After a positive response to a rough to the year, the U.S. Architectural Billings Index (ABI) has pressed on to reach its highest score in almost a year. Steered by an "active" multi-family housing market, billings have been supported by steady demand for commercial and retail properties.
The ABI, the leading economic indicator of construction activity, reflects a 9 to 12 month lead time between architecture billings and construction spending. The national index, design contracts, and inquiries are calculated monthly, while the regional and sector categories are calculated as a three-month moving average. The index runs on a scale from 0-100 and scores above 50 suggest growth while anything below implies negativity in the market.
This May, the ABI hit a score of 53.1, up from 50.6 in April. Earlier this year however, the score was as low as 49.
“Business conditions at design firms have hovered around the break-even rate for the better part of this year,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD in a press release. “Demand levels are solid across the board for all project types at the moment. Of particular note, the recent surge in design activity for institutional projects could be a harbinger of a new round of growth in the broader construction industry in the months ahead.”
The scores in detail are as follows:
- Regional averages: West (53.8), South (53.7), Northeast (51.2), Midwest (49.9)
- Sector index breakdown: multi-family residential (53.7), institutional (53.0), commercial / industrial (51.0), mixed practice (51.0),
- Project inquiries index: 60.1
- Design contracts index: 52.8