### Q1 2026 # Architecture Industry Insights This quarterly report highlights the trends, market signals, and strategic considerations shaping architectural practice. From ABI data and construction forecasts to building performance and evolving market conditions, it provides actionable, must-read insights to guide your practice and decisions. ##### Q1 2026 National Billings ## Topics ##### Month By Month Indicators ##### Regional Trends & Sector Snapshot ##### The Construction Economy ##### Building Performance & the AIA 2030 Commitment ##### Where to Watch in Q2 & Beyond ##### Q1 Summary Curated by Ed Akins II, AIA, LEED AP Principal Architect, cove --- Q1 2026 National Billings FIRM BILLINGS REMAIN BELOW GROWTH — BUT SIGNS OF STABILIZATION EMERGE January: 43.8 — inquiries declined for the first time since April 2025; design contracts continued to soften February: 49.4 — inquiries rebounded and the pace of contract decline slowed significantly OVERALL: Q1 dipped further before beginning to level off. Rising material costs, tariff impacts, and economic uncertainty will test whether this stabilization carries into Q2. --- Month By Month Indicators Billings | 43.8 Design Contracts | ~47 KEY INDICATORS AT A GLANCE Design Contracts | ~47 Project Inquiries | Declined February: Billings | 49.4 Design Contracts | ~49 March: PENDING --- Regional Trends & Sector Snapshot REGIONAL TRENDS The South holds firm; other regions struggle. The Midwest, which posted growth through late 2025, saw that momentum recede in Q1. The South emerged as the only region at or near stability. The Northeast remained the weakest, further impacted by winter storms in February. SECTOR SNAPSHOT No sector breaks into growth; institutional continues to climb. Q4 avg. → Q1 avg. Institutional: 48.7 → 48.0 Commercial/Industrial: 47.8 → 44.8 Multifamily Residential: 45.5 → 48.3 Institutional work continued its gradual climb, reaching 49.2 in February. Multifamily improved but hasn't posted sustained growth since mid-2022. Commercial/Industrial saw the steepest Q1 decline. --- The Construction Economy Tariffs on steel and aluminum (50%), copper (50%), and softwood lumber (10%) continue to push material costs higher, with overall project expenses rising an estimated 4–6%. Renovation, repositioning, and adaptive reuse projects remain the most viable sources of work under current lending and budget conditions. A RESHUFFLE, NOT A BOOM --- # WHERE TO WATCH IN Q2 The South emerged as the most stable region in Q1 and may continue to lead as a bellwether heading into Q2. The Midwest, which posted growth through late 2025, will be worth monitoring for signs of recovery. Institutional work continued its gradual climb toward stability, reaching 49.2 in February. Public-sector and infrastructure funding may sustain this trajectory. Renovation, repositioning, and adaptive reuse projects are expected to remain the most reliable sources of near-term work as lending conditions stay cautious. Tariffs on steel (50%), aluminum (50%), and copper (50%) continue to compress project budgets. Whether the 10% global tariff set to expire in July is extended will be a key factor for project feasibility in the second half of 2026. Rising energy and material costs are adding further pressure across the supply chain. Firms building price escalation provisions into contracts and maintaining diversified supplier relationships are better positioned to protect margins. Firms prioritizing operational efficiency, flexible staffing, and data-driven forecasting remain best positioned to navigate continued uncertainty. --- # In Summary ## AIA ABI (Q1) – Soft Conditions with Signs of Stabilization Architecture billings remained below 50 throughout Q1. January's 43.8 was the lowest reading in months, but February's 49.4 offered the first signal that conditions may be approaching a floor. The South was the only region holding near stability. The Midwest saw its late-2025 growth recede, and the Northeast remained the weakest. Institutional work continued its gradual climb toward 50, while Commercial/Industrial saw the steepest decline. No sector has posted sustained growth since mid-2022. **A Reshuffle, Not a Boom** The construction economy is moving at several different speeds. Data centers continue to grow while manufacturing construction has fallen sharply and office remains challenged. Tariffs on steel, aluminum, and copper are adding 4–6% to project costs. Rising energy prices are compounding pressure across the supply chain. Renovation, repositioning, and adaptive reuse remain the most consistent sources of work under current lending and budget conditions. ## What People Are Watching February's near-flat ABI and firm sentiment suggest cautious optimism for Q2, but tariff policy, rising costs, and workforce challenges create significant headwinds. Private-sector development is expected to remain uneven, while public-sector and renovation-driven work may provide relative stability. Firms prioritizing operational efficiency, flexible staffing, and procurement strategy are best positioned to navigate continued uncertainty. --- # Meet the Expert ## Ed Akins II, AIA #### cove Principal Ed Akins II, AIA is an architect and educator with a passion for sustainable design and innovative thinking. A former Sustainable Fellow and Interim Chair of the College of Architecture and Construction Management at Kennesaw State University, he holds a Master of Architecture from Georgia Tech and has earned multiple industry accolades. ### Get Ahead of the Trends