Uneven 1st Half on K Street
Three Lobby Firms Break Into Top 25
K Street turned in an erratic first-half performance for 2009, as several mid-sized lobbying shops broke into the ranks of the top 25 lobby firms, while many of the biggest earners faced revenue drops compared with the first half of 2008.
Fourteen of the top 25 firms reported double-digit changes in revenue.
But while the majority of top firms reported revenue losses when comparing the first six months of 2009 with the same period in 2008, almost every K Street shop is reporting high revenues when compared with the first quarter of 2009.
Several mid-sized firms, as well as a handful of relatively younger lobby shops, weighed in with stratospheric revenue growth.
The Podesta Group, Holland & Knight, Brownstein Hyatt Farber Schreck and K&L Gates all reported more double-digit growth over the same period.
Breaux Lott Leadership Group, McBee Strategic Consulting and Mehlman Vogel Castagnetti Inc., all of which have been in existence less than 10 years, pushed their way into the top 25.
Some longtime K Street titans are no longer on the list.
Most noticeably absent is the PMA Group. The firm, which ceased operations on March 31 after becoming embroiled in a federal probe, reported $7.5 million during the first six months of 2008. It reported only one filing during the first half of 2009, billing $10,000.
Livingston Group also dropped off the list. The firm, which previously included its foreign lobbying as part of its total, reported billing $3.8 million in federal lobbying for the first six months of 2009, according to Senate lobbying disclosure reports.
The top three lobbying firms — Patton Boggs, Akin Gump Strauss Hauer & Feld, and Van Scoyoc Associates — maintained their positions despite revenue drops or only marginal increases.
No. 1 Patton Boggs reported a drop of 9.8 percent, bringing in $18.5 million during the first six months of 2009 compared with $20.5 million over the same time period in 2008.
Patton Boggs’ Nick Allard doesn’t see that as something to worry about, noting that the firm posted higher numbers compared with the first quarter of 2009.
Patton Boggs reported an 18 percent increase in business between the first and second quarters of 2009, billing $8.5 million and $10 million, respectively, for the first two quarters of 2009.
“I am cautiously optimistic that it’s going to sustain, but it’s too early to tell,— Allard said.
Allard also noted that the firm had added 63 registrations during the first half of 2009, while reporting only 53 terminations.
The biggest changes in top earners happened among mid-level firms.
The Podesta Group continued its meteoric rise, posting a 56.8 percent growth, knocking out Cassidy & Associates for the No. 4 ranking.
Podesta’s revenue jumped from $7.4 million during the first half of 2008 to $11.6 million this year.
“Growth has come across all of our practice areas,— firm founder Tony Podesta said. “We’ve been doing health care for 20 years, but five years ago we weren’t doing energy and we really weren’t doing financial services, and now we have big energy and financial services practices.—
Podesta is on pace to nearly double its revenue since 2006.
Holland & Knight jumped six spots to No. 5, with 39.5 percent growth this year compared with the first half of 2008. The firm brought in $10.6 million for the first half of 2009 compared with $7.6 million over the same period in 2008.
Holland & Knight’s head of public policy, Rich Gold, attributed the growth to what he called a deep bench in energy and financial services, and close ties to the Obama administration.
“I think it’s having an activist government,— Gold said of the uptick. “The fact that we’ve got a Democratic majority in both houses of Congress and a Democratic president for the first time since 1994 is driving a lot of people both defensively and offensively to play … in a way that they otherwise would not have.—
Cassidy & Associates, long a stalwart among the top three in lobbying revenue, dropped out of the top 5 to the No. 6 slot, reporting $10 million during the first six months of 2009, a decline of $2.1 million over the same period in 2008.
Dutko Worldwide slid from No. 5 to a tie for No. 6, with a 3.9 percent drop in revenue. The firm reported billing $10 million during the first half of 2009, down $400,000 over the same time period in 2008.
K&L Gates moved up two spots to No. 8 with 18.8 percent growth. The firm reported billing $9.5 million this year compared with $8 million during the first half of 2009.
Tim Peckinpaugh, head of the firm’s lobbying practice, attributed the growth to the increase in legislative activity and the explosion of regulatory work, as businesses are getting more involved in Washington.
Brownstein Hyatt Farber Schreck also reported a dramatic jump, pushing its lobbying revenues up by 31.9 percent this year compared with the first half of 2008. Brownstein reported billing $9.1 million compared with $6.9 million during the first half of 2008.
It wasn’t just some K Street stalwarts that produced sharply higher figures.
Breaux Lott Leadership Group, which started in January 2008, grew 66.7 percent. The firm made its first appearance among the top revenue earners, in a tie for No. 19, billing $5.5 million during the first half of 2009 compared with $3.3 million over the same period in 2008.
McBee Strategic Consulting, which started in 2002, and Mehlman Vogel Castagnetti, which opened its doors in 2004, are tied for No. 22, reporting 5.4 million for the first half of 2009. That’s a 22.7 percent increase for both firms.
Alex Vogel, co-founder of Mehlman Vogel Castagnetti, attributed the growth to the busy agenda.
“The reality is there’s a lot going on in Washington,— Vogel said.
The firm added 14 clients during the first six months of 2009, according to Senate lobbying disclosure reports.
Elizabeth Jordan contributed to this report.