According to the AIA, construction investment and spending remain slow to recover. The Architecture Billings Index (ABI), a monthly survey AIA conducts referencing the Department of Commerce on Construction Put in Place and a panel of AIA member-owned firms, recorded a negligible increase of 0.2 for the month of May.
The small rise from 45.8 to 46.0 still reflects a decline in demand for design services, with any score below 50 indicating a decrease in billings. The Northeast experienced the highest regional average at 47.7 while the West was the lowest at 43.6. Also, commercial/industrial averages were at 50.6 while multifamily residential was at 46.5.
“The steep decline in nonresidential property values has slowed investment in new facilities,” says AIA Chief Economist Kermit Baker. “Conditions at architecture firms continue to remain very soft, but we’re optimistic that they will improve before the end of the year.”
The ABI reflects approximately 9-12 months between architecture billings and construction spending, indicating a difficult year ahead for contractors. However, the new projects inquiry index increased from 55.5 to 57.7, supporting Baker’s hope for an improved market within the next year.