Billings were also soft at firms in all regions of the country in January. Firms located in the West saw very modest billings growth in the fourth quarter of 2024, but unfortunately, billings returned to negative territory to start the new year. Business conditions remained softest at firms located in the Northeast, which has been the trend in recent months. And billings softened further at firms located in the South, which saw more encouraging signs last fall, before weakening again. Billings also declined at firms of all specializations in January. Firms with a commercial/industrial specialization continued to be most likely to report softening business conditions, but billings have weakened at firms of all specializations in recent months.

Architecture firms report strong hiring to end 2024.

Conditions remained somewhat soft in the broader economy as well in January. Inflation in January was higher than anticipated, with the Consumer Price Index (CPI) increasing by 0.5% from December and 3.0% from one year ago, the highest level since last June. Inflation growth in January was primarily due to increases in energy and food prices, as well as core goods (like used vehicles) and services (e.g., shelter away from home). Recently the Federal Reserve has signaled reluctance to lower interest rates further in the short term, and they will remain even less likely to do so if inflation remains at this higher level.

Nonfarm payroll employment added 143,000 new positions in January, modestly below the average monthly increases of 166,000 in 2024. However, architecture services employment ended 2024 on a strong note after shedding jobs in the fall, adding 2,200 new positions in December (the most recent data available). This amounts to a net loss of 1,400 positions for 2024, as employment at architecture firms has declined by a total of 4,100 positions since the post-pandemic peak in June 2023.

Nearly all architecture firms pay for membership dues/licensure fees for their staff.

This month we asked firm leaders about their support of membership dues and licensure fees for their architecture staff. Overall, 85% of responding firm leaders indicated that they pay membership dues/licensure fees for their staff in some capacity, increasing to nearly all large firms with annual billings of $5 million or more (97%). Nearly all firms (98%) reported that they pay for AIA membership dues (82% in full, 16% in part), followed by 93% that pay for professional accreditation/certification fees (65% in full, 28% in part), 91% that pay for licensure fees (75% in full, 16% in part), 85% that pay for NCARB fees (65% in full, 20% in part), and 84% that pay for professional membership dues (other than AIA, NCARB) (55% in full, 29% in part).

Overall, responding firm leaders reported that an average of 69% of the architecture staff at their firm that are eligible for membership are members of AIA. This is highest at firms with an institutional specialization (72% of eligible staff are members) and lowest at firms with a multifamily residential specialization (59% of eligible staff are members). In addition, a majority of firms (72%) also reported that, in general, a fairly stable share of architecture staff at their firm has remained AIA members over the past five to 10 years. Just 14% indicated that a smaller share of architecture staff at their firm are members now than five to 10 years ago, while an additional 14% reported that a higher share of architecture staff at their firm are members now than five to 10 years ago.

Finally, when asked to rate the importance of the principal benefits of having eligible employees as AIA members, nearly half of responding firm leaders (48%) rated the promotion of greater levels of professional development of their staff as a very important benefit, while an additional 40% rated it as a somewhat important benefit. Responding firm leaders also highly rated giving employees an opportunity to connect with others in the profession (33% rated as very important, 50% as somewhat important), giving their firm the perception of being more professional/a more desirable place to work (32% rated as very important, 50% as somewhat important), and giving staff access to practical tools and research (30% rated as very important, 49% as somewhat important). Firms rated helping them to win projects and win more desirable projects, helping retain staff, and helping advocate for favorable policy as less important benefits to having eligible employees at their firm as AIA members.

Visit AIA’s website for detailed information about this, and past billing index reports.

The post ABI January 2025: Architecture Firm Billings Remain Soft to Start the New Year appeared first on Residential Design.

Community-based projects often struggle to find funding, especially the funds needed to hire professional design teams to help solve design challenges. Too often nonprofit organizations feel they cannot afford to pay for design services even though architects would provide immense value and can make the project more successful.

Grant applications will be reviewed by the AIA Small Project Design Knowledge Community Advisory Board, which will serve as the jury. The board will award up to 3 grants of up to $5,000 each. Submissions may be completed or updated until the application deadline of April 18, 2025 at 5pm ET.  Grant recipients will be notified in early May 2025.

Learn more about the 2025 SPD Community Grant Program on the AIA website and view previous recipients of the grant here.

The post 2025 Small Project Design Grant Now Open for Submissions appeared first on Residential Design.

AIA Fellows are recognized for their exceptional work and contributions to architecture and society. Founded in 1952, the AIA College of Fellows seeks to stimulate a sharing of interests among Fellows, promote the purposes of AIA, advance the profession of architecture, mentor young architects, and be of ever-increasing service to society. Less than 3% of AIA members hold the prestigious FAIA designation.

Each year when candidates apply to be Fellows, the jury considers how they have shown distinction in the context of their object, in relation to AIA’s values, and whether their work has had a ripple effect.

The objects of nomination are essentially the award categories candidates apply under, and each object has specific criteria and requirements associated with it. Learn more about the object categories here.

Meet the Newest Inductees

HONORARY FELLOWS

Alison Brooks, Hon. FAIA
London, England
Alison Brooks Architects
Object One

Tatiana Bilbao, Hon. FAIA
Mexico City, Mexico
Tatiana Bilbao ESTUDIO
Object One

Kain Bon Albert Chan, Hon. FAIA
Shanghai, China
Shui On Land
Object Five

Hu Li, Hon. FAIA
Beijing, China
OPEN Architecture
Object One

Brinda Somaya, Hon. FAIA
Mumbai, India
SNK
Object One

Michel Rojkind, Hon. FAIA
Mexico City, Mexico
Rojkind Arquitectos
Object One

Masaharu Rokushika, Hon. FAIA
Tokyo, Japan
AR Associates
Object Three

Junya Ishigami, Hon. FAIA
Tokyo, Japan
Jun’ya Ishigami Associates
Object One

Kerstin Thompson, Hon. FAIA
Melbourne, Australia
Kerstin Thompson Architects
Object One

Lyndon Uykim Neri, Hon. FAIA
Shanghai, China
Neri&Hu Design and Research Office
Object One

FELLOWS

David W. Altenhofen, FAIA
AIA Philadelphia
RWDI
Object Two

Farooq Ameen, FAIA
AIA Los Angeles
City Design Studio, LLC
Object One 

R. Burton Baldridge, FAIA
AIA Austin
Baldridge Architects
Object One

Thomas R. Bayer, FAIA
AIA Houston
HOK
Object Two

Katherine Shaloo Berg, FAIA
AIA Oregon
ZGF Architects
Object One

Graciela Carrillo Cifuentes, FAIA
AIA Long Island
Nassau BOCES
Object Three

Stephen J. Cavanaugh, FAIA
AIA Chicago
DLR Group, Inc.
Object Two

Daniel J. Chenin, FAIA
AIA Las Vegas
Daniel Joseph Chenin Ltd.
Object One

Lisa I. Cholmondeley, FAIA
AIA Washington DC
Gensler
Object Two

Laura A. Clary, FAIA
AIA Detroit
iDesign Solutions, LLC
Object Two

Brendan P. Connolly, FAIA
AIA Seattle
Mithun
Object One

John F. Corkill, FAIA
AIA Potomac Valley
Corkill Cush Reeves Architects
Object Five

James Crispino, FAIA
AIA New York Chapter
Gensler
Object Two

Karl Daubmann, FAIA
AIA Detroit
Lawrence Technological University, College of Architecture and Design
Object Six

Laura DuCharme Conboy, FAIA
AIA San Diego
DuCharme Architecture
Object Five

William S. Duff, Jr., FAIA
AIA San Francisco
William Duff Architects, Inc.
Object Two

Stuart Emmons, FAIA
AIA Oregon
Emmons Design LLC
Object Two

Eric C. Y. Fang, FAIA
AIA New York Chapter
Perkins Eastman
Object Two

John E. Folan, FAIA
AIA Arkansas
Fay Jones School of Architecture and Design
Object Six

Jonathan D. Moody, FAIA
AIA Columbus
Moody Nolan
Object Two

Arathi P. Gowda, FAIA
AIA Washington DC
ZGF Architects LLP
Object Two

Elizabeth M. Hallas, FAIA
AIA Colorado
Anderson Hallas Architects, P.C.
Object One

Michael J. Hanrahan, FAIA
AIA Central New Jersey
Clarke Caton Hintz
Object Two

Jay M. Brotman, FAIA
AIA Connecticut
Svigals + Partners, LLP
Object Two

Richard W. Hayes, FAIA
AIA New York Chapter
Alexander Gorlin Architects
Object Six

Susan N. Heinking, FAIA
AIA Chicago
Pepper Construction Company
Object Two

Ali C. Höcek, FAIA
AIA New York Chapter
AC Höcek Architecture LLC
Object Five

Katherine M. Hogan, FAIA
AIA Triangle
katherine hogan architects, PC
Object One

Robert K. Iopa, FAIA
AIA Honolulu
WCIT Architecture, Inc.
Object Five

Camille U. Jobe, FAIA
AIA Austin
Jobe Corral Architects
Object One

Benjamin I. Kasdan, FAIA
AIA Washington DC
KTGY Architecture + Planning
Object Three

Carolyn Kiernat, FAIA
AIA San Francisco
Page & Turnbull, Inc.
Object Two

Julie J. Kim, FAIA
AIA Atlanta
Georgia Institute of Technology
Object Six

Stephanie M. Kingsnorth, FAIA
AIA Los Angeles
Perkins Eastman Architects
Object One

Suzanne R. Klein, FAIA
AIA Washington DC
AECOM
Object Two

Jennifer Townsend Knudsen, FAIA
AIA Los Angeles
CO Architects
Object Two

William G. Kontess, FAIA
AIA Alaska
Michael Baker International
Object Four

Andrea D. Lamberti, FAIA
AIA New York Chapter
N/A
Object Two

Steven M Langston, FAIA
AIA Orlando
Rogers, Lovelock & Fritz, Inc.
Object Two

Keith L. Lashley, FAIA
AIA Orlando
HKS
Object Five

Bryan C. Lee Jr, FAIA
AIA New Orleans
Colloqate Design
Whitney M. Young Jr. Award Recipient

Regal H. Leftwich, FAIA
AIA Washington DC
SmithGroup
Object Two

Eric Logan, FAIA
AIA Wyoming
CLB Architects
Object One

Karen A. Lu, FAIA
AIA Minneapolis
Snow Kreilich Architects
Object Two

Jose Luis Alvarez, FAIA
AIA New Orleans
EskewDumezRipple
Object One

Heath Allen May, FAIA
AIA Los Angeles
HKS
Object Two

Praful M. Kulkarni, FAIA
AIA Los Angeles
CannonDesign
Object Five

Paul R. Menard, FAIA
AIA Central Valley
UC Davis Health
Object Four

Brian H. Messana, FAIA
AIA New York Chapter
Brian Messana Architect, PLLC
Object One

Alan Metcalfe, FAIA
AIA Philadelphia
Metcalfe Architecture & Design
Object Two

Christopher P. Meyers, FAIA
AIA Columbus
Meyers & Associates Architects
Object Two

Erick D. Mikiten, FAIA
AIA East Bay
Mikiten Architecture
Object Two

Deborah Finkelstein Moelis, FAIA
AIA New York Chapter
Handel Architects, LLP
Object Two

Kimberly N. Montague, FAIA
AIA Detroit
Albert Kahn Associates
Object Two

Derek A. Moore, FAIA
AIA New York Chapter
Skidmore, Owings & Merrill
Object Two

Catherine C. Morrison, FAIA
AIA Charlotte
Neighboring Concepts, PLLC
Object Three

Peter V. Noonan, FAIA
AIA Potomac Valley
McInturff Architects
Object One

JinHwa Paradowicz, FAIA
AIA Chicago
Perkins Eastman
Object Two

Jonathan Parks, FAIA
AIA Florida
Solstice Planning and Architecture
Object One

Garfield L. Peart, FAIA
AIA Atlanta
Moody Nolan
Object Five

Anthony E. Pellicciotti, FAIA
AIA Memphis
LRK Inc
Object One

Matthew T. Porreca, FAIA
AIA San Diego
LPA Design Studios
Object One

Steven R. Raike, FAIA
AIA San Antonio
Lake | Flato Architects
Object One

Joshua Ramus, FAIA
AIA New York Chapter
REX
Object One

Thomas F. Robinson, FAIA
AIA Oregon
LEVER Architecture
Object One

Jeffrey S. Seabold, FAIA
AIA Mississippi
Seabold Architectural Studio PC / S5 Construction LLC
Object Three

Pierluigi Serraino, FAIA
AIA San Francisco
Pierluigi Serraino Architecture LLP
Object Six

Frank W. Shirley, FAIA
Boston Society of Architects
Frank Shirley Architects
Object Two

David Jack Silverman, FAIA
Boston Society of Architects
STA Design, Inc.
Object Five

Stephen Springs, FAIA
AIA Dallas
Brinkley Sargent Wiginton Architects, Inc
Object Two

Adrianne Steichen, FAIA
AIA San Francisco
Pyatok Architects
Object Two

James C. Stevens, FAIA
AIA South Carolina
Clemson University
Object Six

Gary L. Strang, FAIA
AIA San Francisco
GLS Landscape | Architecture
Object Five

Mark J. Thaler, FAIA
AIA New York Chapter
Gensler
Object Two

Georgeen A. Theodore, FAIA
AIA Brooklyn
Interboro Partners
Object One

Anne Mary Torney, FAIA
AIA San Francisco
Mithun | Solomon    
Object Two

Suchitra M. Reddy, FAIA
AIA New York Chapter
Reddy Architecture PLLC
Object One

Ekaterina Velikov, FAIA
AIA Huron Valley
University of Michigan
Object Six

Taylor C. Walker, FAIA
AIA Minneapolis
OPN Architects
Object Two

Thomas J. Walsh, FAIA
AIA Colorado
Fentress Architects
Object Two

Brian Wickersham, FAIA
AIA Los Angeles
AUX Architecture
Object One

Jerry Yin, FAIA
AIA Shanghai
Tishman Speyer
Object Five

James W. Zack, FAIA
AIA San Francisco
Zack De Vito, Inc
Object Two

Learn more about the College of Fellows and the new inductees here.

To explore all previously elevated Fellows, visit the new College of Fellows Directory. 

The post AIA Announces 2025 Class of Fellows appeared first on Residential Design.

The AIA/Deltek Architecture Billings Index (ABI) score fell to 44.1 for the month as the share of firms reporting a decline in firm billings increased. Firm billings have now decreased for the majority of firms every month except two since October 2022. While not a full-fledged recession, this period of softness and uncertainty has been challenging for many firms. And prospects for future work remain soft as well. Although inquiries into new projects continued to increase at a relatively slow rate, the value of newly signed design contracts decreased further in December as clients remained hesitant to commit to new work. In one brighter spot, backlogs at firms remained steady and strong at 6.5 months in December, so many firms still have work in the pipeline for now.

Despite overall softness in billings, firms located in the West reported growth for the third consecutive month in December. But business conditions remained soft for firms in all other regions, particularly at firms located in the Northeast, which were the first to report slight growth earlier in the year. Billings also declined at firms of all specializations in December, although firms with an institutional sector are on the cusp of growth and have been for several months. However, business conditions softened further for both firms with multifamily residential and commercial/industrial specializations this month, ending the year on a down note.

Inflation remains a concern

Conditions in the broader economy also remain mixed, with robust national employment growth but resurgent concerns about lingering inflation and its impact. Total nonfarm payroll employment grew by an additional 256,000 positions in December, for a total growth of 2.2 million new positions for 2024. However, in November (the most current data available), architecture services employment softened further, shedding 1,300 jobs. More than 4,000 jobs have been lost in the industry since November 2023, and employment has fallen to the lowest level since 2022, although it remains higher than it was pre-pandemic. In addition, the University of Michigan’s most recent Index of Consumer Sentiment results show a spike in consumer concern about inflation over the next six months, after that had significantly decreased in recent months once the Federal Reserve started lowering interest rates. With inflation remaining stubborn over the last few months, the Federal Reserve has now signaled that they are unlikely to lower rates further in the near future, which could affect the availability of credit to finance projects.

Construction budget issues leading to stalled, delayed, and canceled projects

This month, we asked firm leaders about trends in delayed, stalled, and canceled projects at their firm over the past six months. Overall, a majority of responding firm leaders reported that the shares of delayed, stalled, and canceled projects at their firm are generally stable. However, slightly more than one-quarter of firms (26%) reported that the share of significantly delayed projects is increasing, while 23% reported that the share of projects on hold/indefinitely stalled is increasing, and 18% reported that the share of canceled/abandoned projects is increasing. Generally, few firms indicated that the share of these types of affected projects has declined recently, but 17% did say that the share of canceled projects has decreased in the last six months. Firms with a commercial/industrial specialization were generally most likely to report that the share of delayed, stalled, and canceled projects has been increasing, with more than one-third (34%) reporting that the share of delayed projects has increased, 31% that the share of stalled projects has increased, and 24% that the share of canceled projects has increased.

However, the overall share of recent projects affected by issues has remained relatively small. Responding firm leaders indicated that 72% of their projects, on a dollar basis, are proceeding as normal. Just 4% are canceled/abandoned, while an average of 10% are on hold/indefinitely stalled, and 14% are significantly delayed. Firms with a multifamily residential specialization reported the highest share of delayed projects (17%) versus 15% of projects at firms with a commercial/industrial specialization and 11% of firms with an institutional specialization.

When asked about contributing factors to stalled/delayed/canceled projects at their firm, the one most commonly cited issue by firm leaders was a construction budget insufficient for the project as currently conceived, selected by 53% of responding firm leaders. Other issues cited included contractor bids coming in too high or schedules too long (40%), financing problems (39%), changing market conditions making clients nervous about proceeding (39%), permitting/zoning/other approvals delays (38%), and high interest rates (31%). When asked to select the one most significant factor contributing to recent stalled/delayed/canceled projects at their firm, nearly one-third (30%) selected insufficient construction budget. Financing problems was second, with 13% selecting it as the one most significant factor, followed by permitting/zoning delays (11%), high interest rates (11%), client nervousness due to changing conditions (11%), and high contractor bids (10%). Very few firms reported that supply chain issues and material prices/availability were a significant factor contributing to recent project delays.

Finally, when asked about trends in stalled, delayed, and canceled projects for the first six months of 2025, as compared to the past six months, more than half of firms (60%) expect the trend to remain about the same, while 28% expect that it will be lower, and just 12% expect that it will be higher. However, more firms in the Northeast (19%) and Midwest (15%) expect an increase in stalled/delayed/canceled projects in the first six months of 2025 than in other regions.

Visit AIA’s website for detailed information about this, and past billing index reports.

The post ABI December 2024: Business Conditions End the Year on a Weak Note appeared first on Residential Design.

You’ll meet, network with, and learn from an extraordinary lineup of renowned speakers, trailblazing leaders, and industry experts who will share pathbreaking ideas to tackle challenges and lead change.

Don’t miss high-impact programming, networking, education, community, and inspiration designed to change the workplace experience and help create gender equity for women in AEC.

Registration for WLS opens summer 2025! Special rates for registration will be available for AIA members.

Get more details on the WLS Summit from AIA here.

The post Women’s Leadership Summit 2025 Heads to Atlanta appeared first on Residential Design.

Projects in this category should address site-specific geography and climate conditions, showcasing strategies that enhance safety and resistance to fire, earthquakes, flooding, and other natural disasters. Submissions should demonstrate thoughtful integration of materials, technologies, and design approaches that prioritize occupant safety while maintaining architectural excellence.

The Resilient Design Award celebrates the role of architects in creating homes that not only withstand but thrive in the face of adversity, serving as beacons of hope and ingenuity for communities rebuilding and adapting to a changing world.

AIA|LA will donate 5% of the registration fee to the California Community Foundation’s Wildfire Recovery Fund, supporting those impacted by recent wildfires.

Read more about the Resilient Design category and the Residential Design Awards program here.

Affected by the wildfires or looking for ways to help? Find AIA|LA’s Wildfire Response and Resources here.

AIA|LA kicked off its Wildfire Disaster Response Task Force on January 15. Interested individuals may sign up to volunteer with AIA in Los Angeles and Pasadena. Additional resources for those in need and those who wish to help are also provided on this page.

The post AIA|LA Introduces Resilient Design Award in Response to Wildfires appeared first on Residential Design.

After increasing by almost 20% in 2023 and another 6% last year, construction spending for nonresidential buildings—commercial, industrial, and institutional facilities—is projected to slow dramatically this year and next. Panelists participating in The American Institute of Architects’ Consensus Construction Forecast are expecting gains of only 2.2% this year and 2.6% in 2026. Of these sectors, spending on institutional facilities is projected to see the strongest gains of 6.0% this year and 3.4% next year. Commercial construction spending is expected to increase by only 1.7% this year before climbing to 4.2% in 2026 while spending on the industrial sector should grow 2.6% this year before contracting by an almost equal amount of 2.5% next year. 

The modest outlook for construction spending is partly based on a few expected headwinds to building activity, including potential tariffs on imports from selected countries, as well as the enforcement of stricter immigration policy. The threat of increased tariffs is a major source of concern regarding reigniting inflation. The threatened 25% tariffs on goods imported from Canada and Mexico and an additional 10% tariffs on goods imported from China would be inflationary to the overall economy since they are our three largest trading partners. Also, these tariffs could limit the availability of several materials and products used in construction. Among other products, the industry imports lumber and construction equipment from Canada, cement and gypsum from Mexico, and furniture, plastics, and electronics from China.

However, perhaps the biggest policy concern for the construction industry is how emerging immigration policy might impact the construction labor force. There are approximately 12 million construction workers nationally, of which about three million are foreign-born. It is estimated that half of these immigrants are undocumented, so it is likely that about one in eight construction workers nationally is undocumented. The concern is not only the potential deportation of undocumented workers but also the chilling effect on potential new immigrants who might otherwise fill construction positions in the coming years.

Construction spending in the midst of a slowdown

A key question is the extent to which these potential headwinds will slow the momentum in what has been an exceedingly strong construction sector. While the performance of the industry over the past three years has been extremely impressive, it also has been unusually unbalanced. Three niche sectors in the industry—manufacturing, warehouses, and data centers—accounted for a third of all construction spending in the commercial, industrial, and institutional sectors in 2022, and that share rose to almost 40% both in 2023 and 2024. Not only are these sectors a large share of overall activity, but they are also an even larger share of spending growth in these sectors, in excess of 60% in recent years. Spending on manufacturing facilities, in particular, has seen a meteoric rise, accounting for well over a quarter of all building spending last year. In fact, ignoring the manufacturing sector, spending on nonresidential buildings increased a more modest 12% in 2022, 11% in 2023, and less than 2% last year. 

Much of the increase in manufacturing has been attributed to reshoring activity. International supply chains were overwhelmed during the pandemic, encouraging U.S. producers to increase their domestic production. While this no doubt was a factor in boosting domestic manufacturing construction activity, it’s an incomplete explanation. Reshoring as a motivation for increased domestic manufacturing construction would suggest that most sectors of the economy would be involved in increasing their domestic capacity. What we see instead is that a few sectors have dominated manufacturing construction. In 2023, of the almost $200 billion in manufacturing construction spending, fully a third of it was for computer and electronics production, while an additional quarter was for the production of chemicals and pharmaceuticals, but mostly for the production of plastics. The surge in plastics production largely stems from increased domestic production of oil and gas, key inputs to plastics production. 

Other than the surges in construction for manufacturing, warehouse, and data center facilities, most other sectors have seen much more modest levels of activity in recent years. Last year, construction spending declined for the retail and other commercial sector, as well as for lodging. Spending on offices saw a very modest increase only because the U.S. Census Bureau classifies data centers in the office category. The major institutional sectors fared a bit better, with spending on health care and education both increasing in the 5% to 10% range. 

Construction starts, where the entire projected value of a project is assigned to the month when construction begins and is, therefore, a leading indicator of construction spending, pointing to a continued slowdown in construction spending over the coming 12 to 18 months. Total nonresidential building starts declined in 2024, according to ConstructConnect, a firm tracking construction project leads. Commercial sector starts were up at a low single-digit pace percentage-wise over 2023 levels, while institutional starts were up at a high single-digit pace. However, the big change was that starts for manufacturing facilities fell precipitously. 

Forecasters predict very modest growth this year & next

The AIA Consensus Construction Forecast panel projects only very modest gains in construction spending this year and next. These projected gains of just over 2% in 2025 and under 3% in 20226 likely won’t even offset increases in material and labor costs, so the expectation is that the volume of construction is not expected to increase over the coming two years.

Within the commercial sector, spending on offices is expected to increase modestly this year and next. Spending on retail and other commercial facilities will see no gains this year before a modest uptick in 2026. Hotels are expected to see mid-single-digit growth this year and high single-digit growth next year. 

The projected increase in spending on offices might seem surprising given the high levels of remote work nationally, which has produced high vacancies, growing pressure on rents, and overall weakness in that market. However, all the projected increase is coming from data centers, which the Census Bureau includes in the office category. Spending on data centers is projected to continue to see very strong growth, so spending in the core office category is expected to decline both this year and next. 

The growth in e-commerce has hurt retail and other commercial facilities. The Census Bureau includes warehouses in this category, which has driven overall category growth in recent years. However, warehouse construction has become overbuilt in many areas of the country in recent years, and therefore, construction spending in this sector has slowed. 

Institutional building tends to be less cyclical than commercial or industrial activity and is, therefore, less prone to a boom/bust pattern. The major institutional sectors—health care and education—are both poised for healthy but unspectacular gains this year and next. Health care construction has benefited from an aging population. Consolidation among health care providers has changed the construction focus away from large institutional campuses and toward neighborhood health centers. 

Education is the largest institutional category, accounting for well over a third of the spending on institutional facilities. In addition to some upgrading of facilities that was deferred during the pandemic, demographics are the main driver of educational construction needs. As such, moving forward, construction spending for education facilities is likely to be under pressure. The Census Bureau projects our overall population to increase by 2.1% in total over the next five years. However, the preschool population is projected to increase by only 0.7%. Meanwhile, the elementary school population is projected to decline by 4%, high schoolers by just over 3%, and college-aged students by almost 2%. Those trends are expected to limit the need for new educational facilities. 

Architects also project limited improvement

From a business perspective, most U.S. architecture firms faced a challenging year in 2024. Continuing the weakness that emerged mid-year 2023, architecture firms reported the softest period of billings since the onset of the pandemic in early 2020. Conditions began to look a bit more positive beginning in the fourth quarter of last year as commercial property values stabilized, interest rates began to edge down, and architecture firms began to report a resurgence in interest for new design projects. However, this optimism is not uniform; many firms still feel that additional corrections in the economy are needed before their workloads will rebound. When surveyed this past October about revenue forecasts for 2025, just over four in ten firms were projecting gains of 5% or more, a quarter were projecting losses of that magnitude, while a third felt revenue would be essentially flat. On average, design billings are projected to increase only very modestly this year. Larger firms, firms specializing in the institutional sector, and firms located in the South were the most optimistic about their expected 2025 performance.

Visit AIA’s website for more on the January 2025 forecast.

The post January 2025 AIA Consensus Construction Forecast appeared first on Residential Design.

Business conditions continued to improve in the West and South regions of the country in November, where firm billings increased for the second consecutive month. Most notable was the strength of billings growth in the West, where the score was the highest it has been since mid-2022. Although billings continued to decline at firms located in the Northeast and Midwest, the pace of the decline slowed in both regions this month. There was significant improvement in business conditions at firms with a multifamily residential specialization in November as well, where they reported their first increase in billings since August 2022, at the end of the post-pandemic boom. In addition, billings increased for the second consecutive month at firms with an institutional specialization. While billings continued to decline at firms with a commercial/industrial specialization, the pace of the decline slowed significantly.

Despite other improvements in the economy, inflation remains a concern

The broader economy generally improved this month, although there remain some areas of concern. Nonfarm payroll employment added 227,000 new positions in November, a significant turnaround following just 36,000 jobs added in October. Architecture services employment data lags by one month, and the industry shed 100 jobs in October, the most recent data available. However, declines in the sector have stabilized in recent months, following larger decreases earlier this year.

Unfortunately, inflation ticked back up somewhat in November, following improvement in recent months. The consumer price index (CPI) rose by 2.7% from one year ago and by 0.3% from October, the largest monthly increase since April. This month’s primary contributors were gas and grocery price increases, although rent and transportation costs eased modestly. Despite this uptick, it remains highly likely that the Federal Reserve will lower interest rates by another .25 percentage points at their December meeting.

Firm profitability tops the list of firm concerns for 2025, while concerns about project financing subside

This month, we asked architecture firms about their biggest business-related concerns for the coming year. Typically, increasing firm profitability is their top concern, and this year was no exception: one-third of responding firm leaders who rated increasing firm profitability as a major concern for 2025 selected it as one of their top three concerns for the coming year. This is the highest share rating it as their top concern since 2017. In addition, 21% of firm leaders who rated negotiating appropriate project fees as a major concern for the coming year selected it as one of their top concerns. Rounding out the top three biggest concerns was identifying new clients and new markets/enhancing firm business planning/marketing; 20% of firm leaders that rated that issue as a major concern selected it as one of their top three concerns for the coming year, slightly higher than the share that selected it last year (18%).

While staffing issues remain among the top concerns at many firms, the share of firms selecting them as a top concern decreased somewhat from 2024, with 15% of firm leaders selecting filling open staff positions and finding candidates to fill key positions at the firm as a top issue (down from 18%). However, concern over replacing key staff approaching retirement age increased, with 11% rating it as a top concern this year versus 9% last year.

Financing issues also significantly decreased in level of concern for 2025, as interest rates decline and inflation wanes. While 15% of firm leaders rated client challenges in the availability of project financing and higher interest rates as a top concern for 2024, just 7% selected it for 2025. Concerns about managing rising costs of running their firm (e.g., space rents, health care costs, liability insurance) also decreased somewhat for firm leaders this year, with 19% rating it as a top concern versus 22% last year.

Issues of less concern for firm leaders for 2025 included managing possible merger and acquisition activity (65% of firm leaders rated it as not a concern for 2025), increasing firm post-construction work (e.g., post-occupancy analysis and monitoring) on existing buildings (58% rated as not a concern), developing strategies/principles/services for designing buildings for the post-pandemic world (54% rated as not a concern), reducing staffing costs (e.g., cutting hours, reducing headcount) (53% rated as not a concern), and integrating and managing a workforce split between remote and in-office (52% rated as not a concern).

Visit AIA’s website for detailed information about this, and past billing index reports.

The post ABI November 2024: Architecture Firm Billings Remain Flat appeared first on Residential Design.

See all AIA award recipients and winning projects across nearly 30 categories here.

2025 AIA Gold Medal
Deborah Berke, FAIA, LEED AP

Deborah Berke, FAIA, LEED AP, is a transformative figure in architecture whose career spans over four decades. She has combined design excellence, academic leadership, and a commitment to social and environmental responsibility. From founding her practice, Deborah Berke Partners (now TenBerke), in 1982 to becoming the first female dean of the Yale School of Architecture, her journey exemplifies innovation, inclusivity, and sustainability.

The Gold Medal is AIA’s highest annual honor, recognizing individuals whose work has had a lasting influence on the theory and practice of architecture.

Learn more about Berke’s selection as the 2025 AIA Gold Medal recipient.

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Jury, Gold Medal 2025
The AIA Board of Directors and Strategic Council select the winners for this program. The finalists were selected by the following advisory jurors:

• Anne Hicks Harney, FAIA, Chair, Long Green Specs, Manasquan, N.J.
• Kjell M. Anderson, FAIA, LMN Architects, Seattle
• Ung-Joo Scott Lee, AIA, Morphosis Architects, New York City
• Amy Slattery, AIA, Odimo, Kansas City, Mo.
• Megumi Tamanaha, AIA, ARO, New York City
• Roderic Walton, AIA, Moody Nolan, Chicago
• Korey White, AIA, DLR Group, Quincy, Ill.
• Taryn Williams, SGH, Washington, D.C.

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2025 AIA Architecture Firm Award
LPA Design Studios

LPA Design Studios has established itself as a trailblazer in sustainable, high-performance architecture, blending a mission-driven ethos with innovative, interdisciplinary design practices. LPA’s achievements have earned it national and international recognition. The firm has received numerous AIA awards, including a COTE Top Ten Plus Award and several AIA Committee on Architecture for Education honors. Projects like the Lanier High School Renovation in San Antonio and the West Hollywood Aquatics and Recreation Center exemplify the firm’s ability to address pressing social and environmental challenges while creating spaces that inspire and uplift communities.

The Architecture Firm Award is the highest honor AIA bestows on an architecture practice. The award recognizes a firm that has consistently produced distinguished architecture for at least 10 years.

Learn more about LPA Design Studios’s selection as the 2025 Architecture Firm Award recipient.

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Jury, Architecture Firm Award 2025
The AIA Board of Directors and Strategic Council select the winners for this program. The finalists were selected by the following advisory jurors:

• Anne Hicks Harney, FAIA, Chair, Long Green Specs, Manasquan, N.J.
• Kjell M. Anderson, FAIA, LMN Architects, Seattle
• Ung-Joo Scott Lee, AIA, Morphosis Architects, New York City
• Amy Slattery, AIA, Odimo, Kansas City, Mo.
• Megumi Tamanaha, AIA, ARO, New York City
• Roderic Walton, FAIA, Moody Nolan, Chicago
• Korey White, AIA, DLR Group, Quincy, Ill.
• Taryn Williams, SGH, Washington, D.C.

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2025 Edward C. Kemper Award
Raymond “Skipper” Post, FAIA

Across the span of nearly 60 years, Raymond “Skipper” Post, FAIA, has dedicated himself to advancing AIA and the profession at all levels. Through extensive community and organizational service, Post has bolstered the public’s perception of architects’ work while simultaneously operating a productive office dedicated to design excellence. His seemingly inexhaustible vigor and enthusiasm have led to countless meaningful appointments, and his leadership has profoundly influenced his colleagues and the built environment.

The Edward C. Kemper Award is the highest service award AIA can confer upon a member, this program recognizes significant impact on the profession through service to AIA or an architecture-related organization.

Learn more about Post’s selection as the 2025 Edward C. Kemper Award recipient.

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2025 AIA/ACSA Topaz Medallion for Excellence in Architectural Education
Thomas Fisher, Assoc. AIA

Tom Fisher, recipient of the prestigious 2025 AIA/ACSA Topaz Medallion, has profoundly influenced architecture, design education, research, and professional practice. Over a career spanning decades, Fisher has redefined the role of architects as public intellectuals and practical futurists, advocating for a profession that transcends traditional boundaries to address societal and environmental challenges.

Presented jointly by AIA and the Association of Collegiate Schools of Architecture (ACSA), the Topaz Medallion recognizes outstanding individual contributions in architectural education.

Learn more about Fisher’s selection as the 2025 Topaz Medallion recipient.

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Jury, Topaz Medallion 2025

• Elizabeth Danze, FAIA, Chair, Danze Blood Architects, Austin, Texas
• Illya Azaroff, FAIA, +LAB architects, New York City
• Jordan Luther, Assoc. AIA, AIAS, Pittsburgh
• Winifred Newman, Assoc. AIA, Clemson University, Greenville, South Carolina
• Renee Chow, University of California, Berkeley
• Andrew Chin, Florida Agricultural and Mechanical University, Tallahassee

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2025 Whitney M. Young Jr. Award
Bryan C. Lee Jr., NOMA, FAIA, LEED AP BD+C

Bryan C. Lee Jr., NOMA, FAIA, LEED AP BD+C, is a transformative architect, educator, and activist whose career has redefined the role of design in fostering social and spatial justice. As the founder and director of Colloqate Design and a leading voice in the Design Justice movement, Lee has championed architecture as a tool for dismantling systems of oppression and building spaces of reparation and liberation. Lee will serve as the National Organization of Minority Architects (NOMA) 2025-2026 president. 

The Whitney M. Young Jr. Award distinguishes an architect or architectural organization that embodies social responsibility and actively addresses a relevant issue, such as affordable housing, inclusiveness, or universal access.

Learn more about Lee’s selection as the 2025 Whitney M. Young Jr. Award recipient.

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The AIA/Deltek Architecture Billings Index (ABI) score for the month was 50.3, meaning that the share of firms that reported declining billings was essentially equal to the share of firms that reported increasing billings. In addition, inquiries into new projects ticked up in October to the highest level in six months. However, despite declining interest rates and softening inflation, clients remain hesitant to start new projects. The value of newly signed design contracts softened further in October, as they declined for the seventh consecutive month. Responding firms this month indicated that many clients were still awaiting the outcomes of the November elections, at both a national and more local level, before determining how to proceed on new projects.

Business conditions varied significantly across the country in October. While firms located in the Northeast saw billings decline further from September, firms located in the South reported billings growth for the first time in two years. And while billings continued to decline at firms located in the Midwest and West, the pace of the decline in those regions slowed from recent months. Conditions also varied at firms of different specializations this month. Firms with an institutional specialization saw slight billings growth for the first time since January, while business conditions remained softer at firms with multifamily residential and commercial/industrial specializations.

Architecture firms continue to shed employees

Conditions have remained mixed in the broader economy recently. While overall nonfarm payroll growth stalled in October with just 12,000 new positions added on net, the construction industry is still hiring. Overall construction employment grew by 8,000 new positions last month, while nonresidential specialty trade contractors added 14,000 new positions. However, architectural services employment continued its recent decline in September (the most recent data available), shedding an additional 400 positions. Total employment in the industry now stands at 203,100, down 3,000 positions since the beginning of the year and at the lowest level since 2022. In addition, the Federal Reserve lowered interest rates by another .25 percentage points in early November, still hoping to meet their desired goal of an inflation rate of around 2%. Another decrease of .25 percentage points is still expected before the end of the year, which should help the economy even more.

Architecture firms more optimistic about their revenue heading into 2025

This month, we asked architecture firm leaders about how revenue at their firm this year compares to last year and how they expect it to change in 2025. Overall, more than four in ten responding firm leaders (41%) indicated that they estimate that their firm’s revenue will be up this year compared to 2023, with average growth of 0.4% projected. However, more than one-third (36%) project a decline, and the remaining 23% expect it to remain within 5% of last year. Firms located in the Northeast and firms with an institutional specialization expect the largest revenue growth this year, with projected increases of 2.5% and 3.0%, respectively. On the other hand, firms located in the Midwest, and those with multifamily residential and commercial/industrial specializations, expect their billings to decline this year from 2023.

Firms were more likely to report that their current estimates for net revenue this year are below expectations at the beginning of the year, with 26% of responding firm leaders indicating that current estimates are somewhat less than expectations and 13% indicating that they are significantly less than expectations. Slightly more than one quarter reported that their current estimates are higher than expected at the beginning of the year, with 20% saying that they are somewhat in excess of expectations and 6% saying they are significantly in excess of expectations.

Regarding projections for net revenue changes from 2025 to 2024, firms are more optimistic, with growth averaging 1.0% projected for the year. Firms with a multifamily residential specialization, larger firms, and firms located in the South had the highest anticipated revenue growth projections for 2025, with expected increases of 2.9%, 1.8%, and 1.6%, respectively. Overall, 41% of responding firm leaders expect to see net revenue growth from 2024 to 2025, with 32% projecting growth in the 5% to 9% range. Just slightly more than one-quarter of firms (26%) expect a decline in net revenue in 2025.

At firms projecting revenue growth in 2025, 39% cited an improving economic environment (falling interest rates; more favorable lending environment) as a major factor, while 37% indicated that their current project backlog suggesting growth for next year is a major factor, and 35% indicated that getting a higher level of inquiries for new projects is a major factor. More than half of firms expecting growth in 2025 (56%) said that being more fully staffed was not a contributing factor to that projected growth, while 50% said that funds for public projects that have already been allocated is not a factor, and 46% said that a slowing construction market taking pressure off of construction labor and materials prices is not a factor.

At firms expecting a decline in revenue in 2025, more than six in ten firms (61%) cited current projects winding down and fewer new ones on the horizon as a major factor for that decline, with 51% saying that a declining backlog is a major factor. And while just 19% of firms expecting a decline said that elevated interest rates are a major factor, 39% said that uncertain economic conditions discouraging potential clients from pursuing projects is a major factor.

Visit AIA’s website for detailed information about this, and past billing index reports.

The post ABI October 2024: Business Conditions at Architecture Firms Begin To Moderate appeared first on Residential Design.