January 18, 2007
Architecture billings finished 2006 on a strong note fueled by robust activity in the commercial/industrial sector, the American Institute of Architects reports. That should translate into a high level of construction activity throughout 2007, since there is lag time between architecture billings and construction spending that ranges from 9 to 12 months. The AIA’s billings index had a 59.5 rating in December, up from 57.4 in November; any score above 50 indicates an increase in billings.
“Despite a sluggish economy, there is no sign of a slowdown in nonresidential construction activity in the foreseeable future,” Kermit Baker, the AIA’s chief economist, said in a statement. “This is very positive news for the construction industry and those markets affected by it because 2006 ended on a strong rebound, after trending down for most of the first 10 months.” Mark Hughes, an analyst with SunTrust Robinson Humphrey, concurred, adding that the information is particularly timely “in light of the drift in many construction-related stocks since mid-year.”
The Northeast, West, and Midwest remained hot spots of activity, with the commercial/industrial sector recording its highest workload since 1995. Institutional and mixed-use projects also saw a high volume of architecture billings.