A Management Contractor is paid a fee plus their preliminary costs. The fee is usually, but not always, a percentage of the overall project value. The Management Contractor is appointed before a detailed design has been carried out, and has considerable opportunity to contribute value engineering to the pre-construction phase. As a Management Contractor we would contract directly with the Trade Contractors.
The client is taking a higher level of risk than by appointing a main contractor, but has the advantage of a less adversarial relationship and a high degree of professionalism. The division of risk can also be modified by such means as a Guaranteed Maximum Price, whereby the management contractor places a cap on total project costs.