U.S. Architecture Billings Index Moves Upward in October, AIA Warns Overall Conditions Remain Negative

Commercial News » Commercial Real Estate Edition | By David Barley | November 16, 2011 10:19 AM ET

Prolonged economic uncertainty in the U.S. is still taking its toll on the architectural community.

According to the American Institute of Architects (AIA), after a sharp dip in September, the Architecture Billings Index (ABI) climbed nearly three points in October.

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 (residential, commercial, vacation and public projects).

The American Institute of Architects (AIA) reported the October ABI score was 49.4, following a score of 46.9 in September. This score reflects an overall decrease in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 57.3, up from a reading of 54.3 the previous month.

"An increase in the billings index is always an encouraging sign," said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. "We're seeing some regions and some construction sectors move into positive territory. But there continues to be a high level of volatility in the marketplace with architecture firms reporting a wide range of conditions from improving to uncertain to poor. It's likely we will see a similar state of affairs in the coming months."

Key October ABI highlights:

  • Regional averages: Northeast (51.7), South (49.1), Midwest (47.7), West (43.5).
  • Sector index breakdown: commercial / industrial (53.5), multi-family residential (51.3), institutional (47.3), mixed practice (42.0).
  • Project inquiries index: 57.3.

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