Six Point Surge in Architecture Billings Index

WASHINGTON, D.C. – After consecutive months of very modest growth, the
Architecture Billings Index (ABI) saw a considerable jump in November to
its second highest reading of the year.  The commercial / industrial
sector recorded its best mark of the decade and while still reporting
weak billings, residential architecture firms showed encouraging signs
by posting the highest score in four months.

With an approximate nine to twelve month lag time between architecture
billings and construction spending, the ABI is a leading economic
indicator of construction activity, and should translate into a high
level of activity throughout 2007.  The American Institute of Architects
(AIA) reported the November ABI rating was 57.5 up sharply from 51.1 in
October (any score above 50 indicates an increase in billings).

“The nonresidential construction sector continues to see a high level of
demand for design services,” said AIA Chief Economist Kermit Baker, PhD,
Hon. AIA.  “Even though there has been some deceleration in growth the
previous two months, an uptick in billings of this size is noteworthy in
portending sustained construction activity in the months ahead.”

Key November ABI highlights:

Regional averages: West (60.7), Northeast (58.0), South (51.1), Midwest
(49.5)

Sector index breakdown: commercial / industrial (62.9), institutional
(54.6), mixed (50.6), residential (47.4)

Inquiries index: 62.1

Architecture firm concerns for 2007:


        * Attracting and retaining staff

        * Coping with rising construction costs

        * Managing current project workloads

        * Negotiating appropriate project fees

Matthew A. Litfin, an equity research analyst with William Blair &
Company, stated, “The spike in the ABI this month reflects reinvigorated
design activity, now that national elections have concluded and future
interest rate policy is clearer.  The November ABI reading is near
record levels last seen in fall 2005 and before that, in mid-1998.
Looking ahead to 2007, we are predicting very strong growth in
nonresidential construction activity and stabilization in residential
construction activity.”