This is a case study presentation on the Method of payment for the architects regular service. Presenting a computation of the percentage fee based on the construction cost and broken down into 4 stages. Upon completion of each stages, the professional fee is distributed accordingly

1. Page 1
HOW DO ARCHITECTS GET PAID?
CASE STUDIES
THE ARCHITECTURAL PRACTICE

2. Page 2
THIS IS TO GIVE YOU A SAMPLE
COMPUTATION ON THE BREAKDOWN
OF FEES FOR THE METHOD OF
COMPENSATION UNDER
PERCENTAGE OF
CONSTRUCTION COST
THE ARCHITECTURAL PRACTICE

3. CASE STUDY 1
FOR PROJECT COST
AMOUNTING TO
$4,500,000 ($4.5M)
CASE STUDY
Page 3

4. CASE STUDY
PROFESSIONAL FEE
RANGING FROM 5% TO 15 %
Page 4

5. PROFESSIONAL FEE
5% OF CONSTRUCTION COST
= $ 225,000
CASE STUDY
Page 5

6. BREAKDOWN OF FEES
20% PROFESSIONAL FEE – PRELIMINARY DESIGN STAGE
CASE STUDY
40% PROFESSIONAL FEE – DESIGN DEVELOPMENT STAGE
25% PROFESSIONAL FEE – CONTRACT-DOCUMENT STAGE
15% PROFESSIONAL FEE – CONSTRUCTION STAGE
Page 6

7. UPON COMPLETION OF PRELIMINARY DESIGN STAGE
20% OF PROFESSIONAL FEE IS PAID
CASE STUDY
= $ 45,000
Page 7

8. CASE STUDY
= $ 90,000
UPON COMPLETION OF DESIGN DEVELOPMENT STAGE
40% OF PROFESSIONAL FEE IS PAID
Page 8

9. CASE STUDY
= $ 56,750
UPON COMPLETION OF CONTRACT DOCUMENT STAGE
25% OF PROFESSIONAL FEE IS PAID
Page 9

10. CASE STUDY
= $ 33,750
UPON COMPLETION OF CONSTRUCTION STAGE
15% OF PROFESSIONAL FEE IS PAID
Page 10

11. CASE STUDY
* THE FINAL PAYMENT IS ADJUSTED
BASED ON THE
•ACTUAL COST OF THE PROJECT
Page 11

12. $5,000,000 ($5M)
INSTEAD OF
$4,500,000 ($4.5M)
CASE STUDY
IF THE ACTUAL CONSTRUCTION COST IS
Page 12

13. $58,750
INSTEAD OF
$33,750
CASE STUDY
THE FINAL AMOUNT COLLECTIBLE UPON COMPLETION OF
THE PROJECT (CONSTRUCTION STAGE) SHOULD BE
ADJUSTED TO
Page 13

14. SUMMARY - CASE STUDY 1
5% OF CONSTRUCTION COST WITH ASSUMED
$4.5 M
CONTRACT AMOUNT
AND ACTUAL CONSTRUCTION TO
$5.0M
Page 14

15. 20% PROFESSIONAL FEE – $45,000
40% PROFESSIONAL FEE – $90,000
25% PROFESSIONAL FEE – $56,250
15% PROFESSIONAL FEE – $37,750 ADJUSTED TO $58,750
ACTUAL PROFESSIONAL FEE – $250,000
BREAKDOWN OF FEES
Page 15

16. SUMMARY - CASE STUDY 1
5% OF CONSTRUCTION COST WITH ASSUMED
$4.5 M CONTRACT AMOUNT
= PROFESSIONAL FEE = $ 225,000
AND
$5.0M ACTUAL CONSTRUCTION TO
= PROFESSIONAL FEE = $ 250,000
Page 16

17. CASE STUDY 2
FOR PROJECT COST
AMOUNTING TO
$4,500,000 ($4.5M)
CASE STUDY
Page 17

18. CASE STUDY
PROFESSIONAL FEE
RANGING FROM 5% TO 15 %
Page 18

19. PROFESSIONAL FEE
15% OF CONSTRUCTION COST
= $ 675,000
CASE STUDY
Page 19

20. BREAKDOWN OF FEES
20% PROFESSIONAL FEE – PRELIMINARY DESIGN STAGE
CASE STUDY
40% PROFESSIONAL FEE – DESIGN DEVELOPMENT STAGE
25% PROFESSIONAL FEE – CONTRACT-DOCUMENT STAGE
15% PROFESSIONAL FEE – CONSTRUCTION STAGE
Page 20

21. UPON COMPLETION OF PRELIMINARY DESIGN STAGE
20% OF PROFESSIONAL FEE IS PAID
CASE STUDY
= $ 135,000
Page 21

22. CASE STUDY
= $ 270,000
UPON COMPLETION OF DESIGN DEVELOPMENT STAGE
40% OF PROFESSIONAL FEE IS PAID
Page 22

23. CASE STUDY
= $ 168,750
UPON COMPLETION OF CONTRACT DOCUMENT STAGE
25% OF PROFESSIONAL FEE IS PAID
Page 23

24. CASE STUDY
= $ 675,000
UPON COMPLETION OF CONSTRUCTION STAGE
15% OF PROFESSIONAL FEE IS PAID
Page 24

25. CASE STUDY
* THE FINAL PAYMENT IS ADJUSTED
BASED ON THE
•ACTUAL COST OF THE PROJECT
Page 25

26. $5,000,000 ($5M)
INSTEAD OF
$4,500,000 ($4.5M)
CASE STUDY
IF THE ACTUAL CONSTRUCTION COST IS
Page 26

27. $176,250
INSTEAD OF
$101,250
CASE STUDY
THE FINAL AMOUNT COLLECTIBLE UPON COMPLETION OF
THE PROJECT (CONSTRUCTION STAGE) SHOULD BE
ADJUSTED TO
Page 27

28. SUMMARY - CASE STUDY 2
15% OF CONSTRUCTION COST WITH ASSUMED
$4.5 M
CONTRACT AMOUNT
AND ACTUAL CONSTRUCTION TO
$5.0M
Page 28

29. 20% PROFESSIONAL FEE – $135,000
40% PROFESSIONAL FEE – $270,000
25% PROFESSIONAL FEE – $168,750
15% PROFESSIONAL FEE – $101,250 ADJUSTED TO
$176,250
ACTUAL PROFESSIONAL FEE – $750,000
BREAKDOWN OF FEES
Page 29

30. SUMMARY - CASE STUDY 2
15% OF CONSTRUCTION COST WITH ASSUMED
$4.5 M CONTRACT AMOUNT
= PROFESSIONAL FEE = $ 675,000
AND
$5.0M ACTUAL CONSTRUCTION TO
= PROFESSIONAL FEE = $ 750,000
Page 30

31. THANK YOU VERY MUCH