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WASHINGTON, DC-After five consecutive quarters of posting scores above 50, hopes had been raised that the Architecture Billings Index had moved permanently into positive territory—at least for this particular cycle. Those hopes have been dashed with the April ABI score of 48.4. It follows 50.4 in March—a score that AIA chief economist Kermit Baker admitted last month was skirting very close to the line.

That is one reason he was not surprised by this month’s reading. Also, Baker pointed to the continued volatility in the overall economy and the warm winter that accelerated demand and has now produced a pause in projects that moved faster than expected. For those reasons, “this decline in demand for design services isn’t terribly surprising,” he said in a prepared statement.

The new projects inquiry index was 54.4, down from a mark of 56.6 the previous month. Regional averages also dropped from last month’s index. The Northeast posted a score of 51.0, the Midwest of 50.1, the South 49, and the West, 48. Commercial/industrial performed the best in the sector index breakdown at 53.8. Multifamily was 50.5, institutional was 46.6 and mixed practice was 45.

The ABI reflects a nine to 12-month lag time between architecture billings and construction spending. The regional and sector categories are calculated as a three-month moving average, whereas the index and inquiries are monthly numbers.

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Erika Morphy

Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.