Good Areas of Opportunity Remain for Architects

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Friday, March 4th, 2016
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Though conditions are set to drop back in some areas, architects are expected to continue to be presented with significant levels of opportunity going forward as workloads remain strong in a number of sectors and improve in yet others.

Over recent years, demand for architectural services has grown as the dollar value of building work done (excluding small residential renovations) rose from fractionally over $80 billion as recently as 2012/13 to more than $90 billion by 2014/15. Work is expected to exceed $90 billion again in 2015/16.

construction activity

That has delivered benefits not just for architecture practices but for professional staff as well. In its most recent quarterly snapshot, for example, recruitment outfit Hays reported high levels of demand across a number of cities, with skills in need including CAD drafters, design managers, design architects, senior project architects, architectural draftspeople, residential draftspeople, Revit drafters and documenters and senior designers and workplace interior designers.

Going forward, Australian Construction Industry Forum (ACIF) expects activity to level off and remain at around current levels over the next five years. This overall picture, however, obscures a number of areas where improving or healthy levels of activity are expected to be observed, such as housing in the short term and office, retail, accommodation and healthcare buildings over the longer term.

Furthermore, with no fewer than 55,886 new houses and apartments having been approved for construction over the last quarter of last year (far more than at any other time in recent history apart from the surge over the past 12 months), the pace at which new work is coming in the residential sector remains red hot for now. That in the commercial sector is not booming but trended higher in 2015 compared with 2014.

Of course, much will depend on the performance of the overall economy, which for now is not looking overly promising. Despite the low dollar and consequent boost to exports, Goldman Sachs, for example, expects the economy to grow by just two per cent in 2016 as the mining downturn deepens and remain at a modest three per cent in the two years following.

Outside of economic conditions, interesting developments are happening on a number of other fronts. In Victoria, the consultation process regarding minimums standards of high-rise apartment design continues, with draft guidelines set to be released shortly. A recent survey suggested strong public support for minimum apartment sizes in that state.

In New South Wales, moves to introduce architectural style guides for a number of suburbs in Sydney have drawn criticism, with commentators such as Urban Taskforce Australia CEO Chris Johnson raising fears these will be interpreted in an overly rigid manner and could thus inhibit innovation and the flexibility and diversity of design.

Finally, on the issue of sustainability, frustration continues to grow with regard to the NatHERS rating tool, which critics say suffers from disjointed management, gaming of the system, a lack of opportunities for peer review on larger projects and a lack of disclosure of the rating achieved by the end product in the marketplace. In early February, the Australian Sustainable Built Environment Council called for a consistent framework with regard to rating tools in regard to housing sustainability.

housing starts

Areas of opportunity by sector

On a sector by sector basis, according to ACIF and HIA:

  • Having come off a whopping 220,060 commencements last year, Australia‚Äôs residential construction sector is expected to experience another year of extremely strong activity in 2016 by breaking ground on 199,910 new dwellings (the second highest number on record) before dropping back to more modest levels in subsequent years. Conditions will remain at elevated levels in New South Wales, Victoria and Queensland before dropping back in each of these states from 2017 onward.
  • After dropping back from $6.3 billion in 2014/15 to a forecast $5.949 billion in the current financial year, the dollar value of work done on office construction will rise to $6.667 billion again by 2017/18 (ACIF) amid strong levels of activity in Victoria and New South Wales and improving though historically modest volumes of work in the ACT, Western Australia and South Australia.
  • Activity is peaking, sitting at historically high levels in Queensland and New South Wales and Western Australia and improving in Victoria from historically modest levels. The volume of work going into retail-related projects is expected to peak at historic highs of $6.436 billion in 2015/16 but will remain at respectable levels thereon after.
  • Having jumped by almost 70 per cent from $1.041 billion in 2013/14 to $1.721 billion in 2014/15, the dollar value of work done on hotels and accommodation is set to remain at elevated levels going forward.

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