Part 3 to 5: Methods of Compensation and SPP Doc. 201, SPP Doc. 202, Regular Design Services, SPP Docs. 203 and 205

Architect

Refers strictly to a registered and licensed natural person

Architectural Firm

Refers strictly to a juridical entity, such as a DTI registered sole proprietorship or an SEC/PRC registered firm

Direct Selection

A method of choosing an architect usually for smaller projects, based on reputation, personal acquaintance, or recommendations

Comparative Selection

A selection process conducted by committees involving invitation, pre-qualification, interviews, evaluation, and fee negotiation

Design Competition

A selection method used mostly for civic or monumental projects where architects submit design solutions judged on excellence

Basis for Computing Architect Compensation

Mutual evaluation of the architect's talent, skill, experience, effort, and available time required for the project

Lump Sum or Fixed Fee Method

A compensation method used when the project scope can be clearly and fully defined at the very beginning

Probable Project Construction Cost (PPCC)

The estimated construction cost established at contract signing using unit price parameters and square meter rates

Awarded Project Construction Cost (APCC)

The construction cost based on the winning contractor's actual bid

Final Project Construction Cost (FPCC)

The total construction cost calculated from final completion payments, owner-supplied materials, and installed work

Detailed Architectural and Engineering Design Services (DAEDS)

Single contract where the architect provides total architectural design plus normal basic engineering designs at 100% RPF

Detailed Architectural Design Services (DADS)

Separate contracts where the client hires engineers directly; architect leads and coordinates at generally 60% of DAEDS

Separate Professional Liability in DAEDS/DADS

The civil liabilities of each regulated professional remain separate; the architect coordinates but does not assume engineer liabilities

Unit professional fee

Average construction cost per sq m × Percentage of PCC

Multiple of Direct Personnel Expenses (MDPE)

A cost-based fee method restricted strictly to non-creative work like research, reports, and administrative tasks

cannot be used for creative design because creative value cannot be measured by time spent

MDPE Multiplier Range

The multiplier (M) for overhead and reasonable profit ranges from 1.5 to 2.5

Professional Fee Plus Expenses

A compensation method ideal for ongoing client relationships involving a series of continuous projects

Per Diem, Honorarium Plus Reimbursables Method

Compensation used for personal time requests like attending distant meetings, site inspections, or prospective venture talks

Salary Cost Times Multiplier

Basic salary multiplied by a factor starting from 3.0, used when project costs are hard to predetermine

Per Diem or Hourly Basis

Intermittent personal service, including consultation and testimony in court.

Retainer

A regular fixed payment covering minimum ongoing services, with additional tasks billed separately

SPP Doc. 201

The Standard of Professional Practice document covering Pre-Design Services

Pre-Feasibility vs. Feasibility Studies

Pre-feasibility studies rely on existing secondary data, whereas feasibility studies rely on primary data gathering

Architectural Programming

The pre-design service of identifying functional spatial needs and drafting a preliminary space program

Space Planning

Determining the size, layout, and assemblage of spaces through user interviews and space audits

Value Management

A pre-design service aimed at achieving the complete project program requirements at the lowest possible cost

Design Brief Preparation

The preparation of Terms of Reference used by clients to invite or bid out architectural services

Pre-Design Fee Methods Limitation

Percentage of PCC and Unit Cost methods cannot be used for Pre-Design because no construction cost exists yet

Pre-Design Acceptance Fee

A required initial payment of 5% of the agreed fee upon signing the service agreement

Progress payments

Due within 7 calendar days after the statement of account is submitted

SPP Doc. 202

The Standard of Professional Practice document covering Regular Design Services

Regular Design Scope Duration

Services begin when the owner outlines requirements and end when the contractor turns over the completed building

Six Phases of Regular Design Services

1. Project Definition

2. Schematic Design

3. Design Development

4. Contract Documents

5. Bidding/Negotiation

6. Construction

Project Definition

Translating space requirements into a project program, setting initial budget estimates, and establishing fee arrangements

Schematic Design

Preparing preliminary design studies, line drawings, and the Statement of Probable Project Construction Cost (SPPCC)

Design Development

Developing detailed floor plans, elevations, sections, outline specifications, and updated cost estimates

Contract Documents

Preparing complete construction drawings and technical specifications, submitting 7 sets for building permits

Bidding or Negotiation Phase Work

Issuing bidding documents, holding pre-bid conferences, evaluating contractor bids, and drafting the notice of award

Construction

Interpreting design plans, issuing change orders, evaluating progress, and issuing Certificates for Payment

Regular Supervision vs. Full-Time Supervision

Regular Design (Doc. 202) requires periodic site visits only; full-time supervision is a separate engagement (Doc. 204-A)

The Owner's responsibilities

6.1 Provide full information as to his requirements for the project.

6.2 When necessary, designate a representative authorized to act on his behalf.

6.3 Promptly examine and render decisions pertaining to documents submitted by the Architect to avoid unreasonable delay. The Owner should issue orders to the General Contractor only through the Architect.

6.4 Furnish a certified survey of the site, zoning compliances, clearances, and soil investigations.

6.5 to 6.8 Pay for architectural, engineering and allied services, specialty consultants, legal and insurance services, reimbursables, and all taxes (except income tax) imposed on the Architect.

6.9 Give prompt written notice to the Architect of anything that may impair the successful implementation of the project.

Travel Surcharge Distance (Doc. 202)

Travel and living expenses apply if work is located beyond 50.0 km from the architect's office

Suspension of Work Fee Rule

If work is suspended or abandoned, the architect is paid for all services completed up to that point

Suspension Over 6 Months Rule

If building construction is suspended for more than 6 months, fees for remaining work are doubled

Detailed Design Fee Entitlement (90% Rule)

Completing contract documents equals 90% of services; if the owner abandons construction, the architect is still owed 90% of total fees

Project Construction Cost (PCC)

The total cost of the physical structure and installed systems, excluding professional fees and consultant costs

Project Development Cost

The total expenditure including PCC, professional fees, permits, land purchase, utilities, and financing costs

Regular Design Group 1

Buildings of simplest utilization like warehouses, hangars, printing plants, and service garages

Regular Design Group 2

Buildings of moderate complexity like apartments, offices, schools, malls, churches, and residential condos

Regular Design Group 3

Buildings of exceptional complexity like hospitals, airports, hotels, research labs, and theaters

Regular Design Group 4

Single-detached or attached residences, duplexes, row houses, and townhouses

Regular Design Group 5

Monumental structures like mausoleums, memorials, museums, and specialized exhibition buildings

Regular Design Group 6

Repetitive construction using one set of plans for multiple separate identical buildings

Regular Design Group 7

Housing developments consisting of multiple residential units constructed on a single site

Regular Design Group 8

Projects involving extensive detail, custom interior design, built-in fittings, and special equipment

Regular Design Group 9

Alterations, renovations, retrofitting, and additions to existing structures across Groups 1 to 5

Regular Design Group 10

Rendering expert opinions, consultations, technical advice, or courtroom witness testimonies

Group 1 DAEDS Fee (P50M or Less)

5% of the total Project Construction Cost

Group 2 DAEDS Fee (P50M or Less)

6% of the total Project Construction Cost

Group 3 DAEDS Fee (P50M or Less)

7% of the total Project Construction Cost

Bracketed Fee Calculation Formula

Fixed base amount for the bracket plus the excess percentage rate applied ONLY to the amount over the bracket floor

Group 4 (Residences) Recommended Fee

DAEDS is 10% of PCC; DADS is 6% of PCC

Group 5 (Monumental) Recommended Fee

DAEDS is 12% of PCC; DADS is 7.5% of PCC

Group 6 (Repetitive) Multi-Building Discount Rates

1st building: 100% RPF; 2nd building: 50%; 3rd building: 40%; 4th and subsequent: 30%

Group 7 (Housing) Unit Fee Bands

1st unit: 100%; Units 2-10: +50% each; Units 11-30: +40% each; Units 31-50: +25% each; 51+: +15% each

Group 8 (Extensive Detail) Recommended Fee

15% of the Project Construction Cost

Group 9 (Renovations) Recommended Fee

Standard group fee increased by 50%, resulting in a total fee of 150% RPF

Group 10 Hourly Advice Minimum Rate

Not less than P1,000.00 per hour

Group 10 Expert Witness Minimum Rate

Not less than P5,000.00 per court appearance

Long-Distance Travel Surcharge Rate

An extra 60% fee added for travel time when locations exceed 100 km from the architect's office

Cumulative Payment: Service Agreement Signing

5% payment (Mobilization / Acceptance Fee); Cumulative Total: 5%

Cumulative Payment: Schematic Design Completion

15% payment stage; Cumulative Total: 20%

Cumulative Payment: Design Development Completion

20% payment stage; Cumulative Total: 40%

Cumulative Payment: Contract Documents Completion

50% payment stage; Cumulative Total: 90%

Cumulative Payment: Construction Completion

10% payment stage; Cumulative Total: 100%

Final 10% Design Fee Split

Covers periodic site construction supervision (5%) and civil liability under Civil Code Art. 1723 (5%)

Design Payment Due Window

Payments are due within a maximum of 15 days after billing document submission

SPP Doc. 203

The Standard of Professional Practice document covering Specialized Architectural Services

Specialized Architectural Services Scope

Custom expertise provided to enhance interior/exterior components, complementing Regular Design Services

Architectural Interiors (AI)

Interior architecture, surface finishes, and built-in spatial elements designed to complete interior environments

Site Development Planning (SDP)

Designing site civil works, hardscape, and softscape features integrated with the building

Physical Planning Definition

Orderly spatial arrangement of horizontal developments (ROWs, open spaces) and vertical structures on land

Cost of Work (CoW)

Total cost of custom interior fixtures, acoustic/lighting elements, and landscape items specified or installed

Specialized Services (AI, Acoustics, SDP) Fee Rate

10% to 15% of the Cost of Work (CoW)

SPP Doc. 205

The Standard of Professional Practice document covering Post-Construction Services

Post-Construction Role

The architect may serve as Building Administrator, Property Manager, or evaluator

Building and Facilities Administration

Consists strictly of 4 areas: Building Maintenance, Grounds/Landscaping, Equipment Maintenance, and Business Development

Permit Processing Exclusions

Processing permits is part of design and pre-construction stages, not post-construction administration

Post-Construction Evaluation Forensic Work

Investigating system failures and defects like water seepage; cross-referenced as Forensic Architecture under Doc. 203

Post-Construction Compensation RPF

4% to 6% of the gross rental income

Percentage-based fee

Percentage of Project Construction Cost

Time basis

Multiple of Direct Personnel Expenses

Mixed Methods

More than one method may be used on a project, one for each phase