Out-of-town lawyers doing big city business

By Holly Dutton

In an increasingly tight and expensive New York real estate market, some commercial developers are turning to law firms based in Westchester, where the quality is the same but the cost is less.

Steven Goldman, a partner in the real estate practice of Kurzman Eisenberg Corbin & Lever, LLP, can afford to charge a lower hourly rate due to the much lower cost of rent for office space outside of Manhattan.

In Westchester, rents are almost one-third of space in Manhattan. Lower rent means lower legal fees. “Instead of paying $700 or $900 an hour, clients are paying $500 or less,” explained Goldman, whose clients include New York real estate developers such as  Bayrock Partners, Fisher Brothers, Stillman Development and Artimus Construction.

STEVEN GOLDMAN

A former real estate partner at Brown Raysman Millstein Felder & Steiner LLP, and Baer Marks & Upham LLP, Goldman’s projects include Tishman’s 2 Court Square in Long Island City, the Centurion condos on West 56th Street designed by Pei Partnership Architects, Bayrock’s Trump Soho Hotel, and 151 West 52nd Street, the building that houses the Michelangelo Hotel.

He said that working for a large firm with hundreds of attorneys was “killing” his billing structure amd moving to the burbs just made economic sense.

Born and raised in New York, now he makes a 20-minute commute from his home in Nyack to his White Plains office, a major change from his former routine, seven years ago, commuting to Manhattan and back every day.

“Bottom line, we just decided from a lifestyle and economic point of view that our overhead expenses are substantially less than what we would pay in New York City for rent,” said Goldman. “Salaries, the labor cost and the rent are the single most important items.

“We are representing very large, sophisticated developers, [and are] up against major law firms representing banks or sellers. I have not lost any major clients at all as a result of the move and I think my business has actually grown.
“I think part of it is the competitive nature — some of the people I compete with charge $750 an hour and I charge $400.”

Condo buildings and co-op boards are also clients of Goldman’s, and despite pressure from big firms to change his rates, he didn’t.  “We’re the same lawyers we were in New York City,” he said. “We don’t have all this back office stuff, we’re streamlined, most research is done online, so the library doesn’t have to be the type afforded by large firms.”

Sub-contracting her Westchester work makes economic sense for Jamie Hieberger-Harrison, founder of the landlord-tenant law firm, Hieberger & Associates.

“When I have cases in Westchester, it doesn’t make financial sense to send my lawyers there,ˮ said Harrison.

JAMIE HEIBERGER HARRISON

“I have two or three law firms in the suburbs that I sub-contract work to because it is cheaper to use the local lawyers. My people handle a slew of cases — seven to ten for each attorney. If they have to travel to Westchester to work on one case, it means they can’t also be working on their other cases in the city.ˮ

And just because a lawyer works in the burbs doesn’t make him any less of a lawyer, agreed Harrison. “They are good lawyers who also have the benefit of knowing the local judges and court clerks. Whatever your field is, whether its a moving violation or an eviction, it makes senses to have local people who know the local courts.”

As for catching on with large, established Manhattan firms, in some cases it will and some it won’t, said Goldman. “I can’t speak for other areas like Long Island, but I noticed that up in the White Plains area, some of the major law firms have opened offices and shifted people up here so they can save on costs,” he said.

“Right around us, there are two or three firms that opened offices up. I don’t think major Wall Street firms can do this because they are so organized around being in the city, their staff and support are all city based.”

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