Serhiy V. Piontkovsky, the head of Baker McKenzie's Energy, Chemicals, Mining and Infrastructure and Real Estate practice groups, was drawn to real estate and construction because the subject matter is tangible and the results are visible. In an interview with Best Lawyers CEO Phillip Greer, Serhiy discusses what else he strives for in his field, including finding practical, commercially viable solutions for his clients.
What inspired you to focus on real estate?
Early on, I wanted to see tangible results beyond just our legal advice or assistance to clients. What was the ultimate reason for our legal recommendation? What did the client get as a result? In the end, just seeing some new developments was very effective for me: a beautiful building on what was before just a field. You can see those results. You can touch them. And it makes you really proud to be a part of making it happen. In terms of joining Baker McKenzie, I was initially drawn in by the brand and the reputation. As it often happens in the modern world, at least superficially, brands and reputation have some influence over our decision making. Baker McKenzie is a very influential brand name and maintains a very good reputation. And then, of course, I met people at the office. I believe that we have one of the strongest teams here in the Ukrainian legal market.
Are there any attorneys whom you'd like to recognize as particularly valuable to the firm?
Yes, I would like to mention my partner Lina Nemchenko. Lina has been with our firm for more than 10 years. She started as a junior lawyer and now she's one of my partners and she represents, as a leading lawyer, many well-known international companies doing real estate business in Ukraine. Also, in Baker McKenzie's Ukraine office we just launched a new practice: the IT practice, which is headed by Oleksiy Stolyarenko, our very talented, young lawyer. In further news, we developed a new practice in the healthcare industry group. We just promoted Olha Demianiuk as our new partner heading the new healthcare industry in Ukraine. So that's what I wanted to share about the firm, our attorneys and our local office in general.
I would also like to mention that we just had our financial year-end, as Baker McKenzie's financial year runs from July to the end of June. Globally, our revenues reached USD 2.9 billion. That's Baker McKenzie's global revenue for the financial year just past, almost USD 3 billion, 10 percent more than in the previous year. As a team, we are all very proud of that.
What trends in the real estate sector have you witnessed this past year, and do you see those trends continuing in the coming years?
To start, we see the market is becoming more active. Unlike, for instance, the European property market, Ukraine's entry into the growing real estate market came much later. This was, in part, due to the conflict in Eastern Ukraine, which had a general effect on the property market in Ukraine. Finally, in the last year, we've seen some recovery in real estate prices and that's why we are seeing more deals. We also see that banks—which foreclosed on some bad loans and property deals a while ago—are trying to dispose of those assets, which of course are not their core business. So, we are seeing more and more deals in that market now that the banks are disposing of those properties and their new buyers are succumbing and buying them.
In the legal area, we're seeing a shift where clients are expecting lawyers to become more efficient (in terms of their work) and more cost-efficient. This is quite evident, as in many areas we are seeing a trend of moving from the billable hour to seeking budgets and moving to so-called "alternative fee arrangements." There is still a combination of the typical fees that lawyers used to charge in the past, but now we can see that clients are demanding we come up with creative solutions. Clearly, this is a change in practice that will continue going forward.
How does your firm stay agile in the face of competitors?
I think the reason we are one of the leaders in our area, and a leading law firm in real estate in Ukraine, is because we have an excellent team of lawyers. We are not just lawyers who know the law. It's not enough now just to be a good lawyer. To get ahead of the competition, a good lawyer also needs to understand how the industry works. You need industry knowledge and an understanding of what the client expects, not only from a legal point of view but from a commercial and business point of view. Furthermore, success in the face of competitors requires a deep knowledge of industry players: property agents, brokers, consultants, and architects. And of course, a good reputation. Tapping into this industry knowledge is our goal when we train our lawyers, to give them not only a solid legal framework but also give them industry training and crucial contextual information.
We often invite industry players to come and present, not only legal issues, but commercial issues, construction issues, and sometimes technical issues in a case. Doing so gives us the opportunity to speak the same language as the client, to understand the client very quickly, and to provide the client, not with theoretical, but very practical advice. We aim to go beyond simply describing the legal issues or legal problems, but to find a solution—a practical solution. Clients want what is commercially acceptable but at the same what is in accordance with legal requirements. That is the most important thing. It's not easy to find such a solution but the art of property law and the skill of the property lawyer is, ultimately, to provide the client with such a practical and legal solution.