Tip:
Highlight text to annotate it
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Text & 3D Text Video: SketchUp Toolbar Series
To view the full tool set, turn on the "Large Tool Set".
There are several ways to create text & annotations in SketchUp.
The Text Tool will create basic on-screen text as well as annotations.
Select the Text Tool, then click on a blank area of the screen.
This opens an area for text input; click outside this area to finish.
This text has no relation to the model, so it remains the same as you orbit and zoom.
You can move this text with the Move Tool.
For annotations, click on geometry in your model and then move the cursor away.
Click again to anchor the text; this is referred to as "Leader Text".
The text will initially display information about the geometry you click on.
You will see the length of an edge, the area of a surface, or the name of a Component.
Double-click on the text with the Select Tool to edit the text at any time.
You can also edit the text by right-clicking on it and choosing "Entity Info".
You can change the font, text, arrow, and leader options from here.
Leaders can be "View based", "Pushpin", or "Hidden".
"View based" leaders try to stay oriented to your view relative to how it was placed.
This method is best for exporting still images, since the text can be obscured otherwise.
"Pushpin" leaders behave like geometry and continually reorient relative to the model.
This method is preferred for fly-bys or when you will be navigating often.
All annotations are linked to the model, so they will follow any geometry changes.
You can control a variety of text attributes by going to "Model Info" in the "Window" menu.
Choose "Text" on the left side to see the available options.
There are additional options here, and some that are also accessed in "Entity Info".
You can give the Leader Text an actual dimension, as shown here.
Select the text first, then click on the "Fonts..." button for Leader Text.
Choose the "Height" option and type the desired text height.
Click on "OK" and then click "Update selected text".
Notice the difference between the original and updated text as we zoom in and out.
It appears smaller or larger because it now has actual dimensions, like other geometry.
The original text is based on screen pixels, so it is always the same size.
Choose the 3D Text Tool for text that creates model geometry.
Type text into the window that appears, and choose the appropriate settings.
Click on "Place" to create your 3D Text, and click anywhere in your model to place it.
The 3D Text will orient itself to the surfaces you hover over.
The text is created as a Group, like any other in SketchUp.
So you can edit that Group, and manipulate the geometry.
Visit Google's 3D Warehouse to find examples you can follow in SketchUp.