Trowers & Hamlins (London)

Our view...

Trowers & Hamlins was traditionally a rather genteel, laces and braces outfit with a reputation for real estate, housing and public sector work. Its relatively small private client department seemed to be funded almost entirely by a handful of wealthy Middle Eastern sheiks, and it leveraged on this to make a big effort to get more out of the region and up its corporate game. For a while this led to impressive growth, but recently the firm has been having a pretty wobbly time of it.

Corporate and Real Estate (which still includes lots of housing and public sector - not very sexy but a big niche for the firm) form the lion’s share of T&H’s work: some 80% of its practice. Property takes up over a third of global revenue and the firm's four UK offices (Manchester, Birmingham, London and Exeter) are all top rated for social housing.

As far as the corporate practice is concerned, the Middle East is where it’s at. The firm has offices in Oman, Dubai, Abu Dhabi, Bahrain and Cairo. The firm does a huge amount of transport work in the Middle East and has a great deal of experience in Islamic finance. The firm’s private client team may still be small, but it’s also still successful in feeding the corporate dept.

After a torrid couple of years, there are signs turnover is beginning to recover. The firm did fairly well during the financial wobbly period of 2007/8, when despite dramatic falls in the real estate revenue at other firms, Trowers managed to grow to £77.6m. And in 2008/09, revenue jumped again by an impressive 15.3% to £89.5m. Whilst the following year saw a small drop to £89.4, the firm was still more than pulling its weight compared to its rivals.

At least it was until 2010/11, when the firm suffered a double digit drop, with revenues plunging 12% to £78.6m, pushing the firm out of the top 40. The firm blamed the difficulties in the social housing market. But its Middle East offices were also in the doldrums, following the ructions of the Arab Spring which caused the Cairo office to close for weeks. And its Saudia Arabia office was shuttered permanently in 2012 after partner defections. But in the 2011/12 period its turnover increased - slightly - by 3%, to £80.8m. Trowers is bullish about a strong rebound, but it's still a tricky time for a firm which relies so heavily on housing work and the fragile Middle East.

To add to Trowers' woes it also fared poorly in the 2013 Firm of the Year Survey, languishing near the bottom of the table for the second year running.

But there are upsides, including what’s widely considered to be a genuine commitment to work life balance. And the firm has moved to "excellent" swanky new offices on Bunhill Row, where apparently the only downside is that the "view from the meeting rooms is somewhat spoilt by Slaughter and May".

Equity partners all make pretty much the same; £480k. And although that's rather less than in the good old days (in 2009 PEP was £553k), it's 9% up on 2010/11. But, in any event, you're unlikely be amongst the top earners. Only 25 of T&H’s 118 UK partners are equity. Although at least this year all 13 of its March qualifying trainees were kept on, after a dismal 2012 when only two out of seven were retained.

The firm's focus may not be everyone’s cup of tea, and given the current state of the housing market and the troubles in the Middle East it's not going to be a quick path to recovery for the Trowers. But if the work does float your boat then T&H may be worth serious consideration. Especially as last year's woeful retention rate may, as Trowers claimed, have been a blip.

As one lawyer says, “in comparison to everyone I was at law school with, I am the only one who still enjoys being a lawyer”.

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