JUVE Law Firm of the year

Construction Law

Low interest rates fueling the market

The European Central Bank’s current policies are making investors’ hearts leap for joy: thanks to historically low interest rates, the German real estate market is booming. And because there are few portfolio properties in attractive locations, new construction is increasing. Project developments, especially residential, are in high demand and are now often sold before they are completed – or before construction has even started.

Whereas a few years ago construction companies were fighting over every available job, these days their schedules are full. A healthy market also leads to less conflict: litigation takes time that these companies do not have, and there is enough business for everyone anyway. Settlements are easily reached because the next profit-making venture is right around the corner.

BIM – progress in the construction sector

Meanwhile, building information modeling, or BIM, is a new development that should put future projects on a firmer footing. BIM is a kind of 3D planning that allows all participants to demonstrate their contribution to the construction before the first shovel breaks the ground. The aim is to avoid planning errors and fix the total costs. In the US, UK and Scandinavia, BIM is already required for contracting bodies. In Germany, market participants are feeling their way towards this development; the German Federal Ministry for Transport has now selected a pilot project in which BIM is to be tested.

Construction firms expanding to Munich and Hamburg

The construction boom is having the expected effect on this usually quiet legal market: the boutique KNH Rechtsanwälte opened a new office in Munich with lawyers from Wendler Tremml, while Leinemann & Partner also put down roots here with two laterals and a senior lawyer from its Berlin office. It is not easy to get a foothold in the Munich market, however, since it is dominated by a number of small firms such as Zirngibl Langwieser and Kraus Sienz & Partner.

Another strong player in southern Germany is Sibeth, which merged with Arnecke Siebold in summer 2015 to become Arnecke Sibeth Siebold, which expanded its national presence into Berlin as well as strengthening the Frankfurt team. Arnecke Siebold gained a Munich office in the merger.

AGS Acker Görling Schmalz was also bolstered when the name partner from Lotz & Partner joined the Frankfurt office together with an associate. Previously, the firm had also opened a Hamburg office with a three-strong team from HFK Rechtsanwälte.

Firms are expanding not only through new offices, but also by widening their spectrums by tapping new, lucrative sectors. More firms such as Kapellmann und Partner, CBH Rechtsanwälte and Graf von Westphalen are moving into the healthcare sector, while Luther stepped up its focus on hospital construction.

 


Firms in this chapter provide advice on traditional construction law, including contract, architects’ and engineers’ law, fees and liability issues, brokerage, rental, and leasing law. Advice for construction projects and representation of the interests of contracting bodies and construction companies, both in and out of court, are also found here. Firms that deal with these issues, but where such activities comprise a large proportion of transactions and/or finance, can be found in the chapter on ?real estate.


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