Firms operating in the Leeds market have been in a state of flux recently, with the region’s mid-tier firms taking advantage of the shrinking headcount at the larger players.
Despite troubling economic conditions in the Leeds market, Gateley was not deterred, and opened its Leeds office in January, marking the firm’s eighth office in the UK.
The move saw Gateley hire restructuring partner William Ballmann and finance litigator Rob Payne from Cobbetts to launch the office. Ballmann is set to run Gateley’s Leeds outpost.
Similarly, as LB was going to press, Dickinson Dees was due to relocate to Leeds from York, moving its 50-strong team into its new No 1 Whitehall Riverside office.
‘Making the move to Leeds was the obvious next step for us; we have big ambitions and are positioning ourselves for further expansion to meet our growth plans,’ said senior partner John Marshall.
‘There is definitely a greater sense of optimism in the Yorkshire market at the moment.’
Guy Jackson, Cobbetts
‘We will be making a number of key appointments soon,’ he added. ‘We have the capacity to double our 50-strong staff in Leeds.’
It’s an ambitious strategy, and one that seems to have worked for rival DWF which is now in its fifth year in Leeds and standing strong at over 200 employees.
James Haddleton, executive partner at DWF’s Leeds office, said: ‘We have been able to unlock potential in excellent people who may not have had the opportunity at previous firms because of a lack of growth there during the recession. We empower people to implement their ideas without fear of failure.’
The firm recently hired restructuring specialist Matthew Brown as an associate partner from Pinsent Masons to help boost its Leeds finance practice.
Brown said: ‘The challenge of establishing a new practice at a time of low growth for the economy is an exciting one. Firms with a compelling strategy they can properly articulate, which puts clients at the centre of the business, and can positively differentiate from competitors, will continue to find new clients and inspire loyalty in existing clients.’
The middle section of the market is growing. Perhaps to some extent it is shielded from the full force of the recession. The top end is affected by the squeeze on fees and the lack of M&A activity, while the bottom end is heavily reliant on small businesses, which haven’t prospered in the recession.
While much of the talent in Leeds is filtering down from the top firms, the mid-tier firms are also on hand to pick up the pieces from smaller players that have admitted defeat, such as Brooke North.
‘We were a victim of the recession,’ said Rodney Dalton, former senior partner of the defunct firm. ‘It wasn’t that we were losing clients, but property clients were doing less, restaurants were doing badly and owner-managed businesses on the whole were badly hit, therefore so were we.’
While Dalton opted to move his own practice to Lupton Fawcett, Brooke North’s private client and insolvency teams were taken in by Ward Hadaway just before Christmas.
‘The gulf between the giant [firms] and the small [firms] is getting wider,’ said Dalton. ‘The large firms have eyes outside of Leeds.’ He cited this as a key reason for departures from the ‘Big Six’ firms: Eversheds, Pinsents, Walker Morris, DLA Piper, Squire Sanders and Addleshaw Goddard.
This is a sentiment echoed by others. Paul Cotton, Leeds senior partner at Eversheds, agreed: ‘[The firm] has always been able to bring global work into the Yorkshire market alongside domestic work. We see the big squeeze in the market appearing at the lower value and volume end of the market, where we are not operating.
‘However, we have not taken our eye off Leeds. We remain committed to operating in our local market.’
It is fair to say that the Big Six as a whole may look solid from the outside but there are some cracks appearing.
Headcount numbers, for example, have been dwindling year on year, and this trend has continued in recent months. Eversheds saw a further key real estate partner, Morag Joyce, exit for DAC Beachcroft in July 2011, following a successful pitch by DAC Beachcroft for work for telecoms giant O2. The firm has already added an additional member to the team with further recruitment planned.
Cotton insists Eversheds’ real estate practice is now ‘the right size for the current market’.
Guy Jackson, corporate partner and head of the Leeds office at Cobbetts, said: ‘Although there is still a considerable degree of caution, there is definitely a greater sense of optimism in the Yorkshire market at the moment. It remains to be seen how much of that is translated into deals.’
Pinsents’ Leeds office senior partner Mark Owen said he is cautiously optimistic about the coming months. ‘As a property lawyer I am watching several very large projects that have been on hold for some time, such as the Trinity Quarter development in Leeds City Centre, now due to open in 2013,’ he said.
Owen added: ‘Those big developments need the confidence of public sector backing but we are also seeing increased movement in the private sector. The pipeline of corporate work is looking healthy through into late spring and beyond.’
Pinsents is to merge with Scotland’s McGrigors at the start of May, a move that Owen hopes will be of added benefit to an already strong Leeds practice.
For those not fortunate enough to benefit from such a network, Dalton offers the following advice in coping with a still-volatile market: ‘Keep your clients close as they’ll look after you when you need it. More people are bothered about their lawyer than they are about the firm.’