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Sweet Spot
Business is good this year for Tampa Bay area law firms, but for the most part growth is conservative.
By David R. Corder
Associate Editor
Over the past several months, a group of lawyers, accountants and financiers met in the Tampa office of Shumaker Loop & Kendrick LLP. They came from Baltimore, New York and Charlotte, N.C., to draft an initial public offering that produced about $71.5 million in capital for Fort Myers-based Radiation Therapy Services Inc.
It was a busy time for Darrell C. Smith, who led the team of Shumaker Loop attorneys that represented the chain of therapeutic treatment centers. Just about six months earlier Smith led another team that closed on a $68 million secondary stock offering for San Jose, Calif.-based WJ Communications Inc. and a selected group of its stockholders.
The deals are a good sign for Smith, who also manages about 46 Tampa-area lawyers for the Toledo, Ohio-based law firm. While the volume doesn't come close to the amount he has worked on in the past, especially during the dot-com heyday of the late 1990s, Smith says he thinks these deals signal continued improvement in the softness that beset the national financial markets over the past few years.
That makes Smith bullish on the market outlook for local legal practitioners. It means revenue opportunities for law firms and jobs for lawyers.
"In terms of how business is right now, I believe the legal environment is in the sweet spot," says Smith, referring to the power point where a baseball bat hits a ball.
Although the signs are encouraging, the apparent market turnaround still isn't enough to spur all-out growth in the legal community. Most of the community's largest law firms maintain conservative hiring policies and strict cost controls in pursuit of higher revenue.
While revenue is up the past couple of years, Holland & Knight LLP, founded in Tampa and the nation's 24th largest law firm, has grown only moderately in the number of attorneys nationwide. Overall, the firm reports slightly more than 1,200 attorneys, according to its Internet Web site (www.hklaw.com). According to American Lawyer's annual survey of the nation's Top 100 law firms, the firm has only 1,161 in 2003. A count of the Tampa and St. Petersburg offices shows about 102 attorneys. That's down from the 111 attorneys the firm reported in a GCBR survey in the fourth quarter of 2002.
Tampa-based Carlton Fields PA, the state's fourth largest law firm, also has adopted a conservative expansion strategy. Tom Snow, the law firm's president, says the firm employs about 210 lawyers, with about 100 of them in the Tampa and St. Petersburg offices. In the GCBR survey two years ago, the law firm reported 97 attorneys in the Tampa Bay area offices.
"We're growing and looking for talent," Snow says. "It's nothing really dramatic. Over the past few years, we're growing at about 6% (annually).
"With the economy coming back, corporate and real estate areas are becoming in higher demand," he says. "When I say corporate, I mean the whole corporate areas of securities, mergers and acquisitions and tax. The industries that seem to be growing for us are insurance, pharmaceuticals, regulated industries, such as energy and telecom, and the construction industry always brings strength to the firm."
Best ever
Rhea Law, president of Tampa-based Fowler White Boggs Banker PA, recently relayed some good news to shareholders during a meeting at the firm's West Palm Beach office.
"Last year was our best year economically ever significantly," she says of the fiscal year ended Oct. 30. "This year we're above where we were last year at the same time."
Such performance translated into the hiring of new lateral and summer associates at the largest Tampa-based law firm, which staffs about 157 attorneys in its Tampa and St. Petersburg offices. That's about a 10% increase of Tampa Bay-area attorneys over two years ago.
"We've been adding rather aggressively," Law says. "As a matter of fact, over the past five years we've added five new offices. We're aggressively looking forward to bringing attorneys on board."
She attributes much of the firm's recent success to efforts by the attorneys in the firm's government, environmental and land use practice group, which handles developments of regional impact for clients. The firm's Fort Myers, Tallahassee and Tampa offices are particularly busy now with the DRI regulatory process, she says.
"Some of it's real estate transaction-oriented, but a large degree of it is new projects coming on line across the state," Law says. "We've started working on some new DRIs after a long period of no new ones."
Also there are indications of increased demand for attorney services in the areas of corporate transactions, estate and trusts, securities litigation and health care law, Law says. "We're also seeing significant increases in our various litigation departments, including employment law."
Tampa-based Hill Ward & Henderson PA also cited increased business.
"Our first six months of 2004 are probably the best we've had during that same period since we've been in practice," says Benjamin H. Hill III, the firm's managing partner. "We're seeing (growth) in our corporate practice, our real estate development practice and all of our trial practices."
Last year, Hill says, the law firm added about six lawyers to its legal staff. A check of its Web site (www.hwhlaw.com) shows the firm has 61 lawyers, a slight increase from the 58 the law firm reported in 2002.
"This year we would anticipate about the same number (of hires)," Hill says. "The growth is the same but steady. Our corporate people are busy, and there are more corporate lawyers than we've ever had and are adding more."
Better sleep
Up until about six months ago, Cathy Fitch lamented over the career opportunities for new graduates at the Stetson University College of Law. She is the school's director of career services. Her outlook has changed somewhat dramatically, however.
"I'm seeing more jobs at smaller to mid-sized firms," she says. "The market has come back. In just the past six months, I've seen a difference in the job listings we post. We've gone up appreciably. I can sleep better now than I could six months ago."
Notwithstanding the demand from the smaller firms, Fitch also expressed optimism about the potential job opportunities at the area's larger firms such as Holland & Knight, Fowler White and Carlton Fields, especially in the areas of corporate and M&A law.
"The larger law firms are looking at augmenting their numbers and are looking at lateral hires," she says.
So far, this market shift falls far short of the demand graduates experienced four to five years ago, Fitch says. That was an unprecedented period of opportunity for graduates and lateral hires.
"I'm not sure everybody is quite as gung ho as they were in the late '90s," Fitch says. "It was amazing (then), and it did feed a lot."
Citing anecdotal experiences, Fitch says most of the graduates who have found jobs in the current market relied on a simple formula.
"The ones who are successful are doing very detailed, targeted searches," she says. "If their interest is, say, in labor and employment law, they're going to research as many firms in their geographic area and then tailor their cover letter to the firm. You're not going to get very far now with a generic cover letter. Whereas four years ago you could."
That's advice Jim Headley used to find a job at Abbey Adams Byelick Kiernan Mueller & Lancaster LLP, St. Petersburg's largest firm. Out of 60 total resumes, the recent Stetson law school graduate hand-delivered 48 of them to firms within a short distance of downtown St. Petersburg. In the cover letters, he promoted his experience as a retired enlisted member of the U.S. Army intelligence community.
"Anytime you go into the job market cold you have to find something that sets you apart," Headley, 32, says. "I'm a military retiree, which put me in a better position than many of my peers.
"I also wanted to find a firm that would take the time with me to teach me to be a proficient attorney, not necessarily just to find a job," he adds.
Consistent growth
The growth rate for Tampa-based firms appears fairly consistent with other firms elsewhere that have established a presence in the Tampa Bay area. But there has been some contraction, too, but mostly because of attrition.
Orlando-based GrayRobinson PA expanded quickly in Tampa about three years ago with the merger of Shackleford Farrior Stallings & Evans PA. It reported 45 Tampa-area attorneys in GCBR's 2002 survey. The Tampa office now reports 39 Tampa area attorneys.
"We're always open to talking with lateral hires," says Richard Zabak, who manages GrayRobinson's Tampa office. "That's been consistent since the merger in 2001.
"When we first started the Tampa office we had a tremendous growth spurt," he says. "It doubled in size quickly. We've held in size, but we're always open to the idea of adding talented lawyers."
Business is good in the Tampa office, Zabak adds.
"All of our practice areas seem to be busy," he says. "Litigation doesn't seem to be sensitive to the state of the economy. As for our transactional people, perhaps that's increased, but there hasn't been a time when they haven't been busy."
That's much the same story for the out-of-state firms such as Milwaukee-based Foley & Lardner LLP, Baltimore-based Piper Rudnick LLP, Cleveland-based Squire Sanders & Dempsey LLP and Kansas City, Mo.-based Shook Hardy & Bacon LLP. Each of them rank with Holland & Knight on American Lawyer's list of the top 100 U.S.-based law firms.
Each out-of-state firm reported increased revenue in the American Lawyer survey published this month. Foley & Lardner, Shook Hardy and Squire Sanders reported slight decreases in total number of attorneys, but they have remained fairly consistent compared with the number of Tampa Bay-area attorneys reported to the GCBR survey in 2002.
That steady consistent growth explains how Shumaker Loop has become the out-of-state law firm with the largest presence in the Tampa Bay area, Smith says. Since entering the market in 1985, the Tampa office has grown to 46 attorneys and has lost only two partners, each who left the legal professional for other business opportunities.
"In terms of hiring, we're always on the look out for competent experienced laterals," Smith says. "That's how we've grown this office so successfully. We're talking to a number of laterals. We also typically hire a couple of law school graduates.
"A lot of firms cut people during the slow down in business two years ago," he adds. "We didn't really have to do any of that."
Cutbacks are not even in Smith's vocabulary with the current amount of business coming through the door. He attributes some of that new business to young lateral hires over the years who are now maturing as lawyers.
"Mergers and acquisitions: We're really busy in that area right now," he says. "It's really humming. Commercial litigation is probably as busy as I can remember. A lot of our younger lawyers are coming along. Real estate is cranking as well.
"It just seems to be a great environment all around," Smith adds. "Frankly, I'm expecting us to have our best year ever."
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