Highest levels of demand at residential firms in over two years
The American Institute of Architects is reporting this week that buoyed by increasing levels of demand across all project types, the Architecture Billings Index (ABI) was positive in June 2016 for the fifth consecutive month.
The AIA reported the June 2016 ABI score was 52.6, down from the mark of 53.1 in the previous month. This score still reflects an increase in design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 58.6, down from a reading of 60.1 the previous month.
"Demand for residential projects has surged this year, greatly exceeding the pace set in 2015. This suggests strong future growth for housing in the coming year," said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. "While we expect to see momentum continue for the overall design and construction industry in the months ahead, the fact that the value of design contracts dipped into negative territory in June for the first time in more than two years is something of a concern."
Key June 2016 ABI highlights:
Regional averages: South (55.5), West (54.1), Northeast (51.8), Midwest (48.2)
Sector index breakdown: multi-family residential (57.9), institutional (52.7), mixed practice (51.0), commercial / industrial (50.3)
Project inquiries index: 58.6
Design contracts index: 49.7
Considered a leading economic indicator of U.S. construction activity, the ABI reflects the approximate nine to twelve month lead time between architecture billings and construction spending.