As the prognosis for the design and construction industry continues to improve, the Architecture Billings Index (ABI) is reflecting its strongest growth since November 2007. As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending.
The American Institute of Architects (AIA) reported the January ABI score was 54.2, up sharply from a mark of 51.2* in December. This score reflects a strong increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 63.2, much higher than the reading of 57.9 the previous month.
“We have been pointing in this direction for the last several months, but this is the strongest indication that there will be an upturn in construction activity in the coming months,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “But as we continue to hear about overall improving economic conditions and that there are more inquiries for new design projects in the marketplace, a continued reservation by lending institutions to supply financing for construction projects is preventing a more widespread recovery in the industry.”
Key January ABI highlights:
- Regional averages: Midwest (54.4), West (53.4), South (51.7), Northeast (50.3)
- Sector index breakdown: mixed practice (54.9), multi-family residential (54.5), commercial / industrial (52.0), institutional (50.2)
- Project inquiries index: 63.2
The regional and sector categories are calculated as a 3-month moving average, whereas the index 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 White Paper Architecture Billings as a Leading Indicator of Construction: Analysis of the Relationship Between a Billings Index and Construction Spending on the AIA web site.
About The American Institute of Architects
Founded in 1857, members of the American Institute of Architects consistently work to create more valuable, healthy, secure, and sustainable buildings, neighborhoods, and communities. Through nearly 300 state and local chapters, the AIA advocates for public policies that promote economic vitality and public well being. Members adhere to a code of ethics and conduct to ensure the highest professional standards. The AIA provides members with tools and resources to assist them in their careers and business as well as engaging civic and government leaders, and the public to find solutions to pressing issues facing our communities, institutions, nation and world. Visit www.aia.org.
* Every January the AIA research department updates the seasonal factors used to calculate the ABI, resulting in a revision of recent ABI values.
Related Stories
| Sep 4, 2013
Smart building technology: Talking results at the BUILDINGChicago/ Greening the Heartland show
Recent advancements in technology are allowing owners to connect with facilities as never before, leveraging existing automation systems to achieve cost-effective energy improvements. This BUILDINGChicago presentation will feature Procter & Gamble’s smart building management program.
| Sep 4, 2013
Last chance to pre-register for BUILDINGChicago/Greening the Heartland Conference at 20% savings
Attendees of the BUILDINGChicago/Greening the Heartland Expo and Conference can still save 20% off the at-site registration fee by registering online in these final days before the event opens on September 9 and concludes on September 11.
| Sep 3, 2013
'School in a box' project will place school in San Diego public library
Thinking outside the box, LPA Inc. is designing a school inside a box. With an emphasis on three E’s—Engage, Educate, and Empower—e3 Civic High is now being constructed on the sixth and seventh floors of a public library in downtown San Diego. Library patrons will be able to see into the school via glass elevators, but will not have physical access to the school.
| Sep 3, 2013
Delinquency rate for commercial real estate loans at lowest level in three years
The delinquency rate for US commercial real estate loans in CMBS dropped for the third straight month to 8.38%. This represents a 10-basis-point drop since July's reading and a 175-basis-point improvement from a year ago.
| Sep 3, 2013
EDGE studio, GBBN announce merger
GBBN Architects and EDGE studio of Pittsburgh, Pennsylvania are very pleased to announce the merger of their firms under GBBN Architects effective September 1, 2013.
| Sep 3, 2013
Jon Pettit (1952-2013) - DLR Group Managing Principal
Jonathan (Jon) E. Pettit, AIA, died August 19, 2013 in Seattle following treatment for cancer. He was 61. Pettit was a DLR Group managing principal and practiced for his entire professional career with DLR Group.
| Aug 30, 2013
Modular classrooms gaining strength with school boards
With budget, space needs, and speed-to-market pressures bearing down on school districts, modular classroom assemblies are often a go-to solution.
| Aug 30, 2013
Local Government Report [2013 Giants 300 Report]
Building Design+Construction's rankings of the nation's largest local government design and construction firms, as reported in the 2013 Giants 300 Report.
| Aug 30, 2013
A new approach to post-occupancy evaluations
As a growing number of healthcare institutions become more customer-focused, post-occupancy evaluations (POE) are playing a bigger role in new construction and renovation projects. Advocate Health Care is among the healthcare organizations to institute a detailed post-occupancy assessment process for its projects.
| Aug 29, 2013
First look: K-State's Bill Snyder Family Stadium expansion
The West Side Stadium Expansion Project at Kansas State's Bill Snyder Family Stadium is the largest project in K-State Athletics history.
