Extract from Jon Campisi‘s article, “Escalating Costs of Doing Business, Buying Tech May Change Firms’ Cautious Tune on Debt.”
Even as law firms say they’re investing more heavily in artificial intelligence technologies, few large firms are taking on debt, and those that do are most likely to spend it on real estate.
What You Need to Know
- Law Firms have traditionally been debt-averse, but the tide is starting to change a bit as legal operations become costlier.
- While many large law firms don’t appear to be borrowing to fund things like generative AI technology, they are still turning to debt to finance real estate acquisitions and for other working capital needs.
As more Big Law firms embark on costly technological improvements driven by the increased use of generative artificial intelligence, they are not, by and large, turning to debt to fund AI needs, with debt utilization still being more heavily tilted toward real estate construction, expansion and renovation, according to experts and Law.com data.
