How Much Are Construction Manager or Project Manager Fees?

What is Construction Management?

Construction management is a professional field that focuses on each part of the building process. It typically involves commercial building sites or multi-unit residential sites, not usually single-family residential building sites. They:

• Oversee each phase of work.

• Resolve any discrepancies between original blueprint design and actual implementation.

• Are accountable for cost and must control material and labor prices.

• May work with one or more:

  • General contractors

  • Project managers

  • Architects

  • Site-specific superintendents

• Must be familiar with design and building laws such as OSHA regulations and building codes.

Construction Management vs. Project Management

These professionals overlap in many areas, but there are a few key differences. Construction Managers oversee building and construction factors, while Project Managers oversee every detail from visualization to completion. They also:

• Manage security, tech and amenities

• Focus on the owner’s greater objectives

• Responsible for hiring construction managers

Both Professionals

• Act as the owner’s representative and advisor

• Are responsible for hiring and managing subcontractors

• Accept liability for staying within budget and on time

General Contractor Rates vs. Construction Management Fees

A general contractor (GC) charges a higher rate than managers for their services, closer to 10% to 20% of the overall cost versus 5% to 15% for CMs.

A GC will:

• Pay for supplies, materials, and labor.

• Determine costs and markups on all services for one overall price.

General contractors can act as a construction manager and participate in pre-construction planning by:

• Managing your job from start to finish.

• Hiring subcontractors and other workers.

• Leasing vehicles (trucks, cranes, backhoes, etc.).

• Maintaining all accounting and personnel records.

• Accepting total liability for the work at hand.

• Covering delays and issues out of pocket, depending on circumstances.

Hiring a general contractor is more likely to mean you’ll have a consistent, reliable crew of workers or subcontractors who are used to working with that GC and team.

Standard Construction Manager Fee Percentage

Standard construction manager fees range from 5% to 15% of the project total. However, costs can also come as a fixed amount or based on the size of the build. They will also vary with the services that the Construction Manager, or CM, provides. You should pay the fees based on completing specific phases of work. Structure payments so that everything is paid in full once the work is complete.

TIP: Pay attention to the cost of materials and labor when reviewing your estimate or contract. If the CM marks up these factors, that may impact the overall percentage you’re paying for their services. Such markups might take a CM’s rate up from 5% to 15%.

Construction Manager Fee Scale

The industry standard for construction manager fees ranges from 1% to 15% of the total cost depending on the scale and scope of the job. You’re more likely to see a 1% fee if your total costs are over $100 million.

Typical Construction Project Management Fee Structure

Construction project manager fees will be either fixed, a percentage of the overall costs or calculated by the size of the build. Typically, they are 5% to 15% for small-scale projects. For larger jobs, they’re more likely to be 5% or less.

• Fixed: Based on the hours the manager will spend on the project overall. You’ll pay the fee in monthly installments. This rate ranges vastly depending on the type of project.

• Percentage:

  • 5–15% of the total price for small projects (typically under $500,000).

  • 5% or less for large-scale jobs ($500,000 to $5 million and more).

• Size: Some managers charge based on the square footage and the total price.

Commercial Project Manager Fees

On commercial projects, the manager’s fees are likely to range from 1% to 5% of the overall price. Commercial projects are typically higher in cost compared to residential, making the percentage fee lower.

Renovation Project Manager Costs

On renovation projects, the manager’s fee is likely to range from 5% to 20% of the total cost, depending on the extent of their services. Renovation project managers are more similar to Project Managers than Construction Managers.

Bathroom Renovation Management

The average bathroom remodel costs between $6,600 and $16,600. Based on those figures, the project management fee would be between $330 and $2,500. This does not include architect costs or the price of a structural engineer that you'd need for extensive remodeling work. 

Other factors can also increase the total project cost and, therefore, the project management cost, such as reinforcing the floor to hold a cast iron tub, or completely changing the layout of the plumbing.

Kitchen Renovation Management

Kitchen remodels cost between $13,400 and $38,400, putting the typical construction management fees between $670 and $5,760. Per square foot, expect to pay an average of $150 for the project, including $7.50 to $22.50 per square foot for construction management. 

For a high-end kitchen renovation project, you can easily pay $100,000 to $130,000 for top-of-the-line appliances, premium materials, and a total redesign, including wall removal and plumbing and electrical work. In this case, expect to pay $5,000 to $19,500 in construction management fees.

Bedroom Renovation Management

Bedroom renovation costs $4,000 to $40,000 for the whole project, putting bedroom renovation management fees at $200 to $6,000. This doesn't include the cost of hiring an interior designer, though. Additionally, you'll pay extra for room expansions, combining two rooms into one, or converting an attic, basement, or garage into a bedroom. 

Residential Construction Consultant Fees

Expect to pay either a percentage of the cost—usually lower than 5% per consult—or a flat fee for residential consultation services.

When it comes to residential construction, you’ll likely need to consult with several professionals before work starts. These include construction managers, structural engineers, architects, landscape architects, and designers.

DIY Construction Management vs. Hiring a Pro

It's possible to DIY the construction management of a project, and you'll save between 5% and 15% of the project total. For larger projects, however, hiring a local construction manager to oversee the job is a much better idea. 

Remember, there are many moving parts to deal with, and it's easy to overlook something important or get overwhelmed with the sheer amount of work involved in the construction management process. If you're just remodeling a bedroom, you can likely handle the project yourself if you have enough time.

However, if you're covering the cost to build a house, then you should hire a construction manager, as there is so much to keep on top of, it's not really feasible to handle on your own.