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Design activity falls in West, rises nationally

Design activity in the West region has decreased for the third consecutive month, despite overall growth across the country, according to the latest American Institute of Architects Architecture Billings Index released on Wednesday.

The West showed an Architecture Billings Index score of 48.7 last month, down from May’s score of 46.9. A year ago the West was at 52.2.

Any score above 50 on the Architecture Billings Index indicates an increase in workload and payment for services for architects. The index reflects the approximate nine to 12 months between architecture billings and construction spending.

This is only the third time since July 2012 that the West has not had demand for design services increase in successive months.

The West had gone 20 consecutive months, before April, with increased demand for design activity. Only the South had more, with 21 straight months.

The West averaged an ABI score of 49.5 through the first half of 2014, down from 52.2 in the first six months of 2013.

The West continues to be the lowest region of design activity on the Architecture Billings Index. The Midwest showed the most workload and payment for design services in June with an ABI score of 56.3, followed by the South at 53.9 and the Northeast at 51.1.

June was the first time since December 2011 and January 2012 that the West region was the only area not have design activity increasing.

Despite the slumping Western division, design activity as a whole around the country is advancing upward with a national score of 53.3 in June, up from 52.6 in May and 49.6 in April. The national ABI score was 52.4 a year ago.

Of the four sectors the Architecture Billings Index tracks, multifamily housing was the area with the most design activity in June with a score of 57.7. It has come in first for the past 10 consecutive months.

Mixed practice reported a mark of 53.8, followed by commercial and industrial at 53.1 and institutional 50.2.

“With the first positive reading since last summer in billings at institutional firms, it appears that design activity for all major segments of the building industry is growing,” said Kermit Baker, American Institute of Architects chief economist.

“The challenge now for architecture firms seems to be finding the right balance for staffing needs to meet increasing demand.”

The American Institute of Architects added an indicator in March to measure trends in new design contracts at architecture firms. The measure is meant to signal the direction of architecture billings.

The score for design contracts in June was 55.7, up from 52.5 in May, 54.6 in April and 48.2 in March. This is the highest mark since the indicator starting being measured in October 2010.

The new projects inquiry index was 66.4, up noticeably from the reading of 63.2 the previous month and its highest level in a calendar year.

“The recent surge in both design contracts and general inquiries for new projects by prospective clients is indicative of a sustainable strengthening across the construction marketplace,” Baker said.

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