Law firms across the country have watched their caseloads explode under a triple whammy of increased artificial intelligence usage, rising regulatory uncertainty and a more litigious business climate.

These new business challenges have supercharged law practices’ growth. Flush with cash, they have been gobbling up office space at a pace few other industries can match, growing their footprints after years of shrinkage.

“The folks who signed a lease in 2019, 10-year leases, they’re coming up in a few years,” said SmithGroup senior workplace strategist Madeline Dunsmore, who focuses on legal clients. “These are big firms with big budgets, and suddenly, in this market, those budgets go pretty far.” 

Bisnow/created with ChatGPT

Compared to the pre-pandemic average, legal leasing activity was up 46% in the year trailing the first quarter of 2026, while tech leasing in the same period was down 8% from its pre-pandemic average, according to CBRE.

The legal industry signed 4.6M SF leases in the first three months of 2026, part of a string of four years of record leasing activity, according to Cushman & Wakefield.

The trend represents a reversal from a decade ago, when the average law firm was giving back 25% of its office space when signing a new lease.

Firms are signing for larger blocks, renewing early and planting flags in fast‑growing markets as they compete for attorneys with specialized AI and compliance expertise. With legal hours rising and AI‑related legislation proliferating across the country, the sector’s office growth now reflects a broader shift.

“The legal profession is recession-proof, and it’s been consistently more office-centric than other industries,” Cushman & Wakefield Head of Insights for the Americas David Smith said. “I think some firms are opportunistic.”

The average firm’s profit growth last year was 13%, according to a joint state of the industry report by Georgetown Law and the Thomson Reuters Institute. 

The report says the surge in demand lifting profits is due in large part to chaos, including trade wars, regulatory upheaval and geopolitical tensions that “require constant legal navigation.” 

These demand drivers led to a 3.9% year-over-year jump in the total hours worked by lawyers last year, one of the most rapid expansions the report has ever tallied. 

Legal leasing continues to grow in top-tier markets. In May, Simpson Thacher & Bartlett finalized a 916K SF lease at Extell Development’s upcoming New York tower at 570 Fifth Ave., Manhattan’s largest office lease in six years. 

Firms like Kirkland & Ellis and Goodwin Procter expanded late last year as part of an industry “space race.” 

Legal clients have accounted for 17% of Manhattan leasing volume this year, up from 11% in all of 2025, according to Savills.

But the industry’s growth is also driving more activity in regional markets with growing populations, business expansion or evolving office dynamics. In Miami, the legal industry now makes up 20% of office leasing, versus 10% pre-pandemic. 

Nashville, Charlotte and Charleston, South Carolina, have all seen similar jumps, and Austin and Dallas have seen booms in new legal spaces due to firms opening satellite offices, Smith said.

“There are countless examples of people just doubling down and renewing with similar amounts of space or slightly more than they had at their large offices,” Smith said.

The number of job postings among law firms for lawyers with AI skills and experience has jumped seven times since generative AI became more prevalent in 2022, according to Cushman & Wakefield.

“There has also been an increase in AI-related bills introduced into current legislative sessions across more than half of states,” Smith said. “This unprecedented legislative activity is a driving force for top law firms to have and grow their AI practice groups.”

But it remains to be seen if the chaos that has driven increased revenues proves to be a sustainable business strategy. The Georgetown-Reuters report hints at substantial financial pressures — including growth in spending on AI tools but an inability to charge premium AI-level fees — and the potential for a boom-and-bust cycle coming to the industry.

Firms are racing to load up on tech and talent, and workforce costs are up 8.2% compared to 2024, according to the Georgetown-Reuters report. 

“Certain law firms, even though they’re becoming more efficient from a utilization-of-space perspective, are actually growing because they’re acquiring attorneys and end up expanding their offices as a result,” said Ryan Lopez, vice president of leasing at Carr Properties.

The amount of office space needed per attorney is down from 925 SF before the pandemic to 746 SF today, but other needs are filling the gaps in law firms’ requirements.

Legal firms want to expand with more collaboration areas and more war room space for mock trials and strategy sessions, and they want high-end amenity space as a talent magnet.

Hospitality-driven design, gyms, pools and collaboration spaces are in, taking up to one-fifth of new offices, Smith said. Other in-demand amenities include parking, especially for partners, as well as conference and meeting rooms sizable enough for events and dinners.

“Rather than just cutting costs, firms are investing in placemaking, shared spaces that support culture and client interaction,” CBRE Managing Director of Americas Consulting Emily Botello said.

They are also investing in proprietary software and AI systems that need staff to oversee them, scaling up space needs where the mid-2010s removal of physical law libraries shrunk office footprints.

“The bottom line is that AI is creating demand for AI legal services, and it is also creating demand for AI support positions within law firms to implement, manage and maintain AI systems,” Smith said. 

When Google leases a large industrial space in North Carolina, it can push the needle of local industrial leasing toward positive absorption.

The Googleplex, Google’s headquarters in Mountain View

Google has been named as the new lessee of a massive industrial warehouse in Rowan County and is eyeing an adjacent site as well, the Charlotte Business Journal reported. 

The 723K SF building, referred to as KC 100, is located in the Overlook 85 industrial park at 1894 Old Beatty Ford Road. Documents show the company has an 88-month lease term, the Observer reported. Google has two five-year renewal options for the space.

The warehouse was developed by New Jersey-based Hudson Capital Properties.

A 1M SF industrial building is planned for the adjacent site, KC 300, and Google has the first rights to lease it, the CBJ reported.

There is no information yet on how Google will utilize KC 100.

The company has maintained a presence in North Carolina for 15 years and has offices in Durham. Last month, Google announced a $1B investment to expand its data center campus in Caldwell County. It is also building a data center near Charleston, South Carolina.

The single lease makes up a significant portion of the region’s total industrial occupancy gains so far in 2026.

Net absorption in Charlotte surpassed 1M SF in the first quarter this year, the third consecutive quarter the local market has reached this figure, according to a Colliers industrial market report.

The report found that steady leasing demand and moderate supply growth helped to bring vacancy down to 8.13%. That vacancy rate should remain stable in the near term, the report states.

A Q1 CBRE industrial report stated that big-box availability for space over 500K SF remains “notably scarce,” causing supply limitations for larger users. The space that Google occupied was one of the few remaining big-box industrial spaces in the area, the CBJ reported.

Healthcare developers considering building primary care space may be hearing a voice in their heads, one that gives them pause: “If you build it, they may not come.”

That’s because patients increasingly are choosing at-home settings for noncomplex care, making primary care space a less desirable part of the medical office building mix, according to medical developers speaking at the Bisnow‘s Charlotte Healthcare Conference. 

“Healthcare has become a consumer-driven product,” said Mike Orlando, vice president of Realty Trust Group.

The healthcare industry has long pushed to provide more in-home care but has only made incremental progress toward that goal in the last couple of years. However, annual spending for at-home care is expected to rapidly accelerate from $155B in 2025 to nearly $321B by 2035, according to a report from healthcare consulting firm Nova One Advisor. 

A wider pool of providers will be focusing on at-home care in the future, said Sarah Mueller, national director of healthcare for the Beck Group. This presents a challenge for developers of medical office buildings.

“If care is really going to start to get pushed more into the home as much as can be done, what does that mean for the built environment?” she asked at the event, held March 31 at The Union at West Station.

As primary care becomes more decentralized, MOB space is being reshaped or developed into facilities focused on intensive or specialized care.

“The way it changes the built environment is it increases the complexity of patients that are going to be [there],” said Bennett Thompson, vice president of real estate for Atrium Health. 

Given the consumer preference for care close to home, healthcare providers are choosing to open satellite or outpatient offices in neighborhood settings. 

“Patients are more comfortable heading to their neighborhood location, if it’s primary care or something that can be done off campus,” said Ben Barr, managing partner for Woodside Health. “So they don’t have to head to a big parking garage and walk through a whole big hospital.” 

When choosing a location for these local facilities, Orlando said accessibility, visibility and convenience are key. He noted that prime locations might be an inline strip center or a grocery-anchored shopping center. These sorts of locations are also good spots for urgent care centers. 

“Is it on the way to and from school and work? Can I get in easily? Those are all factors,” he said. 

This pull away from primary care space comes at a time when new MOB space, in general, can be hard to come by. This isn’t because of a lack of demand. 

From a national standpoint, demand for medical outpatient offices is high. In the state of North Carolina, for example, there are 199 outpatient clinics that employ more than 28,000 workers and earn more than $5B in revenue each year. The MOB market occupancy rate was record-setting in Charlotte, above 93%, according to a November 2025 PwC report on trends in commercial real estate. 

However, the expenses of constructing new medical space is becoming prohibitive. The fit-out cost for medical outpatient facilities has reached $412 per SF, according to a February JLL guide on MOBs. 

This makes existing MOB space a sought-after commodity. Investment in MOB space, driven largely by sales, rose 35% year-over-year in 2025 to $12.6B, according to CBRE. The Southeast led the way in investment dollars in MOB in Q4 2025, specifically, with $1.6B spent on such space in the region. 

Overall, Charlotte has emerged as a med-tech innovation hub, with work currently underway on the $1.5B The Pearl district, a 26-acre development anchored by the Wake Forest University School of Medicine and backed by Atrium Health and Wexford Science & Technology.

JLL represented American Lithium Energy (ALE), a manufacturer of lithium-ion batteries, in a new 81,928-square-foot lease at 1395 Aspen Way in Vista.  The firm is expanding from 21,473 square feet in Carlsbad and will use the space for R&D, manufacturing and distribution of its batteries. The tenant is scheduled to move into its new space in the fourth quarter.

On the heels of our successful A round and SpaceWERX STRATFI award last year, this facility marks an important milestone for ALE,” said CFO Danny Joe. JLL’s Tim Olson represented ALE in the lease. 

“We continue to see the evolution of San Diego’s diverse economy with advanced manufacturing and other sectors growing in the region,” said Olson.  “We have the expertise and experience to guide companies through the complicated real estate process, allowing them to remain focused on their mission.”

Photo credit: CoStar.

The Bascom Group, LLC has retained Noel Aguirre and Sean Lieppman of Lee & Associates to market and lease a 4,100-square-foot ground-floor space at 200 Pine Ave. in Long Beach. Located in the city’s downtown area, the space features an adjoining 3,865-square-foot lower-level space.

The space, which offers patio capability, is second-generation restaurant space suitable for a full-service restaurant concept in the downtown Long Beach market, according to The Bascom Group. The location has dedicated on-site retail and restaurant parking and is at the base of a six-story, 65,909-square-foot office building renovated in 2022.

David Kim, Managing Partner at The Bascom Group, said, “200 Pine is in the heart of the Pine Avenue entertainment district, with numerous retailers and restaurants, such as Altar Society Brewing Company. This building is within two blocks of City Hall, Billie Jean King Public Library, George Deukmejian County Court House, the State Building, and the newly expanded Long Beach Convention & Entertainment Center.”

Hunneman Real Estate brokered an 11,248 square-foot, 12-year lease of CKM Real Estate’s 250 Apollo in Chelmsford, MA to Triton Systems, an advanced materials, coatings and systems engineering product development firm that has been a defense contractor for more than 30 years.  To facilitate the move, 250 Apollo will undergo significant infrastructure upgrades to reflect the tenant’s unique needs.

“Securing this lease is a testament to CKM Real Estate’s creativity in navigating an extremely competitive market,” said Chris Curley, EVP at Hunneman. “The flexibility of 250 Apollo to adapt and accommodate a wide range of user types, including research and development space, flex uses and GMP through a fully permitted 50,000-rentable-square-foot expansion of the building serves as a key differentiator for tenants seeking dynamic spaces.”

Curley and Hunneman’s Ken Oppenheim and Mike Allen represented ownership. The two-floor, 143,215 square-foot 250 Apollo was constructed in 1986 and most recently renovated in 2020.

Newmark Retail secured a new 8,810-square-foot lease with Boggi Milano at the base of 527 Madison Ave., a class A boutique office tower located in Manhattan’s Plaza District. Vice chairman Jeffrey D. Roseman, senior managing director Caleb Petersen and director Drew Weiss represented landlord Mitsui Fudosan America.

“The amount of interest in the space and the speed of which this lease got done is indictive of the overall vibrancy of the retail market in New York City,” said Roseman. “Boggi Milano will be a fresh and exciting addition to the neighborhood.”

Boggi Milano is a luxury Italian menswear brand known for its high-end contemporary clothing, with over 225 locations in more than 58 countries. The tenant secured a long-term lease to occupy the dual-level, corner retail space, encompassing 4,506 square feet on the ground floor and 3,905 square feet on the lower level. The space was formerly occupied by Harman Kardon.

BioMed Realty, a Blackstone portfolio company, said Wednesday it had executed a lease amendment with Xaira Therapeutics, a leading AI-driven drug discovery company. Xaira Therapeutics is expanding its headquarters from its current 56,233-square-foot space at BioMed Realty’s Gateway of Pacific III campus, located at 700 Gateway Blvd. in South San Francisco, to a total of 73,075 square feet at the same location. 

The expansion reflects growing demand for Class A life science facilities in the Bay Area and supports Xaira’s rapid growth as a leader in AI-driven drug discovery, according to BioMed. The space will serve as a foundation for advancing Xaira’s machine-learning research and therapeutic product development, reinforcing the Bay Area’s status as a global hub for biotech and technology innovation. 

“Xaira’s new facility at BioMed Realty’s Gateway of Pacific III campus creates a collaborative and inviting space to focus on critical work that has the potential to reshape the drug development landscape through the use of AI,” said Uplaksh Kumar of Xaira. 

Google has leased a 1.1 million-square-foot warehouse in the Silver Creek Business Park in Fort Worth. The business park, located at 9449 Silver Creek Road, is part of a 520-acre business park developed by Majestic Realty.

The Fort Worth Report provided details about Google announcing data center campuses in Midlothian and Red Oak and said it plans to invest about $1 billion in Texas in 2024, bringing the company’s total investment in North Texas to about $2.4 billion. 

Google announced the Dallas-Fort Worth area as one of the company’s Cloud regions, meaning it will invest in infrastructure and data centers for the area. Majestic’s Silver Creek Business Park will encompass 6.5 million square feet at full build out. Majestic is also a partner in the development of the Fort Worth Stockyards. 

Space Craft and Swinerton are joining forces on Cordo, a 287-unit apartment project in the Optimist Park area of Charlotte. The project at 515 Parkwood Ave., will include eight buildings and nearly 3,000 square feet of ground-floor retail.

The Atlanta Business Chronicle reports the firms recently secured $94 million in financing for the project — a $69 million construction loan and $25 million in joint venture equity. A JLL capital market’s debt advisory team led by Travis Anderson arranged the loan through a Japanese lender. Space Craft acquired the 1.6-acre property in April 2022 for $6 million.

Amenities include a rooftop deck, private courtyard, electric bikes, fitness center, shared dining area and coworking space. Construction is slated to begin immediately and is expected to wrap up in late 2026. Swinerton Builders and Timberlab are the project’s general contractors and mass timber subcontractors.