An Abundance of Choice
A revived economy, price-conscious clients and a rapidly changing legal environment, coupled with greater confidence among supervisory and disciplinary authorities: rarely have there been so many strategic opportunities – and risks – for law firms. And at the same time, such a diverse choice of advisors for clients.
The return of major transactions and IPOs ensured good utilization rates among M&A advisors and lawyers. On top of this, German and international investors were under immense pressure to invest, with the German real estate sector among those profiting. Nothing illustrates this better than Deutsche Annington joining the DAX index. Money from Greek investors found its way to Germany, and Chinese state-owned corporates made acquisitions in Germany as well.
Political players fueled the market with their energy and tax policies. Banks, too, are back in play as creditors, while international banks were active in Germany again. With insurers and other alternative creditors still in action, this means the group of potential financiers is larger than ever. There are some in the market, however, who say they can already see signs that some markets are overheating again after the banking crisis. Frankfurt gained in weight within the European framework, as it is home to the European Central Bank, which now plays a central supervisory role.
Firms under pressure, despite strong economy
At first glance, this would appear to be nothing but good news for commercial lawyers – with the exception of insolvency administrators. But there are growing indications that the pressure is constantly rising, on international firms above all. Despite the strong market for deals, turnover is often only increasing moderately, if at all. There are a multitude of reasons for this, which together result in a difficult and complex situation.