In the face of sliding credit markets and fewer corporate deals, England's top firms still saw revenue growth in the first quarter of 2008, according to a report released Sept. 1 by Deloitte Touche Tohmatsu.
Deloitte's Quarterly Legal Sector Survey said that the top 10 U.K. firms showed particular resilience during the quarter ending July 31, 2008, when they enjoyed 11.1 percent growth; the top 100 firms saw a reported 6.3 percent growth. (A recent study by Citi Private Bank found that revenue growth for 175 U.S. firms was just 4.8 percent.) But the slowing legal economy is hitting all the firms across the pond. While annual revenue is up for British firms, the rate of growth slipped from last quarter, when the top 100 firms reported 12 percent growth. Overall, the study found that the strongest firms were staying afloat through overseas work in the Middle East, Asia and Russia.
"The sector faces a challenging year with tough economic conditions expected to continue for the foreseeable future," says Jeremy Black, associate partner in Deloitte's professional practices group in a statement. "However, in such an environment, average growth of over 6 percent is still impressive and reflects the resilience of the industry to the downturn."
Black noted that real estate practices were hit the hardest by the economic slowdown, but litigation practices fared better. He cited the most growth from firms with thriving practices in China, the Far East, Middle East and Russia.
The Magic Circle firms seem to have already learned this lesson. Clifford Chance, Linklaters, Allen & Overy and Freshfields Bruckhaus Deringer all have offices in Russia, China and United Arab Emirates, and only Linklaters lacks a Saudi Arabia office.
"We will continue to increase our focus across the wider region, with particular emphasis on Russia and the Gulf region," Nick Eastwell, regional managing partner of the emerging markets group at Linklaters, tells The Am Law Daily.
Reinforcing the trend, Allen & Overy announced Monday that it has added a combined 20 lawyers to its offices in Dubai, Abu Dhabi and Riyadh -- pushing its overall total of lawyers in the Middle East to more than 100. Freshfields introduced an office in Abu Dhabi in June, where Clifford Chance had already opened its doors in January. DLA Piper augmented its Dubai practice with one in Abu Dhabi in August. "There are significant geopolitical and geo-economic changes in the Gulf," David Church, regional managing partner for the Middle East and international development partner for DLA Piper, tells The Am Law Daily. "The development of economies and the diversifications of businesses in the region has meant that the demand for legal services has increased."