by Calculated Risk on 2/19/2020 12:31:00 PM
Wednesday, February 19, 2020
Note: This index is a leading indicator primarily for new Commercial Real Estate (CRE) investment.
From the AIA: Architecture billings continue growth into 2020
Starting the year on a strong note, architecture firm billings strengthened slightly in January, according to a new report today from The American Institute of Architects (AIA).Click on graph for larger image.
AIA’s Architecture Billings Index (ABI) score of 52.2 for January compared to 52.1 in December reflects an increase in design services provided by U.S. architecture firms (any score above 50 indicates an increase in billings). Indicators of work in the pipeline, including new project inquiries and new design contracts remained positive, posting scores of 57.9 and 56.0 respectively.
“Despite the continued presence of volatility in the economy, design activity has begun to accelerate in recent months,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “Even with the ongoing challenges facing the nonresidential construction sector, this upturn points to at least modest growth over the coming year.”
• Regional averages: South (56.7); West (52.1); Midwest (51.3); Northeast (45.3)
• Sector index breakdown: mixed practice (51.6); commercial/industrial (51.5); multi-family residential (51.2); institutional (51.1)
This graph shows the Architecture Billings Index since 1996. The index was at 52.2 in January, up from 52.1 in December. Anything above 50 indicates expansion in demand for architects' services.
Note: This includes commercial and industrial facilities like hotels and office buildings, multi-family residential, as well as schools, hospitals and other institutions.
According to the AIA, there is an "approximate nine to twelve month lag time between architecture billings and construction spending" on non-residential construction. This index has been positive for 8 of the previous 12 months, suggesting some increase in CRE investment in 2020.
Posted by Calculated Risk on 2/19/2020 12:31:00 PM