The recession is weighing heavily on architects, engineers, and contractors, if the results of an exclusive BD+C survey of 504 AEC professionals are any measure of the commercial construction industry’s outlook on business prospects for 2012.
More than three-fourths of respondents (78.4%) rated “general economic conditions (i.e., recession)” as the most important concern their firms will face in the next year, followed by competition from other firms (40.1%) and lack of capital funding for their projects (34.5%).
Nearly three in four (74.8%) described the current business situation for their firms as “very” to “intensely” competitive—a strong verification of the dog-eat-dog climate that many in the AEC industry have reported anecdotally in the last couple of years.
On the brighter side, nearly half of respondents (49.7%) said their firms were in at least “good” financial health, and four-fifths (80.2%) said their companies would at least hold steady in revenue in 2012.
Layoffs over the last two years were reported by 44.8% of respondents, with another 37.3% saying that hours had been reduced, while more than half (51.0%) said their firms had eliminated or cut back on bonuses.
Looking toward 2012, nearly half of respondents (46.8%) said they thought their companies would be beefing up PR and marketing initiatives to revive their businesses.
More than a third (35.7%) said their firms would be pumping dollars into technology. However, more than one in five (20.6%) said their firms were not using building information modeling; of those who said BIM was used in their shops, a clear majority (58.4%) said BIM figured in less than 25% of projects, while only slightly more than one-fourth (26.8%) said BIM was being used most of the time (i.e., 50% or more of projects, based on dollar value).
Healthcare remains strongest sector
Respondents were asked to rate their firms’ prospects in specific construction sectors on a five-point scale from “excellent” to “very weak.” (Respondents who checked “Not applicable/No opinion/Don’t know” are not counted here.) Among the findings:
- Healthcare was the most highly rated sector, with a strong majority of respondents (54.6%) giving it a “good” to “excellent” rating.
- Data centers and mission-critical facilities were also given good marks, with 45.2% of respondents in the good/excellent category.
- Government and military work was rated good to excellent by more than two-fifths of respondents (41.1%).
- Senior and assisted-living facilities drew a fairly strong 37.8% of respondents in the good to excellent category.
- University/college facilities were rated good to excellent by nearly a third of respondents (32.3%).
Other sectors had much less optimistic support from respondents. Only one in nine (11.1%) said they thought retail commercial construction would have a good to excellent year. Less than 1% thought cultural/performing arts centers had a chance to have even a good year, and only 1.5% were sanguine about industrial and warehouse facilities.
The prospects for office buildings were bleak as well, with only 9.4% saying that market would be good to excellent—and nearly two-thirds (67.3%) predicting office buildings would be “weak” or “very weak.” However, office interiors and fitouts fared better, with 28.0% saying that sector would be good to excellent.
“Good to excellent” prospects for other sectors were mixed: 23.2% for K-12 schools and 24.0% for multifamily projects (condos and apartments, but most likely the latter).
In sum, hardly the cheeriest of prognostications for the 2012 commercial design and construction industry, according to respondents to our exclusive survey.
Note: Of the 494 who gave their professional description, 41.3% are architects; 19.0%, engineers; 18.8%, contractors; 10.7% building owners, developers, or facility/property managers; and 10.2%, consultants or “other.”
For more information visit www.BDCnetwork.com/forecast/2012. BD+C
Related Stories
| Mar 4, 2013
Dewberry names James Draheim president of architectural practice
Dewberry, a privately held professional services firm, has recently hired James Draheim, AIA, LEED AP BD+C, as president of the firm’s 175-person nationwide architectural practice. Draheim will be responsible for all facets of the firm’s business development, operations, strategic planning, and growth.
| Mar 4, 2013
German healthcare design specialist TMK Architekten joins HDR Architecture
TMK Architekten • Ingenieure, one of Germany’s leading healthcare architecture firms, announced today that it is joining forces with HDR Architecture, the world’s No. 1 healthcare and science + technology design firm. The merged company will conduct business as HDR TMK, and will be the hub for the firm’s healthcare and science + technology design programs in Europe.
| Mar 4, 2013
Korean Air, AC Martin collaborating on Western region's tallest tower
The 1,100-foot Wilshire Grand will combine retail and restaurant space, offices, and a luxury hotel in the sky.
| Mar 4, 2013
Gehry unveils design for Santa Monica hotel-condo tower
If all goes as planned, Frank Gehry will design the first building in his hometown in some 25 years.
| Mar 3, 2013
World's first LEGO museum planned in Denmark
Bjarke Ingels Group and Ralph Appelbaum Associates will team up with the LEGO Group to design the physical home for The LEGO House, the world's first museum dedicated to LEGO.
| Feb 28, 2013
Daniel J. Rectenwald promoted to chief operating officer of HGA
HGA Architects and Engineers (HGA) has promoted Daniel J. Rectenwald, AIA, to Chief Operating Officer. He will oversee daily operation of the firm’s design and business strategies across seven national offices.
| Feb 28, 2013
Videos reveal City 2.0 ideas from 2012 TED Prize winners
Thought leader TED has released eight new videos from winners of its 2012 TED Prize: the City 2.0. The prize went to 10 winners involved in urban issues, including education, safety, health, food, and public space.
| Feb 28, 2013
Greeening Silicon Valley: Samsung's new 1.1 million-sf HQ
Samsung Electronics' new 1.1 million sf San Jose campus will support at least 2,500 sales and R&D staff in the company's semiconductor and display businesses.
| Feb 28, 2013
BIA opens entries for 2013 Brick in Architecture Awards
The Brick Industry Association (BIA) has opened entry submissions for its 2013 Brick In Architecture Awards—with a new Renovation/Restoration category and new category divisions this year. BIA’s annual awards honor architectural excellence and sustainable design nationwide that incorporates clay brick products as the predominant exterior building or paving material.
| Feb 27, 2013
Marvin Windows and Doors now accepting entries for fifth annual Marvin Architect’s Challenge
Architects have an opportunity for their best work to compete on a global stage in the fifth annual Marvin Architect’s Challenge. Previous winners of Marvin Windows and Doors’ prestigious award program have come from Spain, Ireland and across the United States — with their work among the world’s finest.