Real Deals

Real Deals: Developers vie to land Womble Carlyle for Raleigh office projects

dbracken@newsobserver.comMarch 5, 2014 

— The horse race playing out among two downtown Raleigh office projects and a third at North Hills is increasingly centering around the law firm Womble Carlyle Sandridge & Rice.

The firm, which leases 68,000 square feet in the Wells Fargo Capitol Center downtown, has been evaluating the possibility of moving for about a year. The firm has narrowed its list of possible destinations to four, and its decision could ultimately determine which new office project gets off the ground first.

Womble’s final four includes its existing building, Dominion Realty’s Charter Square project at the south end of Fayetteville Street, developer Gregg Sandreuter’s Edison office building planed for the corner of Martin and Wilmington streets, and Kane Realty’s 18-story tower at North Hills.

The decision Womble now faces is one that many law firms have made in recent years. As the practice of law has changed, so have law firms’ office space requirements.

Less support staff

Womble once had a secretary for every two lawyers. Today that ratio is 1-to-4 or 1-to-5. The shift to electronic documents has also greatly reduced the space firms need for law libraries and document storage.

Womble now has empty secretarial stations, and its law library is one-third to one-quarter the size of when the firm moved into the Wells Fargo building more than 20 years ago.

“The practice of law has changed significantly during the period of time we’ve been here,” said Johnny Loper, one of the firm’s partners.

The firm estimates that it now needs between 45,000 and 50,000 square feet of space for its roughly 100 employees, which includes about 50 lawyers.

Womble’s options are to have space in the Wells Fargo building re-engineered to meet its needs, or relocate to a new building after its lease expires at the end of 2015. The firm has toured Smith Anderson’s space in the Wells Fargo building, which was redesigned to meet that firm’s needs several years ago. Womble expects to make a final decision in the near future.

While some law firms have decided to stay put in recent years, others have taken the opportunity to move into new buildings.

Ellis & Winters and Hedrick Gardner Kincheloe & Garofalo are each leasing 20,500 square feet in Highwoods Properties’ new building under construction at the GlenLake office park near Crabtree Valley Mall in Raleigh. Ellis & Winters currently occupies space in one of the Crescent Green office buildings in Cary, while Hedrick Gardner will be moving from the Westchase office complex in West Raleigh.

Pre-leasing key

Landing Womble would be a major coup for one of the three new projects being considered, all of which are eager to pre-lease portions of their buildings before breaking ground.

The 13-story Edison office building is the largest of the three, with a proposed 315,000 square feet. Sandreuter has said Edison needs anywhere from 25 to 50 percent of its space pre-leased before construction can begin.

Kane Realty’s North Hills tower is to include 300,000 square feet. CEO John Kane said this week that the project is closing in on its 30 percent pre-lease threshold and that he hopes construction will begin by mid-May.

Dominion’s 11-story Charter Square building will include 236,000 square feet.

If Womble does decide to leave the Wells Fargo tower, it would be the second major law firm to depart the building over the past year. Last summer, Parker Poe Adams & Bernstein announced it would move one block south to Highwoods’ PNC Plaza building when its lease expires later this year.

Parker Poe will sublease about 50,000 square feet of space in PNC Plaza. While that’s about the same amount of space it leased in the Wells Fargo building, the firm said the PNC Plaza space can be configured to accommodate significantly more attorneys.

Bracken: 919-829-4548 or dbracken@newsobserver.com; Twitter: @brackendavid

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