After a poor showing this spring, architectural billings bounced back in June, with the Midwest leading all regions, according to the American Institute of Architects (AIA) Architectural Billings Index.
The Midwest posted a score of 56.3, marking its strongest performance in years, followed by the South with 53.9, the Northeast with 51.1 and West with 48.7.
By sector, multi-family residential led with 57.7, followed by mixed practice with 53.8, commercial / industrial with 53.1 and institutional with 50.2. Any score above 50 denotes positive growth.
“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,” AIA Chief Economist Kermit Baker indicated in a statement.“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.”
Yet, it's not clear whether institutional growth will continue. “The institutional market has been a drag on overall recovery for the last few years, and until we see state and local governments ramp up spending for new education, health care and public safety structures there likely won't be a widespread acceleration in spending for the entire industry,” Baker noted upon the recent release of AIA's semi-annual Consensus Construction Forecast (CCF), a survey of leading industry forecasters. “But we continue to have an optimistic outlook for the commercial and industrial sectors, both for the rest of this year and into 2015.”
Meantime, CCF revised growth projections for the year downward, from 5.8% to 4.9%, the result of severe winter weather. Survey respondents project growth will accelerate to 8% in 2015.