The projects market speaks with one voice on deal flow in the coming year: it is going to be down. And while 2008 saw the banking community take the brunt of the downturn, the next sector to feel the pinch will be advisory.

As the market continues to tighten we have seen a considerable drop in global project finance deal value with full-year 2008 figures falling 8.7% against the 2007 market high.

Infrastructure Journal tracked 930 individual infrastructure transactions – combined global project finance and corporate finance deals – to reach financial close over the course of 2008, giving a total of $475bn (£329bn) worth of deals.

In project finance alone, the value (debt plus equity) dropped to $285bn (£198bn) from $312bn (£216bn) in 2007. But deal count fell just 2.7% to 678 in 2008 from 697 in 2007, kept artificially high by a swathe of small-scale renewable deals.

In 2007, a total of 221 legal advisers worked on 1,118 deals. This past year, 235 legal advisers worked on 1,048 transactions. In recent years, law firms have targeted private sector advisory roles ahead of acting for the procurer, seeking to build stronger client relationships and work on the sexier side of the table.

There are some law firms – and Pinsent Masons stands out as the perfect example – that have a 50:50 split of public/private advisory mandates in the infrastructure sector. The wisdom of this will make itself felt as the year progresses and half the team is still billing strongly while the other is waiting for financial close before it sees any return.

With most lawyers' fees paid on a success basis and a year of limited financial closes on the cards, this will have to impact on the infra teams that have been built up in recent years to cope with continued growth in this sector.

As one leading project finance lawyer says: "Yes, there are going to be areas where business will be down and questions will be asked as to whether there is too much capacity within the law firm, but I believe the fundamental drivers of energy and infrastructure remain.

Received wisdom has it that law firms with a track record in advising the public sector will be in a good position to ride out the storm. And as such, those that have chased better returns in the private sector will likely struggle.

As everyone braces themselves for the tough times ahead, the question is how bad it is going to be, I have been genuinely impressed by the air of optimism since the New Year. The banking sector is a lot more bullish, lawyers are guardedly cautious, financial advisers are getting slightly nervous about the amount of competition that is in the running for deals, and developers are getting a shot in the arm.

There is also a sense from legal teams targeting projects that they are committed to the sector for the long term, even if 2009 will see a sharp fall in completed deals.

It will be interesting to see if this translates to downward pressure on fees. But as one banker says: "At the end of the day, I suspect not. You will probably see quotes go down and the bills stay the same."