An uncertain economic environment, political instability and an oversupply of market participants has seen the planning environment practices at some firms experience challenging times in the past year.
Most affected have been those firms whose work is heavily planning focused, particularly those practices with a strong local government client base. A drop in planning appeal numbers has left the same number of seagulls fighting over fewer chips. Given the already low rates and correspondingly lower margins within many such practices, any downturn in work delivers an exponentially greater impact upon profitability.
The flow on effect of the above is an increasingly competitive market and escalating pressure on many of the larger firm’s P&E practices. Absent high hourly rates or high volumes of meaty planning appeal work, P&E lawyers rarely get fair credit for their contribution to the firm. While a degree of rationalisation within the NSW P&E market has already occurred there’s likely still more to come.
The likely output of such it would seem is by and large a more pure evolution of the current environment where the P&E practices at larger firms focus on providing ancillary services to an effectively internal client base and a host of smaller firms fight over less common and less lucrative planning appeal work. Within this framework though there are a few firms that look well positioned to differentiate themselves and prosper in both the short and longer term.
In this regard we’d point to Corrs Chambers Westgarth, Gadens, Henry Davis York and Norton Rose Fulbright as the most likely to prosper. Corrs’ independence and historically strong property, construction and government practices combined with a mixture experience (Christine Covington) and youth (Louise Camenzuli) positions it well. Gadens although perhaps a little too reliant on the reputation and client favour of Anthony Whealy, present the most compelling developer focused mid-tier planning presence. The demographic and expertise mix of HDY’s P&E team combined with an increasingly strong government practice presents only upside. Finally, Norton Rose Fulbright’s ability to sit atop both the NSW and Victorian P&E markets as well as the breadth of depth of talent within the firm’s national practice is places it in an elevated position that few other firms are capable of challenging.
Finally it’s also worth noting the “entry” of a number of firms into the NSW P&E market in recent times. Hall & Wilcox (via the hire of Stan Kondilios), Swaab Attorneys (via the merger with Shaw Reynolds) and Jones Day (via the hire fo Jim Parker) have all, despite a challenging market, all sought to establish a presence in the NSW P&E market. To date their impact has been limited.