Introduction to Design Fees
If you ask around, you’ll probably come to find that design fees can be difficult to track. There are many factors that go into determining design fees, and multiple ways in which they can be structured over the course of any given project. Additionally, depending on the scope of your project, you may need to procure services from multiple design or engineering consultants in order to produce the necessary deliverables to get your project approved.
Our goal here is to help you understand (as a baseline reference) what industry standards and guidelines exist, and how we approach our fees.
How do Architects calculate fees?
Fees are typically built from one of these two core foundations:
Bottom-Up Pricing: understanding the amount of time and effort required for each specific task/phase and adding that time up
Top-Down Pricing: this method involves establishing a total fee based on historical project data or as a percentage of the construction budget and dividing that fee up proportionally into each phase of the project
Specific fees for a project can be calculated in a number of different ways:
Hourly (billed monthly)
Fixed-fee or lump-sum (billed by phase)
Percentage of construction budget or cost (billed by phase)
Depending on the specific client and project, the approach may vary, but the end result is generally the same or similar. These different approaches may make sense for some projects, and not others. For example, projects with an unknown scope of work or budget will likely utilize an hourly fee (at least to start). Projects with a clear scope and budget will likely utilize either a fixed-fee, or percentage of construction budget/cost approach.
At the end of the day, calculating fees comes down to clearly understanding the the client’s needs, the scope of work, and how much time it will take to complete the work. Regardless of how we present our fees to our clients, we are always analyzing our fees using each of the methods described above.
What is a typical rate for an Architect?
Industry standards shown as a percentage of construction costs:
3 - 15%+
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Projects with construction budgets in the $15M+ range
Smaller single family projects ($300K or less) that require low-level of detail, basic permit set drawings.
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Most common fee range for mid-large projects with clearly defined scopes and a moderate level of complexity ($500K - $5M+)
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Complex projects requiring high-levels of coordination and detail
Projects involving existing conditions (even with single family projects, this adds complexity to the design and requires additional services to document the existing structure)
Industry standard hourly rates:
$80 - $200+
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Junior-level design services
Drafting services
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Mid-senior level Project Architect or Project Manager
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Senior level Principal Architect
Rates for some additional project services
Important questions to ask your Architect:
What services are included in their basic services scope?
Does their fee include design consultant’s fees?
What happens when/if the scope of work changes as the project progresses?
Understanding Basic vs. Additional Services
Basic Services
Typically involves the baseline level of services required in order to design the project and develop a complete set of permit & construction documents.
Pre-Design: research the project and site to understand limiting factors of zoning and building codes and develop building area and massing strategies
Design: commonly broken into two phases (Schematic Design & Design Development), developing and refining design concepts, coordinating consultant’s designs, reviewing aesthetic/material qualities, understanding major building assembly requirements (floors, walls, roof/ceilings)
Documentation: developing a coordinated and detailed set of permit and construction documents to deliver to the client for project approval, involves coordinating consultant’s work, finalizing project specifications (materials, assemblies, products/equipment, etc…)
Construction Administration: oversight of the construction progress, ensuring the project is built according to the project documents, developing reports
Additional Services
Services that are commonly outside of the Architect’s basic scope of services
Existing conditions documentation (by the Architect or a third party consultant)
Renderings
Interior Design / interior detailing (material/finish selections and specifications, detailing of interior built-ins/cabinetry/other millwork - may be provided under an Interior Designers scope of work)
Landscape Design / drawings (may be provided under a Landscape Architect)
Drawing revisions due to re-design at the client’s request or due to unforeseen project conditions
As-built drawings (drawing documentation of the project upon substantial completion)
Supplemental drawings or documentation in connection with public or administrative project approval hearings - this can also include attending/speaking at public hearings
Additional fees incurred due to travel, printing services, or other unforeseen project costs
What other factors may impact an Architect’s fee?
Outside the lines of strictly performing the basic level of services required to design and document any project, there are a number of other factors that can impact the scale of an Architect’s rate:
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An experienced Architect is going to have a much clearer understanding of what a project requires and therefore may simply be presenting you with a more realistic expectation of total project costs.
If an Architect has additional credentials or certifications that makes them suitable for complex or specialized projects, they likely charge at a higher rate (Passive House, LEED, etc…)
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If you’re working with a smaller firm, their rates may be higher due to the fact that more time is being dedicated to the project from higher-level designers or Architects that are billed at a higher rate. There are pros and cons to this, but it often means a more streamlined and detailed approach as review times and rework are limited.
Larger firms deploy full teams to a project, usually anywhere from 3-6 people, sometimes more. Rates and time dedicated to a project will vary across the team members.
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This item covers some of the more intangible things that you will experience when working with an Architect, but there is real value to this.
How detailed are they? Have they thought about everything? Who do you talk to when you call them? How organized are they? Are they available when you need them (not being ghosted)?
Project Consultant’s Fees
The following represents a general order of magnitude for typical consultant fees (fees may be expressed as a dollar amount or percentage of construction cost):
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$2,000 - $5,000+
Depends on the size and complexity of the site/project.
Required for new construction and addition projects that change the footprint of a structure.
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1 - 5%
Depends on the size and complexity of the project/site.
Includes: site drainage design, septic systems/waste management, other utilities
Required for new construction and major renovations/additions requiring rework of utilities.
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1 - 5%
Depends on the size and complexity of the project.
Required for most new construction and major renovation/addition projects (some jurisdictions may not require for smaller single family projects).
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1 - 3%
Refers to mechanical, electrical, plumbing, and fire protection.
Typically not required for projects that fall under the International Residential Code (1-2 family dwellings).
Required for multi-family and commercial projects under the International Building Code.
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$800 - $2,000+
Depends on size and complexity of a project.
Required for all new construction in the state of Massachusetts (even single family homes).
HERS raters provide a range of valuable services. At a minimum, they must provide an initial certificate stating that the project is designed in accordance with energy code requirements, perform inspections of the building’s envelope during construction, and provide a final inspection/blower door test to ensure maximum air-leakage rates are met.
In addition, HERs raters can provide guidance on the best and most efficient ways to heat and cool your building (sometimes working in tandem with mechanical engineers) as well as provide you with all the necessary information and steps to maximize incentives and rebates offered at the state or federal level.
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10 - 25%
Depends on the size and complexity of a project.
This rate may come as a surprise, but an experienced interior designer delivering top-tier services requires a significant amount of time, coordination, and attention to detail. It is common for Interior Designers to include in their services the selection and procurement (scheduling and ordering specific products or materials) of all interior finishes.
While not explicitly required on any project, Interior Designers can bring a ton of value to the design process and help a client through a complex decision-making process in order to clearly define scope & costs. (Remember materials, products, and finishes are one of the easiest ways to blow a budget).
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5 - 15%
Depends on size and complexity of the project.
These services are not explicitly required, but if your project involves substantial exterior work, a Landscape Architect is the best person for the job.