The American Institute of Architects (AIA) monthly Architecture Billings Index (ABI) pointed to a slower decline in July in design activity at U.S. architecture firms.
The American Institute of Architects (AIA) reported the July ABI score was 48.7, up considerably from the mark of 45.9 in June. This score reflects a decrease in demand for design services (any score below50 indicates a decline in billings). The new projects inquiry index was 56.3, up from mark of 54.4 the previous month.
Considered a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending.
"Even though architecture firm billings nationally were down again in July, the downturn moderated substantially," said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. "As long as overall economic conditions continue to show improvement, modest declines should shift over to growth in design activity over the coming months."
Key July ABI highlights:
Regional averages: South (52.7), Midwest (46.7) West (45.3), Northeast (44.3).
Sector index breakdown: multi-family residential (51.4), mixed practice (49.1), commercial / industrial (48.4), institutional (46.6).
According to data from CBRE, vacant office space in the U.S. increased slightly by 10 basis points (bps) during the fourth quarter of 2017 (Q4 2017) to 13 percent. For the year, vacancy inched up 10 bps, marking the first year-over-year increase in vacancy since 2010.
The National Association of Home Builders is reporting this week that their latest Multifamily Production Index dropped 10 points to 46 in the third quarter of 2017. This is the lowest reading since the second quarter of 2011.