What Are MEP Design Costs, Drafting Fees & Engineering Service Rates for Companies?

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In a residential building project, clients often see MEP (mechanical, electrical, and plumbing) design as an easy gateway for engineering/construction firms to set a high percentage of cost markup, leading to excessive waste of time and money the client’s part. The same issue can happen in commercial projects as well. However, the MEP engineers are usually more hands-on about getting things right and solving any cost-related problem that may arise from inefficient design. In both cases, mistakes can happen, but it is much less common in a commercial project. 


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Engineering consultants are less engaged in a residential housing project because the responsibility of MEP, such as plumbing and HVAC, is left to individual suppliers or contractors. As soon as the designer or architect finishes drawing the plans, nearly all works about the MEP aspect of the building are handed over to a contractor. Clients can choose a contractor directly or ask the architect to help to bid.

MEP is already specified in the plan by the architect, but whether or not the plan does the on-site construction is another matter. A client may hire an architect to oversee the construction process until completion, which means additional cost for every visit, review, and revision. Depending on the compensation method used, the architect’s fee can put a restrictive strain on the construction budget. Most clients let a contractor take care of MEP entirely, meaning they must purchase materials and items (AC, pipes, tubing, gauges, valves, insulations, hoses, structural supports, tools, and consumables) separately from suppliers. 

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Issues with residential building plans

Nearly every aspect of the building plan falls under the control of individual suppliers and the contractor. If or when a mistake happens, the architect is not held responsible. One of the biggest problems with residential building plans is that the MEP is often not given sufficient details, leading to an improper construction sequence and, ultimately, remedial work.

For example, a contractor decides to have the frame and joist done as soon as possible without considering the MEP components. When installing pipes and electrical wiring for an HVAC system, the existing structure must be first disassembled to open access and then rebuilt or modified after MEP installation. 

Why MEP is essential

Most residential project contractors tend to think of MEP as an additional part of a building, so it can be installed later on when the main structure is completed. While this can be true, MEP is an integral feature of modern housing. HVAC and plumbing must be installed at around the same time as the structure. If done afterward, additional work on the system is inevitable. The relationship between materials, design and MEP components can be challenging, especially when the information is presented in a 2D drawing format. Even with 3D images drawn using BIM or CAD software, it is not always easy to capture the spatial concept of a design.

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In MEP, detailed drawing cannot be concise. For an MEP drawing to contain all the necessary information, it has to be overcomplicated, And the problem with being overcomplicated is an incorrect interpretation. Not every architect–let alone contractor or builder—can read and translate the design as intended by the MEP engineers. VDC (Virtual Design and Construction) allows architects, engineers, and contractors to see if the proposed MEP design will clash with the approved structure.

VDC is best utilized right from the beginning of a project to minimize the risk of mistakes and additional costs. VDC displays the building plan and the interconnected MEP components throughout the building, making everything easier to understand. A residential project does not typically utilize BIM and VDC. Before construction begins, VDC provides a clear overview of the relationship between walls, frames, spaces, HVAC designs, and plumbing connections.

Architects, contractors, MEP engineers, and clients can see if there is any incompatibility among the interconnected parts and make changes as needed. Once again, things often go wrong when MEP engineers are no longer involved in the project after the plans are submitted for bidding.

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The cost

Ideally, the construction cost is the same amount as estimated before it starts. There can be some differences, but they usually don’t stray too far from the original estimate. MEP engineering accounts for a reasonable percentage of the total construction cost. It all depends on the complexity, scope, and type of project, but it falls in the range of $0.5 to $3 per square foot for residential housing. More components and equipment translate to a higher fee. The MEP drawing services alone start from $2,500 per 5,000 sq. ft. If the project is for a medical or manufacturing facility, the price can go up to $15,000 for the same area. 

MEP DrawingPer sq. ft.Per 5,000 sq. ft.
Residential, empty shell$0.5$2,500
Commercial, medical, or manufacturing facility$3$15,000

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Change orders

It is not uncommon for people to feel caught off guard by the cost of MEP engineering services. In most cases, the main reason is something known as “change orders” by a contractor. A change order refers to an additional fee billed to you by a contractor/subcontractor each time there is a change (an increase) to the original scope of work indicated in the architectural drawing design. Such a shift in content arises from unexpected findings, a modification to the original MEP plan, or anything else that requires an extra clause in the contract.

Without the involvement of an architect and an actual MEP engineer, a contractor may use the opportunity to gain more profit. It is not ideal for the client, but not entirely inappropriate either; you can almost say this is a gray area in a construction project. A revision in an MEP drawing, for instance, when you need to move the bathroom location closer to the garage or further back near the pool, may cost around $1,500 to $2,000.

Assuming the revision happens in the middle of the project, the construction cost estimate also increases accordingly. You may think all the rework to the structural aspect will require around $10,000 because the building is not completed yet anyway. At the end of the revision, you’ll be surprised to see a bill of more than double the amount. 

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Compliance cost

MEP engineers work based on the principle of safety, meaning they design everything first and foremost to ensure a safe environment for the inhabitants. An effective way to do that is to comply with building codes. At times, the cost of compliance is much higher than you expect. In an HVAC system, the cost of mechanical ventilation is often an overlooked item in the budget.

You may think that five tons of cooling are adequate for the size of your home; with the revision and rework, however, the building outline is modified, and now you have to spend a sizeable amount from the budget just for compliance issues. After some calculation, the MEP engineer may come up with ten tons of cooling and $30,000 in HVAC instead. A significant amount of the money goes towards ensuring that the space’s mechanical ventilation complies with the local building code. Things get more expensive if you upgrade the water meter and make new connections, and more fixtures cost more money.

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Percentage of construction cost

MEP costs up to twenty-five percent of the overall construction budget, assuming everything goes as planned throughout the project. There is no revision, rework, or significant overhaul of the structure. If a residential building costs $1,000,000, around $250,000 will go to the MEP portion alone. The engineering consultant takes at least four percent of the cost, about $10,000. The consultant’s fee is already included in the MEP portion. You are paying $240,000 for the construction and materials and $10,000 for the engineering solution. 

* Percentage of the overall construction budget

BudgetPercentageAmount
Overall construction fee100%$1,000,000
MEP portion25% of the total cost$250,000
MEP design fee4% of MEP portion$10,000
In other words, MEP design fee is about 1% of overall construction cost ($1,000,000 x 1% = $10,000).

* Percentage of architect’s fee

You can also use “percentage of architect’s fee” as the MEP compensation method.

BudgetPercentageAmount
Overall construction fee100%$1,000,000
Architect’s fee10% of the total cost$100,000
MEP design fee10% of the architect’s fee$10,000
You will end up paying the same amount using either method. 

Bear in mind that the architect’s fee (based on a percentage of total construction work) is affected by various factors. A brand-new construction takes a lower rate than a renovation or remodeling project, and it usually does not exceed eight percent for a new residential project. 

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Save money on MEP design costs.

MEP is not the only aspect of a construction plan that requires change orders, resulting in completion delays and increased costs. That said, it is always a big deal when problems arise from mechanical engineering design issues, electrical, plumbing, and HVAC systems. If a change order happens because of something wrong with MEP, you will likely face an expensive problem. The best way to prevent unexpected challenges in MEP during construction is to utilize 3D design solutions.

A clear overview of a building layout in three-dimensional format helps architects, engineers, and general contractors identify problems long before construction begins. A 3D structure makes it easy for everyone to understand the slope of plumbing pipes, spaces available for ductwork, the best location for cable support inside walls, mechanical ventilation, and light switches, to name a few. 

Architects, in collaboration with MEP engineering consultants, work to make the design of a building as efficient as possible in the most affordable way without sacrificing quality. In projects where the general contractor handles everything independently from the architect and engineers, a simple case of misinterpreting the plan drawing can lead to an expensive mistake. It doesn’t often happen in commercial or public projects, but it is a prevalent issue in private residential types.

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Forward-thinking general contractors, MEP engineering consultants, and architects are willing to adopt technology solutions to minimize the chances of change orders or any costly revision in a project. Using advanced software like BIM design (Building Information Modeling) means more overhead, and the associated cost will be billed to the client. Since a client tends to go with the lowest bidder, there is always a risk that the winning contractor is yet to adopt the technology required to comprehend what the architects and engineers want.

With or without 3D CAD design and BIM, there are few things engineers can do to help the client save money on MEP design. Contractors can also apply the same principles to increase work efficiency. For example, specific MEP equipment such as boilers and chillers are among the most expensive and costly to run. Simple optimization methods can improve efficiency by selecting only the equipment based on building load capacity.

Also, the ductwork and piping system length can be reduced to ease the budget. The purpose is to reach full building coverage using the shortest possible stretch. The same principle should be applied to the electrical wiring as well. In general, a qualified MEP engineering consultant must aim for the following.

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Minimum pipe length

In any building, residential housing included, pipes are most commonly used to deliver fresh water into the house and send wastewater out. In a more advanced building plan, there is also piping for a sprinkler system and HVAC:

  • In an automatic sprinkler system, pipes deliver water to the sprinkler heads; such lines are often painted red.
  • In an HVAC installation, piping is part of the hydronic system in which water is used as a heat-transfer medium. Water removes or delivers heat from indoor areas. A chiller does not generate heat and spread it throughout a room. Instead, it cools the water inside a pipe, then runs it through a set of cooling coils.

Efficient placement of heating, cooling, and sprinkler equipment can reduce the overall length of pipe to support the system. Avoid placing the equipment “wherever is convenient” because it may require unnecessarily long piping installation. Not only is it expensive to install, but also inefficient in terms of energy usage. Use a good quality sprinkler head that offers comprehensive coverage, so you use fewer sprinkler heads and shorter piping. Furthermore, water loses pressure when it travels a long distance from the source, and friction between the pipe’s inner surface and flowing water also hurts pressure.

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An architect (and MEP engineering consultant) asks a comparatively small fee for a new building because the design doesn’t have to adapt to an existing feature. An architect can work closely with an MEP engineer to develop a concept that works best for the client from scratch. System optimization for existing buildings is possible, but the solution is often more complicated, hence a higher fee for renovation.

Air duct coverage optimization

Many MEP components, including ductwork, have to share spaces above the ceilings. Since air ducts are larger than piping in a typical residential property, optimization will lead to cost reduction and better space utilization. Adequately installed ductwork also minimizes noise and vibration. If long piping requires more power to pump the water, a longer air duct needs more fan power to send air out. In areas where electricity is expensive, efficient pumping and ventilation help reduce power bills.

Electrical and conduit optimization

Distance of circuit run affects power usage. The shorter it gets, the cheaper it is to operate. Efficient placement of electrical equipment will reduce total circuit length. An electrical installation focusing on energy efficiency will use a lower electric current. Despite the constant supply voltage, low current can use small conductors (low cost per foot). Thanks to the conductor’s dimension, the installation only needs a small, affordable conduit. In a multi-story building, an effective way to reduce circuit length is by using a vertical layout. Instead of distributing the electrical equipment across the walls and horizontal frames, arranging them in a vertical shaft is better.

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The layout may not give much of an effect for smaller electronics, but it delivers significant savings for major equipment such as the water heater or AC. Any large equipment should be installed close to the main power supply to minimize the length of conductors. Energy efficiency equipment and design approaches are more expensive to install, but the additional cost is soon counterbalanced by reduced operational expenses such as maintenance and electricity bills.

Takeaway

Mechanical, electrical, plumbing, and HVAC systems account for a considerable portion of the overall construction cost of a property. Installation for those systems takes around twenty-five percent of the total budget in a new construction design project and may take more for renovation and remodeling. Smart layout optimization using 3D CAD and BIM software helps minimize the chances of installation mistakes and improve efficiency thanks to the efficient placement of MEP equipment.

A construction project can achieve significant savings in multiple parts of the MEP, such as piping, wiring, and ductwork optimization. Appropriate savings in all the right places will not reduce the performance of the connected features. They will improve efficiency by eliminating unnecessary components so that every part can work to its full potential while reducing the bills. 

How can Cad Crowd Assist

At Cad Crowd, we have the privilege of working with some of the best freelance MEP engineers in the world. Contact us for a free quote for expert assistance from our pre-vetted professionals.