Ralf Thaeter, a managing partner at British law firm Herbert Smith Freehills, is keen to point out that the bottled water at his new German office was sourced from Berlin.
Most lawyers would not think about where the liquids come from, and more often than not, the water is Vittel from France or San Pellegrino from Italy.
But Herbert Smith Freehills, which was founded in 1882, wants to make it clear that it takes seriously the local environmentalist leanings at its first German offices, which opened in Berlin and Frankfurt last year after a merger with its long-term German partner firm Gleiss Lutz failed.
The law firm is one of several that have recently opened in Berlin. Frankfurt has long been the traditional center for corporate law firms in Germany, which want to stay near the companies they represent, but now a new wave of companies is setting up base in the German capital.
In 2013, four new international law firms opened offices in Berlin. While some had already worked in the market through collaborations with German partner firms, others are entering a new market that may appear saturated from an outsider’s perspective.
Two American companies – tech heavyweight Morrison Foerster and the smaller Ogletree Deakins — have also opened offices in Berlin, as has Magnusson, which specializes in the Baltic Sea region.
Real estate consulting firm Jones Lang Lasalle said in a recent study that the number of law firms leasing office space in Germany has jumped by 20 percent in two years.
“International law firms have high expectations with respect to the German legal market, due to the relatively strong economy and the comparably successful way it gets through the euro crisis,” said Jens-Uwe Hinder, managing partner at Morrison Foerster.
But is not just a trust in Europe’s most stable economy that brings these firms to Germany.
A partner at the firm Berwin Leighton Paisner, Hanns-William Mülsch, told Handelsblatt Global Edition that they decided to open up offices in Berlin in 2011 because of growing demand from clients.
“Some BLP clients wanted to invest abroad and required legal advice in the countries they were interested in. Many of BLP’s clients are real estate investors. The competition in the sector is high and in order to stay competitive, it made sense for BLP to open up offices in Germany where the real estate sector is flourishing,” he said.
The move has been a boon for Berlin’s lawyers, who find themselves headhunted by international law firms wanting to hire them for their expertise and client base.
“There are two reasons why someone wants to do business with you: either they trust the institution or they trust the person,” said Mr. Mülsch.
Competition for staff is fierce. One source said Herbert Smith Freehills has struggled to hire a complete team, and is having to recruit at a slower pace than it would have liked. Morrison Foerster not only moved into the offices of law firm Lovells, but also poached their whole team. Lovells, which only opened in Berlin in 2010, simply disappeared from the city.