I'm a architect in the DC area (5 years experience) who was laid off from a firm this past spring that worked solely on commercial project types (high rise multi-family, hospitality, office, retail). When the money for these dried up, 60% of the firm was pushed out the door.
In the DC area now, most firms have stopped or considerably slowed layoffs (with the exception of healthcare, which has been the last typology to depress, from talking to others in the industry). Also, there is a great demand for new urban residential product in the next few years, so it would seem that multi-family will be the projects that lead us out of the recession. There are also a few large firms (such as HDR, URS, AECOM) that specialize in federal and infrastructure work that are very busy and hiring strategically.
A drawback from not working is being out of touch on industry news. Are there those who work for firms in large urban areas who have seen a rise in project starts again? Is there any chatter about firms projecting to start to hire again in the next few months?
I don't see how multi family projects other than those that are HUD backed or LIHTC will move forward given the CRE market is about to nose dive just like the single family home market did. Residential Rental Vacancies across the country are very high and landlords have been forced to lower rents due to the many people who are moving in with family and renting out their own places that they purchased during the boom. I did read that DC was one of the better places currently for AEC so that is probably what you are experiencing. As far as getting out of this anytime soon? I don't think so. I do not work in architecture, however.
I don't see many places that have a great demand for new residential construction given the huge inventory out there and the soon to be huge inventory in apartment buildings, office buildings and shopping centers. There are people who will try to push these projects forward, but I suspect many of them to run into trouble. A lot of the money is on the sidelines right now waitiing for the Tidal Wave to crash so they can be the first ones on the beach to pick up the best treasures. Why build for $120k a unit when pretty soon you'll be able to buy turnkey properties for much less?
FMI is forecasting another 15% dip in non residential constrution for 2010.
DC is special market at the moment, you are correct. There have been a few multi-family projects that have gained financing in the past month and are starting construction in early 2010.
One of the other problems that developers face at the moment is that many overpaid for land in emerging areas of the city during the height of the boom and going through construction and sales right now doesn't pencil out. However, the inventory in DC is very low and projected to run out by 2011, so there will be a big need for new housing starts in the very near future.
For those who are working at the moment, what is the level of confidence in your firms for ongoing and future work? Have you noticed any turnaround or is there still a lot of pessimism?
We certainly have more inquiries than we did 6 months ago but few if any do I have any confidence in getting beyond the initial design phase. So no, I have very little confidence in 2010 being profitable.
More layoffs in my firm last week... we have two offices, one in Metro DC. both offices have shrunk by 75%. Most of our work was the mixed use new urbanism deal, and we have attempted to diversity into government work with no real success yet. Attitude in the office is total and complete pessimism, taking bets on when the ship will sink.
We are a 30 person firm, and have hired three people in the last month. Our backlog has been increasing. We had a downturn in work last year of about 15%, but did not lay anyone off. Things seem to be up to last years level now. Several other firms in our city hired recently too. On the other hand, several firms have gone out of business or are filing for bankruptcy, so it seems to be uneven.
Experienced developers never pay for land before they have to. They put together development deals that tie up the land until they receive entitlements and are ready to build. The downturn in the economy sent alot of mixed-use and multi-family projects sideways. This gives the developers an opportunity to renegotiate the land costs and terms, or they walk away and lose a bit of money. Labor costs are relatively inexpensive these days. The combination of less expensive land and labor are good indicators of an increase in building activity. Once financing normalizes we will begin the building cycle all over again.
Mixed-use and multi-family projects will most definetly find their way back to viability. There are market-rate and affordable projects that are shovel-ready or close to it that that have yet to be financed. On average, most projects take about a year before they are completed. The real estate market should be much stronger by the end of 2010.
The vacancies in residential rentals will subside. Alot of people moved in together or moved back in with their families because of job losses and to save money. These living situations will change as the economy improves. I should think that we should start to see this happening around spring/summer 2010 as the jobs market continues to pick up.
There are some corporate architectural firms that are hiring and some that are still laying off a few people here and there. I have seen an increase in hiring from small to medium size (30 people or less) firms. As expected, firms with a practice of varied projects types fared much better during the economic downturn. On the whole, I think that our profession is stabilizing.
UrbanDC, I work for one of the DC firms you mentioned. Just as an FYI, while just about every firm in the area was contracting heavily about this time last year we were still hiring (all the way up until January when we officially went on a hiring freeze). However we didn't go completely unscathed. Our office did have a limited round of layoffs over the summer but nothing substantial. But our other offices in other cities were hurting badly and some of them are still hurting.
HDR in DC also had layoffs. I have no idea how many but I know it from hearing things around the office since they are one of our competitors.
Right now though, our office is doing phenominal and we have a lot of work coming in. Some if it aint pretty award-winning architecture (like jails, detention centers, youth wards etc) but some of it is very amazing -- particularly our federal and public works.
Oct 29, 09 3:33 pm ·
·
Block this user
Are you sure you want to block this user and hide all related comments throughout the site?
Archinect
This is your first comment on Archinect. Your comment will be visible once approved.
Emerging Job Wave?
I'm a architect in the DC area (5 years experience) who was laid off from a firm this past spring that worked solely on commercial project types (high rise multi-family, hospitality, office, retail). When the money for these dried up, 60% of the firm was pushed out the door.
In the DC area now, most firms have stopped or considerably slowed layoffs (with the exception of healthcare, which has been the last typology to depress, from talking to others in the industry). Also, there is a great demand for new urban residential product in the next few years, so it would seem that multi-family will be the projects that lead us out of the recession. There are also a few large firms (such as HDR, URS, AECOM) that specialize in federal and infrastructure work that are very busy and hiring strategically.
A drawback from not working is being out of touch on industry news. Are there those who work for firms in large urban areas who have seen a rise in project starts again? Is there any chatter about firms projecting to start to hire again in the next few months?
I don't see how multi family projects other than those that are HUD backed or LIHTC will move forward given the CRE market is about to nose dive just like the single family home market did. Residential Rental Vacancies across the country are very high and landlords have been forced to lower rents due to the many people who are moving in with family and renting out their own places that they purchased during the boom. I did read that DC was one of the better places currently for AEC so that is probably what you are experiencing. As far as getting out of this anytime soon? I don't think so. I do not work in architecture, however.
I don't see many places that have a great demand for new residential construction given the huge inventory out there and the soon to be huge inventory in apartment buildings, office buildings and shopping centers. There are people who will try to push these projects forward, but I suspect many of them to run into trouble. A lot of the money is on the sidelines right now waitiing for the Tidal Wave to crash so they can be the first ones on the beach to pick up the best treasures. Why build for $120k a unit when pretty soon you'll be able to buy turnkey properties for much less?
FMI is forecasting another 15% dip in non residential constrution for 2010.
DC is special market at the moment, you are correct. There have been a few multi-family projects that have gained financing in the past month and are starting construction in early 2010.
One of the other problems that developers face at the moment is that many overpaid for land in emerging areas of the city during the height of the boom and going through construction and sales right now doesn't pencil out. However, the inventory in DC is very low and projected to run out by 2011, so there will be a big need for new housing starts in the very near future.
But to get back on the thread topic....
For those who are working at the moment, what is the level of confidence in your firms for ongoing and future work? Have you noticed any turnaround or is there still a lot of pessimism?
We certainly have more inquiries than we did 6 months ago but few if any do I have any confidence in getting beyond the initial design phase. So no, I have very little confidence in 2010 being profitable.
Again, not in architecture, but more layoffs/paycuts in construction are anticipated. Seeing the same thing from my friends in manufacturing.
More layoffs in my firm last week... we have two offices, one in Metro DC. both offices have shrunk by 75%. Most of our work was the mixed use new urbanism deal, and we have attempted to diversity into government work with no real success yet. Attitude in the office is total and complete pessimism, taking bets on when the ship will sink.
We are a 30 person firm, and have hired three people in the last month. Our backlog has been increasing. We had a downturn in work last year of about 15%, but did not lay anyone off. Things seem to be up to last years level now. Several other firms in our city hired recently too. On the other hand, several firms have gone out of business or are filing for bankruptcy, so it seems to be uneven.
Experienced developers never pay for land before they have to. They put together development deals that tie up the land until they receive entitlements and are ready to build. The downturn in the economy sent alot of mixed-use and multi-family projects sideways. This gives the developers an opportunity to renegotiate the land costs and terms, or they walk away and lose a bit of money. Labor costs are relatively inexpensive these days. The combination of less expensive land and labor are good indicators of an increase in building activity. Once financing normalizes we will begin the building cycle all over again.
Mixed-use and multi-family projects will most definetly find their way back to viability. There are market-rate and affordable projects that are shovel-ready or close to it that that have yet to be financed. On average, most projects take about a year before they are completed. The real estate market should be much stronger by the end of 2010.
The vacancies in residential rentals will subside. Alot of people moved in together or moved back in with their families because of job losses and to save money. These living situations will change as the economy improves. I should think that we should start to see this happening around spring/summer 2010 as the jobs market continues to pick up.
There are some corporate architectural firms that are hiring and some that are still laying off a few people here and there. I have seen an increase in hiring from small to medium size (30 people or less) firms. As expected, firms with a practice of varied projects types fared much better during the economic downturn. On the whole, I think that our profession is stabilizing.
UrbanDC, I work for one of the DC firms you mentioned. Just as an FYI, while just about every firm in the area was contracting heavily about this time last year we were still hiring (all the way up until January when we officially went on a hiring freeze). However we didn't go completely unscathed. Our office did have a limited round of layoffs over the summer but nothing substantial. But our other offices in other cities were hurting badly and some of them are still hurting.
HDR in DC also had layoffs. I have no idea how many but I know it from hearing things around the office since they are one of our competitors.
Right now though, our office is doing phenominal and we have a lot of work coming in. Some if it aint pretty award-winning architecture (like jails, detention centers, youth wards etc) but some of it is very amazing -- particularly our federal and public works.
Block this user
Are you sure you want to block this user and hide all related comments throughout the site?
Archinect
This is your first comment on Archinect. Your comment will be visible once approved.