The architecture business may be in a slowdown, but the two top executives at the world's largest design firm say there should be enough client interest to stave off an industry recession in 2024.

Project types expected to remain steady include aviation, conversions of office buildings to residential, hospitality and healthcare. That’s according to Julia Simet and Jordan Goldstein, the incoming co-CEOs at Gensler.

Architects’ client billings declined in October across the United States for the third straight month, according to the American Institute of Architects. But many firms are seeing steady demand from clients when it comes to institutions such as schools, governments and airports, as well as some parts of the industrial sector, the Gensler executives said.

“Diversification is important” for an architecture firm to help offset slowdowns in specific industry sectors, Simet, whose appointment with Goldstein as co-CEO takes effect Jan. 1, told CoStar News. “Some of our specialty and counter-cyclical practices are holding up well.”

Aviation has been the top revenue generator among property types for Gensler in 2023, and it’s expected to remain in that position next year as travel continues to rebound from the pandemic, Goldstein said.

“It’s the rise in travel,” he told CoStar News. “The volume of traffic going through airports is significant.”

Gensler is designing new airport terminals at JFK International Airport in New York and Pittsburgh International Airport. Gensler has also picked up work for interior designs on airline clubs for frequent flyers and other amenities offered at airports, Simet said. The firm designed the Delta Air Lines Sky Club at Los Angeles International Airport.

Other firms have won airport design contracts, too. Page Southerland Page, Grimshaw and PGAL were hired to design expansions at George Bush Intercontinental Airport in Houston.

As office-to-residential conversion projects pick up steam, the concept of redesigning an existing building for a new use is branching out to other property types. Gensler was already working on conversion projects before the pandemic hit, Goldstein said.

“The notion of conversion is something we have been familiar with for a while,” he said. “Unused retail spaces like big-box stores converted to wellness clinics is one example.”

Now, as investors and landlords have a better sense of which office buildings are more likely to have persistently high vacancy rates, they’re exploring the conversion option, Goldstein said. Gensler developed an algorithm to help building owners analyze their portfolios to identify the properties that would be best suited for a conversion.

“Every business day we are using [the algorithm] and in every way, shape and form,” Goldstein said.

Conversions also appeal to developers because the costs are typically 30% cheaper than creating designs for a new building, Goldstein said.

“In 2024, expect more government municipalities to incentivize adaptive-reuse strategies and conversions whose renovations breathe new life into cities,” Gensler said in its Design Forecast 2024 report released this month.

Office conversions also have a major effect on climate change, according to the Gensler Design Forecast report. Using its in-house algorithm, Gensler has assessed more than 1,000 buildings in 120 cities worldwide. It determined about 32% of those buildings are suitable for conversion, which would save about 3.3 billion kilograms of carbon emissions.

“There is an inherent sustainability story in being able to find new uses for old bones” of a building, Goldstein said.

Despite lingering uncertainties about the U.S. office market, Simet and Goldstein said design work for new offices remains a steady revenue generator.

Gensler is the architect for Under Armour’s new headquarters in Baltimore. The designer and maker of athletic gear is developing a new corporate campus on 235 acres on the Port Covington peninsula that it expects to include offices, athletic fields, basketball courts and track and field facilities.

In another office project, Gensler is the interior designer for CoStar Group’s $460 million campus expansion in Richmond, Virginia. CoStar is developing a 26-story tower and a mass timber building next to its existing office building on the James River.