Where the Deals Are: Understanding Transactional Lateral Demand in 2026

Much of the conversation around lateral hiring in 2026 has focused on litigation, investigations and enforcement.

That makes sense from a volume perspective. Disputes work remains resilient during periods of uncertainty and accounted for a significant proportion of recent partner movement.

However, that headline tells transactional lawyers very little about the opportunities available within their own market.

Transactional demand behaves differently. It is shaped by deal flow, access to capital, client confidence and the sectors attracting investment. In 2026, the market is active but activity is concentrated rather than evenly distributed.

For lawyers considering their next move, the question is no longer simply whether firms are hiring.

It is whether your experience is aligned with the practices, clients and transactions currently generating demand.

The Transactional Deal Market Has Restarted

The wider M&A environment provides important context for lateral hiring.

US M&A involving domestic targets was on course to reach approximately $2.3 trillion in 2025, representing a 49% increase on the previous year. That momentum continued into 2026, with deal values remaining strong across many sectors. According to PwC’s Global M&A industry trends, the market is entering a new phase where activity is increasingly driven by AI investment, infrastructure and large-scale strategic acquisitions rather than a broad-based recovery.

However, the recovery has not been evenly distributed.

Much of the recent increase has been driven by high-value transactions rather than a broad rise in deal numbers. PwC’s 2026 outlook describes a “K-shaped” market in which deal values are rising while volumes remain under pressure, with megadeals accounting for an increasingly large share of overall activity.

This distinction matters for recruitment.

A small number of major transactions can generate substantial workloads for the firms advising on them without creating widespread hiring across the entire legal market. As a result, lateral recruitment remains focused on specific teams, skill sets and client-led requirements.

This is not a return to the indiscriminate hiring environment seen during the post-pandemic deal boom.

Firms are hiring but they are doing so selectively.

Private Equity and Funds Remain Highly Competitive

Private equity continues to be one of the most competitive areas of the transactional lateral market.

Sponsor-side M&A, fund formation, secondaries, co-investments and portfolio company transactions are all creating demand. As middle-market activity improves, firms with strong sponsor relationships are looking to strengthen the associate teams responsible for delivering that work.

The market is also highly concentrated.

A relatively small number of firms handle a significant proportion of premium private equity mandates. This creates movement in both directions: leading platforms recruit to protect capacity, while firms seeking to grow their market share hire experienced lawyers who can strengthen their credibility with sponsors.

Candidates with meaningful sponsor-side experience, strong deal sheets and exposure to transactions from signing through to completion remain particularly attractive.

Private Credit Is a Structural Growth Market

Private credit is no longer a niche alternative to traditional bank lending.

It has developed into a major source of corporate and acquisition finance, with private credit assets now exceeding $2 trillion and expected to continue growing over the remainder of the decade.

That expansion is creating demand across:

• Direct lending
• Leveraged finance
• Asset-backed finance
• Structured credit
• Fund finance
• Restructuring and special situations

The growth story is becoming more complex as well.

Banks are increasingly partnering with private credit managers, new investment structures are bringing individual investors into the asset class, and regulatory scrutiny is increasing alongside its scale. Morgan Stanley reports that semi-liquid wealth products now represent almost a third of the US direct lending market, illustrating how the investor base is broadening.

For finance lawyers, this makes private credit one of the strongest areas for long-term lateral opportunity.

Energy and Infrastructure Are Being Reshaped by AI

Energy and infrastructure transactions have become increasingly connected to the growth of artificial intelligence.

AI data centres require enormous amounts of power, creating demand for new generation, transmission, storage and supporting infrastructure. Deloitte estimates that US power demand from AI data centres could increase from approximately four gigawatts in 2024 to 123 gigawatts by 2035.

That demand is influencing investment across traditional and renewable energy assets.

Data centre developers and technology companies need reliable power alongside decarbonisation strategies. As a result, lawyers may find themselves advising across renewable generation, gas, nuclear, battery storage, grid infrastructure and project finance within the same wider market.

The strongest candidates are therefore not always those with the narrowest experience.

Firms increasingly value lawyers who can work across project development, financing and M&A, particularly where energy assets intersect with digital infrastructure and technology investment.

Technology Transactions Are Becoming More Deal-Embedded

Technology remains a major driver of transactional activity, but the work is becoming increasingly integrated with other practices.

Technology, intellectual property, data protection and commercial arrangements are now central to M&A, infrastructure and investment transactions rather than being treated as separate workstreams.

For technology transactions lawyers, this changes how experience should be presented.

Firms are particularly interested in candidates who can advise on technology and data issues within live corporate deals, including:

• IP ownership and licensing
• Data use and regulatory risk
• Transitional service arrangements
• Commercial technology contracts
• Cybersecurity and AI-related diligence

The ability to work effectively alongside corporate, finance and regulatory teams can be as valuable as technical specialism alone.

Capital Markets Demand Remains More Cyclical

Capital markets and structured finance hiring continues to be closely linked to interest rates, investor confidence and available issuance windows.

When markets reopen, demand can rise quickly. However, it can also slow more sharply than hiring within private equity or private credit.

For candidates, timing matters.

The strongest move may not be to the firm currently experiencing the most visible activity. It may be to the platform investing ahead of the next issuance cycle, particularly where there is evidence of client demand and a clear plan for team growth.

What Transactional Lawyers Should Take from the Market

Transactional lateral demand in 2026 is genuine, but it is not universal.

The clearest opportunities are concentrated across private equity, private credit, energy and infrastructure, and technology-related transactions. Firms are also favouring candidates with recent, demonstrable deal experience rather than hiring against general market optimism.

Associate demand is particularly strong for lawyers with several years of portable transaction experience who can join a team and contribute quickly.

At partner level, the assessment is different.

Hiring committees increasingly want evidence of portable relationships, credible revenue and a clear explanation of how a candidate’s practice complements the firm’s existing platform.

There is also growing competition from outside private practice. Private equity firms, credit funds and financial institutions continue to recruit transactional lawyers who want to remain close to deals while moving into an investment or in-house environment.

Positioning Your Experience for the 2026 Market

The transactional market is active.

The more important question is whether your experience sits within the areas attracting investment, client instructions and lateral hiring.

Candidates who can clearly connect their deal experience to current demand will be best positioned. Firms, meanwhile, need recruitment strategies built around the markets they genuinely expect to grow not those that were busiest during the previous cycle.

Understanding where the deals are is only the first step.

The real advantage comes from understanding where they are going next.

Looking to Strengthen Your Transactional Team?

Whether you are building a private equity, private credit, infrastructure, technology or broader transactional practice, successful lateral hiring begins with a clear understanding of the market.

Our specialist consultants work closely with law firms and transactional lawyers to identify where demand is developing and connect the right professionals with the right platforms.

Get in touch with our team to discuss your hiring plans or explore your next move in the transactional legal market.

Frequently Asked Questions

Which transactional legal practices are hiring in 2026?

Demand is strongest across private equity, private credit, energy and infrastructure, and technology-related transactions, although opportunities vary between firms and markets.

What experience are law firms looking for?

Firms typically prioritise recent deal experience, strong technical skills and exposure to the clients or transaction types relevant to their practice.

Is private credit a good area for lateral lawyers?

Private credit continues to expand and is creating opportunities for lawyers with direct lending, leveraged finance, structured credit and asset-backed finance experience.

What do firms assess when hiring lateral partners?

Firms generally look for portable client relationships, credible revenue, market reputation and a practice that complements their wider strategy.

Final Thoughts

Transactional hiring is active, but the strongest opportunities are concentrated in the sectors driving investment and deal activity. Private equity, private credit, energy and infrastructure, and technology-led transactions continue to shape where firms are growing and where lateral demand is strongest.

For both lawyers and firms, success will come from staying aligned with these trends. Understanding where the market is heading, and positioning yourself accordingly, will be key to making the right move in 2026 and beyond.

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