It looks like the Architecture Billings Index is finally ready to start 2015. As AN reported last month, the ABI failed to impress in January, posting a 49.9, which technically puts the outlook in negative territory with 50 marking the cut off. That’s right, negative territory for the first time in ten months. Thanks ABI, happy New Year to you, too.
But what a difference a month makes. The ABI appears to be returning to a happier place. In February the ABI moved up to 50.4—that’s not a huge jump, but it does cross the crucial 50 threshold that indicates growth. This good news, though, comes with its own bad news. Here goes: While the ABI ticked up, the new projects inquiry fell from 58.7 to 56.6. The Design Contracts Index was also recorded at exactly 50.0.
By region, the South (52.5) and Midwest (50.2) were way out front while the Northeast (48.0) and West (46.7) stayed in negative territory. By sector institutional (52.2) and commercial / industrial (51.4) led the pack, followed by multi-family residential (48.9) and mixed practice (45.3).
“The health of the institutional market has been the key factor for positive business conditions for the design and construction industry in recent months, and it is encouraging to see that sector remain on solid footing,” AIA Chief Economist Kermit Baker said in a statement. “However, we’re seeing some slowing in the other major construction sectors. Design billings for residential projects had its first negative month in over three years, and commercial design billings have seen only modest growth in recent years.”