Buoyed by sustained demand for apartments and condominiums, coupled with state and local governments moving ahead with delayed public projects, the Architecture Billings Index (ABI) has been positive for seven consecutive months.
The American Institute of Architects (AIA) reported the November ABI score was 50.9, down from a mark of 53.7 in October. This score reflects a slight increase in design activity (any score above 50 indicates an increase in billings). The new projects inquiry index was 58.8, following a mark of 62.7 the previous month.
As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lead time between architecture billings and construction spending.
The AIA has added a new indicator measuring the trends in new design contracts at architecture firms that can provide a strong signal of the direction of future architecture billings. The score for design contracts in November was 54.9.
“Demand for design services has slowed somewhat from the torrid pace of the summer, but all project sectors are seeing at least modest growth,” said AIA Chief Economist Kermit Baker, Hon. AIA, PhD. “Architecture firms are expecting solid mid-single digit gains in revenue for 2014, but heading into 2015, they are concerned with finding quality contractors for projects, coping with volatile construction materials costs and with finding qualified architecture staff for their firms.”
Key November ABI highlights:
• Regional averages: South (57.9), West (52.7), Midwest (49.8), Northeast (46.7)
• Sector index breakdown: multi-family residential (56.8), mixed practice (52.6), institutional (51.3), commercial / industrial (50.6)
• Project inquiries index: 58.8
• Design contracts index: 54.9
The regional and sector categories are calculated as a 3-month moving average, whereas the national index, design contracts and inquiries are monthly numbers.
About the AIA Architecture Billings Index
The Architecture Billings Index (ABI), produced by the AIA Economics & Market Research Group, is a leading economic indicator that provides an approximately nine to twelve month glimpse into the future of nonresidential construction spending activity. The diffusion indexes contained in the full report are derived from a monthly “Work-on-the-Boards” survey that is sent to a panel of AIA member-owned firms. Participants are asked whether their billings increased, decreased, or stayed the same in the month that just ended as compared to the prior month, and the results are then compiled into the ABI.
These monthly results are also seasonally adjusted to allow for comparison to prior months. The monthly ABI index scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline. The regional and sector data are formulated using a three-month moving average. More information on the ABI and the analysis of its relationship to construction activity can be found in the recently released White Paper, Designing the Construction Future: Reviewing the Performance and Extending the Applications of the AIA’s Architecture Billings Index on the AIA website.
Related Stories
| Aug 22, 2014
Before & After: Hospital upgrade shows shifting needs in healthcare construction
Community Hospice of Northeast Florida took an outdated 10-bed inpatient hospice unit and created a space that would meet the needs of patients receiving end of life care by creating a place that felt like home.
| Aug 22, 2014
Spireworks app lets users control a piece of the New York skyline
Mark Domino, the son-in-law of developer Douglas Durst, has developed an app, called Spireworks, that allows anyone with a smartphone to change the color of a building's lights.
| Aug 21, 2014
Ranked: Top science and technology sector AEC firms [2014 Giants 300 Report]
HDR, Affiliated Engineers, and Skanska top BD+C's rankings of the nation's largest S+T sector design and construction firms.
| Aug 21, 2014
Ranked: Top convention center AEC firms [2014 Giants 300 Report]
Gensler, AECOM, and Hunt Construction top BD+C's rankings of the nation's largest convention center design and construction firms.
| Aug 21, 2014
Apartment construction hits 25-year high
The boost to apartment construction suggests that job gains are encouraging the creation of households.
| Aug 21, 2014
Strategies for providing great customer service
Customers are inherently inefficient and inconvenient to do business with, writes Customer Service Consultant Micah Solomon, in a recent Forbes post. That’s why he believes great customer service depends on understanding this. SPONSORED CONTENT
Sponsored | | Aug 21, 2014
Defining the measure of success when implementing new technologies
Sasha Reed and Chad Dorgan, McCarthy Building Cos.’s Vice President of Quality and Sustainability, discuss the keys to managing innovation within a large construction firm. SPONSORED CONTENT
| Aug 21, 2014
RTKL's parent company Arcadis acquires Callison
The acquisition of Callison, known predominantly for its leadership in retail and mixed-use design, builds on Arcadis’ strong global design and architecture position, currently provided by RTKL.
| Aug 21, 2014
Must See: Detroit's Beaux-Arts parking garage
An opulent Renaissance Revival building in downtown Detroit is being used as a parking garage.
| Aug 20, 2014
WELL Building: The next step in green sports construction
The WELL Building Standard, a new protocol that focuses on human wellness within the built environment, is a particularly good fit for sports facilities, write Skanska's Tom Tingle and Beth Heider.
