do it.  

Law Schools 

How can we train a new generation of lawyers? “I predict contraction on law schools. There will be more competition to get into the top 100, and some will be left without a chair,” said Wright.

For those schools not in the top tier, “the future is specialization.” Law schools can distinguish themselves with online courses in concentrated areas of study that appeal to a virtual, global student body.

It’s a brave new world. But with any luck, maybe rent will be cheaper.