Law firms expand digital infrastructure teams as data center transactions surge

Kirkland and Latham build benches of over 100 lawyers as energy and compute transactions hit record deal volumes

A rapid buildout of artificial intelligence data centers by hyperscalers and financial backers has prompted major law firms to assemble dedicated digital infrastructure practices.¹ Law firms that once treated power and utility regulation as low-margin specialty practices are reallocating transactional partners to manage the land, electricity, equipment, and capital requirements of large-scale computing facilities.¹

The expansion has shifted staffing across corporate, real estate, energy, and regulatory groups. Major firms have established digital infrastructure groups drawing specialists from finance, insurance, and environmental law to handle transactions that combine property acquisitions with massive energy procurement and equipment financing.¹

According to Melissa Kalka, an M&A and private equity partner at Kirkland & Ellis in Dallas, data center dealmaking has accelerated rapidly.²¹ “Personally, I’ve done $110 billion worth of deals in the last 12 months,” Kalka said in an interview with Semafor.¹ Kirkland & Ellis has expanded its digital infrastructure team to more than 100 people, integrating real estate attorneys alongside infrastructure specialists and adding lawyers focused on customer contracting and regulatory enforcement.¹²

Surging deal volume and specialized practices

Data center merger and acquisition volume reached a record $69 billion in 2025, according to reported figures from S&P Global, as investors committed capital to support artificial intelligence infrastructure.² The scale of individual transactions has grown alongside the physical power requirements of new facilities, altering the legal work required to close financing packages.

Gabe Silva, a partner in the energy and infrastructure group at Simpson Thacher & Bartlett, observed that power capacity needs have increased dramatically.² Silva noted that two years ago a 100-megawatt data center was considered massive, whereas developers are now negotiating facilities designed for up to 5 gigawatts to support computing engines.

To capture these transactions, law firms are building specialized practices capable of managing the full life cycle of assets. Latham & Watkins announced that it advised on more than $1 trillion of digital infrastructure transactions during the first half of 2026.³ The firm assembled a team of nearly 200 lawyers across 28 offices and 24 practice areas to handle matters ranging from site acquisition and power procurement to capital markets offerings.³

Justin Stolte, global chair of the energy and infrastructure group at Latham & Watkins, noted that client demand has centered heavily on energy access.² Stolte explained that over the last six months transactions have shifted toward securing power at scale, even as project risks increase due to regulatory scrutiny and local community resistance.²

Lateral recruitment and talent shortages

The rush to staff these groups has triggered intense lateral hiring across major legal markets. Research tracked by Pirical Legal Professionals showed that lateral partner moves involving attorneys with data center experience increased 65% across Am Law 200 firms in 2025.⁴ Between January 2020 and January 2026, lateral partner moves with data center experience expanded by 168%.⁴

Pirical reported that Kirkland & Ellis held the largest bench in the sector with almost 250 partners possessing data center experience as of January 2026.⁴ Dentons followed with 195 partners, Latham & Watkins with 110 partners, Greenberg Traurig with 101 partners, and DLA Piper with 100 partners.⁴ Across the Am Law 200, 21% of partners with data center experience practice primarily in real estate, while 16% work in corporate law.⁴

Geographically, lateral hiring has concentrated in established corporate centers while expanding into regional hubs. Pirical recorded 131 data center partner hires in New York City, 87 in London, and 85 in Washington between January 2020 and January 2026.⁴ Chicago recorded 43 partner hires, supported by more than 70 existing data centers, while Texas saw 39 hires in Dallas and 35 in Houston as the state grew into the second largest data center market in the United States.⁴

The rapid growth has created recruitment challenges, as firms seek lawyers with rare combinations of regulatory, energy, and corporate experience. Chirag Dedania, a partner at Latham & Watkins, told Semafor that the scarcity of seasoned practitioners creates a “challenge of maintaining quality while continuing to grow.”¹

Contract complexity and community opposition

Legal teams face novel drafting demands because large data center developments lack established boilerplate contracts. Attorneys must negotiate custom agreements governing long-term power delivery, grid interconnection, specialized equipment purchases such as graphics processing units, and high-stakes commercial tenancies.

The transaction timeline has compressed simultaneously. Morgan Melby, a partner at Morgan, Lewis & Bockius, told Semafor that transactions that previously required three to six months to negotiate are now closing in three weeks.¹ Morgan Lewis launched its Data Center Strategic Initiative roughly 18 months ago, assembling lawyers across real estate, power, telecommunications, tax, and cybersecurity.²

Much of the current legal work involves establishing protective contractual frameworks against anticipated disputes. Data center projects face rising public opposition and regulatory hurdles over local water use, electricity grid stability, and noise pollution. Sam Rudnik, a partner at Simpson Thacher & Bartlett, observed that community buy-in has become a critical variable, with some sponsors abandoning planned developments because of local resistance.²

A survey conducted by Foley & Lardner among developers, financiers, and operators found that 63% of respondents anticipate a strategic market correction by 2030, while nearly 40% described the current development pace as unsustainable.² Even so, 95% of survey respondents expressed confidence that the industry will meet compute demand by the end of the decade.²

Reporting note: this piece draws on reporting from Tim McDonnell published by Semafor on September 3, 2026, alongside data center workforce analysis from Pirical Legal Professionals and transaction announcements from Kirkland & Ellis and Latham & Watkins.

Source: Semafor, September 3, 2026

References

This article is based on 5 sources, listed in the order they are cited.

1. 1 TM Tim McDonnell announcement · 3 Sep 2026 Exclusive: Big Law sees a gold mine in data centers See the source
2. 2 K kirkland.com For Dealmaking Firms, Data Centers Are Money Centers. Will It Continue? | News | Kirkland & Ellis LLP See the source
3. 3 L lw.com Latham & Watkins Surpasses US$1 Trillion in Digital Infrastructure Transactions During H1 2026 See the source
4. 4 P pirical.com third party · 25 Feb 2026 Which Law Firms Are Powering The Data Center Boom? See the source
5. 5 L lw.com Digital Infrastructure See the source