Law Firms Account for Nearly a Quarter of Office Rents Above $100 per SF
Law firms are increasingly anchoring the highest tier of U.S. office demand, accounting for 21.7% of all leases signed above $100 per square foot as competition for premium space intensifies across major gateway markets, according to data from JLL.
The shift underscores a deepening "flight to quality" dynamic in the office space, with legal tenants consolidating and expanding into the best-quality assets while establishing a new benchmark for premium leasing velocity across core urban markets.
The trend is also broadening geographically. Washington, D.C. led expansion activity with 65 transactions, followed by New York City with 46 and Chicago with 38. West Coast markets, including San Francisco and Los Angeles, each recorded 23 expansion deals, signaling that demand for high-quality space remains active across both coastal and Sun Belt regions.
Expansion activity was led by major firms, including Freshfields, Sullivan & Cromwell, Milbank LLP, Simpson Thacher & Bartlett and Covington & Burling, reflecting continued consolidation into trophy assets even amid uneven broader office fundamentals.
The largest deals of the quarter reinforce the concentration of legal demand at the top of the market. Cleary Gottlieb Steen & Hamilton led with a 475,000-square-foot renewal in New York's Financial District, while White & Case committed nearly 200,000 square feet in a relocation in Washington, D.C. Midtown Manhattan also saw continued repositioning, including a 150,000-square-foot new lease and a 59,468-square-foot expansion by McDermott Will & Emery across two separate transactions.
On the West Coast, Cooley LLP and Weil, Gotshal & Manges anchored Mid-Peninsula activity with combined leasing activity across Redwood City and Redwood Shores.
Overall, the ratio of law firms expanding vs. contracting has tripled over the past two years, with only 12% of firms reducing their footprint in Q1 2026.
At the same time, law firms are operating within a structurally tightening office market. U.S. office inventory declined by nine million square feet in the first quarter of 2026 alone, as conversions and demolitions continued to outpace new deliveries. Total office stock now sits approximately 25 million square feet below its peak in late 2023.
That contraction is occurring alongside record-high legal employment of 1.23 million in the first quarter, with roughly 114,000 service jobs in the sector added over the past decade.
Labor conditions remain exceptionally tight across the sector, with unemployment among lawyers at just 0.8% and 2% among paralegals and legal assistants, well below the national average jobless rate of 4.3%.
Source: GlobeSt/ALM