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How to price a fee proposal for a public architecture tender

TenderDesk · 12 Oct 2026 · 19 min read
fee proposalpublic procurementhoaipricingarchitecture tenders

Build the fee from hours by stage, then test it against the buyer's price formula, national fee references (HOAI, Italian parametri, MIQCP) and abnormally-low-tender rules.

Price a public-tender fee from the bottom up: hours by stage, multiplied by your real cost per hour, plus margin and risk. Then test that number three ways: against the buyer's price formula, against the national reference (the HOAI in Germany, the DM 17/06/2016 parametri in Italy, past awards elsewhere) and against the abnormally-low-tender rules. Binding minimum fee scales have been gone in Germany since the 2019 EU Court ruling, but scales still shape what buyers expect, and Italy now fixes 65% of the fee on design tenders of €140,000 or more.

Key points

  • Fee is rarely the deciding factor. In design tenders price usually weighs less than quality. Italy caps the price score at 30%, and Spain requires quality to carry at least 51%. A 10% cut often buys fewer points than a better methodology.
  • Read the price formula before you price. Proportional, linear and average-based formulas reward discounts very differently. Model your score at two or three fee levels before deciding.
  • Germany: since 1 January 2021 the HOAI is a reference, not a minimum. Fees are freely agreed in text form, and the Basishonorarsatz applies only if nothing valid was agreed.
  • Italy: buyers must set the tender value from the DM 17/06/2016 parameters (Allegato I.13 of the 2023 Code). On tenders of €140,000 or more, 65% of that amount is a fixed price and only 35% can be discounted.
  • France, Spain, Portugal, the UK, Belgium and the Netherlands have no binding fee scale. Your benchmark is your own cost base and past award values.
  • Abnormally low bids get questioned. The buyer must ask you to justify the price before rejecting it, so build a fee you can explain line by line.
  • Plan for VAT, indexation and partner fees before you submit. Design work for a building is taxed where the land is, multi-year missions need an index clause, and partner quotes must be fixed before your price is.

How the fee is scored

Under Directive 2014/24/EU, public buyers award on the "most economically advantageous tender". For design services, that almost always means a best price-quality ratio (Article 67). How much the fee counts, and how it turns into points, decides how you should price.

How much the fee counts

Weighting varies by country and buyer. Some national rules set limits:

Country Rule on price weighting Source of the rule
Italy Price score capped at 30% on design tenders ≥ €140,000 Art. 41(15-bis), d.lgs. 36/2023
Spain Quality criteria must carry at least 51% for intellectual services, which include architecture and engineering Art. 145.4 and DA 41 LCSP
Germany Planning services are awarded "in a performance competition" (§ 76 VgV). Price is usually a criterion but a minor one, and a fixed fee with competition on quality alone is allowed (§ 58(2) VgV) VgV
UK No fixed split. Government guidance warns buyers about relative price scoring Procurement Act 2023 guidance
France, NL, BE, PT No statutory split. Read the règlement de consultation, gunningscriteria or programa do procedimento Tender documents

The practical rule: when price carries 30% or less, design and team quality decide the result. Spend your effort there. For a full walk-through of reading award criteria, see how to write a winning tender response.

Price formulas and what they do to your bid

The same fee scores differently under different formulas. The three you will see most:

  1. Proportional to the lowest bid: score = max points × (lowest fee ÷ your fee). Cutting your fee helps, but with diminishing returns. You cannot know the lowest bid in advance, so every cut is a guess.
  2. Linear between budget and zero (or a floor): points fall in a straight line from a reference price. Every euro counts the same, so cuts pay off more than under the proportional formula.
  3. Relative to the average or the sum of bids: your score depends on everyone else's price. One very low outlier can compress everyone's scores.

Formulas can produce odd results. The lowest total price does not always get the highest price score, especially when prices are scored per lot or per item. UK government guidance on the Procurement Act 2023 explicitly tells buyers to be wary of scoring relative to the lowest tender because of its effect on value for money.

Worked example (proportional formula, quality 70 / price 30). Your team fee is €514,000 and you expect the lowest bid to be about €440,000.

  • At €514,000: 30 × 440 ÷ 514 = 25.7 points
  • At €470,000: 30 × 440 ÷ 470 = 28.1 points

Cutting €44,000 (8.6%) buys 2.4 points. That is 3.4% of the 70 quality points. If a sharper methodology note or a better-matched reference can lift your quality score by that much, it is the cheaper move. If the cut can only come from site-stage hours, do not make it.

Fixed-price tenders: competing on quality only

Article 67(2) of the directive allows the buyer to fix the price and let firms compete on quality alone. Germany allows this under § 58(2) VgV. Italy has made it partly compulsory. Under art. 41(15-bis) of the 2023 Code, as amended by d.lgs. 209/2024, 65% of the tender value for design services of €140,000 or more "takes the form of a fixed price" and only the remaining 35% may be discounted. ANAC's standard tender documents for architecture and engineering services (Bando tipo n. 2/2026, binding from 30 May 2026) confirm that buyers cannot set the discountable share below 35%.

Italian example: tender value €300,000. €195,000 is fixed and €105,000 can be discounted. A 20% discount on the discountable share is €21,000, so you bid €279,000, which is 7% off the total. The deepest possible discount is 35% of the total. A very deep cut on the discountable share is not automatically excluded, but expect an anomaly check. Treat it as a red flag rather than a strategy.

Abnormally low tenders

Every system covered here lets the buyer question a fee that looks too low. None of them allows automatic rejection without first asking you to explain (Directive 2014/24/EU, Article 69).

Country Rule
EU baseline Art. 69 Directive 2014/24/EU
Germany § 60 VgV (ungewöhnlich niedrige Angebote)
France Art. L2152-5 and R2152-3 Code de la commande publique
Italy Art. 110 d.lgs. 36/2023
Spain Art. 149 LCSP
Portugal Art. 71 Código dos Contratos Públicos
Netherlands Art. 2.116 Aanbestedingswet 2012
Belgium Art. 84, law of 17 June 2016
UK Procurement Act 2023, s. 19

What a buyer will accept as a justification: a real hours-by-stage plan, a stated cost per hour, a proven efficiency such as a repeat building type or an existing BIM template, and partner quotes on letterhead. What gets rejected: costs that do not add up. In July 2025 Italy's Consiglio di Stato (judgment 5741/2025) set aside the award decisions in a design tender and ordered the flawed stages repeated, because the winner's justification counted overheads, surveys and profit inside the professional fee it had declared untouchable.

In Germany, many buyers use the HOAI range as their yardstick when deciding whether to run this check, so a bid well below the Basishonorarsatz needs a ready explanation.

Germany: the HOAI as reference, not law

On 4 July 2019 the Court of Justice of the EU ruled (C-377/17) that the HOAI's binding minimum and maximum rates breached the Services Directive. The HOAI 2021, in force for contracts concluded from 1 January 2021, changed this:

  • Fees for all HOAI services can be freely agreed. The tables now give "orientation" ranges from the Basishonorarsatz to an upper rate (§ 2a HOAI).
  • Fee agreements need only text form, so an email can be enough, and they can be made or changed after award (§ 7 HOAI).
  • If no valid fee is agreed, the Basishonorarsatz applies to the basic services.

In practice, German buyers still estimate contract value with the HOAI. Most bidders price relative to it, as a percentage above or below the Basishonorarsatz for the right Honorarzone, and the fee still rises with the eligible construction cost (§ 6 HOAI). § 34 HOAI's stage weightings for buildings (LP1 2%, LP2 7%, LP3 15%, LP4 3%, LP5 25%, LP6 10%, LP7 4%, LP8 32%, LP9 2%) remain the standard way to split a fee by stage, even outside Germany. Country specifics for bidding: architecture tenders in Germany.

Italy: the parametri set the base, the Code fixes 65%

The DM 17 June 2016 (decreto parametri) gives a formula based on works value, building category, complexity and the specific deliverables. The 2023 Code (Allegato I.13) updates its tables to Italy's two design levels: PFTE (technical and economic feasibility) and progetto esecutivo. Buyers must use these values to set the tender amount for design services. The amount includes fees plus spese e oneri accessori. The correttivo (d.lgs. 209/2024) added a 10% increment for BIM.

Under €140,000, a direct award may reduce the parametri fee by no more than 20% (art. 41(15-quater)). Italy's fair-pay law (equo compenso, Legge 49/2023) sits behind all of this. So in Italy your fee is mostly a question of which deliverables are included and how deep a cut you make on the 35%, not of building a price from scratch. See architecture tenders in Italy.

France: no scale, a lump sum on three factors

French public design commissions follow the former loi MOP, now in Book IV of the Code de la commande publique. For new buildings the mission de base (ESQ, APS/APD, PRO, ACT, VISA, DET, AOR) is compulsory. The fee is a lump sum (forfait). It must reflect three things (R2432-6): the scope of the mission, its complexity, and the estimated works cost. When the works cost is not yet firm, the fee is provisional and becomes final by amendment once the client accepts the APD.

There is no official scale. The MIQCP's negotiation guide gives reference percentages of works cost, multiplied by a complexity coefficient. It states that its figures are neither obligations nor norms, but many buyers use them. See architecture tenders in France.

Spain, Portugal, the UK, the Netherlands, Belgium and Switzerland

  • Spain: no official scale. Fee weight is limited by the rule that quality must carry at least 51% of the score for architecture and engineering services (art. 145.4 and DA 41 LCSP).
  • Portugal: the old percentage-of-works fee instructions for public works were revoked in 2008. Project phases are now set by Portaria 255/2023 (programa base, estudo prévio, anteprojeto, projeto de execução, assistência técnica), which replaced Portaria 701-H/2008. Price the hours per phase yourself.
  • UK: fee scales were dropped after a 1982 Monopolies and Mergers Commission investigation, and later recommended and indicative scales were withdrawn too. RIBA now offers a resource-based fee calculator aligned to RIBA Plan of Work stages, not percentages. Competition law forbids sharing prices with competitors.
  • Belgium: the European Commission condemned the Order of Architects' recommended minimum fee scale in 2004. There is no scale.
  • Netherlands: no scale. Buyers describe the scope with the standard task description (DNR-STB 2014) under the DNR 2011 terms, which makes fee bids comparable.
  • Switzerland: the SIA 102 service description is the reference. The federal buildings conference (KBOB) publishes recommendations on hourly rates and fee models, but they are not binding.

Building a bottom-up estimate

A bottom-up estimate is the only number you can defend in an abnormally-low check, and the only one that tells you whether the job makes money.

Step 1: Fix the scope against the stage framework

List every deliverable the tender asks for, then map it to stages. Use the buyer's framework, not your own.

Your stage UK (RIBA 2020) France (CCP) Germany (HOAI LP, § 34 weight) Italy Portugal
Brief 0–1 Programme, études préliminaires LP1 (2%) DIP (by the buyer) Programa base
Concept 2 ESQ, APS LP2 (7%) PFTE Estudo prévio
Developed design and permit 3 APD, permit file LP3 (15%) + LP4 (3%) PFTE Anteprojeto
Technical design 4 PRO LP5 (25%) Progetto esecutivo Projeto de execução
Contractor tender 4–5 ACT (AMT) LP6 (10%) + LP7 (4%) (buyer) (buyer)
Construction 5 VISA, DET LP8 (32%) Direzione lavori (separate service) Assistência técnica
Handover 6 AOR LP9 (2%) Collaudo (separate) —

Flag anything outside the standard mission: surveys, BIM management, sustainability certification, cost planning, OPC (site coordination), and extra design options. Price these separately or exclude them in writing.

Step 2: Estimate hours by stage

Work from timesheets of a similar past project, adjusted for size and complexity. Example: a €4.0 million (excl. VAT) school extension, new build, full architectural mission.

Stage Hours Share HOAI weight
Brief 60 2% 2%
Concept 380 11% 7%
Developed design and permit 640 19% 18%
Technical design 900 27% 25%
Contractor tender 260 8% 14%
Construction 1,050 31% 32%
Handover 100 3% 2%
Total 3,390 100% 100%

The HOAI column is a sanity check, not a target. Here it shows that the tender stage looks light, so check whether you have allowed for answering contractor queries and assessing their bids.

Step 3: Work out your real cost per hour

Divide total annual practice cost (salaries, social charges, rent, software, insurance, professional indemnity) by billable hours, not paid hours.

  • 8-person practice, annual cost €720,000
  • About 1,250 billable hours per person (roughly 75% of paid time) = 10,000 hours
  • Cost per billable hour: €72
  • Plus 15% margin: €83 per hour

Architectural fee: 3,390 h × €83 = €281,370. Add a 7% risk allowance for extra meetings, buyer review cycles and programme slippage: about €301,000, or 7.5% of works cost.

Step 4: Add partners, then sanity-check the total

Partner quotes in the example: structure €70,000, MEP €95,000, cost consultant €38,000, so €203,000. Add a coordination allowance of 5% of partner fees (€10,150) for the lead firm's management time.

Team total: about €514,000, or 12.9% of works cost.

Now test it:

  1. Against the reference: the HOAI range for the right Honorarzone (Germany), the parametri tender value (Italy), the MIQCP reference rate × complexity (France), or award values for similar buildings on the open tender feed and in published award notices.
  2. Against the tender value: if the notice gives an estimated value, a bid far above it rarely wins. A bid far below it invites an abnormally-low check.
  3. Against the formula: model your score at your number and at 5% and 10% lower, as in the example above.

If the gap between your bottom-up number and the market is large, the answer is often to decide not to bid, not to cut.

Partner fees and the fee split

  • Get fixed quotes before you price. Partners must price the same scope, stages and assumptions as you. Send them your stage table and the tender's deliverables list.
  • Decide who carries which risk. If the fee is provisional (France) or cost-linked (Germany), agree how increases flow through to each partner.
  • Put the split in the teaming agreement: fee shares by stage, payment pass-through times, how each party's share changes if scope changes, and who absorbs penalties. In a joint bid with joint and several liability, a partner's under-pricing becomes your problem.
  • Charge for coordination. Leading a multi-disciplinary team takes real hours. Name the allowance rather than hiding it.

More on structuring the team: lead firm, consortium or subcontracting and choosing an engineering partner. You can find partner firms in the verified practices directory.

Disbursements and what is included

Tender documents usually ask for an all-in lump sum. State clearly what it covers:

  • Travel to site and client meetings: number of visits assumed per stage. Construction-stage visits are where budgets break.
  • Printing, models, renders, surveys, permit fees and third-party reports. These are often excluded and best listed as excluded.
  • Meetings: number of client, user and planning meetings assumed.
  • Design iterations: number of option studies and revision rounds per stage.

In Italy, spese e oneri accessori are already inside the parametri amount, so they are not extra. Elsewhere, if the form does not let you state assumptions, put them in the methodology note.

VAT and cross-border invoicing basics

Most cross-border B2B services are taxed where the customer is, with reverse charge. Architecture is the main exception. Under EU VAT rules, "the drawing up of plans for a building or parts of a building designated for a particular plot of land" is a service connected with immovable property (Implementing Regulation 282/2011, Art. 31a). It is taxed in the country where the building is, even if it is never built.

What that means for a cross-border public commission:

  • You may need to register for VAT in the country of the site, unless that country applies a domestic reverse charge to non-established suppliers. Practice varies, and public bodies are not always VAT-registered.
  • Bid prices are normally excluding VAT. Check the price form.
  • Budget for a local tax adviser or fiscal representative if needed. Get advice before you submit, not after award.

UK sites have similar land-related rules under UK VAT; check HMRC guidance.

Inflation and indexation

A design mission on a school can run four or five years. Without an index clause, your margin can disappear.

  • Italy: price-revision clauses are compulsory in the 2023 Code (art. 60). For services, revision applies when costs move more than 5%, and 80% of the excess is recognised.
  • France: contracts must be at revisable prices where the parties face major economic risks (R2112-13). Engineering contracts usually index on the ING (ingénierie) index.
  • Germany: HOAI-based fees rise with the eligible construction cost, which protects part of the fee. Hourly-rate parts need a separate escalation clause.
  • Everywhere: if the tender allows it, propose a clause. If it does not, add the expected inflation to the later stages.

Also check how a programme extension is paid. Construction-stage hours over a longer programme are the most common source of losses on public jobs.

Common pricing mistakes

  1. Pricing by percentage from memory. "We always charge 8%" ignores scope, building type, the formula and your cost base.
  2. Cutting site-stage hours to hit a number. Construction is about a third of the work. Under-resourcing it shows up as claims, penalties and reputational damage.
  3. Using partner quotes based on different scope. Price on a shared stage table or the team fee is meaningless.
  4. Ignoring the formula. Under a proportional formula with 20% price weight, a deep cut rarely changes the ranking.
  5. Confusing the Italian share discount with a total discount. A 20% discount on the 35% share is 7% off the total. To match a rival's 10% total discount you need about 29% on the share. Know what you are giving away.
  6. Forgetting VAT registration abroad. It can wipe out the margin on a small commission.
  7. No assumptions on record. If the methodology does not say how many meetings and options you allowed, you will not get paid for the extra ones.
  8. Pricing a "pitch" design for free. In France, a design contest prize must equal the estimated cost of the studies requested, less at most 20% (R2172-4). In Germany, buyers who ask for design proposals outside a competition must pay a reasonable fee (§ 77(2) VgV). Check the rules before giving work away.

When you shortlist tenders, look first at notices with a real design scope and a stated value. The TenderDesk feed scores notices by how much of a real design commission they are, which saves pricing tenders that were never worth it.

Checklist

  • Read the award criteria: price weighting and the exact price formula
  • Check for a fixed-price element (Italy 65/35, § 58(2) VgV, Art. 67(2) tenders)
  • List every deliverable and map it to the buyer's stage framework
  • Mark extras (surveys, BIM, certification, OPC, options) as priced separately or excluded
  • Estimate hours by stage from past timesheets
  • Compare the stage split with the HOAI § 34 weights as a sanity check
  • Calculate cost per billable hour and add margin
  • Add a risk allowance (meetings, review cycles, programme)
  • Collect fixed partner quotes on the same scope and stage table
  • Add a lead-firm coordination allowance
  • Check against the national reference (HOAI, parametri, MIQCP, past awards)
  • Check against the estimated contract value in the notice
  • Model your price score at three fee levels
  • Prepare a one-page justification in case of an abnormally-low request
  • State assumptions: meetings, site visits, options, revision rounds
  • Confirm VAT treatment and any foreign VAT registration
  • Propose or price in indexation for multi-year missions
  • Fix the fee split, pass-through times and risk sharing in the teaming agreement

Frequently asked questions

Is the HOAI still mandatory in German public tenders?

No. Since the HOAI 2021 came into force on 1 January 2021, fees can be freely agreed, and the tables are only orientation ranges. Buyers still use the HOAI to estimate contract value. A bid well below the Basishonorarsatz is likely to trigger an abnormally-low check under § 60 VgV, so a deep discount must be justified.

Can I bid below the Italian parametri?

Only within limits. On design tenders of €140,000 or more, 65% of the parametri-based tender value is fixed, and you can discount only the remaining 35%. On direct awards under €140,000, the fee may be reduced by no more than 20%. Any bid can still be checked as abnormally low under art. 110 of the 2023 Code.

What price weighting is typical in architecture tenders?

There is no single norm, but design tenders usually weight quality more heavily. Italy caps the price score at 30% on larger design tenders, and Spain requires quality to carry at least 51%. German procedures often give price a small weight. Always model your score with the actual formula rather than assuming.

Should I quote a percentage of construction cost or a lump sum?

Follow the price form. France uses a lump sum, which is provisional until the APD if the works cost is not firm. Germany often ties the fee to eligible costs through the HOAI. Elsewhere, a lump sum per stage is most common. Whatever the form, build it from hours, and state what happens if the construction budget changes.

Who charges VAT when I design a building in another EU country?

Design for a specific plot of land is a service connected with immovable property. It is taxed in the country where the building is, not where you are based. Depending on that country's rules, you may need to register for VAT there, or the client may self-account. Get local tax advice before you submit your price.

What happens to my fee if the construction budget rises after award?

It depends on the contract. In France the provisional forfait is fixed by amendment after the APD, based on the confirmed works cost. Under HOAI-based contracts the fee follows the eligible costs. In Italy, revision clauses apply if costs move more than 5%. If the contract is silent, negotiate a change before doing the extra work.

Sources