Bilzin Sumberg Baena Price & Axelrod isn’t on the Am Law 200 list of top grossing U.S. law firms. But it regularly ranks among them in terms of profits per partner and revenue per lawyer.
While Bilzin’s profits per partner dipped over 1 percent in 2016 to $1.6 million, the profit breakdown they report for each of their 24 equity partners is still higher than what has been reported for any other Florida-based firm , including global firms like Holland & Knight and Greenberg Traurig. And this unusually high profit per partner occurred despite a gross revenue drop of 1.3 percent in 2016, to $81.3 million.
“For at least the last eight or nine years, our firm has produced economically, where we have been No. 1 or 2 in both profits per partner or revenue per lawyer, according to your statistics,” said Bilzin co-founder John Sumberg, referring to the Daily Business Review’s ranking of top Florida-based firms.”We believe there is a place in this community for a preeminent regional firm, and we think that is our niche, and we think that the results have borne that out.”
Despite a more than 9 percent drop in net income to $38.8 million in 2016, Bilzin still claims a nearly 48 percent profit margin. Revenue per lawyer at the 84-attorney firm dropped 2 percent to $963,000. But that is still more than $200,000 above the amount that any other firm based in Florida reported in 2015 and 2016.
The firm has managed to maintain its strong financials in part because it eschews a regional or global footprint, preferring instead the efficiency of one downtown Miami office. Sumberg said he and the firm’s co-founders all came from larger firms and been frustrated by the multi-office experience, where people didn’t have the sense of working together and pulling in the same direction.
“For us, pulling together multidisciplinary teams and the ability to communicate with each other and with the client is much easier than with a global firm, where people are in offices in different places and don’t know each other,” Sumberg said. “The reason for the success of the firm is the selectivity and the depth in the community, and the advantage of being in one office where everybody knows everybody.”
Indeed, legal recruiter Joe Ankus, who has worked with Bilzin for two decades, said the firm has been able to navigate the gulf between Big Law top-tier service and mid-size firm collegiality because it is exceptionally well-run.
“They are positioned to be much more flexible and nimble than a law firm with 25 satellite offices,” he said. “When you don’t have a lot of different offices, it’s much easier to adapt to changes in the legal marketplace.”
Hiring at the firm is done strategically. Last year, Bilzin hired 10 Hispanic lawyers because it needed more capacity to service people from Latin and South America, Sumberg said. About 35 percent of the firm’s work relates to international inbound work—a lot of it from Latin America. Likewise, the firm added lawyers to its international private wealth practice because of “huge demand in the area,” he said.
The public-private partnership practice and litigation practice also did particularly well in 2016, Sumberg said. The firm’s litigation practice attracted a significant amount of antitrust and securities work, as well as partnership disputes, and the corporate and real estate groups also grew. Sumberg said this year he expects to see growth in commercial mortgage backed securities, which will lead to some additional hiring.
Ankus said the firm enjoys considerable stability. Associates tend to get more hands-on responsibility at Bilzin, he said, adding that the firm lays out a realistic path to partnership and offers a greater ability to navigate a career than an Am Law 50 firm. Associates therefore tend to stay. Bilzin also puts training programs in place starting at the summer associate level, said Abbe Mald Bunt, president of Bunt legal Search, who has also worked with Bilzin for years. “They train and mentor younger people, so there is buy-in to stay at the firm,” she said.
Last year, the firm raised new associate salaries to $160,000 to remain competitive, Sumberg said. But it also increased billing rates, and it expects to raise rates this year as well.
The firm’s success has led to many merger offers. But Sumberg said the partners believe the firm’s current setup is best for its clients, partners and associates and partners. “We are not interested in merging at this time,” he said. “It’s not our objective to become bigger, and it’s not our goal to be on the Am Law 200 or Am Law 100.”
Sumberg said Bilzin manages to compete economically with much larger firms because of its community involvement and selectivity in hiring and clients. Community involvement has led the firm to such projects as Liberty Square Rising, a $300 million public-private partnership for public housing intended to transform Liberty City—a 50-square-block area of one of the city’s most blighted neighborhoods. It is the first public-private partnership for public housing in Florida.
The firm is also handling the Brightline project, a high-speed rail project that will connect Miami to Orlando, and ancillary mixed-use facilities at the Miami and Fort Lauderdale stops along the way. The firm also handled the Dacra Group’s $1.4 billion Design District project and is involved in a $4 billion, 183-acre ongoing Biscayne Landing project in Miami. Other clients include the Miami Dolphins, Lennar Corp., Miami Dade College and LNR Property Corp.
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