usiness conditions at architecture firms stabilized in June, following significant declines in previous months, according to the American Institute of Architects. While June’s Architectural Billings Index score of 40.0 for the month means the majority of architecture firms saw billings decline month over month, the pace of that decline slowed.
Inquiries into new work nearly returned to the positive in June, as clients began trying to restart projects. However, the value of new design contracts lags behind, as many potential clients are price shopping to multiple firms but will ultimately select only one to work with. Firm backlogs began to tick back up, rising from an average of 5.0 months in March to 5.3 months in June. Concerns remain about whether the momentum will continue or if recent gains will be reversed by a resurgence of COVID-19 cases.
The Dodge Momentum Index, issued by Dodge Data & Analytics, fell 6.6 percent in June to 121.5 from the revised May reading of 130.1. The index measures the first report for nonresidential building projects in planning, which typically lead construction spending for such developments by a full year. The institutional component of the Momentum Index fell 11.7 percent while the commercial component declined by 3.5 percent.
While projects continue to enter planning, the slower pace suggests that recovery in the construction sector will be modest in coming months, Dodge said.
The impact of COVID-19 caused the first major drop in the USG Corp./U.S. Chamber of Commerce’s Commercial Construction Index since its launch in 2017, lowering 18 points to 56. This is the largest quarterly decline in index history.
While 73 percent of contractors expect there will still be COVID-19-related project delays in the fall, the percentage of their projects impacted by those delays is expected to lessen throughout the year: from the 40 percent in April to just 23 percent predicted by October.
Contractors’ confidence in the ability of the market to provide new business through the next 12 months has dropped dramatically to 50, demonstrating concern about the pipeline of work.
In spite of the lack of firmness in order backlogs and less assurance the market will recover rapidly, architectural firms continue to win awards for working with green materials such as aluminum.
Cal Poly Pomona’s Student Services Building, the subject of this month’s cover story (Page 18), won a 2019 Architecture MasterPrize and took top honors at the Los Angeles Business Council’s Architectural Awards. The standing-seam roof and panels—designed to shade and let in light simultaneously while surpassing energy efficiency standards—were roll formed on site. The result is an undulating structure that mimics local topography and reflects the mountainscape to the north.
