Healthcare maintained its edge over hospitality as second-largest sector, a mantle it first achieved in 2020. The category continued to experience solid growth in 2023, defying a predicted levelling-off. In fact, design fees increased 26 percent last year, and the dollar amount—$880,469,047—reflects a very healthy 45 percent jump since 2019. The total number of projects ballooned as well: a 19 percent uptick, marking a 105 percent increase over 2019 numbers.
Holding steady as the top three subsectors are acute-care facilities, outpatient care, and clinics—a trio projected to carry the healthcare category yet again in 2024. The vast majority of those proj- ects are located in the U.S., the hottest growth area being (no surprise) the south. The 10 percent sliver of overseas work is concentrated in the same three regions that dominate other verticals: Asia, Canada, and Europe. About a third of Giants predict growth in international healthcare markets this year.
Healthcare Giants Rankings
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Of the 50 Healthcare Giants ranked, 10 names are new, which reflects market growth and diversification. A number of firms had big movement last year, including LS3P, which jumped up 15 places in the rankings to number 31, reflecting a healthcare income increase from $1.6 to $4.3 million.
Digging into FF&C value, we were happy to see a 23 percent year-over-year increase—and a wowzers 50 percent more than 2019 numbers. Overall for the top 200 firms, the ratio between FF and C has been skewing more heavily to furniture and fixtures in recent years; healthcare has been the sole exception and remains so again this year, despite slowing construction, rising costs, and clients pivoting to more refresh projects.
When Healthcare Giants gaze into the crystal balls to predict how they’ll fare in 2024, they anticipate another 20 percent FF&C growth. But this optimism is not reflective of overall positivity. In fact, despite the all-good news regarding last year’s tallies, Healthcare Giants predict a 16 percent decline—perhaps because of economic uncertainty and volatility, perhaps because long-gestating projects that kicked off during the pandemic are winding down. In fact, the 2024 design-fee figures Giants are expecting for healthcare and hospitality sectors mark a closing of the gap between them, to just a few million. Stay tuned to find out which segment takes the No. 2 mantle.
Read more about Interior Design’s latest Giants of Design, including Top 100, Sustainability, Rising, Hospitality.
Project Categories
Firms With the Most Fee Growth
Editor’s Note: Take a look at recent coverage of our Healthcare Giants most admired firms below. Perkins&Will tops the list followed by EwingCole, NBBJ, CannonDesign, and HKS.
Read More About The Most Admired Firms
Percentage of Firms Predicting Regional Growth Over the Next Two Years
Segment Fees and Growth Predictions
Percentage of International Work by Region
Methodology
The Interior Design Giants of Design annual business survey comprises the largest firms ranked by interior design fees for the 12-month period ending December 31, 2023. The listings are generated from only those surveyed. To be recognized as a top 100, Rising, Healthcare, Hospitality, or Sustainability Giant, you must meet the following criteria: Have at least one office location in North America and generate at least 25 percent of your interior design fee income in North America. Firms that do not meet the criteria are ranked on our International Giants list. Interior design fees include those attributed to:
1. All aspects of a firm’s interior design practice, from strategic planning and programming to design and project management.
2. Fees paid to a firm for work performed by employees and independent contractors who are “full-time staff equivalent.”
Interior design fees do not include revenues paid to a firm and remitted to subcontractors who are not considered full-time staff equivalent. For example, certain firms attract work that is subcontracted to a local firm. The originating firm may collect all the fees and retain a management or generation fee, paying the remainder to the performing firm. The amounts paid to the latter are not included in fees of the collecting firm when determining its ranking. Ties are broken by rank from last year. Where applicable, all percent ages are based on responding Giants, not their total number.
All research conducted by ThinkLab, the research division of SANDOW Design Group.
