Posts tagged with "The Economy":

Stimulus and Sandwiches

The second of the “Not Business as Usual” lunchtime conversation series last Wednesday at the Center for Architecture in New York had quite a turnout, including laid off designers, freelancers, and managers of struggling firms. Everyone was looking for ideas in these turbulent economic times. “We are trying to give information to people, to help them keep in contact with the industry so that they feel like they haven’t lost all their friends,” Steve Glenn from Lutron, one of the sponsors of the series, told AN. In the light of the current economic situation and the much debated stimulus package, this luncheon focused on federal and local government efforts to spark economy, and how these efforts could affect the design professions. The idea was to get architects and designers to participate and have their say on how the AIA, elected officials, and city agencies advocated for high quality public design as a part of the economic recovery plan. Last week, members of the AIA went to Washington to express their position on Federal Transportation Policy and to advocate for healthy and safe communities. “The AIA urges members of Congress to support community-based planning and design programs in the upcoming reauthorization of SAFETEA-LU that helps enhance the quality of life, reduce congestion, and provide long term economic and environmental benefits,” according to a statement by the AIA. Sherida Paulsen, president of the AIA New York Chapter, urged those present to address these concerns in coherent written form to congresswoman Carolyn Maloney. The session broke down into different groups addressing different advocacy areas, including transportation, infrastructure, healthcare, and small business issues, Design Corps, energy policy and sustainability, and other issues. In a session that could very well have been a support group for struggling architects, many of the attendees were eager to participate and jot down their proposals, but many others were disappointed for not getting the answers they had come for: How to start their own businesses? What about start-up benefits and unemployment compensation? Will there be tax exemptions? How much of the stimulus package will be directed to architecture firms as opposed to engineering firms? The truth is, the stimulus package is evolving by the hour. We will likely be unpacking it for months to come.
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Big Turbine Keep On Turnin'

Touchstone Architecture/Columbia River Crossing
Everyone seems to be talking about infrastructure and green jobs, which are expected to be a big part of any Federal stimulus package. One tension, however, is that a lot of infrastructure projects, especially highways, are anything but green. Here's one plan that attempts to reconcile this discrepancy, a wind turbine-equipped bridge planned for Portland, Oregon and Vancouver, Washington. The schemes, designed by Florida-based Touchstone Architecture, would integrate vertical turbines into the structure, powering lighting and toll stations. It's difficult to evaluate the project as energy generation capacity has yet been estimated. It's important to note, however, that this project is not pie-in-the-sky. The proposed Columbia River Crossing would integrate car, train, pedestrian, bicycle traffic, including Interstate-5 and a light rail line to Clark College in Vancouver, Washington.
Touchstone Architecture/Columbia River Crossing
The Crossing is be one of hundreds of projects vying for federal funds, but advocates hope the green bells and whistles will help it stand out from the crowd. (The Oregonian via Planetizen).
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The Downturn of the McMansion?

Amid the anxiety, speculation, and real hardship caused by the ongoing economic downturn, the provocative thesis of this Washington Post article stands out, which, if correct, could hold a silver lining for architects. Reporter Elizabeth Razzi interviews housing historian Virginia McAlester about how previous periods of economic declines shaped consumer demand for housing. The answer is simple and somewhat obvious: the demand for small houses rises. Her predictions for this cycle are less so. While McAlester argues the downturn of Depression through World War II, and the resulting shortage of materials, led to the construction of smaller houses, specifically Levittown and its progeny, she argues that this cycle could lead to a different landscape. While she argues that McMansions, with their multiple gables and double height foyers, will fall out of fashion, they will not be replaced with rows of modest Cape Cods repeated in endless rows. She argues that some McMansions will be converted into multiple unit “manor houses.” New construction, she argues, will likely be more compact, attached and more closely located to shopping and other amenities. While a spokesman for the National Association of Homebuilders refutes some of McAlester’s predictions, he agrees that highly energy efficient houses will be increasingly in demand.
What could this mean for architects? While many architects design lavish, over-scaled homes, speculative builders, who rarely employ architects, dominate the McMansion segment of the market. Architects have for the past twenty years, been increasingly designing mixed-use buildings and districts, as well as compact, urban, and green projects. So it seems logical, then, that developers who are looking to salvage their unfinished subdivisions or respond to future demand may give enterprising architects a fresh look.
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Not So Fast, Seaport Edition

The news that General Growth Properties--which is on the verge of bankruptcy due to a massive debt-load related to its acquisition of the Rouse Company in 2004--put three historic properties up for sale has led some observers to speculate that development plans for one of them--New York's South Street Seaport--have hit the dustbin. Not so, AN has learned. Two sources have confirmed that the project is not for sale, as has been widely reported, but instead that the developer is seeking an equity partner to help keep the Seaport plan afloat through these choppy economic waters. In fact, they still expect the plan to go before the city's Landmarks Preservation Commission for another review in early 2009 as originally scheduled, which commission spokesperson Lisi de Bourbon also confirmed. "The status of the seaport is that the application remains active at this time," she wrote in an email. And in a statement, GGP re-emphasized its commitment to the project:
Jim Graham, senior director of public affairs, General Growth Properties, Thursday said:  “South Street Seaport is among a group of properties for which General Growth is seeking partners, investors or buyers. We intend to continue working with the City of New York on a plan for the property’s development that they and the community will embrace.”
In the end, the project's fate remains up in the air at the moment, like so much else in the development world. Which is all the more reason not to jump to any conclusions. As for the other two properties involved--Baltimore's Harbor Place and Boston's Faneuil Hall--the latter may have just become worth a little bit more, having been recently honored with the 25 Year Award by the AIA.
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Strike Two? Not So Fast

First Laurie Olin, now Frank Gehry. That was the news earlier this week when the Wall Street Journal reported that the Santa Monica-based architect had laid off "more than two dozen" staffers involved with Bruce Ratner's Atlantic Yards project. What followed was a string of cheers predicting the troubled Brooklyn mega-development's demise. After all, how could it go on without its signature architect? While considering this question, I kept thinking of a comment made by Kermit Baker yesterday, during an interview about the abysmal November billings index. Given what's going on elsewhere in the industry, the termination of a handful of architects may not signal the doomsday scenario the project's critics would like, and instead may be one more credit-related payroll pause like many others around the nation:
What we're seeing, as a result of the credit freeze, is a lot of projects, even a lot of good projects, being put on hold. Once the credit markets begin to unfreeze, though, a lot of this work will come back. You know, "Okay. We got our financing back in place, why don't you get back to work on this." It's very disconcerting because these sudden seizures can be very unexpected. It's hard to own and manage and know how to cope.
Hence the layoffs, largely unforeseen, plaguing firms nationwide, a problem we've noted before. Though Baker was not speaking specifically to the Gehry/Atlantic Yards layoffs, he said he was seeing the same sort of "payroll activity" at many of the dozens of firms he surveys to put together the billings index. The upshot to all the bad news, Baker said, is that it is possible that, as credit becomes available again, a number of projects could come back online:
There are some projects that do make sense in this economy. Obviously, the list of ones that don't make sense has gotten longer and the list of projects that do make sense has gotten shorter. But there was a time when even those projects could not get financing. I expect that to change at some point, hopefully in the near future.
And while financing could very well turn around for the project, as Baker speculates, the Observer is not so sure it will. Furthermore, the Daily News reports today that Gehry and Ratner may not be on the best of terms, as the architect has not been paid for what the paper reports are still unfinished Phase One designs. Still, the point is that, while the layoffs could be another possible death knell for Atlantic Yards, they could also simply be the economizing of one of many architects in dire straits at the moment. As for Gehry's office not returning phone calls--something the Daily News and others see as a sign that the project is faltering--don't read too much into that, either. The firm is notoriously press averse, even on the most laudatory pieces, almost never returning phone calls.

Hope for Housing (Update: And Carrión)

President-elect Barack Obama named Shaun Donovan, chair of the city's Department of Housing Preservation and Development (HPD bio), to serve as his Secretary of Housing and Urban Development. The announcement came during his weekly web-address: AN had heard from a number sources that Donovan--an outside candidate--had taken a month off in late October and early November to prepare a white paper on affordable housing for the Obama campaign, though HPD did not return numerous calls seeking confirmation on this or his possible nomination. Well, now it's official. If confirmed, Donovan will be returning Washington, where he served as Deputy Assistant Commissioner for Multi-Family Housing in the Clinton Administration. A graduate of Harvard, Donovan has been acclaimed for his work on the mayor's New Housing Marketplace plan, which seeks to create 165,000 affordable units over a decade through construction and preservation. Get acquainted with the appointee's thoughts on housing policy, which AN published after a chat with Donovan last year. Update: Both Posts--that being The New York Post and The Washington Post--are reporting that Bronx Borough President Adolofo Carrión Jr. will serve as Director of Urban Policy for the Obama administration. The Bronx Beep had been also in the running for the HUD position, though whether he has been awarded a greater or lesser prize remains to be seen as the exact mandate of directorship has yet to be laid out by the administration, as we reported. Carrión is less known for his work on land-use issues than his compatriots in Manhattan and Brooklyn--partly a result of the relative levels of development in each borough--though the Baychester-raised Bronxite did receive a masters in planning from Hunter, according to his official biography, followed by stints at the Department of City Planning, Bronx CB5, and local non-profit developer Promesa before he moved to City Council and then the borough presidents office. Politco points out that the number of New Yorkers in Obama's cabinet is beginning to rival the number of Illini there, which hopefully means the Feds will stop ignoring the city as it has in the past.
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Miami Vices

Designer and AN friend Ken Saylor, of saylor+sirola, reports from Art|Basel|Miami Beach: For the seventh year in a row, the international art world descended upon Miami Beach to instantly transform the city into a galaxy of cultural production, salesmanship, and hopefully, with this year's delicate economy, elite consumption. If you add cars, champagne, mojitos, and cigars, provided by the current corporate sponsors, one's experience of Art|Basel|Miami Beach was a decadently over-the-top trip to the beach. With 24 auxiliary fairs attaching themselves to the main event, it is impossible to see everything, although everyone runs around the city in frantic abandon—entourages in tow—to openings, parties, parties, and, yes, more parties. Despite the mood of abandon, many New York City gallery owners and directors were either somber or pragmatic in their assessment of the current art market, stating that they were either prepared for the recent economic crisis and had downsized their presentations and sales expectations, or chose to show work that was sure to sell. As one prominent dealer put it, "The conversation is finally about art again, not about money." If one was blind to the current state of world affairs and entered the world of excess, however, Miami was awesome!   Art Positions, an exhibition by young galleries that presented their wares in shipping containers converted to public art spaces, was one of the highlights of the Miami trip. Twenty containers surround a central plaza where Art|Basel|Miami Beach and Art Radio created an immersive futuristic environment, featuring an architectural installation by Federico Díaz and E-Area. Surround-sound audio, video projections, mood lighting, food, drink, and live radio broadcasts provided the ultimate art world beach lounge, a welcome spot to chill out after the visual intensity and economic jitters of the fair. The escapist theme was, of course, intentional. According to the press release, "The themes celebrated in this environment are a retro-futuristic vision first explored by artists, architects, filmmakers, designers, and musicians of the '50s and '60s. Some of their organic shapes, space-age materials, hallucinogenic visions, dreamscapes and soundscapes, and early computer-assisted design have been integrated into the project."   As for the design itself: "A deformed topography of polyethylene layers cut by CNC robotic technology blankets the courtyard of Art Positions. The lounge, cafe, and Art Radio broadcast booth were transformed by undulating waves, extrusions, and futuristic furniture all awash in a bed of soothing psychedelic sound, light, and video." Just lovely.   For a different sort of surreality, located within the Miami Beach Botanical Gardens, Cartier presented "Diamonds, Gold and Dreams," an immersive audio-visual environment conceived by filmmaker and visual artist David Lynch. The interior of the dome was designed as an ornate and gilded event space, complete with Cartier jewel cases around the perimeter where you could try on jewelery. The domed ceiling was used as a giant planetarium-esque projection surface using state of the art projection technology.   The seven-minute show begins with an impressive Pantheon dome structure of floating jewels carefully arranged around a small oculus. Then the Lynch magic begins, as the ceiling begins to undulate and graphically transform into a variety of shapes using the clusters of jewels. Finally, the jewels come crashing down on the spectators below. Most of the VIP visitors in the space didn't seem to realize the show's obvious irony: the sky was falling!
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Landscapers Short On Green, Too

We've been tracking the AIA Architecture Billings Index ever since it took a dive last spring. But what about the rest of the design industry? Well, the American Society of Landscape Architects released its quarterly survey of member firms, and the numbers are no better than their brick-and-mortar friends. In fact, the numbers are even worse, with only 16 percent of firms experiencing growth in their billings and 43 percent having stable or rising inquiries. Nancy Somerville, executive vice president and CEO of the society, said that with the market the way it is, the downturn was to be expected. “The reduced demand for landscape architecture work comes as no surprise considering the current problems with the economy,” Somerville said in a release. “International projects, particularly in the Middle East and Pacific Rim, are a strong and expanding source of work for many firms. Domestically, the public sector remains the most robust source of projects.” Not surprisingly, architects are seeing the same trends. As for the landscape designers, those are: Compared to last quarter, your billable hours are: Well above average – 5.6% Slightly above average – 17.3% Right where they usually are, average – 21.1% Slightly below average – 38.3% Well below average – 17.7% Compared to last quarter, your inquiries are: Well above average – 2.3% Slightly above average – 14.7% Right where they usually are, average – 25.7% Slightly below average – 35.5% Well below average – 21.9% Compared to the same quarter a year ago, your second quarter 2008 billable hours were: Higher – 17.9% About the same – 23.7% Lower – 58% Don’t know – .4% Compared to the same quarter a year ago, your second quarter 2008 inquiries were: Higher – 12.5% About the same – 27.8% Lower – 59.3% Don’t know – .4% Do you plan on hiring any employees in the upcoming quarter?: Experienced landscape architect – 6.8% Entry level landscape architect – 9.4% Support staff – 7.9% Intern – 4.1% Other – 6.4% Not hiring – 74.4% Role of sustainability issues in candidates’ platforms: High on candidates’ agendas – 9.4% Cited more than in the 2004 campaigns – 38.9% About the same as 2004 – 14.0% Cited less than 2004 – 4.2% Not a significant part of the candidates’ agendas – 31.3% Other – 2.3%

Jitters? AIA to the Rescue

As the economic crisis continues to reverberate across the globe, everyone is feeling uneasy. Architects are particularly susceptible because the downturn stems from the housing collapse, which has crept into most ever sector of the construction industry. Not to worry (too much). Last week, the AIA launched Navigating the Economy, a special webpage aimed at, well, helping architects navigate the economy during this time of uncertainty. "AIA leadership felt it was important to keep members abreast of the current economic landscape and offer resources on how they can best respond to any challenges they face in running their business," Matt Tinder, a spokesperson for the institute, explained. The page is broken down into four section. The first two offer an aggregation of articles from outside sources offering advice on management and financing, and the third is a list of links to other helpful sites. The forth, and perhaps most interesting, or at least unique, is original content and resources from the AIA, including podcasts from experts, articles from the institute, listings of helpful events, and other resources. Tinder said the AIA will continue to update the website on a regular basis, so check back often. That is if you need it, which we all here at AN hope you don't.
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Looking for Work?

As you already know, things aren't going so well for architects right now, economically speaking. We got word earlier today that a certain three-letter firm laid off more than 100 employees in recent weeks, and smaller firms have been shedding staff as well. But there is hope yet. Should you be fired, that is. Consulting for Architects, a former CAD reseller that now does architecture, construction, and design recruitment, announced today that the firm has hired two new recruiters to, as a press release put it, "keep up with an increase of unemployed architecture and interior design professionals." The move brings the firm's staff of recruiters at the New York-based company to five. Putting a positive spin on the economic hardship facing the industry, Emily Schepp, one of the new hires, pointed out that while there may not be long-term work out there, the projects that remain must still get built. "While many firms are reluctant to hire on a permanent basis," Schepp said, "many still have openings on a project basis." Time to break out those resumes. Update: A representative for said three-letter firm told AN that no such layoffs have been made. Still, given CFA's uptick in applications in recent months, the recruiters said it is hard to deny the economic turmoil that has beset the industry.
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The Economy & You, Humble Architect

There's been a lot of questions about how the so-called credit crisis might impact the architecture and design industries. We've been tracking this for months, but so far no one has exactly admitted to apocalypse. Until now. At a Vanity Fair party on Monday--the day the Dow dropped 504 points--man about town Richard Meier had some dour words for the Observer:

Architect Richard Meier, who lately has become known for designing costly Manhattan apartment buildings, seemed somewhat more disturbed by the news. “I don’t know how to deal with it or what it means. Certainly, it’s going to have a serious effect on my work here.”

When asked just how long our economic troubles might last, Mr. Meier said, “Hopefully, two or three more hours.” Then he tilted his head back and took a swig of Champagne.

Things must be so bad for Meier that word has even reached John Stewart. In a segment last night entitled "The Economy & You," which explores the impact of the crisis on "real people," the Daily Show host quipped that a hypothetical Dick Fuld (the former chief of Lehman Brothers) would probably ride out the financial crisis, though there might be "some cutbacks."

"Richard Meier's not going to be designing your eighth house," Stewart said. "You're probably going to have settle for Norman Foster." Someone had better pour poor Richard another glass of bubbly.

(The line comes around the 2:15 mark. Video via HuffPo.)