The World Shrinks, Dubai Grows
Globalism comes to the profession as more and more architects take their work abroad

by Zach Mortice
Associate Editor

Summary: The number of U.S. architecture firms doing international work has doubled since 2002. Large firms of more than 100 people and firms that have some specific type of international expertise or connection are the most likely to take on these projects. Firms see expanding internationally as a way to mitigate building downturn risks by increasing their geographic diversity, gain footholds in exponentially expanding markets in the developing world, and detect nascent building industry trends in advance of their domestic presence.

In October, the Cityscape Dubai real estate conference brought 45,000 developers, investors, architects, and designers together to buy, sell, and vie for $1.3 trillion of development projects on display. Billed as “the largest business-to-business real estate investment and development event in the world,” the event caters to “institutional investors,” which organizers define as investors ready to drop at least $5 million into the future of the desert city that is rapidly becoming the symbol of global capitalism’s next phase of growth. To attract this money, the world’s premiere architecture firms sponsored booths. One case in point was Zaha Hadid, Hon. FAIA.

“When an architect like [her] has a booth, you know you’re in a strange place,” says Michael Ellis, partner at Los Angeles-based 5+Design during a phone interview from the conference. “It’s a bit like after the Chicago fire here.”

As a measure of the increasing globalization of the architecture profession, the conference has been wildly successful. Since 2005, this annual conference, held October16–18, has doubled in attendance, according to the Gulf News, which is almost in lockstep with the increase in the amount of international work architects are doing.

The price to play
Dubai’s expansion is unique, but not singular. In Europe and Asia, commercial real estate investment increased 33 percent in 2006 to a record $645 billion. China’s GDP has multiplied by a factor of almost 10 in the last 15 years.

While international work is still a relatively small part of all U.S. architecture firm billings (6 percent), for large firms with the scale and resources to handle the complexity of work abroad and smaller firms with specialized expertise, the explosive markets in the Middle East, China, India, and elsewhere are the newest frontier. A 2006 AIA firm survey of member-owned firms revealed that among those of 100 people or more, 59 percent had done international work (defined as billings from outside the country for either international or domestic clients and inside the country for international clients) in the past three years.

Ellis’s firm’s relatively small size (75 people), makes 5+Design an exception to this statistic. He and his four partners started the company in 2005 after leaving Jerde Partnership, where they had specialized in creating large, mixed-use master plans for overseas clients. With their own firm, they’ve used this same expertise to get a solid foothold in the Dubai and Abu Dhabi markets. Since the firm’s founding, partner Arthur Benedetti says their specialized design capabilities have attracted new clients to them. “We left the old company without taking anything with us,” he says.

A design-only firm, 5+Design’s work exemplifies the luxury New Urbanist aesthetic taking hold in the Middle East, with its mixed-use Central Market towers in Abu Dhabi shaped like the bud of an emerging flower, to its Los Angeles-style marina master plan for the Dubai Festival City Zone 8c.

From the Dubai convention floor, FXFowle’s Peter Weingarten, AIA, says his firm was able to establish their 12-person satellite Dubai office a year ago with the help of an American expatriate the firm hired who could help them navigate the local regulatory agencies and fees.

AIA Chief Economist Kermit Baker, PhD, Hon. AIA, says gaining this type of expertise (either accumulated over time or hired on the fly) is a key element for firms planning to expand abroad. “It’s not [casting] a wide net,” he says. “It’s very idiosyncratic of how they find out about those opportunities.”

Consolidation and mergers have been rampant in the economy and in architecture as well for the past 15 years, says Baker, and some firms are using this strategy to expand beyond their domestic borders. Last summer, high-profile, multi-national mergers of RTKL with Netherlands-based ARCADIS and Hillier with Scotland-based RMJM saw the European firms co-opting American architects’ strong design brand identities in exchange for giving the American companies a wider array of engineering and planning support services that can offer clients single-stop shopping across the entire building process. But Baker says most firms don’t see the jump from national to international as an intuitive next step. “My sense is that that’s a very complicated leap,” he says. “It really depends on the opportunities that present themselves.”

The view from up here
Beyond the sheer availability of development-ready land seen at Cityscape Dubai, Baker says expanding internationally is one way for architecture firms to spread market risk and survive building downturns in their home bases. Kevin Flanagan, AIA, a senior associate partner at KPF’s London offices and president of AIA UK, says that due to an economic downturn during the early 1990s, there was very little work to be done in their New York City headquarters, which pushed KPF to expand to Asia and South America and establish their UK office as a foothold for completing ongoing work in Europe and finding new work in the Near and Far East.

When will the amount of overseas work architecture firms do double again? Baker says it is difficult to tell: This trend is too dependent on the domestic economy and the individual economies of foreign clients to forecast accurately.

Up-close involvement with these economies can give architecture firms a bird’s eye view of global building industry changes perhaps equal to the cityscape vistas that SOM’s 162-story Burj Dubai will offer visitors. One example of this, says SOM Managing Partner Gene Schnair, AIA, has been the vast improvement in Chinese building materials, especially glass. He says that steep building costs in the U.S. will necessitate the importation of cheaper products, and China is poised to take advantage of this. “A couple years ago we wouldn’t even have considered using Chinese glass products, and now we believe they are [on] par with U.S. products,” he says.

Such direct and rapidly transmitted knowledge of foreign building materials would have been unthinkable a generation ago, and this global awareness is beginning to pull apart the notion of architecture firms as organizations tied to any definite geography.

“What’s happening in one particular region of the world is likely to affect us at home,” says Schnair. “We all need to recognize that we’re in a global environment.”