Guc arct 702 legislations lecture 7 - fees 1 2-11-2017

GUC – German University in Cairo

Architecture and Urban Design

ARCH 702 Legislation, Professional Practice and Contracts

Fall 2017

Instructor: Dr. Yasser Mahgoub

Fees 1

1

النقابة العامة للمهندسين

الئحة الهندسة المعمارية

تقدير األتعاب الئحة

Services and Compensation


Introduction

Project planning and pricing identify both

the services and the compensation

appropriate to the needs of the project.

The architect proposes the services to

be provided and a compensation for

those services.


The Fees Proposal

EARLY in the selection process

To be formulated LATE in the discussion

An owner's Request for Proposal (RfP)

Series of proposals ……..

Verbally (not recommended!)

Thick "package"

Sometimes there is NO proposal!

The client offers terms of what appears to be

a "take it or leave it" basis!!!


I. The Architect's Services

What are the services that the architect proposes to provide?

What services are appropriate to meet the owner's objectives?

What will it take to define the scope of the project?


I.1. Options for defining services

I.1.a. Selecting from a "menu”

I.1.b. Using a predefined "package"

of services


I.1.a. Selecting from a "menu"

Owner and architect working from a

menu of possible choices.

Select a complement of services

specifically appropriate to the project

at hand.

Owner-Architect Agreement for

Designated Services.


I.1.a. Selecting from a "menu"


I.1.b. Using a predefined "package" of

services

Basic services

Additional services



services

Basic services are divided into five phases:

1. Schematic design

2. Design development

3. Construction documents

4. Bidding or negotiation

5. Construction contract administration



services

Other services packages include:

Small projects and projects of

abbreviated scope

Interiors (furniture, fixtures, and

equipment) projects

Projects involving construction

management services

Design/build projects


I.2. When services cannot be defined

Work with the client to:

Define the project

Establish project requirements

Identify the remaining services

necessary to take the project to

completion


I.2. When services cannot be defined

Compensation methods:

lump sum

hourly cost basis


II. Project planning and budgeting

The Project Plan

Carefully constructed and formally drawn

Quick calculation based on lots of comparable

experience



Project planning offers important opportunities:

It helps the architect and the owner think

through the project.

It helps both parties identify the professional

services that are important to the project's

success.

It helps the owner understand his role in the

project (responsibilities, decisions, approvals,

and implications)



Project planning offers important opportunities:

It helps the architect structure the appropriate

design team for the project.

It helps the architect understand how the project

will affect the firm, its people, priorities, and

other projects.

It helps both owner and architect build a

foundation for the owner-architect agreement to

follow.


II.1.a. Bottom-up planning

Starts with the tasks to be performed

Identifying who will do them

How much time each task will take

What each task will cost

The total cost is the proposed price (compensation or fee)


II.1.b. Top-down planning

Starts with the compensation or fee

available to do the project.

Backs out the money available for

various project tasks.


II.2. Tasks and responsibilities

Decide if the task is to be provided:

By the architecture firm, with its own staff

By the architect, subcontracted to a

specialist consultant

By another consultant to the owner

By the owner with its own forces


II.2. Tasks and responsibilities

Ideas to identify tasks and responsibilities:

Review the deliverables being promised to the owner Who is likely to accomplish it (assistance,

backup, and supervision)

Key project tasks (approvals) even if they are not with the architect's scope of service)

Include project management as a task (expertise, time, and resources)


II.3. Project schedule

Construct a schedule for professional

services.

How long will it take to accomplish each task?

How are the tasks related to each other?

What are the milestone dates to be met?



Simple Milestone chart indicating major

tasks or phases with target completion

dates.



More elaborate Bar Charts.



Critical Path Method (CPM) networks and

schedules.



Suggestions:

Use the task list

Include activities that may influence the

schedule

Discuss contingencies to provide the owner

with flexibility for considering options and

possibilities.

Consider an interactive approach that

involves key people, consultants, the owner,

and outsiders


II.4. Costs of providing services

First-cut-budget

The expenses that will likely be incurred in

performing the services.



Cost of providing the services

"No brainer" Based on recent very similar projects for the same client.

"Built up" Based on the cost of providing services.

"Start from the other end" A client-nominated amount.



Ways to cost services

Make "cartoon set" of the

drawings to be provided

Estimate parallel that of a recent

similar project



Step-by-step buildup of the cost of providing services: for each task: who, how many hours

totaling the hours X each person's hourly rate =

total Direct Salary Expense (DSE) for in house staff

+ payroll burden

OR

X DSE multiplier (1.25)

= total Direct Personnel Expense (DPE)

+ non-reimbursable direct expenses =

totals for each phase + contingency + profit =

total project expenses



Suggestions:

Work at an appropriate level of detail:

Project - Phases - Tasks Document the internal budget carefully so you can

use this information as a yardstick for measuring progress

Don't neglect the costs of project management. Require senior management time and important to project success

Course corrections

Develop cost estimates in spreadsheet form on the computer. "what if" analysis.



Suggestions:

Involve the people who will be performing the

work in the process.

Track project expenses by task or phase

Build historical database you can use in

budgeting future projects

Types of projects that the firm does best and

that earn satisfactory profits as well as those that

require extra expenses, more time, and/or higher

profit margin.


III. Compensation methods

The are two fools in every market; one asks too little,

one asks too much. Russian proverb

Guc arct 702 legislations lecture 7 - fees 1 2-11-2017

Design

Transcript of Guc arct 702 legislations lecture 7 - fees 1 2-11-2017