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RE: Design fee guidelines

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Until today I have not put my $0.02 (2%) in. If I tried to get even 1% of
the construction fee on a $2,000,000.00 custom home I would expect
$20,000.00 in fee's. This would be considered outrages for this area and I
could expect to retire on welfare if I was not willing to compromise.
Possibly the difference is that this is not a commercial project (although I
only received $3,500.00 for the last 5,000 S.F. commercial Starbucks Coffee
I did and the owner "bitched that I was almost $1,000.00 more than the
engineer I replaced who moved out of the area).
Are these fee's for government work, offices, etc?
What are typical fee's for residential and light commercial projects?

I am considered priced high in my area where I calculate my fee by square
foot. Custom homes generally bring in $6,000.00 for a 6000 square foot home.
Minimum fee's are between $2,500 and $3,500.00 for an entire package. I
leave my observation fee's separate and are charged at an hourly fee of
$100.00 to $125.00 per hour.

Still, these fees are nowhere near the cost quoted in by most of you.
If, however, the percentage fees are for the structural cost - I may be more
in line, but am not sure what percentage of total construction is placed in
the structure. My home cost $17,000 to frame in 1993 dollars. I think the
total structural portion from a $200,000.00 home was somewhere in the
$35,000.00 range including slabs, shearwalls, trusses and framing. Does this
sound correct?
If I were to take my fee's based upon a $35,000.00 Structural construction
fee, then I would be earning closer to 10% of the construction fee.

Can someone clarify this. I have not priced my projects by a percentage of
total fee's. I thought I was doing well compared by my competition in and
out of my area. I do have some new commercial projects which may be in the
horizon and I need to know how best to bid these.


-----Original Message-----
From: T [mailto:vicpeng(--nospam--at)]
Sent: Tuesday, November 03, 1998 8:30 PM
To: seaint(--nospam--at)
Subject: Re: Design fee guidelines

Typically between 17% and 25% of the total structure + about 7% for
overhead.  Most general buildings (ie low rise such as condominium and up to
5 storeys) here in BC run at about 20% structural content.  Where there are
underground or basement parts that may be separated out for costing since
that may be almost all structural.  Here in BC we calculate at between 1
1/2% and 6% of STRUCTURAL cost for design fee depending on whom we are
trying to put out of business :-).  The average around Vancouver Island
seems to be about 3%.  There appears, unfortunately, to be a trend at the
moment for some (larger?) companies to undercut or buy projects from under
the noses of sole practitioners.  So the fee may vary despite (inaudible)
howls of protestation by both practitioners and our illustrious Association
that such undercutting is jeopardizing our quality...... etc, etc.

But tough times call for tough measures.......n'est pas??!! :-(

Thor A. Tandy   P.Eng.,  MCSCE
Victoria, BC, Canada
e-mail: <vicpeng(--nospam--at)>

-----Original Message-----
From: Serroels, Chris/SAC <CSerroel(--nospam--at)>
To: 'seaint(--nospam--at)' <seaint(--nospam--at)>
Date: Tuesday, November 03, 1998 2:53 PM
Subject: RE: Design fee guidelines

>Be careful making this comparison Bill.  Yes, in the bridge game
>maybe we get between 5 and 10%, sometimes even as high as 15% for
>retrofit work, but the item your taking this percent of is all
>structure.  On the building side of things I'm assuming that their
>percent is calculated based on the cost of the structure including
>all of the electrical, mechanical, finish work, ...
>This brings up a question.  What portion of a buildings cost is
>taken up by the structure?
>-----Original Message-----
>From: Bill Polhemus [mailto:polhemus(--nospam--at)]
>Sent: Tuesday, November 03, 1998 1:47 PM
>To: seaint(--nospam--at)
>Subject: RE: Design fee guidelines
>> -----Original Message-----
>> From: jbotch(--nospam--at) [mailto:jbotch(--nospam--at)]
>> Sent: Monday, November 02, 1998 9:07 PM
>> To: seaint(--nospam--at)
>> Subject: Re: Design fee guidelines
>> My feeling is that 2% or 2.5% would be easier gained if it weren't for
>> engineers in our field willing to sell very little for less,
>In the Transportation game (where we do the bridges), we wouldn't think of
>taking less than 6-7% for our part.
>That's what you-all get for working for ******* architects!
>This helps explain why, a few years ago, I received a job offer from an
>eminent structural engineering firm in Oklahoma City, and was astounded to
>realize it was about 60% of the salary I was receiving at the time.
>In fact, it was by far the lowest salary offer I'd ever received since
>becoming a P.E.
>You all really ought to be ashamed.