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Orrick, Herrington & Sutcliffe’s old San Francisco office was old money: The former Federal Reserve Building on Battery Street, fronted by 10 Doric columns, still boasted a bank vault. Last summer, Orrick moved to a gleaming glass-wrapped cube South of Market, a building conceived in the new-money boom, that — thanks to the bust — was available for a reported $27 per square foot. The flexible floor plan allowed for litigation war rooms, corporate coffee bars — even a gym. “It is a thoroughly modern and forward- looking building,” said Joseph Malkin, who heads the firm’s San Francisco office. “These are the qualities of the Orrick of today.” Orrick is just one of a handful of large firms that have repositioned themselves amid the Bay Area real estate downturn. And with the market still cheap, at least compared to its boom-time high, others are still looking. Transactions in San Francisco range anywhere from $24 to $32 a square foot, said Nick Slonek, senior vice president of Cornish & Carey Commercial. View space is going for $32 to $38. For some firms, the focus is on saving money, but others want to swap for space that will serve notice to clients — and even competitors. Cooley Godward will be moving from One Maritime Plaza to 101 California this summer, taking about the same amount of space. At One Maritime, the firm had view space between the 19th and 24th floors. It’s new floors are four through six. Richard Bradshaw, Cooley Godward’s executive director, wouldn’t say what the firm is paying. He said it had to move because One Maritime is undergoing renovation work. Cooley will be able to redesign the new space. When Kirkland & Ellis came to the Bay Area two years ago, it set up a temporary shop on Bush Street while looking for a building “consistent with Kirkland space in other cities,” said branch founder Jeffrey Hammes. Last fall, Kirkland moved its 50 lawyers into the 27th and 28th floors of the Bank of America building, with an option for more. The 12-year lease, said Hammes, “demonstrates our long-time commitment to San Francisco.” Of course, San Francisco can be an expensive proposition, especially for firms that signed leases at the market’s peak. As Kirkland was moving into the BofA building, Shearman & Sterling was moving out. In April, Shearman moved to about a third as much space at 525 Market St. John Wilson, who heads the firm’s San Francisco and Menlo Park offices, readily admits the move was financially driven. “We signed a lease in 2000 at the top of the market [in San Francisco] and at the same time we opened Menlo Park,” said Wilson. “When the market cracked, we found ourselves with more space than we needed.” Wilson said the consolidation has the advantage of allowing the firm to put more of its attorneys in Menlo Park, which makes most sense since the technology market is coming back. “We don’t consider real estate essential to our image,” said Wilson. “For us, what really counts is the quality of the work we do.” Sedgwick, Detert, Moran & Arnold left its space at One Embarcadero, where it had been for 20 years. The firm took 112,000 square feet at One Market, including space that had been occupied by Brobeck, Phleger & Harrison, Clifford Chance and Wilson Sonsini Goodrich & Rosati. Sedgwick Chairman Kevin Dunne said the rent was cheaper, and the firm worked out options allowing it to grow over time. “Law firms fail most often because they can’t pay their rent,” said Dunne. “Brobeck had space for hundreds of lawyers that was vacant. We tried to take as much of the risk out through negotiations.” Next year’s market could see more movement as a host of firms continue to reconsider their options. Heller Ehrman White & McAuliffe, Baker & McKenzie, Sonnenschein Nath & Rosenthal and Kirkpatrick & Lockhart are among the firms still looking around. Bingham McCutchen just signed a 10-year lease extension for its offices in Three Embarcadero. The firm took 16,000 additional square feet and options to grow. Firm leaders say searches are often as much about negotiating existing leases as they are about relocation. “We have found that the market is very open to lease negotiations and that there is a substantial amount of attractive space available with landlords continuing to make concessions,” said Sonnenschein’s Paul Glad. Some brokers see a slight uptick in rents over the next two years for prime San Francisco and Palo Alto locations. In Palo Alto, lease rates range from $36 to $48 a square foot, said Craig Kammerer, vice president of The Staubach Co. “Major law firms want an institutional image. They are not interested in a converted R&D building,” said Kammerer, noting that buildings that work well for law firms are becoming scarce. Much of the law firm movement has been at the University Circle complex in East Palo Alto, which Brobeck once called home. The firm’s implosion almost two years ago left the complex with Bingham McCutchen as its only law firm tenant. Since then, Gray Cary Ware & Freidenrich, Dewey Ballantine, Shaw Pittman and Greenberg Traurig have all moved in. “We’ve leased 300,000 square feet in a miserable market,” said James “Skip” Law, a partner in the project. There are still 70,000 feet left, Law said, with three firms in negotiations for the space.

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