I’ll start this off with a provocation: the business model for conventional/traditional architectural practice is broken.
So, I’ve been thinking about what other possibilities there might be. For instance, can a model be developed for a not-for-profit practice offering professional architectural services? Could it be made sustainable?
The pipe dream triggering this is:
What if an architect could make a simple living by doing projects which enhanced the community, not worried about taking jobs which are typically considered ‘bread and butter’ just to keep in operation?
What if an architect could offer design services for free to those who couldn’t otherwise afford to hire an architect but who really need design services to make their projects a reality? How would that work?
I assume the venture would have to be funded through grants and fundraising. Not necessarily the most stable support for a business which needs to have specifically educated/skilled staff, periodic software updates, and a functioning office infrastructure. What resources could be brought to bear to make a non-profit office operate? Could there be a sort of subscription/membership structure, like public radio?
What I'm NOT proposing is that architectural needs to be offered for free in all cases. There still has to be an understanding of the value proposition in professional services provided. An explicit statement about the value of the services in the general professional market that could be related to the cost of running the organization. But that value might be more readily acknowledged if what the public saw was architects consistently working toward a public good, not compromising their role by always having to jockey for *any* paying job.
-That empty storefront might be turned more easily if architectural services weren't among among the barriers to entry.
- If the billable hours aspect of practice was removed, greater attention and rigor could be brought to bear on small typically non-lucrative projects.
- Neighborhoods could bring architects into a conversation about the potential for certain catalyst projects to trigger re-investment. Developers might be attracted more readily if they understood what a neighborhood's goals were and there was a pre-vetted vision for it.
There would have to be some discretion on the part of the venture about what kinds of projects would be taken on and what the limits of the services would be. If it was more appropriate for a for-profit firm to do the work, the non-profit would pass - or possibly offer limited assistance to help the project along and keep it going in a community-positive direction.
I’ve looked around a little at what the architecture not-for-profit world looks like. What will come to mind first for most people is Architecture for Humanity, but they're more of an aid organization and a clearing house, of sorts, for the design work of others.
Public Architecture (http://www.publicarchitecture.org) is closer to what I’m looking for. Are they the only ones experimenting with this kind of practice? Can it be considered a model for practice, or is it just a side project of Peterson Architects? Can it sustain itself independently as a business concern?
Has anyone seen other examples in your cities for how this kind of thing could work?
xian
Dec 21, 13 4:24 pm
Realistically, the rest of the world just doesn’t see architecture as being as important as architects do. People who do think architecture is really important all become architects. To the rest of the world, architecture is interesting, but they would rather have an extra 800 sqft on their house or just save the money than pay for the typical architects definition of “good architecture”. You are going to have to come up with a better way to sell architecture to these folks than to just keep calling them stupid and uneducated, it just causes them to stop taking you seriously.
As far as architects becoming developers, any architect that does this will quickly learn that the profit margins aren’t nearly as large as you think they are, and to stay in the green and get sales, you have to build buildings that people want, not the buildings architects think they should want.
My point here is that the although the current business model may not work well for a lot of architects, it actually works pretty well for the rest of the world. It’s structured to fit their priorities, not ours. If you want it to change, you’re gonna have to come up with an idea non architects will buy into.
Miles Jaffe
Dec 21, 13 6:25 pm
^ Bullshit. There are plenty of very, very rich developers. The ones I know won't touch a project if the most conservatively figured profit margin is below 30%.
xian
Dec 21, 13 7:01 pm
Have you seen their books? It’s competitive out there, and if you want a 30% profit margin, then you are going to be up againts people who are happy with a 5 or 10% margin. That’s still a shitload when you’re talking multi million dollar projects.
Miles Jaffe
Nov 26, 17 5:52 pm
These guys get far more than 5% return just on rents with no risk. Actual development needs to be a windfall before they're even slightly interested. The people happy to get 5% (or less) are the architects and contractors building these projects.
pietereerlings
Nov 26, 17 2:47 pm
just FYI
I did interview 2 architects on how and why they did transform their service business into real estate business:
I find it interesting how earlier in this thread it ran with the typical hating on capitalism for making architecture not valuable to people. I don’t really understand that thought process. Capitalism is really just a process of letting markets decide what goods and services are produced or invested in. Luxury items such as design have a harder sell because they are luxuries. They don’t really do much for people unless you really sell it and prove it. But what other time in history or other system of government has there been a design role for such a wide array of structures? Yes there were much grander forms of architecture in the past but they were limited to whoever held the power at the time, churches, institutions, monarchies. Never before have we seen the common man benefit so much. I’d say we have it pretty good and if you are frustrated by your client being wrapped up in numbers it’s just their way to quantify if the project is a correct allocation of resources. Learn the language and you can prove it to them why you are valuable.
archi_dude
Nov 26, 17 6:51 pm
Excuse me, *common person
Miles Jaffe
Nov 26, 17 11:02 pm
"Capitalism is really just a process of letting markets decide what goods and services are produced or invested in."
Capitalism is in practice an economic system for returning the maximum profit by any means available. That means control and manipulation of markets and either the elimination of regulation or the establishment of favorable regulation.
The results of capitalism are best demonstrated by the massive accumulation of wealth by a tiny fraction of society at the expense of everyone else.
archi_dude
Nov 27, 17 12:41 am
Hmm I’d say largest middle class ever. What system would you like Miles?
Volunteer
Nov 27, 17 8:25 am
The middle class has been shrinking with fewer high-paying jobs with benefits. Employment HAS gone up under Trump, whether you loathe him or not. The proposed tax plan does seem to be a disaster, though.
msparchitect
Nov 27, 17 2:18 pm
Proactive Practices has been interviewing some interesting studios creating an impact... sometimes without the initial client: http://proactivepractices.org/
whistler
Nov 27, 17 2:32 pm
Check out Housebrand.ca. Started by a canadian architect who became the builder and realtor . took the whole "master-builder-realtor" idea to the next level. Small scale but grabbed all the available percentage points as opposed to giving the profits away. Not unlike Jonathon Segal.
I’ll start this off with a provocation: the business model for conventional/traditional architectural practice is broken.
So, I’ve been thinking about what other possibilities there might be. For instance, can a model be developed for a not-for-profit practice offering professional architectural services? Could it be made sustainable?
The pipe dream triggering this is:
What if an architect could make a simple living by doing projects which enhanced the community, not worried about taking jobs which are typically considered ‘bread and butter’ just to keep in operation?
What if an architect could offer design services for free to those who couldn’t otherwise afford to hire an architect but who really need design services to make their projects a reality? How would that work?
I assume the venture would have to be funded through grants and fundraising. Not necessarily the most stable support for a business which needs to have specifically educated/skilled staff, periodic software updates, and a functioning office infrastructure. What resources could be brought to bear to make a non-profit office operate? Could there be a sort of subscription/membership structure, like public radio?
What I'm NOT proposing is that architectural needs to be offered for free in all cases. There still has to be an understanding of the value proposition in professional services provided. An explicit statement about the value of the services in the general professional market that could be related to the cost of running the organization. But that value might be more readily acknowledged if what the public saw was architects consistently working toward a public good, not compromising their role by always having to jockey for *any* paying job.
-That empty storefront might be turned more easily if architectural services weren't among among the barriers to entry.
- If the billable hours aspect of practice was removed, greater attention and rigor could be brought to bear on small typically non-lucrative projects.
- Neighborhoods could bring architects into a conversation about the potential for certain catalyst projects to trigger re-investment. Developers might be attracted more readily if they understood what a neighborhood's goals were and there was a pre-vetted vision for it.
There would have to be some discretion on the part of the venture about what kinds of projects would be taken on and what the limits of the services would be. If it was more appropriate for a for-profit firm to do the work, the non-profit would pass - or possibly offer limited assistance to help the project along and keep it going in a community-positive direction.
I’ve looked around a little at what the architecture not-for-profit world looks like. What will come to mind first for most people is Architecture for Humanity, but they're more of an aid organization and a clearing house, of sorts, for the design work of others.
Public Architecture (http://www.publicarchitecture.org) is closer to what I’m looking for. Are they the only ones experimenting with this kind of practice? Can it be considered a model for practice, or is it just a side project of Peterson Architects? Can it sustain itself independently as a business concern?
Has anyone seen other examples in your cities for how this kind of thing could work?
Realistically, the rest of the world just doesn’t see architecture as being as important as architects do. People who do think architecture is really important all become architects. To the rest of the world, architecture is interesting, but they would rather have an extra 800 sqft on their house or just save the money than pay for the typical architects definition of “good architecture”. You are going to have to come up with a better way to sell architecture to these folks than to just keep calling them stupid and uneducated, it just causes them to stop taking you seriously.
As far as architects becoming developers, any architect that does this will quickly learn that the profit margins aren’t nearly as large as you think they are, and to stay in the green and get sales, you have to build buildings that people want, not the buildings architects think they should want.
My point here is that the although the current business model may not work well for a lot of architects, it actually works pretty well for the rest of the world. It’s structured to fit their priorities, not ours. If you want it to change, you’re gonna have to come up with an idea non architects will buy into.
^ Bullshit. There are plenty of very, very rich developers. The ones I know won't touch a project if the most conservatively figured profit margin is below 30%.
Have you seen their books? It’s competitive out there, and if you want a 30% profit margin, then you are going to be up againts people who are happy with a 5 or 10% margin. That’s still a shitload when you’re talking multi million dollar projects.
These guys get far more than 5% return just on rents with no risk. Actual development needs to be a windfall before they're even slightly interested. The people happy to get 5% (or less) are the architects and contractors building these projects.
just FYI
I did interview 2 architects on how and why they did transform their service business into real estate business:
http://blog.archisnapper.com/punch-list-app-iPhone-iPad-Android/from-architects-to-real-estate-developers-with-alex-and-esther-from-barcelona/
I find it interesting how earlier in this thread it ran with the typical hating on capitalism for making architecture not valuable to people. I don’t really understand that thought process. Capitalism is really just a process of letting markets decide what goods and services are produced or invested in. Luxury items such as design have a harder sell because they are luxuries. They don’t really do much for people unless you really sell it and prove it. But what other time in history or other system of government has there been a design role for such a wide array of structures? Yes there were much grander forms of architecture in the past but they were limited to whoever held the power at the time, churches, institutions, monarchies. Never before have we seen the common man benefit so much. I’d say we have it pretty good and if you are frustrated by your client being wrapped up in numbers it’s just their way to quantify if the project is a correct allocation of resources. Learn the language and you can prove it to them why you are valuable.
Excuse me, *common person
"Capitalism is really just a process of letting markets decide what goods and services are produced or invested in."
Capitalism is in practice an economic system for returning the maximum profit by any means available. That means control and manipulation of markets and either the elimination of regulation or the establishment of favorable regulation.
The results of capitalism are best demonstrated by the massive accumulation of wealth by a tiny fraction of society at the expense of everyone else.
Hmm I’d say largest middle class ever. What system would you like Miles?
The middle class has been shrinking with fewer high-paying jobs with benefits. Employment HAS gone up under Trump, whether you loathe him or not. The proposed tax plan does seem to be a disaster, though.
Proactive Practices has been interviewing some interesting studios creating an impact... sometimes without the initial client: http://proactivepractices.org/
Check out Housebrand.ca. Started by a canadian architect who became the builder and realtor . took the whole "master-builder-realtor" idea to the next level. Small scale but grabbed all the available percentage points as opposed to giving the profits away. Not unlike Jonathon Segal.