COVER STORY, JULY 2009

A BRAND NEW DESIGN
Architects retool businesses to confront recession.
Jon Ross

Sizeler Thompson Brown Architects designed a new space for The Louisiana DOTD in Louisiana.

The ongoing economic downturn is forcing architects to pursue new business avenues. No longer able to rest on a steady diet of development projects, architecture firms throughout the Southeast are searching for new ways to serve clients. The financial downturn has slowed construction starts across the country, leading to a large number of companies struggling to land a shrinking number of projects. 

“It’s a more competitive marketplace, so you have to find ways to be super-efficient,” says Stephen Swicegood, managing director of Gensler’s Atlanta office. “Some of that has been re-engineering our business processes, our design processes and looking more at integrating the different phases we do. We’re looking at making the process more streamlined.” Gensler is also utilizing its worldwide offices for less costly help. When Swicegood needs assistance on a project in the Southeast, he might enlist workers in the company’s Costa Rica location to save money. 

The financial meltdown didn’t destroy the need for development, but it has severely retarded plans for most new spaces. Gensler is keeping busy by pursuing a blend of work from a variety of different clients. Business isn’t rosy — Swicegood estimates that activity is down 15 to 20 percent from last year — but architects at the firm are finding new projects. “We’ve definitely seen work in the pipeline and won more than our share of it,” Swicegood says. “We haven’t been in a we’re-dying-of-thirst mentality.”

Many of these jobs come in the form of tenant-improvement projects from corporate clients. Swicegood is finding that the firm is working more with clients to utilize existing space. “The vast majority of corporate America leases space,” he says. “They go on the marketplace, they find space, they lease it, and that gives them the ability to upsize, downsize and adjust over time.” If a company has recently laid off a few employees, Swicegood might help them find a new use for empty offices or a way to reconfigure smaller spaces in order to sell excess square footage. “It’s very discouraging for people to walk into an office that’s half empty,” he says. “Maybe there are ways to compress and get everybody together. Maybe you’ve got some space you can put on the market.”

Swicegood also is seeing an increasing number of firms splitting up the workday between employees, a practice he calls “hot desking.” With fewer workers in the office, it may make sense to downsize space and designate alternating shifts of workers to the same desk. “It’s an appropriate time to look at portfolio strategies and workplace strategies,” he says. “It’s not designing a building; it’s strategizing what buildings you’re going to need when you come out of the recession.”

Competition is strong in New Orleans, but for an entirely different reason. Local architects are seeing activity from post-Katrina rebuilding, and this increased level of development attracts national firms. Ian Thompson, a principal with New Orleans-based Sizeler Thompson Brown Architects, says his firm hasn’t had to look hard to find work. The company recently  completed its design for the Louisiana Department of Transportation and Development’s new building in Louisiana. 

“We are going like gangbusters at the moment,” Thompson says.

The rebuilding effort is a boost to construction, but at the same time it’s changed the types of properties that are being built. Private work is hard to find in the current market; government-driven projects are fueling the fire because even this far along in the recovery process, money from the federal government is still slowly trickling in. “We’re saying that it ought to start drying up, just by logic,” Thompson says. “We’re thinking next year work will start slowing down.”

Public projects are usually larger than private developments, so Thompson is using the competition to his advantage by partnering with national firms on projects Sizeler Thompson couldn’t handle alone. “No one is an expert in everything, so we’re often partnering with other firms to bring a stronger team to a project,” he says. “We’ve always had that as a policy, but we seem to be doing that a little bit more.” Thompson adds that even if the market returns to post-recovery levels and the competition from national companies dissipates, Sizeler Thompson will keep partnerships at the forefront of the firm’s strategy. “Those partnerships will hopefully last into the future, now that we know each other and know how we work,” he says. “That gives us a more regional marketing ability.”

The economic downturn has forced companies to reconfigure time-tested strategies and outside competition has pushed firms to strengthen business practices. “The outside competition forces us to be better,” Thompson says. In Atlanta, Swicegood embraces this change in his company’s outlook, while at the same time remaining optimistic about the present market. He maintains that even though some firms are struggling, work is out there if people are willing to look for it. “It’s a recession, but people are not not doing business.”

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