Industrial and Commercial Firms Improve

By firm specialization, only firms with a commercial and industrial specialization reported improving business conditions in February, according to Jennifer Riskus, AIA Economics Research Manager. The score for these firms remained above 50 for the eighth month in a row. Firms that specialize in residential (primarily multifamily) and institutional projects suffered setbacks, which could be temporary impediments.

Residential real estate remained relatively weak in most districts, with little construction activity reported. However, commercial real estate activity picked up in the Boston, Chicago and Dallas districts, while the Richmond, Kansas City and San Francisco districts have seen an uptick in commercial leasing in recent weeks.

A residential specialization firm in the South said it can't get enough work moving to bring in money to keep everyone paid. The client base is (a multifamily) developer, and while the news reports that apartments will be coming back first, the firm hasn't seen that as reality.

An institutional specialization firm in the Midwest has endured mergers and acquisitions within the healthcare industry. This resulted in work stoppages until restructuring and the status of healthcare reform is better determined. This market has carried firms through the recession, but now seem to be entering a recession itself.

- Courtesy of AIA