When more than 60 attorneys jumped ship from Wilkes Artis in 2001, D.C.’s oldest and once-largest real estate firm, only seven partners remained. The group of property tax and condemnation law specialists considered a dissolution and listened to suitors including Shaw Pittman (now Pillsbury), which absorbed much of Wilkes’ zoning practice, and Holland & Knight, where a number of the firm’s transaction and zoning attorneys landed. Ultimately, they decided to stick together under the Wilkes banner, reinvented as a boutique. We went to visit them at their 18th Street abode. “I don’t know of any other situation like ours,” attorney Stuart Turow told us of the shop’s unconventional makeover.
Chris Camalier, Stan Fineman, and Stuart Turow, fresh from lunch at the University Club when Bisnow caught up with them. These guys aren’t strangers–Chris and Stan have practiced together for 30 years, and the group eats together four to five times a week. Wow, that’s a lot.
Stan, president of the firm, now jokes about its “modest downsizing,” but the adjustment was challenging. After the exodus, Wilkes “had the size of a small firm and the debts of a big firm.” Beyond capital contributions owed to departing equity partners, it faced lease payments on its K Street office (40k sq-ft) and five others in Maryland and Virginia, plus loan terms with Sequoia National Bank placing the firm in default if 25 percent of the partnership left. Even the copy machines caused headaches, due to punishing termination clauses in equipment leases.
The firm negotiated payment schedules with ex-partners and the bank. Now clear of those burdens, partners focus on lowering assessments on properties owned by their clients—a growing group. Long dominant in the property tax area (with clients like Boston Properties and Douglas Development), the practice has achieved a larger clientele and market share than ever in its boutique form, Stuart tells Bisnow. An influx of out-of-state developers is one source of the new work.
On the condemnation side, Wilkes recently represented owners seeking fair value for property taken in the Washington Nationals’ new ballpark development. A January trial for a truck repair shop is the final outstanding case.
Chris thinks a mid-sized mindset helps the downsized firm avoid pitfalls. “We aren’t counting paper clips. There’s no micro-management.” That statement doesn’t apply to Chris’ handkerchiefs; the office’s nattiest dresser has folded his just so.
The partners saw early signs that a boutique model could work for their niche. Most American Property Tax Counsel firms (a group co-founded by Wilkes in 1994) have small numbers, and their specialization does not put them in competition with former Wilkes colleagues, who still send referrals. Another reason to go it alone: their work is contingency-based. Wilkes takes a cut of the tax savings achieved for their clients, which makes an awkward fit with a billable-hour system. “They wouldn’t have known what to do with us,” Stuart says.
The shareholders, who have stayed constant at seven, have no plans for expansion. They currently have two associates and a staff of 25, with three real estate analysts crunching the valuation numbers. “We’re all math geeks,” Stan admits.
A North Potomac man, Stuart used to run football camps for 8-18 year olds with his dad. He now coaches his son’s Boy’s Club team.
Clients don’t want their tax details trumpeted, so Wilkes doesn’t talk about its victories. That’s one more reason to have retained the well-recognized Wilkes name, which the firm keeps visible through seminars on real estate assessment.
Wilkes Artis just celebrated its 80th anniversary. And their old lender, Sequoia? Yep…they’ve been acquired by a larger bank.