Fee Structure
Architectural Fee Structure
We are happy to share typical project cost and fee information here because we believe in full transparency and we understand that determining cost is a very important part of the initial process.
Typical architectural fees for a new build (approx. 4,000 sf house) will range from $20,000 to $40,000, depending on the complexity of the project and required design revisions.
Architectural fees for an addition or renovation project vary greatly, as all projects differ in complexity and the amount of design time and construction detail required. Fees can range from $5,000 for a simple renovation project to $20,000 for a larger addition/renovation.
Over the years we have transitioned from a “fixed fee” or “lump sum” fee structure for architectural services, to billing hourly based on an estimated range of expected fees for each phase of the work.
As the amount of design time required for each project can vary greatly, depending on many factors, we ultimately found ourselves charging too little for the more complex projects and too much for the projects that come together very quickly. The obvious pitfall of this methodology is that the majority of the clients with less complex projects end up footing the bill for the rest.
Most people, when presented with the option, would instinctively say they prefer a “fixed” price for every purchase they make. But, when presented with a proposal that defines the phases and presents a range of fees for each phase, they are immediately on board because it becomes real and they know they will get to see where their money is going.
Construction Costs and Billing
Construction cost estimating is a bit more challenging early on, as our clients try to decide if their project is worth the investment. Cost per square foot estimating can be misleading and not very informative, especially when it comes to renovation. Costs for new construction can range from $350/sf to $750/sf, depending on the size and complexity of the project. As a rule, the smaller the project, the higher the cost per square foot. We find that it is more helpful to present examples of real construction costs for real projects we have completed. Here are a few of those examples, in chronological order (older ones may not be as relevant to today's costs):
- Handicapped Accessible Bath/Laundry Renovation in Natick, MA: $87,000
- Renovation in Weston, MA (Kitchen/Baths/Floors/Paint): $282,000
- 1-Story Master Suite/Office Addition/Renovation in Newton, MA: $365,000
- 2nd Floor Addition and Complete Renovation in Arlington, MA: $394,000
- Full Gut Remodel in Wellesley, MA: $542,000
- New 3,400 Home in Wellesley, MA: $882,000
- Renovation of a 5,700 sf Home in Wellesley, MA: $1,012,000
- New 4,200 sf Home in Wellesley, MA: $1,158,000
- New 4,000 sf Home in Wellesley, MA: $1,460,000
- Major Remodel of a 3,200 sf Home in Belmont, MA: $590,000
- 460 sf Addition to and Renovation of a 2,800 sf Home in Wellesley, MA: $805,000
- New 3,600 sf Home in Wellesley, MA: $1,880,000
- New 3,600 sf Home in Wellesley, MA: $1,800,000
- Major Remodel and 2-Story Addition in Wellesley, MA: $800,000
- Partial Remodel and Large 1-Story Addition in Weston, MA: $790,000
Our billing structure for construction management services, much like our architectural services, is based on actual cost of subcontractor and material costs plus a fixed percentage for overhead and profit.
To maintain complete accuracy, all transactions in the construction process are entered into the construction accounting software as well as into a formula-driven spreadsheet, so there is a continuous cross-checking of every transaction. All of this information is presented on a bi-weekly basis with each invoice, so our the client has all of the information at hand, should they choose to “drill down” into the numbers.
We find that our clients overwhelmingly prefer this process to the fixed-price / change order scenario, in which there is a constant disconnect and tension.
ADVICE
Fixed-Fee vs. Hourly Billing
Over the years we have found that with integrity comes the opportunity to approach the billing process with transparency. Most clients would instinctively say they prefer a “fixed” price for everything, assuming that the cost is then a “known” cost. When presented with a proposal that breaks the project into several phases and gives a range of costs for each phase, clients tend to see the higher end of the range as more of an “upset” number and see that if less time is spent, less time will be billed. This range of fees is more realistic than a fixed price. After all, it is much easier to go to a client and make your case that the work was more than anticipated in your fixed price than it is to explain that, when you had the opportunity to provide a range of fees, you were way off target. The range of fees method shows that you understand that the scope of services may change and you’ve done your best to anticipate that.
Leaving your Architect out of the Negotiation and/or Construction Phase
It is relatively common for a client to embark on the negotiation and/or construction process directly with their builder of choice and, for whatever reason, not bring the architect into this phase of the project. Typically, it is to save some on fees, but more often than not, we think it is to avoid the anticipated tension between architect and builder. Some builders may even convince the client that keeping the architect involved will only make the project more expensive.