Compensation Flashcards
SPP 201:
SPP 202:
Regular Design Services
SPP 203:
Specialized Architectural Services
SPP 204a:
Full-time Construction Supervision
SPP 204b:
Construction Management
SPP 205:
Post-construction Services
SPP 206:
Comprehensive Architectural Services
SPP 207:
Design Build Services
SPP 208:
Competitions
SPP 209:
Architectural Consulting Services
- Consultation
- Pre-feasibility studies
- Feasibility studies
- Site selection and analysis
- Land use studies
- Research
- Architectural programming
- Space planning
- Space management studies
- Value management
- Design brief preparation
- Promotional services
SPP 201: Pre-design Services
- Project Definition Phase
- Schematic Design Phase
- Design Development Phase
- Contract Document Phase
- Bidding or Negotiation Phase
- Construction Phase
SPP 202: Regular Design Services
Six phases of regular design service:
- Architectural Interiors
- Acoustic Design
- Lighting Design
- Site Development Planning
- Physical Planning
- Comprehensive Development
Planning - Heritage Conservation and
Planning - Security Evaluation/Planning
- Building Systems Design
- Facilities Maintenance Support
- Testing/Commissioning
- Environmental Certification
- Forensic Architecture
SPP 203: Specialized Architectural Services
- Building Appraisal
- Structural Conceptualization
- Preliminary Services
- Contract Documentation/Review
- Post-design Services
- Dispute Avoidance/Resolution
- Architectural Research Methods
- Special Building Design
- Building Components
- Management of Practices
SPP 203: Specialized Architectural Services
Rendering service as the Architect-in-charge of construction (AiCC), who
is directly and professionally responsible and liable for the construction
supervision of the project.
SPP 204a: Full-time Construction Supervision
● The responsibilities of the Construction Manager (CM) include the
following functions:
○ Coordination and Supervision
○ Cost and Time Control
○ Quality Control of Work
○ Keeping of Records
SPP 204b: Construction Management
● Building Maintenance
● Grounds and Landscaping Supervision
● Building Equipment Maintenance
● Business Development and Management
SPP 205: Post-construction Services
● Comprehensive Architectural Services refers to the range of
professional services that covers:
○ Pre-design Services
○ Regular Design Services
○ Specialized Architectural Services
○ Construction Services
○ Post-Construction Services
● The Architect in this capacity functions as the Project Manager.
SPP 206: Comprehensive Arch’l Services
- Design-Build Services by Administration
- Design-Build Services with Guaranteed Maximum Project
Construction Cost
SPP 207: Design Build Services
Two types of competitions:
1. Competitions for actual projects proposed for implementation.
2. Ideas competitions set as a design and planning exercise to
elucidate a problem.
SPP 208: Architectural Design Competitions
● Classifications based on number of stages
○ Single stage
○ Two-stage
● Classifications based on participants
○ Open competitions
○ Limited-by-invitation competitions
SPP 208: Architectural Design Competitions
The rendering of independent advice and extension of technical
assistance requiring appropriate knowledge, skills, training and
experience, and recognized competence.
SPP-209: Professional Arch’l Consulting Services
The total cost of all fixtures and accessories for architectural interiors,
acoustics, lighting works, site development civil works and landscaping
works which were either designed, specified, or procured by the Specialist
Consultants.
Cost of Work (CoW)
The total cost considering the rate of the Architect, the Consultants,
Technical Staff, Researchers, and others involved in the Project per hour,
per day, or per month
Direct Personnel Cost
Any factor which compensates the Architect for the following:
● Overhead costs of the office
● Benefits and social charges for employees
● Contingencies
● Cost of money/interest
● Reasonable profit
Multiplier
The value of the multiplier may range from 1.5 to 2.5 depending on the
setup of the Architect’s office, the type and complexity of the Project,
experience of the Architect, and the geographic area in which hs/her office
is located.
Multiplier
● Provisions for office, light, air-conditioning, and similar items for the
working space
● Depreciation allowances or rental of furniture, equipment and
instruments
● Vehicle and travel-related expenses
● Office supplies
● Taxes and insurances other than those included as salary cost
Overhead
● Library and periodical expenses and other means of keeping abreast
with new developments and technologies
● Executive, administrative, accounting, legal, stenographic, and clerical
salaries and expenses
● Business development expenses
Overhead
Cost of the completed building to the Owner, including the structure,
plumbing, sanitary and electrical fixtures, mechanical equipment, elevators,
air-conditioning system, communications and electronic systems, elements
attached to the building, and all items indicated in the plans/designs of the
Architect and his consultants.
Project Construction Cost
The cost of materials used and the labor for their installation are part of the
PCC. If these items are furnished by the Client below market cost, the cost
of the material and labor shall nonetheless be computed on the basis of
current and fair market value costs.
Project Construction Cost
The PCC does not include any of the fees for the Architect, the Engineer, the
Specialist Consultants, or the salaries of the construction inspectors.
Project Construction Cost
Includes the cost of the construction as well as all professional fees,
permits, clearances, and utilities and cost of acquiring the project site, cost
of money, etc.
Project Development Cost
Expenses related to the project that may include, but not be limited to:
● Transportation
● Housing and living allowance of consultants if assigned to placed over
100km away from office
● Cost of printing of extra sets of drawings
● Identifiable communication expenses such as overseas and
long-distance calls, internet, SMS, postage, etc.
Reimbursable Expenses
The cost of salaries of professional consultants for the time directly
chargeable to the project, plus all imposable taxes and contributions for
social security and insurance benefits.
Salary Cost
A duly notarized written contract stipulating the scope of services and
guaranteeing compensation for such services
Service Agreement
AiCC:
Architect in Charge of Construction
AoR:
Architect-of-record
CA:
Consulting Architect
AF:
Architectural Firm
DAEDS:
Detailed Architectural and Engineering Design Services
DADS:
Detailed Architectural Design Services
PCC:
Project Construction Cost
PPCC:
Probable Project Construction Cost
APCC:
Awarded Project Construction Cost
FPCC:
Final Project Construction Cost
CoW:
Cost of Work
PF:
Professional Fee
RPF:
Recommended Professional Fee
Title
● UAP-IAPOA Doc. 210: _______
● This replaces the 1979 UAP Doc. 208-B (Methods of Compensation
and Schedule of Fees)
Architect’s Guidelines for Standards of Professional Practice (SPP) Compliances - Methods of Compensation and Schedule of Fees
Rationale
● To standardize the ranges of compensation for architectural services
● To complement RA 9266, Code of Ethical Conduct, SPP 201-209, and
other related laws
Question 1: This does not include any of the fees for the
Architect, the Engineer, the Specialist Consultants, or the
salaries of the construction inspectors.
C. Project Construction Cost
A. Salary cost
D. Reimbursables
B. Project Development Cost
C. Project Construction Cost
Question 2: This includes the cost of the construction as well
as all professional fees, permits, clearances, and utilities and
cost of acquiring the project site, cost of money, etc.
C. Project Construction Cost
A. Salary cost
D. Reimbursables
B. Project Development Cost
B. Project Development Cost
Question 3: Library and periodical expenses and other means
of keeping abreast with new developments and technologies
and business development expenses fall under which?
C. Overhead
A. Reimbursables
D. Direct Personnel Cost
B. Cost of Work
C. Overhead
Question 4: The total cost considering the rate of the
Architect, the Consultants, Technical Staff, Researchers, and
others involved in the Project per hour (man-hours), per day,
or per month.
C. Overhead
A. Reimbursables
D. Direct Personnel Cost
B. Cost of Work
D. Direct Personnel Cost
Question 5: The total cost of all fixtures and accessories for
architectural interiors, acoustics, lighting works, site
development civil works and landscaping works which were
either designed, specified, or procured by the Specialist
Consultants.
C. Overhead
A. Reimbursables
D. Direct Personnel Cost
B. Cost of Work
B. Cost of Work
Criteria
● The compensation computation should be based on the Architect’s:
○ talents, skill, and experience
○ effort and time available for the project
○ effort and time required by the project
Criteria
● The method of compensation should be chosen _______.
● The computed fee must be commensurate with the scope and
complexity of service.
● Compensation for services that require the use of more than one type
of expertise shall be treated differently from those services that
require only one kind of expertise
based on the type of
service.
Criteria
● The following criteria must also be considered:
○ Studies, programs, and other professional input furnished by the Client
○ Client’s procedure and timing for review and approval of designs
○ Costs of administration, including records to be maintained and preserved
○ Probability of contingencies
○ Number of third parties that the Architect needs to coordinate with
Methods of Compensation
● Compensation methods can be grouped into three main types:
- Percentage-based fee
- Lump sum or fixed fee
- Time-based fee
- Percentage based on Project Construction Cost (PCC)
- Unit cost method
- Value-based pricing/Percentage of gross rentals
- Percentage-based Fee
- An appropriate percentage of the PPCC
- Estimating the individual elements of the cost outlines + a reasonable
margin for profit
- Lump Sum or Fixed Fee
- Multiple of direct personnel expenses
- Professional fee + expenses
- Per diem, honorarium + reimbursable expenses
- Salary cost x multiplier + direct cost or reimbursable expenses
- Per diem or hourly basis
- Retainer
- Time Basis
● Using one method of compensation on a single project may not be
applicable all the time. It is recommended that an assortment of
compensation methods be used, if appropriate.
● Example: Pre-design and construction services could be
compensated on an MDPE basis while the regular design and
specialized architectural services may be compensated based on a
percentage of the PCC.
Mixed Methods
● One of the most common compensation methods
● The percentage amount is based on the type of project
● The fee of the Architect is determined by multiplying the specified
percentage by the PCC
1.1 Percentage Based on PCC
● Fair to both the Client and the Architect
○ Fair to the Client because the fee is pegged to the Client’s budget
○ Fair to the Architect because if there are changes, the fee adjusts accordingly
1.1 Percentage Based on PCC
1.1 Percentage Based on PCC
● The PCC may be:
○ Probable Project Construction Cost (PPCC), which is the estimated amount
○ Awarded Project Construction Cost (APCC), which is based on the bid of the
winning contractor
○ Final Project Construction Cost (FPCC), which is the actual and final cost based
on cost records
which is the estimated amount
Probable Project Construction Cost (PPCC),
which is based on the bid of the
winning contractor
Awarded Project Construction Cost (APCC),
which is the actual and final cost based
on cost records
Final Project Construction Cost (FPCC),
1.1 Percentage Based on PCC
● The percentage amount for DAEDS and DADS are not the same.
● DAEDS is the more common than DADS.
● In a DADS arrangement, the Architect is entitled to ____ of the
corresponding DAEDS professional fee, since he is the lead
professional and coordinates the work of the other designers.
60%
● A variation of the Percentage Based on PCC method
● Under this method, the fee is based on cost per square meter of the
project.
● The cost per area may be derived from historical data (average
construction cost per sqm. of similar projects)
1.2 Unit Cost Method
1.2 Unit Cost Method
● Example: A high-rise office building project with 10,000 sqm GFA and
2,000 sqm non-GFA. DAEDS contract.
○ Average project construction cost: PHP30,000/sqm
○ Applicable Professional Fee: 6% of PCC (DAEDS)
○ Fee for GFA
■ PHP30,000/sqm x 6% = PHP1,800/sqm
■ PHP1,800/sqm x 10,000 sqm = PHP18,000,000
○ Fee for non-GFA
■ Use 50% of rate for GFA = PHP900/sqm
■ PHP900/sqm x 2,000 sqm = PHP1,800,000
○ Total Fee: PHP19,800,000
● The compensation under this method is a value-based pricing based
on the revenue/profitability outcomes of the service. Examples:
○ Sales in retail facilities
○ Leasing in housing
○ Leasing in commercial spaces
● In this service, the Architect goes beyond maintenance/upkeep
functions and innovates schemes to maximize building occupancy
and make the building’s operations efficient.
1.3 Value-based Pricing/% of Rentals
● This method is appropriate when the scope of services required can
be clearly and fully defined from the beginning of the project. As such,
the following must clearly defined from the beginning:
○ Scope of work
○ Schedules for designs and approvals
○ Construction schedule
- Lump Sum / Fixed Fee
● The lump sum may be computed in two ways:
○ As a percentage of the PCC
○ Estimating direct cost then adding a reasonable margin for profit
- Lump Sum / Fixed Fee
● This method is useful when the services are difficult to determine in
advance and if they are interim in nature or often short in duration.
● Time-based methods are often used for:
○ Services that are not well-defined
○ Predesign services
○ Partial services or additional services
○ Rendering expert testimony
○ Consultancy
- Time-based Fee
● Applicable to non-creative work only (i.e. not design services).
● This method is based on technical hours spent and does not account
for creative effort since the value of creative design cannot be
measured by the amount of time spent.
3.1 Multiple of Direct Personnel Expenses