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UK architects more confident about future of property industry

Monday, Aug 31, 2009

Architects are more upbeat about the future of the property industry, according to a new survey but some are still experiencing financial difficulties because of the global real estate downturn.
Fewer firms expect a decrease in workload than in the previous month and 11% of practices actually expect staff levels to rise in next three months, the Future Trends Survey from the Royal Institute of British Architects has found.
Some 18% were expecting a decrease in workload in July compared to 21% in June. In addition, practices predicting an increase in workload rose from 27% to 31% over the same period.
But confidence within the architectural profession is not uniform across the country. 'Practices based in London and the south east are currently much more confident about some recovery in workloads than practices elsewhere in the UK,' said Adrian Dobson, director of practice at the RIBA.
But not all practices in this region are unscathed. Architects Aukett Fitzroy Robinson recently issued a profits warning after a project in Moscow was stalled. The company said that the loss of work on the Moscow River project will hit turnover.
It is also pursuing a significant claim for unpaid fees on two related projects in Buckinghamshire and London. As a result of the economic backdrop, the company said it may cut jobs.
Foster & Partners, one of the IK's best known architects practices has also been badly hit by cancelled or delayed projects in Russia and other countries. It has made job cuts and has sunk £16 million into the red.
Pre-tax losses at Lord Foster's firm have almost doubled after 'one of the most challenging years since practice's inception'.
But an 8% rise in turnover is expected to see the firm through the downturn and a large part of the company's losses has been due to the £4.7 million cost of restructuring earlier this year when the practice was forced to downsize by about 400 employees.
Work in the UK now amounts to only 10% of the practice's turnover, according to the results, with almost a third of its overall revenue, some £47 million, coming from its work in the Middle East.

Source: Propertywire.com