by Brianna Crandall — November 5, 2012—Billings at architecture firms increased for the second consecutive month in September, showing the strongest growth since late 2010, according to new figures from the American Institute of Architects (AIA). With the economy as a whole showing continued signs of improvement, AIA expressed hope for a more sustained period of recovery.
AIA reported the September Architecture Billings Index (ABI) score was 51.6, up from the mark of 50.2 in August. This score reflects an increase in demand for design services (any score above 50 indicates an increase in billings, notes AIA). The new projects inquiry index was 57.3, compared to a mark of 57.2 the previous month. 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.
“Going back to the third quarter of 2011, the multifamily residential sector has been the best-performing segment of the construction field,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “With high foreclosure levels in recent years, more stringent mortgage approvals and fewer people in the market to buy homes, there has been a surge in demand for rental housing. The upturn in residential activity will hopefully spur more nonresidential construction.”
Key September ABI highlights:
- U.S. regional averages: West (53.4), South (51.9), Northeast (49.5), Midwest (47.2)
- Sector index breakdown: multifamily residential (57.3), institutional (51.0), commercial / industrial (48.4), mixed practice (47.8)
- Project inquiries index: 57.3
The regional and sector categories are calculated as a three-month moving average, whereas the index and inquiries are monthly numbers, notes the AIA Economics and Market Research Group, which produces the monthly indexes.
