How to Calculate Architect’s Fees Edition II

This is an update to the first edition of ‘How to Calculate Architect’s Fees‘ which was prepared using the 1996 Architect’s condition of engagement and a forerunner to How to Calculate Architect’s Fees Edition III‘s comparisons between fee calculations in Nigeria and Canada.

This detailed update has been prepared with the most recent version of the conditions of engagement signed into law by the Architect Registration Council of Nigeria (ARCON) on the 8th of June 2016.

ARCON insists that the architect’s conditions of engagement are to be used in all transactions with clients and the approved fees are minimum payments for professional architectural services – payable by both the public and the private sector to the architect.

Download the 2016 ARCON condition of engagement

Also, read;

Major methods of fee calculation

Time charges:

The revised condition of engagement dwells heavily on time charges, unlike the previous conditions. Here, the calculation of stage 3 fees of standard architectural services (supervision) and all architectural services rendered on public projects are made based on time charges.

Time charges as we learnt from Edition I are hourly-rate for the architect and his support staff to a maximum of 8 hours per day. It can be computed to determine the daily, weekly or monthly payments due to the architect for a specific work.

S/NProfessional CadreMinimum years of experience Hourly rate (Naira)
1Consultant architect/fellow30 and above125,000-225,000
2Consultant architect/fellow25 – 29110,000-200,000
eConsultant architect/fellow20 – 2495,000-150,000
4Consultant architect15 – 1985,000-135,000
5Consultant architect10 – 1475,000-125,000
6Architect 5 – 964,000-100,000
7Architect1 – 450,000-85,000
8Architect (Provisional stage II)35,000-60,000
9Architect (Provisional stage I)25,000-50,000
10Architectural impressionist 25,000-50,000
11Architectural technologist 15,000
12Architectural technician 15,000
Time charges showing hourly rates for architects in Nigeria

Scale of fees:

The scale of fees calculation on the 2016 condition of engagement was strictly limited to private projects alone and the sliding scale was dropped.

Before now, the scale of fees was the most commonly used method of calculating the architect’s fees. It still involves the use of percentages.

Type of projectStage Percentage
Standard services for new projects Design Stage I & II7.5%
Services on existing structures Design Stage I & II15%
Scale of fees for private projects. Note: Public projects should be calculated using time charges.

Calculation of the architect’s fees

The standard services offered by architects can be grouped into two broad categories;

  • Architectural design and specification (Pre-contract services)
  • Supervision (Post-contract services)

Architectural design and specification (Pre-contract services)

Private projects:

The fees charged by the architect for design services on private projects should either be based on the scale of fees applied to the estimated project cost/adjusted final project cost or on time charges calculated for the work.

For example;

An architect has been commissioned to design a new private commercial project whose estimated project cost was determined by the quantity surveyor to be N60m after the architect’s initial concept sketches. How do you calculate the architect’s pay using a scale of fees?

Answer;

N60m (estimated project cost) multiplied by a minimum of 7.5% (scale of fees for new projects).

Equals N4.5m (architects fee for pre-contract services)

Note;

ARCON conditions of engagement say that these fees are the minimum that should be charged, therefore, your design circumstances may warrant a little increase in the percentage.

Public projects:

The fees charged by the architect for pre-contract services on public projects should be based on time charges.

For example;

An architect with 8 years of experience is commissioned to design a new public library building for his community. How would you calculate the architect’s fee?

Answer;

  • Determine how many designers will work on the project
  • Determine how many hours per day you will put in
  • Determine how long (in days/weeks) it will take to complete the design work.
Personnel required Hours per day Duration of design
(in days/weeks)
Unit rate (N)Total cost (N)
Architect 228 days (4 weeks)50,0002.8m
Architectural impressionist (3D)57 days (1 week)25,000875,000
Architectural technologist828 days (4 weeks)15,0003.36m
N7.035m
Calculation of Architect’s fee using time charges (pre-contract services)

Note:

Always ensure your duration of work is as close to accurate as possible, so as not to over or under-charge.

Construction supervision (Post-contract services)

For standard supervision (i.e. one visit per month) the architect should calculate his fees based on time charges. If the project exceeds the estimated contract period, the architect should continue to calculate his fees based on time charges

Additional supervision and residency (Post-contract services)

When an architect is required to offer additional and/or residency supervision (i.e. over and above one visit per month or daily residency on-site), an additional fee (i.e. in addition to your professional fee) should be charged based on time charges.

For example;

A consultant architect with 15 years of experience has just completed an architectural design for a hotel building and is required to put forward his fees for the construction supervision (post-contract service) of the same building. The duration for the construction was determined in the contract documents to be 6 months and the nature of supervision was stated as nominal (one per month). How will you calculate the architect’s fee?

Answer;

  • Determine how many of your staff will be on the site during meetings/inspections
  • Determine how many hours per day they will put in
Personnel requiredHours per meeting /supervisionTotal days on site
(though construction duration is 6 months, the contract states you are expected on site once every month)
Unit rate (N)Total cost (N)
Consultant architect 26100,0001.2m
Architect (Provisional stage (1)2625,000300,000
Secretary265,00060,000
N1.56m
Calculation of architect’s fee for construction (post-contract services)

Note:

This cost is only for your professional services. DO NOT include the cost or time spent transporting yourself and staff to the site or any other cost associate with organizing the meeting/supervision. These are what we call Reimbursable Expenses and they are addressed under a different cost section. Read more about reimbursable expenses below.

Payment Milestones

S/NStagesScope of architectural workPercentage applied – Scale of fees (Private projects)Time charges (Public projects)
1Pre-Design Stage (PDS)Commission and design brief.

Articulation of the proposed project.

Instruction from the client to proceed.
PHASE 1:
15% of Scale of fees (7.5% or 15%) (commitment fee)
Hourly rate
2Design Stage I (DS I)Final concept of design.

Estimated Total Cost.

Approval by the client.
PHASE 2:
20% of Scale of fees (7.5% or 15%)
Hourly rate
3Design Stage II (DS II)Coordinated detailed drawings.

Complete construction documents.
PHASE 3:
25% of Scale of fees (7.5% or 15%) for coordinated detailed drawings.

PHASE 4:
40% of Scale of fees (7.5% or 15%) for complete construction documents.
Hourly rate
4Tendering and Award (T&A)From tendering process to contract award.PHASE 5:
Hourly rate
Hourly rate
5Construction Stage (CS)From site handover to practical completion.PHASE 6:
Hourly rate
Hourly rate
6Post-Construction Period (PCP)Project handover, Defect liability period and Final account.PHASE 7:
Hourly rate
Hourly rate
Payment milestones for design/supervision work applicable to both public and private projects

Repetitive works

Repetitive works are reproduced units of the same architectural design to be built on either the same site or a different location

There are instances where architects work on repetitive buildings for either the private or public sector. A good example is an estate design, where all the buildings are alike.

Private projects

The architect’s fees for repetitive work on private projects are charged based on the number and nature of the repetitive work.

There may be a tendency to apply the scale of fees to the estimated project cost/adjusted final project cost. That would be wrong, as the buildings are similar and would take less work to produce.

Fee calculation for repetitive building in private projects can be tricky. The substructure isn’t treated as repetitive work but the superstructure is. All substructure is charged fully, while the superstructure is charged as below. Also, Repetitive reduction doesn’t apply to external works and post-contract services of the project (construction supervision).

Number of repetition Percent payable
Initial building 100%
First 10 buildings 50%
Next 20 buildings 30%
Next 30 buildings 20%
Next 60 buildings 10%
Percent of the fee applicable to repetitive work on private projects

Public projects

The architect’s fee for repetitive work and/or external works on public projects is calculated based on time charges.

Note: Repetitive work with major modification shall be deemed to be a new project attracting full charges.

Reimbursable expenses

Besides the professional services paid for by either time charges or the scale of fees, all other expenses incurred by the architects in the course of the project are reimbursable by the client and are an additional payment to the architect. These expenses include transportation, accommodation, re-printing, computer, office equipment and other incidental expenses incurred on the project.

Reimbursable expenses differ from private projects to public projects.

Private projects:

Same city reimbursable cost

The architect whose project site is located in the same city where he is based is entitled to reimbursable expenses of 1% of the final project cost. These expenses cover local travel, communication, printing and drawing reproductions.

Out-of-city reimbursable cost

The architect whose project site is located outside the city where he is based is entitled to reimbursable expenses of actual cost expended plus 20% administrative charges upon presentation of a detailed invoice with supporting receipts. These expenses include travel, rentals, communication, printing, drawing reproductions and all other project expenses incurred outside his city of residence

Public projects:

The architect handling public projects is entitled to reimbursable expenses of cost for the provision of project vehicles, travel costs, accommodation, communication etc.

Value Added Tax (VAT)

Architects are required by law and ARCON to include Value Added Tax (VAT) in all their transactions with clients. VAT of 7.5% (2020) is what is currently applicable in Nigeria.

What are your comments on how realistic these fees are to both the architect and the client? Tell me about your experiences in charging clients based on the 2016 condition of engagement compared to the 1996 edition. Share your favourite ways of fee calculations. Drop your comments in the comment box and I will send a reply.

28 thoughts on “How to Calculate Architect’s Fees Edition II”

  1. Japheth Abraham

    Thank you for putting this together. I have two questions though:
    1. Who are provisional stage II architects?
    2. What will an architect working as a site manager or a project manager to a contractor in a public project charge?

    1. Hi Japheth. According to ARCON on their website, Provisional registered Architects Category 2 are entitled to use the title Architect but can only practise under the supervision of a fully registered Architect and shall not act as principal or consultant in any private organization. To your second question, the charge will depend on what you can negotiate because this service is outside what the fee guide covers. You can charge monthly for the duration of the project or charge per site visit.

      1. Japheth Abraham

        Thank you sir,
        So we can say MSc holders fall within that category right?
        To the second question, I saw that ARCON conditions of engagement doesn’t cover that too.
        Thank you again.

  2. Thank you. This is a great write up.
    I’m an MEP Engineering Consultant, what percentage should be give to the MEP Engineering Consultant. Since the architect is the lead consultant.

  3. Kevin Vershima Vincent

    Thanks alot Ehimen… I’ve been looking for this online to no avail but i have been using the 2011 edition to guide me. You are appreciated.

  4. Hello, great work on your articles.
    Is there a concise template available to be downloaded that covers the architect’s fees?
    I’d gladly pay to have that.

    1. Hi Seyi, there is none that I know of but maybe in the future, I could consider creating various fee templates and making them available on this blog. thanks for the idea.

  5. Orisadare Adeoye Olaniyi

    Thanks for this write-up. But sir, under payment milestones,at stage 3 phase 4, I want to know if the 40% for complete construction documents covers other consultants input or it’s only for the architects construction detailed drawings and specifications.

    1. Hi Orisadare,
      Only the architects, except the total scale of fee ab initio included all the consultants.

  6. Very good write up, but my question is, how do you get to know the Estimate of a project during the Pre design Stage?..coz I believe the Architect must have completed the design before the Q.S can do the BOQ..
    So what happens if after Architect has completed design, QS calculates the BOQ and then the Client says the Architect Professional Fee is too much..
    So how can you get the rough estimate of a project at the conceptual stage to communicate your fee to client, to avoid embarking on a design that client won’t pay for?

    1. Hi Teeboy,

      One way to determine the estimated cost of construction at the pre-design stage of every project is to prepare a functional space program before you commence the design. This will help you determine the approximate area of all spaces required in the building. Once you have this, multiply this gross area by a cost per area (sqm) to calculate the estimated total cost of construction.

      The architect’s fees are always perceived as ‘too much’ by private clients in Nigeria, it is your duty to convince them that your services are worthy of the price. If you are concerned that the QS has overpriced the quantities, you can both go through the BOQ thoroughly.

      Lastly, charging professional fees in Nigeria is a hassle, only few architects succeed at it with private clients. It’s one of major challenges the profession is facing today.

  7. Very insightful. God bless you for this.
    However the repetitive works category is still not clear enough, is it that for every additional 10 buildings the percentage has to drop by 10%?…. And also what happens when there are additional 10buildings,and we’re at 10% pay level already?

    1. Hi Opeyemi,

      According to the 2016 ARCON conditions of engagement,

      1. For the Initial building, you charge 100%
      2. For the first 10 repetitions, you charge 50% each.
      3. For the next 20 repetitions, you charge 30% each.
      4. For the next 30 repetitions, you charge 20% each.
      5. For the next 60 repetitions, you charge 10%.

      To answer your second question, The condition doesn’t state what percentage to apply when you get after no. 5 above, I will suggest you keep applying no. 5 till you calculate for all repetitions.

  8. Chima Uchechukwu

    This piece of Knowledge give hope to young and aspiring Architects to go through the challenges of becoming. However I wonder if this is the current reality of professional Architects in Nigerian.

    1. Hi Chima, the young and aspiring Nigerian professional architects have a lot of challenges. A realistic and uniform fee will truly help the profession.

  9. A nice post by you. Kindly note this correction on your example for the fee calculation for private projects:

    N60m (estimated project cost) multiplied by a minimum of 7.5% (scale of fees for new projects).

    Equals ‘N4.5m’ (architects fee for pre-contract services)

    N4.5m is 7.5% of N60m

    Regards

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