By RYAN DORAN
In the final days of 2008, architects in Fairfield and Westchester counties are still benefiting from a strong 2007, although the current economic storm is expected to continue in 2009, leaving many looking ahead for opportunities.Architecture’s small margins, burdensome overhead and frightening liabilities can make being an architect in the best of times a daunting task, said architect Tobias Guggenheimer of Dobbs Ferry, N.Y.
“During the last recession, firms were slow to reduce staff because they anticipated a rapid recovery,” Guggenheimer said. “Because they were loathe to disband experienced teams, many suffered serious losses when the recession turned out to be deeper than expected.”
In the current climate there seems to be no reason to expect a quick turnaround, so he said he sees architects rapidly downsizing.
“This comes as a shock after a terrific run wherein every sector, residential, commercial, academic, government and the international market, provided plenty of opportunities for architectural firms,” he said.
According to Mark Van Summern, principal at Perkins Eastman in Stamford, architects are continuing to work with a few distinct industries in the downturn, while others have frozen building.
“Overall for Perkins Eastman as a firm, 2008 has been a record year in sales and profits generated via a very diverse practice area base that includes commercial and corporate interiors, higher education, K-12, healthcare, housing, senior living, hospitality and others,” Van Summern said. “In the second half and especially fourth quarter of ’08 we were seeing a slowdown in several of the practice areas including corporate interiors, housing, and senior living; the last especially impacted as retirees have not been able to sell their current homes to make a move to an adult community and or their savings have been severely impacted.”
According to Van Summern, there has not been a significant slowdown in health care or higher education where he says his firm continues to receive new request for proposals weekly.
“2008 is actually ending up as a pretty good year,” said Rich Granoff, president and founder of R.S. Granoff Architects in Greenwich. “This was mostly due to a very strong first half, with many projects continuing from 2007, which was a banner year for the industry.”
Granoff said he has seen decreased momentum in the industry recently.
“Our 20-person firm is still busy, though, which we credit partly with the diversity of projects that we design,” Granoff said.
Van Summern said time and effort is going to have to be asserted to achieve the amount of work that they want for next year.
“The good thing about ’09 is that all businesses seem, for the most part, to be in the same boat – rowing upstream looking for a site to put in,” he said. “We still project a very difficult first half of the year especially in corporate interiors, housing, and senior living. Many of our local clients who are able to move projects through entitlement without having to finance them are doing so with an eye to 2010 and 2011.”
Van Summern said he sees building in areas of health care and higher education to continue to be bright spots for architecture as well as some localized commercial development.
“It will take a much longer time to burn off office inventory and lower vacancy rates throughout the region,” he said.
Granoff said his firm is planning on further slowdowns in 2009.
“To be proactive, we are reducing nonessential expenses, but plan on maintaining our current staffing levels, Granoff said. “Although the construction industry is tightening up, we have many larger projects that are in design or will be going through approvals next year. These projects will get built in 2010.”
According to Granoff, the industry of architecture stands to contract paralleling the economy.
“One interesting aspect of architecture is how porous a profession it is,” said Guggenheimer. “The pathway to becoming a registered architect is analogous to that of becoming a doctor.”
According to Guggenheimer, college, professional school, three years of internship, challenging week-long state board combine with proportionally modest financial rewards to make the attrition rate in the industry already high during normal times, and rise during crises.
“I would expect many laid-off or struggling architects will end up in other lines of work,” said Guggenheimer. “This may result in short term staffing issues when demand heats up again.”
According to Granoff, his firm has seen less new homes and more renovation work in his residential business.
“As businesses downsize, there will be less of a demand for facilities expansion,” said Granoff. “As with any down-cycle, there will be an industry shakeout.”
Granoff said his shop has been preparing to ride out the storm and are lining up projects up for 2010.
According to Guggenheimer, the infrastructure initiative promised by the incoming presidential administration holds great potential for architects and the economy in general. Guggenheimer reiterated Granoff’s sentiment that a drop in the market shouldn’t cause firms to curl into hibernation.
“The challenge for everyone associated with a lagging construction industry is to remain constituted as a viable organization until an uptick in opportunities arises,” Guggenheimer said. “To that end we are increasing, not decreasing, our marketing efforts, and forging strategic associations with allied, but non-competitive organizations.”
Guggenheimer also anticipated a sluggish year in 2009.
“On the other hand, it seems clear that the demand for architectural services, in Westchester as elsewhere, has only been frustrated by the credit meltdown; it has not evaporated,” he said.
A growing population, and eventually, an expanding economy, will continue to demand the handiwork of architects.
“I am as optimistic about the long term as I am pessimistic about the short,” he said.