Demand for Tampa Bay area architecture services points to modest real estate development growth in 2025

The survey also shows that the development industry is wrestling with impacts of 2024’s hurricanes, with higher costs and questions about how best to rebuild

TAMPA, FL (February 14, 2025) - Tampa Bay area architects expect to see only modest growth in demand for their services this year. The results in this year’s AIA Tampa Bay Voice of Architecture survey are similar to 2024’s, marking the second consecutive year when growth in demand for the industry’s services can be expected to be slower than in 2022.

In turn, the results can be used to predict how real estate development will look in the Tampa Bay area this year. Architects are “canaries in the coal mine” for development-related economic trends, as demand for design services signals upcoming construction activity.

In the January survey, conducted by the Tampa Bay chapter of the American Institute of Architects (AIA), 66% percent of the 96 architects surveyed expect demand for architectural services in the Tampa Bay area to increase in 2025. This is a similar percentage to the response in last year’s survey (64%), and both years’ results are markedly lower than 2022, when 85% of respondents predicted demand to increase.

While the real estate development economy can be expected to have a healthy year overall, architects also acknowledged the significant impacts on their businesses from 2024’s two hurricanes, Helene and Milton. They are dealing with higher costs, and are working with clients on how best to rebuild – in particular, when rebuilding of older structures will require following the latest building codes.

Most of the architects surveyed about hurricane impacts (77%) anticipate higher overall project costs due to the storms, while 42% expect greater challenges in obtaining necessary materials and supplies.

"The back-to-back hurricanes have introduced new challenges, from rising project costs to the need to rebuild damaged structures in a manner that matches the latest codes,” said Jody Beck of Traction Architecture, AIA Tampa Bay’s chapter president. “At the same time, it’s important for our industry to play a major role in rebuilding in a way that protects us from future storms.”

Overall, the architecture industry is doing well in the Tampa Bay area, though – a sign of continued growth for real estate development. In this year’s survey, 64% of Tampa Bay architects expect their organization or department to hire more employees, and 42% anticipate their organization or department revenues to grow by 10% or more.

“The survey shows modest growth potentially bolstered by hurricane-related rebuilding,”  said Jason Jensen, President and CEO of WJArchitects. “We’ve seen a pause in smaller developments due to higher construction and tightened lending regulation.  All eyes are on the Gas Plant district / Tampa Bay Rays development, for which these conditions have jeopardized. There is a slowdown, but Tampa Bay has a great future. It’s still undervalued versus South Florida developments, with the best years ahead.”

Elsewhere in the survey, the same percentage of architects as last year, 80%, predict that the Tampa Bay area’s development-related economy in 2025 will be “excellent” or “good.” That figure is also lower than in 2022, when 95% of architects predicted an “excellent” or “good” area economy.

"The Tampa Bay area continues to attract new residents, and we are bouncing back from the impacts of 2024’s storms,” said Jeff Callahan, Senior Vice President of Moss Construction’s Mid-Florida Region, based in Tampa. “We continue to have solid fundamentals in terms of job growth and quality of life.”

This year’s survey results also show that higher interest rates continue to negatively impact the area’s real estate development outlook. In the survey, 79% of respondents believe the higher interest rate environment has had a negative impact on their architecture business, compared to 80% last year.

Also, 40% of the survey respondents said they have cut costs to compensate for higher project financing costs, compared to 57% last year; and only 34% are optimistic that interest rates will drop significantly in 2025.

"Costs are always a factor in whether new projects go forward, and higher interest rates certainly play a role,” said Will Conroy, President of Backstreets Capital, a St. Petersburg-based development company. “While the impact remains significant, we’re seeing development teams make adjustments so they can make projects work.”

Of the 96 respondents in the survey, 79% of the architects were either principals or managers. Most respondents were from Hillsborough County (73%) or Pinellas County (24%), though many of the architects in the two counties work on projects throughout the Tampa Bay region.

“The survey results suggest a continued leveling off in growth in some areas around Tampa Bay, reflecting how developers and investors are taking a measured approach,” said Katie Cole of the Hill Ward Henderson law firm, who works on entitlements for area real estate development projects.  “But the interest in our market continues to be extremely high.”

Tied to the local survey, AIA Tampa Bay is assembling an industry panel to interpret and discuss the results of the report. The event, set for Thursday, February 20 from 5:30 to 7:30 p.m. at the Center for Architecture & Design (1208 N Howard Avenue, Tampa), will feature the following panelists:

·         Jeff Callahan, Senior Vice President, Moss Construction;

·         Katie Cole, Shareholder, Hill Ward Henderson;

·         Will Conroy, President, Backstreets Capital;

·         Jason Jensen, President & CEO, WJ Architects.

Registration for the event is available at www.aiatampabay.com.  The panel discussion will be moderated by Kyle Parks of Parks PR, which represents a number of area companies in the real estate industry.

About the AIA:

The American Institute of Architects (AIA) is the professional association for architects and those in the architecture field. AIA Tampa Bay is the regional chapter representing 750 members in Hillsborough, Pinellas, Polk, Hernando, Citrus, Sumter and Pasco counties. The AIA provides programs and services including educational programs, design competitions, community service programs and serves as the united voice of the architecture profession. For more information, go to www.aiatampabay.com or call 813-229-3411.