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Fees

Fees

(OP)
I would like to know if there's a rule of thumb on what the structural engineering fee is in relation to the square footage of the building.  I know that it varies with a lot of factors such as complexity of the job and the scope of services, but I am just looking for a starting point to help me set a reasonable fee.  Thanks in advance.

RE: Fees

Structural fees are usually 17% to 21% of the total design fee, which ranges between 4% and 8% of the total  construction costs for new construction.

RE: Fees

I like to think of the number of drawings it will take to get it done, but that's not always reliable. All structural engineers need to be raising fees immediately!

RE: Fees

JAE,

Where did you get your figures? They are very close to what I am used to. But I doe not have solid reference such as ASCE or NSPE publications.

Regards,
Lutfi

RE: Fees

(OP)
JAE,
Would you ask the Architect for the construction cost or would you have to take a stab at estimating it yourself?

RE: Fees

I typically see around $0.36 to $0.45 per sq ft. But I try to factor in complexity and time also.  It's a good starting point.  Don't be afraid to ask the architect for the construction cost. They should be very willing to give you the number.

We see about 10% of the design fee in my area.  Although, I am trying to increase fees as I can.  I think it is way to low for the amount of liability structural engineers are exposed too.

Another factor to think about is the client you are working for.  Do they change the structure throughout the design phase.  If they do, charge them more, because you will be designing and redesigning constantly.

Hope this helps.

RE: Fees

(OP)
Thank you all for the great responses, they are extremely helpful.

RE: Fees

Lutfi - these are just approximate figures I've seen over the years - and also read about in some publications.  A firm named Zweig-White provides a lot of this sort of info in their publications and services.

kmead - In many cases the contracts I've seen have been actually written to set the fee at a percent of the actual bid construction fee.  While designing, the construction cost is estimated to serve for on-going payments each month until the true final figure comes in.  I once worked on an office building where our fee was set at 3.25% of the structural portion of the project.  This meant that we had to get a copy of the contractor's cost breakdowns and figure out what parts were "structural".  This got to be a little contentious as we haggled over things like masonry (how much structural goes into CMU design vs. architectural)...so this form isn't very good.

Means Cost Estimating guide lists structural fees at 1% to 2.5% of the total construction cost of the building (I think it excludes the site work but not sure).  One old-time structural engineer I once knew who had his own practice would always charge 0.75% of the total construction cost.

RE: Fees

(OP)
JAE
Thanks for the valuable information.  I think .75% of the total construction cost seems very reasonable and in line with what I've heard from people so far.
Thanks again.

RE: Fees

I "like" to see around $3000/drawing. Normally it is lower, as much as half. But like rgerk said the client(if architect) can kill you with meetings and changes (which we often don't charge for to make sure we don't get anybody irritated). If structural engineers would collectively start raising fees we could completely change our profession.

RE: Fees

That is the key.  We collectively have a responsiblity to make sure our profession changes.  We have no less responsiblilty than doctors and we must charge based on that responsibility.  Everyday I deal with those "bottom feeders" that quote unreasonable fees that I cannot compete with.  I raise the red flag on these folks every chance I get.  The medical profession does not have to contend with this for some reason.

RE: Fees

We develop our fees in 3 different ways:

1) % of total construction cost (based upon previous history). I agree with JAE that 3/4 is a good starting place for new steel framed commercial buildings.

2) $ per sheet times no. of sheets (based upon estimated scope).


3) Hours for various talks times hourly charge out rates

We then examine all 3 numbers and try to resolve any differences.

RE: Fees

A good quote I heard about low fees:

"You pay peanuts, you get a monkey."

RE: Fees

From my experience fees vary based on project type.  I typically calculate it two ways and then average them.

I do it first by how many full size 24x36 sheets assuming it takes 35 hours per sheet to complete.

Then I compare that number to a percentage of the total construction cost, usually:

5/8% for a big straight forward warehouse
3/4% for a straight forward apartment condominium
1% for straight forward school
1% for a straight forward addition to existing
1 1/4% for a straight forward church

If the project (or client) is complicated then I up it by a "trouble factor".  This ranges from 1.00 to 1.50 based on project/client complexity.

I have heard lawyers mention that based on our risks we as structural engineers don't have nearly enough compensation.

I have also heard of us compared to medical doctors before.  However, doctors are paid by insurance companies, and we know where that is going.

I always figured we were paid what we are paid because we are a good representation of a capitalist market. (equal product, numerous providers)

I also agree that we all raise our fees based on what the lowest priced man raises his fee to.

I don't think any of us makes what we should, but hey - that's true capitalism for you.

RE: Fees

Aoother proverb I've heard with regard to fees is:

"The work can be done fast, or right, or cheap.  But you can only get two out of the three.  Pick."

RE: Fees

Quite interesting to read through the indications of fees charged - presumably most refer to peoples experience in the US market. Although I expect quite similar, anyone have any indications of fees in the UK market?

RE: Fees

Do you ever add in an amount to cover shop drawing review, letters to be written, meeting time and so on?  Those can take up quite a few hours of an engineer's time.

When you work hourly, what kind of rates do you charge?

RE: Fees

2
1)  $0.75 to $1 per sq. ft of building footprint depending on the overall size, number of floors, construction materials;
2)  estimate construction cost per sq ft (typically $100/sq ft for most commercial projects, $125/sq ft for health care, $85/sq ft for classrooms, $200/sq ft for fine arts centers); 10% to 15% of const. cost for structural; 4% to 6% of structural costs for fee;  I will use a preliminary cost estimate if one is provided;
3)  1.25 multiplier for design build or project involving a construction manager;
4)  fees include meetings during design effort, construction admin effort (site visits and shop drawing review);
5)  I don't base fee on number of sheets, although architects known for intricate designs that require alot of detailing on my part will be charged a higher fee than normal.

RE: Fees

Hourly rates: Principals 150, Employees  2.6x wages

RE: Fees

We strive for a 3.0 multiplier minimum, and get a great deal of repeat business.

Not sure how familiar you are with the multiplier- but take your cost of production, multiply it by the multiplier and that's the fee. The key is knowing how much it costs to produce a job before you start it. The important aspect here is specifically outline what is included in your sevices in the proposal, and what is NOT included- and STICK TO IT!

Additional services for any item that isn't included in the proposal should be sought after from the client.

If your contractor ends up being incompetent, a very detailed proposal can keep you from getting hosed- for instance if you specifically say you will do 3 site visits during the construction phase of the project, and the owner/contractor insists on more, and you end up going out there 18 times- that's add-services.

Always remember you are not running a charity- you are running a business.

RE: Fees

one thing I always remember is that old joke about the retired engineer who charged $50,000 to fix a problem.  When the client complained about the fee, because it only took the engineer a short time to solve the problem, the engineer said the fee was based on $1 to fix the problem and $49,000 to know how.  In my opinion, our fees should not just cover our production costs.  Our fees should include enough to cover liability risks and the use of our knowledge.  The question is: how much more to charge the clients for the risks and knowledge part of the project?

RE: Fees

archeng59

I thought only lawyers got paid for know how. Only occasionally us engineers get paid what we really deserve.

RE: Fees

cap4000, that's our fault as an engineering profession for not charging the correct fees.  In my opinion, part of the problem is architects.  Our fees are tied to whatever they agree to accept from the client.  At least in my part of the world.  When I'm able to work directly for the owner, my fees are generally better than when working thru the architect.  

just wondering, how many of you set your fee agreement as a % of construction costs instead of a fixed fee?  I always do a fixed fee contract.  When the architect asks me to do a % of construction cost agreement, I refuse.  I sell the fixed fee two ways:  1) If I do a % of construction cost, I want the construction costs to be as high as possible so where is the incentive for me to be economical? 2) what part of the construction costs will govern my final fee and how do I verify those costs?  

RE: Fees

Let's face it guys, we get paid what we do because there is always another structural engineer out there ready to cut your throat!  I work in transportation (bridges, O/H sign structures, etc.) industry and I see the structural engineers know and do so much more than the other civil engineering disciplines.  But we don't get any more money and are often the butt of so many jokes because we don't "get it" (usually with regard to the big picture).

I also see structural engineers dying to show how they know a little more than the next guy, or that the other guy could have done such-and-such better.  The joke that I am reminded of is,

Don't wrestle with a pig.  You both get dirty and some may not be able to tell the difference when it's over.

My 2 cents

RE: Fees

"don't wrestle with a pig."  good one.

also, you gotta get your hands dirty when the gutter needs cleaning.  we don't make progress without challenging the status quo.  if challenging ideas never happened, we'd all still be living in Europe thinking the world was flat.

RE: Fees

Those who derive their fees based on percentage of construction cost are mostly using "total" construction cost.  We frequently do on the basis of "general" construction cost, exclusive of M-E.  Anyone else doing that?  

RE: Fees

I do both residential and commercialwork. Typically residential work runs about $1.25/sq.ft. and about half for a repeat fee, althugh there are people out there that will charge about $0.75 per sq.ft. and a few hundred dollars for repeat fees...ludicrous.
Commercial work is a whole different game. I like to price it by the sheet, $2000-to-$3000 per 24"x36" sheet. Of course, the money is in the revisions and inspections...particularly inspections.
Also, as someone said before, you get what you pay for. The South Florida market is tough. The Plans Examiners are all reistered structural engineers and the require calculations to the last nail...it's good and bad. Some are semi-retired individuals that don't really care and some are very sharp engineers that can really be a pain in the butt because some of the stuff we do is "empirical" (time tested) and you cannot really put a number to it...But they always want calculations. So your fee, must be adjusted accordingly.

RE: Fees

I get frustrated because our plans examiners are not competent.  Civil engineers in the area will design retaining walls that don't in any way meet code requirements.  They do very little work, charge very little and the walls are cheaper to build because they do not have sufficient reinforcement or footings.  As we all know they work decently for a fair amount of time, but that doesn't make it right.  Unfortunately sometimes when these guys have a program they feel competent and from what I've seen it isn't so.

akastud

RE: Fees

I know this is an old thread, but I came across some information others may find useful. I was preparing a cost estimate and was surprised to find an estimate of engineering and architectural fees in the Means Facilities Construction Cost Data. I've always found it to be a reliable resource. It also provides alot of good information on SE fees based on type of project, size of project, etc.

RE: Fees

I am aware of the Means fee info.  curious to know if anyone is getting fees of those magnitudes.  they are 40% to 50% higher than what engineers are getting in my part of the US.

RE: Fees

And a realtor gets approx. 5% of the sale. Something is wrong

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