Architecture Billings Index slows but remains strong

Architecture firms reported increasing demand for design services in May, according to a new report today from The American Institute of Architects (AIA).

The ABI score for May was 53.5. While this score is down from April’s score of 56.5, it still indicates very strong business conditions overall (any score above 50 indicates an increase in billings from the prior month). Also in May, both the new project inquiries and design contracts indexes expanded, posting scores of 63.9 and 56.9 respectively.

“The strength in design activity over the past three months has produced a broader base of gains. The Northeast region and Institutional sector have struggled with slow billings activity, but now have posted consecutive months of positive scores.” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “With the improvement in inquiries and new design projects, demand for design services will likely remain high for the next several months, despite strong economic headwinds.”

Key ABI highlights for May include:

Regional averages: West (59.3); Midwest (56.8); South (52.3); Northeast (51.4)
Sector index breakdown: commercial/industrial (57.7); mixed practice (56.2); multi-family residential (54.5); institutional (51.7)

The regional and sector categories are calculated as a three-month moving average, whereas the national index, design contracts and inquiries are monthly numbers.

To learn more about recent economic developments impacting design and construction, visit AIA’s website.

One of the hardest decisions multifamily developers and their design teams have to make is what mix of amenities they’re going to put into each project. A lot of squiggly factors go into that decision: the type of community, the geographic market, local recreation preferences, climate/weather conditions, physical parameters, and of course the budget. The permutations are mind-boggling.