by Bill McBride on 10/21/2009 09:11:00 AM
Wednesday, October 21, 2009
From Reuters: U.S. architecture billings up in September-AIA
... The Architecture Billings Index was up 1.4 points at 43.1, matching July's level, according to the American Institute of Architects.Click on graph for larger image in new window.
The index has remained below 50, indicating contraction in demand for design services, since January 2008.
A measure of inquiries for new projects, however, rose to 59.1, its highest in two years -- "an encouraging sign," said AIA Chief Economist Kermit Baker.
"Some larger stimulus-funded building activity should be coming online over the next several months, partially offsetting the steep decline in private commercial construction," Baker said.
This graph shows the Architecture Billings Index since 1996. The index has remained below 50, indicating falling demand, since January 2008.
Note: Nonresidential construction includes commercial and industrial facilities like hotels and office buildings, as well as schools, hospitals and other institutions.
Historically there is an "approximate nine to twelve month lag time between architecture billings and construction spending" on commercial real estate (CRE). This suggests further dramatic declines in CRE investment through most of 2010, if not longer.
Posted by Bill McBride on 10/21/2009 09:11:00 AM