How to Calculate Architect’s Fees Edition III
As a continuation of the previous series on How to Calculate architect’s Fees Edition I and Edition II, I will be sharing my knowledge from a post-graduate course in Canada. My focus is on the percentage-based method of fee calculation and making comparisons between fee calculation in Nigeria and Canada.
The reason I have chosen to write further on fee calculation is that previous articles on fee calculation published on this blog have one of the highest page views to date. This tells me that architects are very interested in fee calculations and want to get it right.
To effectively calculate architectural fees you have to first know your services. Without this initial knowledge, you won’t know what to charge for and how to charge.
Architect’s services are generally of 3 broad categories. The nomenclature may vary based on your location but the concept is the same. Underneath are the 3 major types of services the architect renders and their corresponding names in both Nigeria and Canada;
|Standard Services||Traditional Services|
|Partial Services||Partial Services|
|Supplementary Services||Additional Services|
Standard or Traditional Services
These are the essential architectural services needed to take a project from inception to completion. Alternative terminology for these services are Normal services or Basic services.
We can practically say that when you are offering standard services you undertake the following in this sequence;
- Negotiate with potential contractors
- Administer the contract (supervise the construction work)
Once you have successfully carried out the above tasks then you have successfully undertaken the standard or traditional architectural services. For executing your task you are paid the full fees. For every task that makes up the standard services, a percentage of the fee is released to the architect since we all know that projects especially at the construction stage can take several months and often years.
Underneath is the percentage of the total fee an architect can request when he completes each stage in the standard architectural service in both Nigeria and Canada. I will be using the Nigerian 1996 Condition of Engagement as the recent (2016) Conditions recommends only time-charges for tendering and contract administration.
|Nigeria’s Standard Services||Percentage of Total Fee|
|Stage 1||Preliminary Design||25%|
|Stage 2||Design development, Construction documentation and tendering/award||50%|
|Stage3||Construction phase (Contract administration)||25%|
|Canada’s Traditional Services||Percentage of Total Fee|
|Schematic design||12 – 25%|
|Design development||12 – 25%|
|Construction documents||35 – 45%|
|Bid and negotiation||2.5 – 8.5%|
|Construction phase (Contract administration)||25 – 35%|
Canadian traditional services properly break down the services and allocate a corresponding percentage fee to each stage. Which reduces ambiguity when a task is completed and payment is requested.
These are the individual services that make up the Standard or Traditional services.
Any service that isn’t the traditional architectural service but offered by an architect is an additional service while when the traditional architectural services are broken down and offered in pieces then they are partial services. For example, when you produce only construction documents for your clients you are offering partial service.
Another example is if a client doesn’t want bid/negotiation (tendering) and construction phase services (which is the norm in Nigeria), you can easily take those services out and charge for only schematic design, design development and construction documents.
I must state here that 3D renderings are not part of the Standard/traditional services as they are additional services. So architects should learn to charge adequately.
Supplementary or Additional Services
These are services that aren’t part of the traditional services. They are generally extra services offered by architects to add value to projects. A lot of architects offer these services for free and don’t realize it. For example;
- Production of as-built drawings for an existing building required before commencement of schematic design is an additional service.
- 3D renderings are additional services.
Most additional services are best billed by time-charges (per hour) or a fixed sum.
Examples of additional services
- Interior design
- Landscape design
- Models, perspectives and computer presentations
- Project management
- Facility or Space programming
- Environmental studies
- Energy studies
- Marketing studies
- Life cycle cost monitoring
- Project promotion etc…
An essential part of fee calculation that unfairly burdens architects in Nigeria is the percentage charge applied to the construction cost.
In 1996, architects in Nigeria were made to charge 4.75% on a sliding scale of the construction budget, while in 2016, a fixed 7.5% without a sliding scale was proposed.
In Canada, if you are using the percentage-based charges, several factors determine the percentage to use;
- The complexity or simplicity of the project
- The type/category of the project
You will agree with me that the ease of offering architectural services varies between projects. Certain projects by virtue of their nature require extensive details than others. For example, it’s easier to design a warehouse than a terrace house, a terrace house than a school, a school than a stadium, a stadium than a teaching hospital and a teaching hospital than an international airport terminal.
Furthermore, similar project types within themselves can still vary in complexity. Among airports, for example, there are different standards and technicalities. If you compare the Murtala Mohammed InIernational airport in Nigeria with the new Beijing Daxing International Airport in China you will observe a differences in project complexity. How do you reflect this in the architectural fee?
Beijing Daxing International Airport in China
To address these, the percentage-based architectural fees in Canada are charted from simple to complex and from one building type to another. So, there isn’t one specific percentage figure. The amount of work required by the project dictates the percentage fee the architect gets.
For example, if you are designing any building, you will first determine the building category – these are already predetermined in the fee chart eg elementary school, warehouse, community centres etc. Every building category has it’s a percentage fee. After that, you will observe if the building design will be of a simple, average or complex nature. Every building category is further subdivided in the fee chart to reflect different percentage fees based on project complexity.
This percentage varies from 2.40% -17.0% of the construction cost for architectural fees alone. It should be noted that the sliding scale is also used to regulate the percentage compared to the construction cost in Canada.
Other factors that affect the architect’s fees
There is also an interesting concept used in the Canadian fee calculation called the fee adjustment factors/variables. These variables aren’t necessarily additional services but factors that can easily influence the cost of most architectural services.
A few of these factors are;
- Submittals: Will the client or the project demand multiple and repeated printed drawings at submission
- Approvals: Will you be engaged in the back and forth movement of the physical planning approval process
- Location: how often will you visit the site in the course of design and is the site remotely located or located in the heart of town
- Fast-track: Will the project be fast-tracked
- Specialist consultants: Do you need specialist consultants and how many
- Construction administration: Will the construction phase require more site supervision than normal
- Project documentation: Will your client require documents in special formats like PDF, AutoCAD etc
- New technology
- Third-party certifications: Is your project seeking third-party certification like LEED etc.
These fee adjustment factors are charged as a percentage of the percentage-based fee.
What are your comments on how improvements can be made to these fee calculations in Nigeria? Share your favourite ways of fee calculations. Drop your comments in the comment box and I will send a reply.