- The Washington Times - Monday, October 27, 2008

Washington’s office real estate market is predicted to do well for the next year in a new industry report … but for the most dubious of reasons.

As the nation’s economy falters, more people are hiring lawyers to protect their homes from foreclosure or their businesses from bankruptcy.

For the office market, more lawyers means more law firms are leasing offices.

Washington has more lawyers as a percentage of the population than nearly anywhere else in the world. More than 30,000 are practicing law in the District.

“Looking ahead, demand for legal services is likely to rise over the next year, in part due to the financial crisis,” said the market report from the real estate services firm Jones Lang LaSalle. “The tumult in the markets has led many firms to position themselves to leverage their litigation, bankruptcy and restructuring practices, and, on the lobbying front, companies across the U.S. are recognizing the need for more government relations support.”

The upbeat outlook for Washington’s office market stands in sharp contrast to most other cities.

Real estate markets for Las Vegas and Phoenix will get “blown out” in 2009, according to a report last week from the financial consulting firm PricewaterhouseCoopers. Florida markets are in “disarray,” and Midwestern cities “continue to lose more ground.”

“The cyclical real estate markets always come back, and they will this time too, but not any time soon,” said PricewaterhouseCoopers partner Tim Conlon. “Commercial real estate was the last to leave the party, will feel the pain in 2009 and may be the last to recover.”

Meanwhile, back in Washington, law firms have nearly filled up the central business district, forcing them to build or lease offices in other parts of town.

“Development activity remains brisk with 10.3 million square feet under construction in the noncore markets like Southeast, Southwest and NoMa (North of Massachusetts Avenue) - locations where law firms have rarely ventured,” Jones Lang LaSalle said in a summary of its report.

Recent law-firm transactions have included the 255,000-square-foot relocation for Arent Fox, the 76,000-square-foot lease renewal for Beveridge & Diamond and the 38,000-square-foot relocation of Shook, Hardy & Bacon.

In other news …

• The law firm of Littler Mendelson recently sent a notice to the news media letting them know their lawyers stand ready to advise employers about what kind of costumes employees should wear for Halloween.

“Employers should consider Halloween’s true ghosts and goblins beforehand,” the notice said. “Liabilities associated with extreme costumes are real terrors, particularly in today’s multigenerational workplace where younger and older workers’ versions of what’s appropriate may differ. Employers must also ensure employees are not harassed for potentially risque or controversial costumes - how many Sarah Palins will we expect to see, for instance?”

Among the suggestions are the following:

“Employers should make costume-wearing and participation optional and suggest Halloween activities only as a way to build office camaraderie and goodwill. By creating an optional celebration, the employer can avoid hostile workplace claims.”

Another tip says:

“Employers should advise employees [to] avoid overly revealing costumes, and politically charged costumes may encourage political discussion in the workplace.”

Call Tom Ramstack at 202/636-3180 or e-mail tramstack@washingtontimes.com.

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