by Calculated Risk on 5/18/2022 12:35:00 PM

Note: This index is a leading indicator primarily for new Commercial Real Estate (CRE) investment.

From the AIA: Architecture Billings Index moderates slightly, remains strong

For the fifteenth consecutive month architecture firms reported increasing demand for design services in April, according to a new report today from The American Institute of Architects (AIA)

AIA’s Architecture Billings Index score for April was 56.5 compared to 58.0 in March. Any score above 50 indicates an increase in billings. During April, scores for both new project inquiries and design contracts moderated slightly, but remained strong, posting scores of 62.3 and 55.4, respectively.

“While business conditions at architecture firms have been very encouraging over the past year, project activity has been steadily shifting toward work on existing buildings,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “Billings for reconstruction projects exceeded those for new construction for the first time in the last two decades. While the reconstruction share of building activity will continue to ebb and flow, in general, we’ll continue to move toward an increased share of building activity for reconstruction and a decreased share for new construction.”
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• Regional averages: West (58.2); Midwest (57.6); South (57.3); Northeast (53.1)

• Sector index breakdown: mixed practice (61.2); commercial/industrial (60.7); multi-family residential (57.2); institutional (51.8)
emphasis added

Click on graph for larger image.

This graph shows the Architecture Billings Index since 1996. The index was at 56.5 in April, down from 58.0 in March. Anything above 50 indicates expansion in demand for architects' services.

Note: This includes commercial and industrial facilities like hotels and office buildings, multi-family residential, as well as schools, hospitals and other institutions.

This index has been positive for fifteen consecutive months.   This index usually leads CRE investment by 9 to 12 months, so this index suggests a pickup in CRE investment in 2022.