Design Leaders 2010

Design Leaders 2010
Despite a trying 2009, retail design firms brace for a 2010 comeback

By Alison Embrey Medina, Executive Editor
March 08, 2010

The year 2009 was a tough pill to swallow in the retail design firm world. With retail expansion at a near standstill and cutbacks proliferating throughout the industry, retail design firms have had to take stock of their client lists, expand their services and hang on to their profitability by the skin of their teeth.

But it hasn’t all been bad news.

International work has seen an uptick, with Design Leaders firms reporting having done work in these top three non-U.S. destinations: Canada (36 percent), China (25 percent) and Mexico (24 percent). Half of the firms in this year’s survey (50.5 percent) also reported having worked on at least one green project in 2009, proving that sustainable design is still very much in the forefront.

Some firms actually reported an increase to their retail billings in 2009 over 2008, including Big Red Rooster (up 3.6 percent in retail billings), Bergmann Associates Inc. (up 15 percent), Shikatani Lacroix Design (up 27.2 percent) and Highland Associates (up 37.9 percent). That’s nothing to scoff at in these trying times.

In this year’s annual Design Leaders survey, a total of 73 firms (18 of the 91 firms chose not to report billings) reported a collective total of approximately $505.5 million in retail design fee revenues in 2009. That equates to an average of $6.9 million per firm, a sizeable decrease from last year’s $10 million per firm. This year’s top 10 design firms (by 2009 retail billings) alone accounted for $332.3 million—more than two-thirds of the revenue for the entire listing.

Seventy-six firms also reported designing approximately $251.4 million sq. ft. of retail space (both new and renovated) in 2009. With retail expansion programs down significantly on the year as retailers tested store concepts market-by-market versus launching full-scale rollouts, this number is not surprisingly down from the year prior. That equates to an average of $3.3 million sq. ft. per firm, nearly half of last year’s $7 million sq. ft. per firm.

For the first time ever, Jacobs tops the listing for the highest annual retail billings in 2009, jumping from No. 3 in 2008 to No. 1 with $43.4 million in annual retail revenue. This number is down from the Pasadena, Calif.-based firm’s 2008 retail billings of $59.3 million. Jacobs staffs more than 52,000 employees and devotes fewer than 1 percent of its work to retail design (total billings for the company came in at $11.47 billion in 2009). The firm reports designing 42.6 million sq. ft. of retail in 2009, with leading clients CVS/pharmacy, Publix Super Markets and Pappas Restaurants.

Seattle-based Callison fell to the No. 2 spot this year, reporting its 2009 retail billings dropped significantly to $43 million, from $113 million in 2008. The firm also reported that retail design only encompassed 36 percent of its total annual business in 2009, down from 60 percent in 2008. (Total billings also dropped from $185 million in 2008 to $119.5 million in 2009.)

Ranked third this year is MulvannyG2 Architecture at $42 million retail billings (down from No. 2 and $65 million last year), with Gensler holding steady in the No. 4 spot with $39 million (down from $53 million in 2008). Perkowitz+Ruth Architects snuck in to the No. 5 spot at $35 million, moving WD Partners down to No. 6 at $34.5 million.

Click here to download a PDF of Design Leaders charts, including the Top 20 Design Leaders, highest retail square footage and international opportunities.

For a searchable database of the full Design Leaders listing (including leading retail clients, green projects, international work, retail category breakdowns and number of employees), click here.