Demand for design services in the US continue to increase, as momentum from July’s highest recorded strength since 2007 continues. The American Institute of Architects reported the August Architecture Billings Index (ABI) at 53.0, down from July’s mark of 55.8, and the new projects inquiry at 62.6.
“One of the key triggers for accelerating growth at architecture firms is that long-stalled construction projects are starting to come back to life in many areas across the country,” said AIA Chief Economist Kermit Baker, Hon. AIA, PhD. “Long awaited access to credit from lending institutions and an increasing comfort level in the overall economy has helped revitalize the commercial real estate sector in recent months. Additionally, though, a crucial component to a broader industry-wide recovery is the emerging demand for new projects such as education facilities, government buildings and, in some cases, hospitals.”
A breakdown of regional highlights, after the break…
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 August was 56.9.
- Midwest (51.0)
- South (55.1)
- Northeast (58.1)
- West (52.5)
Sector Index Breakdown:
- Multi-family residential (58.1)
- Mixed Practice (57.1)
- Commercial/industrial (50.4)
- Institutional (54.0)
Key August ABI Highlights:
- Project inquiries index (62.6)
- Design contracts index (56.9)
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. Regional and sector categories are calculated as a 3-month moving average, whereas the index and inquiries are monthly numbers. Any score above 50 reflects an increase in design services.
News via the AIA.