Fees for Architectural services
These are examples of fee structures for Architectural services, percentage fee being most common method.
A percentage fee is negotiated based on the size and complexity of the project. Initially an estimate of the cost of the works is used so that fees can be invoiced at stages throughout the project. This figure is adjusted once the final project cost is known. The percentage fee includes four stages representing the following breakdown of the total fee. 1 Preliminary Design 15%, 2 Design Development 15%, 3 Contract Documentation 40%, 4 Contract Administration 30%.
The Architect will invoice at the completion of each stage, but this is at the discretion of each individual. Payment of fees are not dependent upon gaining approvals from Council.
Architects will seek instructions form the Client at the end of each stage to proceed with the next stage. Clients have the right to terminate an agreement by written notice at any stage during the project. In those circumstances Clients are liable to pay for work completed only up to the point of such notice.
This method is probably the most equable for both parties. An Architect will set a percentage that allows fair fees that enable a professional service to be provided.If the scope of works is altered by the Client then the Architect will be remunerated for that work because it is covered by “final building cost”.
In the interest of clients this is not the best method of setting fees. Because the scope of work is often undefined, the fee is open ended with no fixed limit. A way of giving more certainty to clients is to offer a fixed hourly rate with an upper limit. This is fair for both parties, but the architect guesstimates this limit, and to cover any unknowns a safety margin is added to the overall fee.
The most appropriate use of hourly rate is for additional work not covered within the initial agreement.
Susbstantiation of the hours expended is provided on request.
LUMP SUM FEE
Lump Sum Fee is offered on the basis of an agreed scope of works and services as defined in the Project Brief. Should the scope be altered the fees would be amended accordingly.
This fee can be broken down into stages as defined within Percentage Fee.