Percentage of Construction cost

Definition

• It is defined as the estimated total cost of constructing the facility to be covered by the
proposed detailed design, the construction cost includes the cost of the current market rates of
labor, materials, supplies, and equipment used in the construction.

Percentage of Construction is used to determine the compensation of the engineer for services where
their principal responsibility is providing a detailed design and construction supervision.

• The percentage of construction cost method is seldom used raw. Because of increasing
complexity and large variation in tasks for projects, the percentage of construction cost fee
curves no longer have a direct correlation to the required engineering fees for specific projects

• The percentage fee shall consider the type, complexity, location, and magnitude of construction
cost of the project and shall not exceed the following percentages of estimated construction
cost.

a) Feasibility Studies – Three Percent (3%)

b) Detailed Engineering design – Six Percent (6%)

c) Detailed architectural and engineering design – Eight Percent (8%)

d) Construction Supervision – Ten Percent (10%)