Architect (Urban Designing)

8/7/2019 Architect (Urban Designing)

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Architect (Urban Designing)

Industry Snapshot

Design firms primarily engaged in providing professional construction-relateddesign services constitute the architectural services industry. This industryincludes companies that offer engineering design services related to architecturalwork, but does not include civil engineering or ship and boat design companies.Landscape architecture, graphic arts, and drafting disciplines are covered inseparate classifications.

Aside from actually designing structures, architects typically are employedthroughout all phases of the building process from conceptual planning throughclient construction. In 2009, an estimated 41,800 establishments employingapproximately 270,500 people existed in this industry. About 96,480 architects(except landscape and naval) were working in the United States in 2008.Licensure is the highest form of industry regulation, and all 50 states requirearchitects to be licensed.

After suffering from a deep recession in the late 1980s and the early 1990s, thearchitectural services industry began a steady rise into the 1990s. Consumerconfidence mounted throughout the late 1990s, and the economy boomed. Whenweakening economic conditions slowed consumer spending in the early 2000s,falling interest rates bolstered the home construction sector, although the office

construction sector began to slow at that time. Housing construction boomedduring the mid-2000s, but in 2008, the bottom fell out of the real estate market asthe economy sank into a recession. As a result, the number of new residential,commercial, and industrial building projects slowed significantly.

Organization and Structure

In 2009, of the architect membership of American Institute of Architects (AIA),which represented over 50 percent of all licensed architects in the United States,54 percent were over 50 years old, 45 percent were between the ages of 31 and50 years old, and just 1 percent was under the age of 30. Eighty-one percent of

these architects work for an architectural firm (including sole proprietorships); 5percent, for other design firms; 2 percent, for government; 2 percent, foruniversities, schools, or associations; 2 percent, for corporations; 1 percent, forconstruction firms; and 1 percent, for engineering firms (6 percent is unknown).


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Architecture firms design a multitude of different structures for all sectors of themarket. Office and apartment buildings, schools, military installations, churches,factories, hospitals, houses, and airport terminals are but a few of the facilitiesthat they design for commercial, government, and private nonprofit organizations.While some firms specialize in serving one niche or a few related segments of the

market, others are highly diversified and offer a variety of design services to alltypes of clients.

The Design Process.

Building design can be a complex, detailed, and painstaking endeavor. Inaddition to the important consideration of appearance, architects must also stressfunctionality, safety, and economy in the design process. Even one minusculeflaw in a volume of construction drawings can result in costly litigation and theerosion, or destruction, of a firm's reputation. More important than pleasing thepotential users of any structure or satisfying personal design aspirations,

architects must accommodate the client who commissions and funds a project.

Design programming is the first stage of the building process. Architects are oftencalled upon at this point to determine what type of structure to erect. Marketingresearch, demographic analyses, regulatory constraints, and other factors all helpto determine economically viable development options. Site selection andacquisition follow the design programming stage. The architect analyzes factorssuch as soils, drainage, utility availability, tax rates, and traffic patterns todetermine where to build a project. If the client already has a parcel of land, thefirm can help determine the financial and physical feasibility of developing thesite.

After the client decides to build, the architect begins the conceptual designprocess. Schematic drawings and relational diagrams, prepared by the architect,allow the client to study possible options for developing the site. Crude modelsare often used to represent ideas in three dimensions. The conceptual designprocess eventually results in a hypothetical plan that is used to generate costestimates and guide the development of more detailed elevations, cross-sections,models, and perspectives.

After developing a detailed design, the architect begins the bulk of the designwork, which are detailed construction drawings. These highly detailed drawings

determine accurate construction cost estimates and bids by contractors. They alsodictate the quality of craftsmanship and materials to be used by contractors.Architects cooperate with engineers and other professionals to ensure that thedesign is technically appropriate and complies with legal guidelines. When theworking drawings are complete, the architect usually takes bids on the projectfrom contractors, awards a contract, and supervises construction to ensure thatthe contractor properly executes design details.


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Although rates vary, most architects bill clients on a per-hour basis. The total billfor architecture and engineering design services is often in the range of 2 to 4percent of the total construction cost of a project, but can be much more or lessdepending on the type of project or the level of involvement by the architect.

Types of Firms and Projects.

The three types of companies primarily engaged in providing architecturalservices are engineer/architecture (E/A) firms, architecture/engineer (A/E)companies, and architecture firms. Typically, an estimated 15 percent of the totalbillings by architectural firms are rendered by firms in the architectural servicesindustry. Engineering and construction firms and other companies that offerservices related to architectural work, such as surveying services, consume thebulk of the revenues.

Purely architectural firms bill strictly for architectural design work. They do not

have engineers on staff and often offer limited construction managementexpertise. This segment supplied only a small percentage of all architecturalservices rendered by U.S. companies. A/E firms, while still emphasizingarchitectural skills, have engineers on staff with expertise related to architecturalbuilding design. Firms in this category typically account for a small percentage ofindustry billings.

E/A firms maintain architects on staff but emphasize engineering design servicesthat are related to construction work. These firms produce roughly one-half of allindustry billings and furnish the highest percentage of all architectural servicesrendered by U.S. firms.

Background and Development

Architects have been designing structures in return for compensation for morethan 3,000 years. Although several famous architects designed well-knownprojects during the early history of the United States, such as Thomas Jefferson'sMonticello in the early nineteenth century, an organized architectural professiondid not exist in the United States until the 1850s. In fact, formal educationalprograms for architects were unavailable until the 1860s, with the establishmentof the Massachusetts Institute of Technology, Cornell University, and theUniversity of Illinois.

Prominent works which sprang from the fledgling architectural services industryin the middle and late nineteenth century included the Marshall Field & Companybuilding in Chicago, the Wainright Building in St. Louis, St. Patrick's Cathedral inNew York, and the Harvard Museum of Comparative Zoology in Cambridge.Prominent architects of the period who owned firms included James Renwick,Louis Agassiz, H. H. Richardson, and Louis H. Sullivan. Between 1900 and 1940,Frank Lloyd Wright, Germany's Mies van der Rohe, and France's Le Corbusier,


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among others, designed significant projects and had enormous influence on theprofession. Famous works of this time included many office buildings, such asthe Empire State Building and Rockefeller Center in New York.

It was not until after World War II that the U.S. architectural industry began to

experience rapid growth and to become closely affiliated with building andconstruction industries. During that time, large corporations developed massivestructures that projected wealth and distinction, and government expenditures forinfrastructure and public works grew at an unprecedented rate. This developmentboom gave birth to many large architecture firms, such as Hellmuth, Obata &Kassabaum and Perkins & Will, that employed hundreds of architects. Skidmore,Owings & Merrill, one of the larger firms in the post-war period, designed projectssuch as the Connecticut General Life and Inland Steel Buildings. The GeneralMotors Technical Center and Frank Lloyd Wright's Guggenheim Museum wereother prominent landmarks that characterized the progression of the industryfrom the 1950s through the 1970s.

By 1983, however, new development activity was leading the architecturalservices industry into an era of unprecedented profit and growth. Deregulation oflending institutions, an influx of foreign investment dollars, and new tax laws allcombined to generate a massive injection of capital into the commercialdevelopment industry. Between 1982 and 1985, the total amount of commercialspace designed by architects ballooned from less than 700 million square feet peryear to over 1.3 billion. At the same time, residential markets were also boomingand the demand for new public construction increased. As a result, the totalnumber of establishments in the architectural services industry jumped over 20percent, from 14,089 in 1985 to a peak of 17,777 by 1987. During the same

period, revenues leapt from $5.9 billion to over $9.8 billion, and industryemployment shot up to nearly 140,000 from only 105,000.

In the late 1980s, the flow of capital for new design projects waned. The TaxReform Act of 1986, which discouraged new construction, and a shortage ofsavings and loan capital were two of the various factors contributing to aslowdown in 1987. Architecture firms saw a significant decline in the number ofdesign jobs available in many commercial and residential markets. In fact, by1989, it was clear that the industry had fallen into a severe, and potentiallyprolonged, recession. Total new commercial development plunged to about onebillion square feet in 1988, and fell to under 800 million square feet in 1989.

By the end of 1989, the market for architectural services appeared to manyanalysts to have bottomed out. Nevertheless, while most firms were on the ropesand struggling to survive the industry shakeout, the development marketcontinued to plummet in 1990 and 1991. In fact, many office buildings thatarchitects had designed in the late 1980s opened in the early 1990s without asingle tenant; these became known as "see-through buildings." The total demandfor new construction continued to fall from $410 billion in 1989 to about $358


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billion in 1991. The market for residential design services was also hit hard, asnew construction in that sector fell 14 percent in the same three-year period.Although many firms were able to stay afloat by emphasizing public worksprojects, which experienced expenditure increases of 9 percent between 1989 and1991, most firms lost revenue.

In response to harsh market conditions, the architectural services industrybecame increasingly competitive in the early 1990s. As hundreds of firms closedtheir doors, most remaining companies quickly took measures to increase theirmarket share and to maintain profits. In some cities, about 50 percent of allarchitects were laid off. Those hit hardest were young, inexperienced workersand older, highly paid employees. Firms were also reducing fees in an effort toundercut competitors. Most importantly, however, architecture firms were lookingto new growth markets and technology to give them an edge in the 1990s.

Market conditions improved slightly from 1991 to 1992, indicating that the

development drought was easing. The total value of new construction increasedabout 4 percent to about $423 billion. Although work in commercial markets,especially office building design, continued to decline, housing and public worksdesign projects increased. Furthermore, spending in some commercial nichemarkets, such as health care, improved as much as 5 percent. Importantly,remodeling, retrofit, and repair construction for all sectors reached record levels in1992, allowing many firms to boost billings on small maintenance jobs.

A survey of 100 design firms by Architectural Record in 1992 revealed thatnearly half the respondents had realized a reduction in the construction dollarvalue of their commissions since 1990. The average decrease was between 10

and 25 percent, although some firms lost as much as 90 percent. Of the surveyrespondents, 34 percent reported that their workload was down, 24 percent saidit was up, and 42 percent felt that it had stabilized. A similar surveybyEngineering News-Record showed a 20 percent decrease in design workbacklogs from early 1991 levels, indicating that work was becoming more difficultto secure.

Firms were taking a variety of steps to improve internal operations and increasecompetitiveness. Most firms were increasing their workload-to-staff ratio to savemoney and decreasing fees to attract more business. This was oftenaccomplished by relying on part-time help from trained architects that were called

on only when absolutely necessary. Popular trends were "hoteling," whereemployees would check into offices for short stints on special projects, or whereseveral employees would use the same office but at different times of the day.

One of the most important internal changes for many companies was theincreased use of technology to lower labor costs. In fact, 12 percent ofrespondents in the Architectural Record survey indicated that despite an increasein billings they had elected to diminish the size of their staff. Computer automated


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design (CAD) systems were a major factor in this increased productivity for somefirms. "I've eliminated my whole office staff with a computer," said Philadelphiaarchitect David Steele in the Architectural Recordin March 1993. Many companieswere also eliminating clerical help with the aid of new office technology ascomputers, answering machines, and cellular phones replaced receptionists in

some offices.

In addition to increasing the productivity of their internal operations, many firmsin 1993 were expanding their service offerings. Some companies were going intoproject management, using their design expertise to streamline the constructionprocess and save money for contractors and owners. Other architecture firmswere expanding into interior design, facilities management, and environmentalplanning and engineering to increase revenues. Conversely, some firms werereducing their offerings, choosing instead to specialize in tiny niche marketswhere they held a competitive edge. Niche growth areas in the commercial marketfor architectural services included designs for privatized prisons, arenas,

hospitals and other health care facilities, long-term care facilities, warehouses,and recreational structures around river boat gambling casinos.

Entering new markets was another way that architecture firms were trying tomaintain profitability. As design work for commercial construction continued todecline through 1993, public works projects were allowing many firms to increaserevenues. For instance, while the amount of new hotel space plummeted 40percent in just one year between 1991 and 1992, the value of new public worksprojects steadily increased from almost $91 billion in 1989 to over $102 billion by1992. Water supply facilities and miscellaneous public buildings, which grew in1991 and 1992 at a rate of 5 percent and 7 percent, respectively, offered the

greatest potential for architecture firms competing for public works commissions.Design projects related to utility construction and conservation also offeredincreased opportunities.

After the recession of the early 1990s, the industry began to grow again, bringingin over $14.6 billion in 1994. Revenue was up 8.7 percent from 1993, and up byalmost 20 percent from 1991, and industry strategists predicted the growth wouldcontinue well into the twenty-first century. According to the AIA, building activityincreased an average of 1 percent each year from the levels of the first half of the1990s.

Commercial development of suburban office space contributed to the life of theindustry in the early 1990s, as commuters fled the cities and downtown officevacancy rates soared. Even when urban office vacancy rates stabilized by 1996,suburban office occupancy increased, and vacancy rates in the suburbs droppedby 9 percent annually as growing numbers of businesses abandoned theiroutmoded urban operations in favor of modern new quarters in the suburbs.

At the turn of the twenty-first century, conditions worsened for the commercial


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building industry as the economy weakened and businesses began to rein inspending. At the same time, businesses found it much more difficult to securefunding for expansion efforts. Large projects, including office towers, sufferedmost severely as a result of the return to conservative lending policies, whichbrought an end to what some observers called speculative lending.

Despite the slump in commercial construction in the early 2000s, the residentialhousing market, which accounted for approximately 15 percent of total billings,held strong. Interest rates neared historic lows in 2001 and 2002, fueling newhome construction. New housing starts, the number of new single and multi-family homes under construction, rose from 1.58 million in 2000 to 1.6 million in2001.

In order to encourage a continued source of work contracts, engineering andconstruction companies devised "one-stop shop" (design-and-build) services.Often, these firms offered architectural services at very low or negligible costs to

help the company secure large construction and project management contracts.Gaining prominence at the turn of the twenty-first century, the design-buildindustry saw sales for the top 100 design-build companies grow 22.3 percent to$39.89 billion in 2000. Consequently, U.S. nonresidential construction marketshare for the top 100 design-build firms grew to 35 percent in 2000, compared to25 percent in the mid-1990s. As stated in Engineering News Record, "The trend isclearly away from project-by-project management and toward management oflarger construction programs for clients." The Design-Build Institute of Americapredicted that design-build companies would increase their share of the U.S.nonresidential construction market to 45 percent by 2005.

Social and Political Factors.

Until the late 1990s, one of the most stable areas of growth for the industry wasretail construction sales, which increased a steady rate of 2.5 percent every yearfrom 1980 to 1996. However, several factors were pushing that figure down.Home shopping through network clubs and the Internet was taking away theneed for retail centers. In addition, as the baby-boomers aged, services becamemore of a concern than goods, lessening the need for retail centers even more.The effects of the Americans with Disabilities Act of 1990 offset some of theprojected decline. Compliance with the act required that many newer buildings bemade handicap-accessible, and this was expected to provide millions of dollars in

architectural design contracts, along with rehabilitation and maintenance designwork, especially for aging infrastructure.

Computerized Design.

Two important advances in the architectural services field in the early 1990s werecomputer-aided design (CAD) software programs and 3-D modeling. As late as1993, architects in many offices were still designing with ink or pencil on vellum


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or Mylar surfaces. Designers sat at a drafting board and used triangles andcompasses to produce precise technical drawings. With the introduction of CAD,however, an increasing number of professionals moved away from the drawingboard and onto the computer to develop their designs. Although both methodswere extremely labor intensive, CAD offered the advantages of allowing architects

to save their work, to duplicate and move parts of a design, and to make changesmore easily. Additionally, many tasks that were cumbersome on the drawingboard were accomplished easily using CAD. Calculations of surface areas andvolumes for earthwork projects were among the functions made easy by CADsoftware.

Critics of CAD argued that it was too costly for smaller firms to implement, that itstifled the design process and limited flexibility, and that it displaced architects.In contrast, others maintained that the implementation of CAD systems increasedproductivity for designers and reduced staffing requirements. For instance, J. F.Borelli, a New York architect, increased billings at his firm by 125 percent

between 1990 and 1992 when he expanded his CAD implementation. Hemaintained his staffing level at 65 employees and discovered that clientsincreasingly requested that projects be developed with the CAD software.

Even more sophisticated than CAD software were 3-D modeling systems thatallowed architects to design projects in three dimensions on computer. Three-dimensional modeling enabled architects to create virtual walk-throughpresentations of their projects, which allowed clients and builders to gain a bettersense of the reality of a structure. Through the implementation of 3-D, clients andbuilders could conveniently view the successive stages of a project, or they couldview structures from different angles. By 1993, several larger firms used 3-D

modeling regularly. The technology remained expensive, but the subsequentsavings in construction time and improved communications between designer andclient often justified the implementation of 3-D software and accelerated therecovery of equipment costs.

Turn-of-the Century DesignTrends.

As architects of the late twentieth century turned increasingly to new digitaltechnologies for purposes of productivity, they experimented with 3-D technologyto develop "e-topia" structures in modern communities, according to William J.Mitchell in the Architectural Record. In pursuit of e-topia, an expansion of the

kiosk concept, designers undertook the design of virtual malls for onlinecommerce, as well as virtual amusement parks and other conceptual structuresthat were previously limited to the physical realm. Through virtual realitytechnology, architects became further empowered in the arena of restorativeconstruction. Modern designers ushered the art of structure restoration to a newlevel of evolution at the threshold of the twenty-first century by tapping thepotential of 3-D systems and virtual reality to redefine the parameters ofarchitectural restoration. Through the process of virtual reconstruction, historical


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structures became available for simulated viewing in their original state. Evenancient structures that ceased to exist altogether at some time in the past might berecreated in simulation form, through intensive application of the technique.

Increasingly, as the twentieth century drew to a close, what was old became new

again, including the architectural theories of feng shui, which experienced arevival in the United States during the 1990s. Progressive architecture firms,encouraged in part by academics at the University of Buffalo, subscribed to theethereal concepts of the ancient Chinese art, the substance of which involvesstrategic placement of space and energy. Proper implementation of feng shuibegins prior to construction of a building, with the selection of a site. During thedesign phase, the orientation of the structure must allow for consideration of theforces of wind and water, as implied by feng shui. Despite the ancient mystic andreligious connotations of feng shui, adherence to the practice resulted in buildingdesigns not unlike those of mid-twentieth century architects.

In stark contrast to feng shui, designer Gideon S. Golany discussed the use ofgeo-space (building underground) to squeeze more space for structures fromcluttered landscapes in highly populated areas. Building groundward presented anumber of advantages for better protection from the elements and lower energyconsumption, according to Golany. The practice is most advantageous as a meansof conservation, and despite the speculative nature of underground constructionfor human occupation, geo-space designers implemented designs in Montreal,Paris, and Japan by the end of the 1990s. Geo-space designs were particularlywell-disposed to the growing trend among architectural designers to becomeinvolved in community development from the initial inception in order to create acustomized and cohesive functionality of design, in coordination with existing

regional demographics.

In 2003, the AIA reported that most of an architect's revenue was associated withnew construction, at a ratio of 66 percent new construction to 34 percentrenovation and rehabilitation projects. At that time, sole practitioners accountedfor just under one-third of architectural firms. Approximately 66 percent of firmshad between 2 and 29 employees, 2 percent of firms had between 50 and 99employees, and 2 percent of firms had more than 100 employees. The largestfirms collected almost half of all billings, while sole practitioners received only 2percent of industry billings. By 2005, overall billings by architectural servicesestablishments had increased 11 percent over 2002 levels, to reach $28.7 billion,

a combined construction value of $360 billion.

In the early-2000s, the design of educational facilities brought in the greatestamount of revenue, at 24 percent. Office building accounted for 14 percent, healthcare facilities were 12 percent, retail and commercial space were 10 percent,multi-family residences were 7 percent, and single-family homes were 5 percent.By the late-2000s, health care had the highest percentage with 14 percent,followed by educational facilities with 19 percent, offices with 12 percent, and


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multi-family residences with 11 percent. Forecasts in 2007 expected the strongestgrowth to come from continued activity in the health care, hotel, and office facilityindustry segments.

The industry also reported changes in the makeup of architectural firms, with

more women and minorities holding staff positions. In 2005, women accounted for26 percent of staffing, compared to 20 percent in 1999. Racial and ethnicminorities held 16 percent of jobs, an improvement from 9 percent in 1999.

Current Conditions

According to data collected by the AIA, over the three year period of 2006-2008,U.S. architecture firms increased their gross billings by nearly $16 billion dollars(54 percent) to reach $44.3 billion in 2008--an average annual increase of 16percent. The top five industry sectors in 2008 were health care, office space, K-12education, college/university education, and food services retail. Rounding out

the top ten were government and civic projects, hospitality industry, industrial,transportation, and recreational.

AIA's study revealed to two particular trends. First, architecture firms showed asignificant increase in the number of "green" projects. In 2005, 31 percent of firmsreported using green design practices; by 2008, 50 percent of firms wereimplementing sustainable design features. The largest increase was observed infirms with 10 to 49 employees, which jumped from 48 percent to 72 percentbetween 2005 and 2008. Second, over the same period, the percentage of firmsusing Building Information Modeling (BIM) software increased from 34 percent to69 percent. BIM uses three-dimensional, dynamic building modeling software to

create detailed building designs that can demonstrate the entire life cycle of thatbuilding.

Despite this strong revenue growth, architecture firms began to feel the effects ofthe economic recession late in 2008. Credit dried up, the residential housingmarket collapsed, and residential, commercial, and retail building ground to anear halt. In November 2008, the Architecture Billings Index (ABI), which isconsidered a reliable indicator of future construction activity, was at its lowestlevel (34.7) since it was first recorded in 1995. During 2009, conditions did notimprove, and staff layoffs were widespread as firms moved to cut costs. Inaddition, small and mid-sized firms found themselves competing with much larger

firms for jobs that these heavy hitters would normally pass by. Robert Cassidywrote in Building Design & Construction in September 2009, "It's a sign of howdesperate things are that national firms that normally work on hundred-million-dollar projects are themselves 'reduced' to fighting for the 'scraps' that in the pastwould have gone to small, local firms."

By late in 2009, the industry was looking at some signs of gradual recovery. InOctober 2009, the ABI index had rebounded to 46.1, the highest reading since the


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first signs of trouble in mid-2008. Inquiries for new builds in the institutionalsector (e.g., schools, hospitals) showed the most growth. The commercial andindustrial sectors remained flat in October, and the residential sector showed acontinued, gradual upward trend.

Industry Leaders

According to the Architectural Record, the top three firms in 2008 based onrevenues generated by architecture revenues were AECOM Technology Corp.; M.Arthur Gensler, Jr., and Associates; and HOK Associates, Inc. Los Angeles-basedAECOM Technology is a global leader in design and engineering. Publicly traded,AECOM reported revenues of nearly $5.2 billion (17 percent from architectureservices) in 2008 and employed 43,000. Among the few remaining pure designfirms in the United States, M. Arthur Gensler, Jr., and Associates had revenues of$775 million (84 percent from architecture services) and employed 2,275. The SanFrancisco-based company, founded in 1966 by its namesake, remains privately

owned. Also privately owned, HOK Associates, Inc., located in St. Louis, takes itsname from its founders, St. Louis architects George Hellmuth, Gyo Obata, andGeorge Kassabum, who created the company in 1955. The firm reported earningsof $752 million (78 percent from architecture services) in 2008.

Workforce

Most architects complete a five-year accredited college program. They must thenwork for at least three years before becoming eligible for certification after a seriesof exams. The industry employed 270,500 in 2008. Most work in architectural,engineering, and related services in firms with fewer than five employees. One in

five were self-employed, a proportion that is three times greater than otherprofessions. According to the Bureau of Labor Statistics, in 2008 mean annualsalary for architects was $66,140.

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Kartik Trivedi

Architect (Urban Designing)

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