They say the third time's the charm, and in the case of Freshfields Bruckhaus Deringer's Singapore base, they might be right. After one significant retrenchment in the region and one full office closure, the magic circle finally appears to have hit the ground running on its third attempt to crack the South East Asian city-state.

It began for Freshfields in 1980, when it was the first international player in town, invited to the market by the Singaporean government – which was trying to promote the city-state as a financial hub. At this time the firm was practising both local and international law and, by all accounts, was extremely successful.

Just seven years later though the firm lost its local licence after an internal memo stating that it would not promote a Singapore lawyer to partner leaked into the public domain, causing a stir in the region. By the late 1980s the firm had just one partner, Kevin Julian, left on the ground.

In the early 1990s Freshfields started bulking up in Singapore once more, but this time just on the international side. London partner Charles July relocated and the office built up with a focus on banking and infrastructure finance work. Again the office was a success, counting around five partners on the ground by the end of the decade. In 2001 the firm added to its international law presence through a tie-up with local firm Drew & Napier.

But as the economy slumped and some of Freshfields' key Singapore partners departed, the firm struggled to retain the profitability of the office and, in 2006, announced plans to formally pull the plug on the operation. By the following year, Freshfields had closed the doors, ended its alliance with Drew & Napier and parachuted its two remaining Singapore-based partners to Hong Kong. Reports said the rationale was to consolidate the firm's Asian offering into a two-centre, China and Japan-led practice, servicing smaller markets such as Singapore and Thailand (where it also closed an office that year) from these hubs.

It wasn't until three years ago, driven by the emergence of Singapore as a regional hub for South East Asia, management decided to re-enter the market, and this time get it right, opening a new office in Collier Quay.

"The investment banks were saying to Freshfields, 'Singapore is really important'," says a source close to the firm. "They also realised that Hong Kong was not much of an energy centre – and they wanted to have a stronger energy practice in Asia."

Today the firm has four partners on the ground focusing on high margin corporate and disputes work spanning countries such as Indonesia, India, Malaysia, Thailand and the Philippines. The team includes veteran Freshfields corporate partner Stephen Revell, who relocated from London, energy M&A partner Gavin McLaren, who was hired from top tier Australian outfit Allens, global arbitration head Lucy Reed, who moved from Hong Kong last year, and former Linklaters' India specialist and capital markets partner Arun Balasubramanian, who was hired by Freshfields to co-chair its India practice from the base in the summer of 2013.

Sources inside the firm say the office surpassed its revenue targets by more than 50% last year, targets reportedly in the tens of millions of US dollars. It also worked on some major deals, including advising US energy company Hess Corporation on the sale of assets to Indonesian and Thailand enterprises for $1.3bn.

So what's the difference this time round?

"There's an enormous amount of buy-in from the firm which said: 'if we're going to go back and reopen, we need to make this a success'," says the first lawyer, who has knowledge of the firm's strategy. "And from two important groups: the corporate group in London and the dispute resolution group.

"Now you've got people in London saying: 'it has to work, this is important for us, we'll give it time and attention, we'll give it patience, and we'll give it proper resources'."

One possible problem for the Singapore team could be the lack of local capability. Of the magic circle firms to have expanded internationally, it is the only one without a Qualifiying Foreign Law Practice (QFLP) licence. According to those at rival outfits, unwavering competition in the market combined with a push by the Singapore government to promote its own law in the region is making local capability increasingly more attractive. However, they also note that to date Freshfields has continued to appear on deals led by Singapore companies – albeit largely outbound transactions.

"We've all been successful doing offshore work in Singapore until the licence regime changed," says one local corporate partner. "There has been enough of that to go around for a long time. But the market's a bit quieter now and everyone needs to start thinking: do I continue to just do the offshore work or try and sink deeper into Singapore law, and will I genuinely make money doing Singapore law? The logic is it's ancilliary to other practices. For any international law firm here that wants a credible presence, you've got to think seriously about whether you want to practise local law."

Others however, believe that local law capability isn't necessary, even when the competition is active in that space. An obvious example is Milbank Tweed Hadley & McCloy, which is understood to be among the more successful international firms in the city-state despite advising only on international law, while rivals such as Latham & Watkins have the QFLP. On the other hand, many would also acknowledge that even if local capability is not a pre-requisite for a strong brand, the lack of it places a limit on how big your office can become.

"I think with a name like Freshfields and their global network of clients there is no question that they will succeed," says another partner, "but it seems to be that a lot of international firms saw their spurt in growth after the QFLP licences were given out in 2008 – so there seems to be some correlation between the two. With the government and judiciary pushing for Singapore law to be the governing law for a lot of contracts, having that ability to advise on Singapore law is clearly an advantage."

The next step for Freshfields could be to put a projects specialist on the ground, and perhaps add deeper capability in M&A and private equity, according to a source from the firm. But what's more certain, is that if the continuous flurry of international firms opening or re-opening in the market is anything to go by, it will face intense competition in the long term. Only last month Legal Week reported that Vinson & Elkins planned to re-open in Singapore this year, while King & Wood Mallesons announced less than 10 days ago it had obtained its Foreign Legal Practice (FLP) licence and would be opening in two to three months. Could the likes of Simpson Thacher & Bartlett and Orrick Herrington & Sutcliffe be next?

"Singapore is a very difficult place to make money – very few people make what they think they're going to make, it looks easier than China and a lot of places, but it's competitive," says a senior partner on the ground, doubting a shift in the conservative strategies of most.

"If you look at the top Wall Street firms, the most profitable firms in the world, very few of them are here. Why are they not here? Because it's hard to meet their profitability requirements. Some of the top firms have realised that economically it doesn't make sense for them."

Freshfields declined to comment.