The Real Deal New York

Demand for architect services is down

June 20, 2012 01:30PM

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Following its first drop in five months in April, the Architecture Billings Index, an indicator of future construction activity, showed a significant decrease in May, according to the American Institute of Architects. The index reflects the approximate nine- to 12-month lag time between architecture billings and construction spending. The May ABI score was 45.8, down from 48.4 in April. Any score below 50 reflects a decrease in demand for design services.

However, the new projects inquiry stood at 54 in May, down only slightly from the previous month’s mark of 54.4.

“For the second year in a row, we’re seeing declines in springtime design activity after a healthy first quarter.  Given the ongoing uncertainly in the economic outlook, particularly the weak job growth numbers in recent months, this should be an alarm bell going off for the design and construction industry,” Kermit Baker, AIA chief economist, said.  “The commercial/industrial sector is the only one recording gains in design activity at present, and even this sector has slowed significantly. Construction forecasters will have to reassess what conditions will look like moving forward.”

The billing index for commercial projects was at 50.7 compared to 48.9 for multi-family work. The Northeast posted the highest billings index of any of the four regions, registering a 48.6. – Christopher Cameron

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