Architecture billings dropped in March

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Billings at U.S. architecture firms declined in March, the third drop in five months.

The scores had risen modestly and January and February. But the weak March score “indicates a broader soft spot in design activity,” according to the American Institute of Architects in Washington, D.C.

The AIA says the weakness can also be see in its newly released index of design contracts, which measures changes in the volume of new work coming into architecture firms. The index indicates how much project activity firms will be billing for over the coming months and quarters.

The index shows new project activity was generally flat around the nation in 2012, but began to show gains in 2013.

“This index, however, was negative this January and again in March, indicating that new work coming into architecture firms has not been increasing recently,” the AIA said.

The slowdown in architectural billings could presage a corresponding drop in construction. Kent Hanway, an architect who is the president of the Boise, Idaho, firm CSHQA, noted that construction tends to lag architecture by six to nine months.

The architecture and engineering pipeline is slowing because of factors like higher interest rates, continued caution in the market, and a stall in the absorption of current product, Hanway said.

The market has also been hit by lower government spending. Those factors “will then mean the construction pipeline may be impacted or be a little weaker moving into fall and 2015,” Hanway said.

“Overall, the marketplace is still positive, but tepid and cautious,” Hanway said.