Two weeks after his firm, Greenberg Glusker Fields Claman & Machtinger, moved into its new 85,000-square-foot headquarters in Century Plaza Towers, the attorneys were already moving back out in compliance with Gov. Gavin Newsom’s pandemic stay-at-home orders. Shifting immediately to a remote work network that has now become commonplace, Baradaran, the firm’s managing partner, said the initial displacement came with its share of chaos.
But once the shock wore off, Baradaran said he was amazed at how quickly the firm’s mindset shifted from the problems Covid-19 could cause for its clients to the solutions Greenberg Glusker could offer them. As the largest single-office law firm in California, the firm had a leg up on some of its more thinly spread competitors.
Baradaran hasn’t let the landscape changes distract from a booming practice or his involvement in some of the most prominent real estate deals in Los Angeles, including his representation of the city of Beverly Hills.
Earlier this year, he led negotiations on one of the richest development agreements for a municipality on record, the $4 billion, 1.3-million-square-foot Foster & Partners luxury hotel, retail and condominium project.
Baradaran talked with the Business Journal about the firm’s banner year, his work negotiating lucrative deals for the city of Beverly Hills and the state of the hospitality industry.
How has the firm adjusted to the pandemic?
We’ve been fortunate. I thought Covid-19 might have a meaningful negative impact on the firm’s profits and operations for this most recent fiscal year, but it didn’t. We had a banner year, and this year, I expect even better; it may be one of the best years in the firm’s history. I think that’s generally true for law firms as there’s a lot of demand for legal work right now. But we’ve been busy — overwhelmingly, extremely busy — in every practice group. We’ve been hiring because we’ve been so busy.
Greenberg Glusker is the largest single-office law firm in California. Are there advantages and disadvantages to that model?
There’s a number of advantages that became apparent with the lockdown: A strength of our firm is our very strong, close-knit culture and our flexibility, our ability to work from anywhere to meet our client’s needs, which obviously helped with the move to remote work. Our culture kept us together and working hard through a very difficult period compared against more corporate firms that have their attorneys scattered across multiple offices.
The disadvantage of working remotely is the loss of spontaneity. You lose something not being in the same space as someone. But I think with a bit more time, training and structure, that will improve — although nothing is a perfect substitute for the in-
You mentioned hiring. Has the pandemic made that difficult?
When you’re hiring laterally, it’s kind of awkward if you’ve never met the person. They’ve never seen the office, never had a chance to observe the interactions between people or to pick up on our law firm culture, the things that make us unique. You lose that when you’re completely remote.
Having said that, we’ve done a lot to give everyone the same experience if they had not been remote. We’re always looking for opportunities to connect. We have an employee engagement coordinator who has organized fitness classes, mental health workshops, social events and philanthropy opportunities, all of which have been virtual.
In 2014, the same year you became managing partner, you had a prominent role in the $2 billion sale of the L.A. Clippers to former Microsoft Chief Executive Steve Ballmer. What was your involvement?
I was lead transactional counsel for the deal, which may have been the most challenging — and most interesting — deal of my career. The sale of the team took place over the course of seven or eight days under extreme media controversy and scrutiny. We ended up obtaining the highest price ($2 billion) ever paid for an NBA franchise on record at the time.
Can you tell me about some recent prominent real estate deals you’ve helped negotiate?
Over the past few years, I’ve represented the city of Beverly Hills in negotiating their development agreements for projects within the city. The most recent one was the agreement for One Beverly Hills, a multibillion-dollar residential, hospitality and retail development (from Foster & Partners) on the corner of Wilshire and Santa Monica. What was challenging and noteworthy about that engagement was that we were able to negotiate one of the most lucrative, if not the most lucrative, public benefits package anywhere in the country for the benefit of the city. The deal was very lucrative to the city because it will receive approximately $2 billion in direct public benefit over 30 years.
On the occasions where I’ve served as special counsel, what’s interesting is that I’m negotiating with the real estate developers that I’d typically be representing. That’s one of the reasons the city hired me — they wanted someone with deep expertise in this area. Who better to negotiate these deals than someone who represents the real estate developers trying to build these projects in their regular practice?
On the heels of that, a luxury brand just recently engaged the city of Beverly Hills in negotiating a development agreement, LVMH. They own a number of top brands like Louis Vuitton, and they’re looking to develop a Cheval Blanc hotel. It’s a $1 billion development right in the heart of Beverly Hills on Rodeo Drive.
The luxury market has been doing very well. I assume that’s a benefit
to Beverly Hills?
I think so. Beverly Hills is very luxury rich — it’s an ultra-luxury location. A lot of people are looking to locate their hotels and retail operations here, and it attracts the best from all over the world. The city of Beverly Hills has been in a very envious position with all the business that’s coming this way.
There was a lot of chaos in the commercial real estate space when Covid hit. How are things now?
I think things are starting to improve. There are three buckets of tenants our clients were dealing with throughout the pandemic. The first category were the tenants that just went belly up. They couldn’t make it through Covid, and those tenants are gone. The second category are the tenants that have weaved a basket of personal funds, PPP funds and breaks from the landlord to make it through. This category can be touch and go, but they’re determined to see things through. The third basket are the very strong tenants. Maybe they’ve been impacted by Covid, but there’s no question they’ll make it through fine.
The chaos fell off after that first category did. The landlords wanting to keep their tenants in there are working with them to do so, and the tenants are working to survive. But all and all, over the last quarter, there’s been a dramatic improvement both in activity and things coming back.
What are the needs of your hotel clients?
The hit on the hospitality industry was all Covid-related. They have needed counsel and advice to hold on to their assets from being lost to lenders when all their loans were in default because the pandemic caused their occupancy to go from 80% to almost zero in a matter of two weeks. This was an unprecedented situation in the hotel industry. We’ve found ways to help them weather the storm. It’s recovering now, but there’s obviously problems with having your hospitality assets go from doing very well to being in severe distress in a very short period of time.
What are Greenberg Glusker’s plans for the future?
We made a conscious effort to transition leadership to the next generation. That’s key, and I think there are other firms of our size that have not been as successful at doing that — passing that torch, redistributing where revenue is generated from a handful of people to the whole of the firm.
Our revenue has never been more diversified among a broader group of lawyers, as opposed to 20 years ago where it was much more concentrated.
At the end of the day, the success of a law firm boils down to how talented your workforce is. You’re not distributing goods, you’re not a manufacturer; your service is your workforce. So, it’s a priority for us to not only develop a strong culture but to empower our next generation of leaders, so they feel they have a hand in developing it.