Architecture Billings Index in Negative Territory

by bkrigbaum@solagroup.com








Washington, D.C. – Following the first positive reading since
January 2008, the Architecture Billings Index dropped nearly two 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. The American
Institute of Architects
reported
the October ABI score was 48.7, down from a reading of 50.4 the
previous month.  This score reflects a decrease in demand for
design services (any score above 50 indicates an increase in billings).
The new projects inquiry index was 61.7, down slightly from a nearly
three-year high mark of 62.3 in September.
 
“This is disappointing news, but not altogether that
surprising,” said AIA Chief Economist Kermit Baker, PhD, Hon.
AIA. “We were anticipating a slow recovery period and it is
likely that there will be some fits and starts before conditions show
consistent improvement. Right now, reluctance from lending institutions
to provide credit for construction projects and a sluggish economy are
the main impediments to a revival of the design and construction
industry.”
 
Key October ABI highlights: Regional averages: Northeast
(54.5), Midwest (51.8), South (48.6), West (44.3)

  • Sector index
    breakdown: commercial / industrial (54.5), institutional (50.8),
    multi-family residential (49.1), mixed practice (43.2)
  • Project inquiries index:
    61.7


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