The recession triggered by the pandemic has come quickly andcould have the tailwinds to be as severe as the 2008 FinancialCrisis, although we won't know for sure until the event is ourrearview mirror. The silver lining, however, is that manyindustries are better poised to weather the storm, which could helpstave off job loss business closers. In Los Angeles, the legalindustry is a primary example. The legal industry was hit hard bythe 2008 financial crisis, but this time, the industry is wellpositioned to handle the economic dislocation ahead.

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"This time, most law firms have better managed their leasedspace and have been carrying a lot less growth space,"Stephen Bay, vice chairman atCBRE, tells GlobeSt.com. "Over the past cycle manyfirms have embraced efficient and flexible office space strategies.This fundamental change is definitely benefitting them today, as wemove through a period of substantial economic volatility."

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Los Angeles is the second largest legal services market in thecountry, and it has rapidly expanded over the last decade. Since2015, the industry has expanded more than 12% in Los Angeles. "Theindustry was buoyed overall by the U.S. economic expansion in thepast cycle," Danny Rees, first VP at CBRE, tellsGlobeSt.com. "Plus, in Los Angeles specifically, the growth ofstreaming business, especially over the past 5 years or so, hascreated significant ancillary growth across all professionalservices companies, including law firms."

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Certain pockets of Los Angeles have benefitted from the marketexpansion. You see it in Century City and Downtown Los Angeles."Century City has particularly benefitted from thisgrowth. In that submarket, a dozen law firms have signedlong-term, multi-floor leases in the last three years,"Clay Hammerstein, vice chairman at CBRE, says."Also, to a large extent, many national or global firms that haveopened an LA office for the first time chose Century City duringthe last cycle.

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While the industry is entering the recession from a place ofstrength, this particular recession is coming with a lot ofunknowns that could have unpredictable impacts. For example, morework-from-home activity could negatively affect office leasing inlegal services markets. "It is too early to tell, if any changestoday will be permanent going forward but virtually all of our lawfirm clients are considering incorporating a remote working policyfor their attorneys and staff," says Bay. "If this takes effect, weexpect that it would enable law firms to decrease their leasedspace footprint in the future."

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.