#421 - GUIDE TO ARCHITECTURE FEES
SUMMARY
This week David and Marina of FAME Architecture & Design discuss the different types of architecture fee structures including the percentage of construction cost model; the fixed fee model; the hourly fee structure; and hybrid fee structures. The two also cover the benefits and challenges of each fee structure; interior design fees; why architect’s fees vary greatly; the amount of work involved in each project phase; and more. Enjoy!
TIMESTAMPS
(00:00) Types of Fee Structures.
(00:44) Percentage of construction cost.
(14:29) Fixed fee model.
“When comparing architects’ fees, most of the time, the reason why a fee will be significantly higher or lower than another is that there is a quantifiable difference in the fees and services they offer and the quality of those services. It's not because someone's just cheaper to be cheaper, more expensive to be more expensive, or not necessarily that someone's way more talented than another person. It has to do with the quantifiable difference in their services.
For any client looking to hire an architect, you must know the services they're providing and the quality of those services. You have to, have to, have to know it because this project could cost millions of dollars. It's going to take years. It's a huge commitment. You want to spend a couple of weeks doing that little bit of research to find out what services they're offering and the quality of the services. ” (16:01)
(18:24) Be aware of fixed fee model inclusions and exclusions.
(27:39) Benefits of fixed fee model.
(31:35) Challenges of fixed fee model.
“If you know as a client that you have a hard time in life making choices, it’s most likely that you're going to have a hard time making choices on a project. So, if you're limited to one option for the design of each project element, that's probably not going to work out for you. It's hard for the architect to [provide multiple design options] when they are an additional service and ask for extra payment. It kills the buzz of the agreed fixed fee at the beginning because now the project is going beyond the agreed number.” (32:57)
(36:41) Hourly fee structure.
“When you have an architect who charges hourly, they should give you a ballpark idea of how much the total fee should be. That goes back to using the percentage of construction cost structure to establish that benchmark. So even if you go with an hourly fee, your architect probably has an idea of the range it's going to be. As you move along, they should keep you updated on where you are with the fee that’s spent so far compared to what was estimated and how much work is left.” (40:17)
“The hourly fee structure is not as suitable for clients who don't trust the people they're working with, or if they want to manage the hours of a creative. Design is not always efficient. It could be efficient to draw and model, but to get to the design… it's not an efficient process. That's just the nature of what creation is.” (45:05)
(48:15) Hybrid fee structure.
(55:29) Interior Design fees.
(01:00:03) Why architect's fees vary greatly.
(01:01:54) How much work takes place in each phase.
(01:03:49) Summary.
“You always want to hire the professional that's the best fit for you, and the one who's qualified more than anything else. So, if you're talking to an architect and they have a different fee structure than the other one, but you don’t like their fee structure, then tell them or just deal with it. Always go with the architect who you like as a person and who you trust. That's the most important thing, always. That trumps everything else, including the fee amount to a degree… It's a mistake for clients to compare two architects and say, “Well, there's a 2% difference in fees. I like the more expensive one better [But I’ll go with the cheaper one.” Go with the one that's 2% more. You don't want to roll that dice on a project that is going to be this close of a relationship for years.” (01:04:33)
