The Top 250 Design Survey: Designers weigh in on the state of the market, partnerships, trends and favorite flooring producers – Oct 2023

By Darius Helm

The commercial market has been steady this year, though far from the gains of 2022, and in many ways, it’s back to business as usual, with most pandemic impacts in the rearview mirror. But Covid has left its mark, driving change in medical environments, upending workplace models and generally tinting the market with a hue of uncertainty.

With supply chain issues resolved and inflation starting to abate, the market has largely normalized. The American Institute of Architects’ Architecture Billings Index (ABI), which, when it comes to flooring, generally forecasts conditions nine months to a year ahead, came out of a historically deep trough in early 2021 and stayed in positive territory (scores higher than 50) until October 2022, when the index fell to 47.7. It stayed negative until last May, when it climbed to 51.0, but it fell to 48.1 in August. Regionally, the Midwest has outperformed the Northeast, West and South in 2023.

The ABI suggests that the commercial market in general will soften as it moves into 2024 but still stay relatively healthy, depending on the segment. Dodge Construction Network’s Dodge Momentum Index also shows a slowing, though overall activity is still up. According to Sarah Martin, associate director of forecasting for Dodge, “As we move into the final four months of 2023, both commercial and institutional planning will continue to be constrained.”

This year, 30% of surveyed designers report that budgets are up, 35% say they’re down and 35% say they’re unchanged. This is on par with the last couple of years, following 2020, when only 3% reported that budgets were up, and 47% said they were down.

SECTOR OVERVIEW
We asked designers in which markets they have experienced the most growth in the past 18 months, and the plurality (15%) voted for medical/acute care, which includes hospitals, clinics, urgent care centers and medical office buildings in general. Last year, the biggest vote-getter was multifamily, which saw over a third fewer votes this year. And the most recent ABI data indicates that multifamily residential was the slowest segment, coming in at 45.4, so multifamily may continue to see reduced growth rates.

Two segments where designers report strong growth are corporate, which is the biggest commercial segment, and higher education. Hospitality is also surging back, while K-12 and senior living seem to have slowed.

Designers were also asked about their three largest projects in the last year, and for the third year in a row, the corporate (workplace) segment was the top vote-getter, with its best showing since 2020. Corporate gains have largely come from small office projects, with large- and medium-sized corporate projects also inching up. Healthcare was about flat, with marginal gains in medical/acute care offsetting a slowdown in senior living.

The other big segment, education, was down over 40%, with higher education about flat but K-12 down by nearly two-thirds. Hospitality and government large projects were also up.

For the complete Design Survey results, see the October 2023 issue of Floor Focus Magazine.

Copyright 2023 Floor Focus

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