Reply #100: Cadwalader, Wickersham & Taft - New York, Charlotte, Washington - 96 jobs lost (Real Estate Law)

[Pale Blue Dot]

This morning, the partnership of Cadwalader, Wickersham & Taft is slated to inform 96 lawyers — a group spanning from first-year associates to counsel — that they will be laid off. 90 of the 96 cuts will come out of the real estate finance and securitization practices, said the firm’s chairman, Chris White. Most of the affected lawyers, said White, are in the New York, Charlotte and London offices, with “one or two” in Washington. The 96 layoffs are in addition to the 35 lawyers the firm laid off in January.

Last evening, White, and the head of Cadwalader’s litigation practice, Greg Markel, invited the Law Blog to a 40th floor conference room, where they explained the move.

White said that real estate finance and securitization — areas that he referred to, alternatively, but not necessarily inconsistently, as “discrete areas of the firm” and “a large part of the practice” — grew “very rapidly” over the past five years, focusing principally in the area of commercial mortgage-backed securities. “Our finance department was involved in every major leveraged buyout last year,” said White, including Blackstone’s $23 billion acquisition of Equity Office Properties.

“All of those financings were done on mortgages on those properties, and those mortgages were turned into securities. Every major deal that was done in 2006 and 2007 was done off the back of mortgage-backed securities.” He added: “There was a frothiness that occurred as a result of the Blackstones and the Apollos using mortgage-backed securities to fund their buyouts. It was a lot like junk bonds becoming the instrument of choice in the late 80’s and early 90’s.”

http://blogs.wsj.com/law/2008/07/30/cadwalader-to-cut-96-lawyers/