April 2014

Slowdown expected in commercial construction

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The American Institute of Architects' (AIA's) Architecture Billings Index (ABI) decreased from 50.7 in January to 41.8 in February, the lowest level since October 2001.

The ABI is AIA's leading indicator of nonresidential building activity and reflects a nine-months-to-a-year lag time between architecture billings and construction spending. Any score below 50 shows a decrease of billings, which is a measure of time and effort spent on a project.

"This is a clear indication that there could be tougher times ahead for design firms and a noticeable slowdown in commercial construction projects coming online in the foreseeable future," says AIA Chief Economist Kermit Baker.

Although the ABI rating for the commercial and industrial sector was 40.6, indicating a decrease in billings, the institutional sector has been more positive with an ABI rating of 54.9.


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