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COST PLUS

Providing a dependable solution with a managed budget

The Cost-Plus model is a contract delivery option where the Contractor can get started with work before the design is completed and gets paid for all construction-related expenses, plus a reduced, agreed-upon fee.

Opposite to where the General Contractor works on a fixed contract amount (usually marked up 15%+) based on a completed design package, the project Owner is able to start the project sooner as the drawings are in process (similar to the CM model) and since the Owner carries onus of cost liability, the Contractors mark-up fee will be far less than that of a typical General Contractor model and the cost savings of starting the work sooner benefits the Owner.

Cost-Plus is often used by project Owners where they want peace of mind to select their contractor based on their qualifications and avoid the risk of selecting a contractor based on the lowest bid.

When the Cost-Plus model is useful:

  • Where due to timing factors the Owner is unable to finish project designs and obtain accurate stipulated sum pricing prior to the commencement of work
  • Where due to project complexities it is not possible for the owner to obtain sufficiently accurate and precise specifications for a project, or for certain parts of a project, and construction for that project, or parts of that project, must therefore be administered using a cost-plus pricing arrangement.

For more information or a quote on a Cost-Plus project, contact us today.



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