Relationships, Phasing & Fees

ME 425
Keith Elder, P.E.

Plan/Spec Organizational
Structure
Financing

Owner/
Developer

Taxes
Real
Estate

Architect

General
Contractor

Mechanical
Sub

Electrical
Sub

Mechanical
Engineer

Structural
Engineer

Other
Engineers

Other
Subs

Design/Build Organizational
Structure
Financing
Real
Estate

Taxes

OWNER

General
Contractor

Architect

( Early
Involvement )

- OR Sub
Contractor

Team/Build & Modern

Organizational Structures

Structural
Engineer

Civil
Engineer

M echanical
Engineer

OW NER
DEVELOPER

Electrical
Engineer

Taxes
Finance
Real
Estate

M echanical
Subcontractor

Electrical
Subcontractor

General Contractor

Design Phases
Concept
Schematic Design
Design Development
Construction Documents
Bidding
Construction Administration

Determining Fees
Projects with Well-Defined Scopes
Selections Can be Made Based on Price
Design Costs (if any) are Included
Projects with less well-defined scopes
Selections Made Based on Qualifications
Design Fees are Negotiated
Usually Requires a Fee Proposal

Fee Structures
Fixed Fee
Percent of Construction
Time & Expense Using Multiplier
Time & Expense Using Rate Schedule

Typical Fee Percentages

Total
Construction
Cost
$100,000
$500,000
$1,000,000
$1,500,000
$3,000,000
$5,000,000
$10,000,000
$20,000,000

Total
Design
Fees
10.0%
9.0%
8.5%
8.0%
7.5%
7.0%
6.3%
5.5%