A pair of landlords in New York and Washington, D.C., are turning to Am Law 100 firms to serve as key tenants for two buildings now under construction.

Morrison & Foerster and Covington & Burling are poised to move into the new office towers; MoFo in a 40-story building being developed by Boston Properties at 250 West 55th Street in midtown Manhattan, and Covington in a massive mixed-use project called CityCenterDC being developed in downtown D.C. by Hines, Archstone, and The First Investor U.S. Real Estate Fund.

That the two firms will be occupying such significant spaces would appear to at least partially answer a question considered recently by real estate trade publication CoStar NewsWill Dewey & LeBoeuf‘s demise cause landlords to second-guess the wisdom of offering major leases to law firms, traditionally among the most “prestigious and credit-worthy” of commercial tenants? 

The bottom line, according to observers interviewed by CoStar, is that even in light of flameouts like those of Dewey and Howrey, law firms remain prized as anchor tenants. And why not? As CoStar notes, law firms still make up the fifth-largest category of office tenants in the United States according to total square footage leased, and, after payroll, leases represent a law firm’s second-biggest expense.

MoFo, which initially announced its plans to move to 250 West 55th Street more than a year ago, said this week that it has taken on an additional floor of space, giving the firm eight floors and approximately 205,000 square feet with a 15-year lease expected to start in the spring of 2014.

Chet Kerr, the firm’s New York managing partner, says the firm decided to take on the extra floor in anticipation of continued growth in the city. “We want to make sure that we not only have space when we move in, but also over the next four or five years,” he says, adding that MoFo’s current offices at 1290 Avenue of the Americas are close to maxed out.

With roots in San Francisco dating to 1883, MoFo has made a push eastward over the past few decades, opening in New York in 1987. Chair Keith Wetmore is  based on the East Coast, and the firm now counts about a quarter of its 1,000 lawyers, as well as 150 staff members, in the city.

“While the firm originated in San Francisco, we don’t consider ourselves a California firm anymore,” says Mark Edelstein, chair of MoFo’s real estate finance practice and the firm’s lead negotiator on the new lease.

Boston Properties’s new midtown building has been a long time coming. Initially conceived in 2007, construction was suspended in 2009 due to the recession. Changing market conditions and other factors prompted two other law firms that had initially signed on, Proskauer Rose and Gibson, Dunn & Crutcher, to back out, Kerr says. (Proskauer has since moved into 11 Times Square, where its name adorns the building; Gibson remains at 200 Park Avenue.) “Their loss is our gain,” Kerr says.

The Wall Street Journal
that two other law firms are also considering signing at 250 West 55th Street: Chadbourne & Parke (which toyed with a move to One World Trade Center, according to our past reports) and Kaye Scholer. Representatives for both firms did not immediately return requests for comment.

Further south, CityCenterDC’s developers confirmed in May the signing of a letter of intent with D.C.–based Covington. The firm’s new headquarters, expected to be ready in 2014, will cover 420,000 square feet, according to a statement announcing the deal.

The Washington Business Journal notes an interesting bit of background on the building: Two years ago, news emerged that Skadden, Arps, Slate, Meagher & Flom had signed a similar letter of intent, but those talks were called off, according to the Business Journal, and Skadden used its potential move as leverage to renegotiate a lease in its current location at 1440 New York Avenue.

Covington spokeswoman Rebecca Carr said via e-mail Tuesday that the firm is actively working toward a finalized lease, and that “we have ceased negotiations with all other parties.” She says the firm has been working for three years to either negotiate with its current landlord or find a new locale, and has concluded “that CityCenter was the best choice to take us forward.”

In other Am Law 200 real estate developments, Ballard Spahr has moved into 38,468 square feet in The Millennium Building in D.C.’s Golden Triangle Business District, City Biz reports. And Pepper Hamilton‘s Boston office, which has expanded from six to 36 lawyers in six years, moved to a single floor at 125 High Street from its previous location in the Oliver Street Tower.

For a handful of other firms, negotiations with landlords are mired in litigation.

The Am Law Daily reported last month on Davis Polk & Wardwell‘s lawsuit against its New York landlord seeking to force the company to abide by arbitration rules set out in its lease as the two decide on a base rent price on which both parties can agree.

Hogan Lovells, meanwhile, finds itself on the opposite side of an $8 million lawsuit brought by its Miami landlord, which claims that the firm breached its contract when it moved out following a flood, sibling publication Daily Business Review reports. Hogan Lovells contends that it was allowed to break the lease because of what would have been substantial costs to fix up the damaged property, while the landlord argues that the firm overstated the costs so it could move to smaller, cheaper space, according to DBR.

As for Dewey, its bankruptcy is likely to spark more landlord battles. The firm’s landlords in New York and D.C. appear on a list of its 20 largest unsecured creditors, with claims that Dewey says in court papers total more than $5 million. The firm’s D.C. landlord, 1101 New York Holdings LLC, has already sued the firm in D.C. superior court for what it says is $927,000 due in rent from February to May, sibling publication The Blog of Legal Times reported May 17.

At a hearing scheduled for Monday, Dewey representatives failed to appear in court, according to court filings. A judge stayed the case pending the outcome of Dewey’s Chapter 11 bankruptcy, filed May 28.

National Law Journal reporter Matthew Huisman contributed reporting.