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Design services in West increase for 6th straight month

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Demand for design services in the West increased for the sixth straight month in December, according to the newest American Institute of Architects Architecture Billings Index released Wednesday.

Last month, the West posted a score of 53.4, more than a full point higher than in December at 52.2, and almost eight points higher than a year ago when the ABI reported January as having a score of 45.9.

The Index reflects the approximate nine- to 12-month lag time between architecture billings and construction spending. Any score above 50 on the Index signifies an increase in design services.

The last time the West reported six straight months of scores above 50 was in August 2007, when the West was ending 14 consecutive months of increased demand for architectural services.

The Midwest led the four regions of the United States with a score of 54.4. This is the third month in a row that this has transpired.

The West came in second, followed by the South at 51.7 and the Northeast at 50.3.

All four regions posted scores above 50 for four consecutive months. The last time this occurred was in July 2007, after a 10-month streak of increased billings.

Overall in the United States, demand for architectural services is reflecting the strongest growth in more than five years.

The national ABI score was 54.2 last month, up sharply from December’s mark of 51.2 and the 50.4 score from January 2012.

The last time the national ABI was above 54.2 was in November 2007, which posted as score of 54.9.

“We have been pointing in this direction for the last several months, but this is the strongest indication that there will be an upturn in construction activity in the coming months,” said Kermit Baker, chief economist for the American Institute of Architects.

Baker went onto say that even though economic conditions are improving and there are more inquiries for new design projects, “a continued reservation by lending institutions to supply financing for construction projects is preventing a more widespread recovery in the industry.”

Because of the continued improvement in billings, the sectors the Index follows are all increasing in demand. Mixed-use projects came in first with a score of 54.9; followed by multifamily residential at 54.5; commercial and industrial, 52.0; and institutional at 50.2.

This is the fourth consecutive month that all four sectors the ABI tracks had scores above 50. The last time all four sectors had a run like this was from December 2006 through July 2007.

The Architecture Billings Index (ABI) increased to 54.2 in January from 51.2 the month prior. A score of 54.2 indicates an overall increase in demand for design services, according to the American Institute of Architects (AIA). Any score above 50 indicates an increase in billings. Source: American Institute of Architects | Compiled by: Jenny Ross

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