Boosted by a robust real estate practice, Texas firm Jackson Walker posted record results for 2018, as gross revenue improved by 5.4 percent and profits per equity partner (PEP) increased by 16.8 percent.
Gross revenue hit $262.9 million at Jackson Walker in 2018, up from $249.4 million in 2017, and revenue per lawyer (RPL) came in at $749,000, up 7.9 percent when compared with $694,000 the prior year.
Net income was $108.7 million in 2018, up 14.9 percent when compared with $94.7 million in 2017. PEP reached $1.1 million, up from $942,000 the year before.
“It was strong across the board, but particularly in real estate. We continue to see a very robust real estate practice, which grew dramatically with the addition of four partners from Gardere,” managing partner C. Wade Cooper said.
That group of four joined Jackson Walker’s Dallas office in April before Gardere Wynne Sewell’s merger with Foley & Lardner. Earlier in 2018, Jackson Walker also hired lateral real estate partner Pamela Madere in Austin, he said.
Cooper said real estate has become a huge practice for the firm, with close to 90 lawyers doing real estate work. He said not only did the firm tack on real estate heft in 2018, but the practice was busier, as per-lawyer hours increased in 2018 compared with 2017.
Usually about half of the firm’s practice groups improve each year while the other half don’t, Cooper said. But in 2018, nine of the firm’s 14 practice groups were up on a year-over-year basis, he said.
Litigation was also busier in 2018, Cooper said. In 2017, the practice was in a rebuilding phase because many lawsuits resolved in 2016 or early 2017, but that turned around last year.
Corporate work was “slightly busier” on a year-over-year basis, he said.
Cooper said the firm’s 2017 revenue included about $5 million in contingency fees, so noncontingency fee revenue in 2018 actually improved by 7.1 percent.
The firm’s head count changed little in 2018, coming in at 351 lawyers on an full-time equivalent basis, down 2.2 percent from 359 in 2017. The firm had 99 equity partners in 2018, down two from 101 the year before.
Jackson Walker had “really good” success in lateral hiring, bringing in 14 partners throughout the year, Cooper said, in areas including real estate, litigation, appeals and bankruptcy. Still, expenses were flat from 2017 to 2018, he said.
“Part of our success is our low-expense platform. That’s always been sort of our calling card,” he said.
Cooper said he expects revenue to increase in 2019, as the benefit of 2018′s lateral hiring is fully realized. However, the firm will pay a full year of higher associate salaries in 2019—those salaries went into effect midyear in 2018. The firm also benefited from some savings on its real estate expenses in 2018 that will not extend to this year.
Cooper said Jackson Walker increased the number of new clients in 2018 by an unusually high 20 percent, which he views as an indication of the robust Texas market and the firm’s success in lateral hiring.
The firm is not looking to add offices in 2019, but is looking to add lawyers in existing offices with a “good book of business and a good cultural fit.” Jackson Walker has seven offices in Texas, and it’s the largest Texas-only firm.
Cooper is optimistic about 2019, because the Texas economy is good and the firm has strong practices. On Jan. 1, he said, the partners took one day to celebrate the successful year, and then started working on the next.