Legal Notice – Sept. 14, 2026
Law firms now are more apt to upsize their offices than downsize them
Even as the tech sector has moved ahead of law firms as the number two office occupier in New York City (second only to finance), it’s instructive to look at what legal tenants are doing nationwide as part of a long-term occupancy trend. There, the news is very good: Cushman & Wakefield reported that U.S. legal sector leasing reached a quarterly record of 7.3 million square feet in the second quarter of 2026, 23% higher than the previous quarterly record.
Especially encouraging is law firms’ decreasing emphasis on smaller spaces in either renewals or relocations. Expansions accounted for 43% of legal leases signed during the first half of 2026, while downsizing represented just one-fifth of transactions, according to Cushman & Wakefield. Downsizing’s share of office leases has been steadily declining.
“The legal sector is showing a clear preference for larger footprints, with expansion activity reaching its highest share since 2019,” said David Smith, head of Americas Insights, Global Think Tank at Cushman & Wakefield. “Law firms’ largely office-centric work models combined with continued expansion activity both point to sustained demand from firms evaluating how their real estate needs are evolving.”
Half of the 10 largest legal leases recorded over the past year were signed in Q2 2026, while 15 of the 21 legal leases exceeding 75,000 square feet signed year-to-date were completed during the quarter. The sector is on pace to record 24% more deals in this size category than in 2025.
The 10 major U.S. legal markets accounted for 69% of Q2 leasing activity, led by New York City, Chicago and the Washington, DC metro area. They accounted for nine of the 10 largest leases signed during the quarter, while New York City and Chicago each posted their strongest quarters for legal leasing on record.
Across the 10 major legal markets, law firms accounted for 14% of total office leasing in Q2. Beyond the major legal hubs, nine additional markets recorded more than 100,000 square feet of legal leasing in Q2. They included Minneapolis with 274,000 square feet, Salt Lake City with 145,000 square feet and Pittsburgh with 127,000 square feet.
“Law firms remain among the clearest sources of office demand nationally,” Smith added. “The largest legal markets continue to attract significant commitments, but activity is also extending across a broader range of U.S. markets. That geographic breadth is an encouraging sign for the sector as we look toward the second half of the year.”
Although the report clearly charts leasing trends in terms of size, one question not discussed is the importance of asset class. Two of the largest Q2 law firm leases–Simpson Thacher & Barlett’s 916,000-square-foot commitment at Extell Development’s 570 Fifth Ave. and McDermott Will & Schulte’s lease of 150,000 square feet with BXP at 343 Madison Ave., both in Midtown Manhattan–entailed relocating to new construction. So new, in fact, that neither property has been delivered yet.
The newest Class A product may command a curb-appeal advantage over even the most prestigious vintage Class A competitors. Naturally, these new builds can charge premium rents. Assuming that top law firms bring a cost-no-object mindset to their expansion plans, where does this leave other office owners hoping to attract legal tenants?