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
| Jan 16, 2013
SOM’s innovative Zhengzhou Greenland Plaza opens
The 2.59-million-square-feet building houses a mixed-use program of offices on its lower floors and a 416-room hotel.
| Jan 15, 2013
Morris Architects joins Huitt-Zollars
Morris, which will continue to provide services under its current name and leadership, is entering its 75th year of continuous practice as an architectural, interior design, landscape architecture, and planning firm.
| Jan 11, 2013
HMC Architects: In their own voices
See what HMC professionals say about their “Best AEC Firm to Work For”
| Jan 10, 2013
Guide predicts strongest, weakest AEC markets for 2013
2013 Guide to U.S. AEC markets touts apartments, natural gas, senior housing and transmission and distribution.
| Jan 9, 2013
Panasonic and Bluebeam preview new architect app at CES 2013
Panasonic and Bluebeam Software collaborate to develop and introduce the 4K tablet and software to the design and construction industry.
| Jan 3, 2013
Answered prayers
A bold renovation enables a small church to expand its mission on a grand scale.
| Jan 3, 2013
Top BIM/VDC articles of 2011-2012
A compendium of BD+Cs top building information modeling and virtual design + construction articles from 2011-12.
| Jan 3, 2013
8 trends shaping today’s senior housing
The ranks of those age 65 and older are swelling by the thousands every day. Is there an opportunity for your firm in the seniors housing market?
| Jan 2, 2013
Trends Report: New facilities enhance the quality of campus life
Colleges and universities are building state-of-the-art student unions, dining halls, and other non-academic buildings to enrich the campus experience, boost enrollment, and stay competitive.
