Architecture firms structure milestone billing around standard AIA-style phases, schematic design, design development, construction documents, and construction administration, each triggering its own invoice on completion. The structure itself is well established across the industry. What varies, and what actually determines whether a firm collects on schedule, is how cleanly each phase's completion is defined as a specific, unambiguous billing trigger.
Standard Phase Structure
AIA Document B101-2017, the standard form of agreement between owner and architect, divides an architect's basic services into five phases: schematic design, design development, construction documents, procurement, and construction, with construction administration covering the architect's role during the construction phase itself. This structure is the reference point most US architecture firms build their own billing schedule around, whether or not they use the AIA form directly.
Fee allocation across these phases is not even. A commonly cited industry distribution allocates approximately 15 percent of the total fee to schematic design, 35 percent to design development, 30 percent to construction documents, 5 percent to procurement or bidding, and 15 percent to construction administration, reflecting where the heaviest coordination and technical effort actually falls. Other commonly referenced breakdowns place slightly more weight on construction documents, with design development and construction documents together accounting for well over half of total billings. Every firm should treat these as starting points, not fixed rules, since actual effort varies by project type and complexity.
| Phase | Typical Fee Share | What Completion Looks Like |
|---|---|---|
| Schematic Design | ~15% | Site plan, floor plans, sections, elevation, and a preliminary construction cost estimate delivered and accepted by the client |
| Design Development | ~30-35% | Coordinated architectural, structural, and MEP drawings with material types and system selections defined |
| Construction Documents | ~30-40% | Fully detailed drawing set with specifications, issued for permitting or bid |
| Procurement / Bidding | ~5% | Bid packages issued, contractor pricing received and evaluated |
| Construction Administration | ~15% | Ongoing service through substantial completion, typically billed monthly rather than as a single trigger |
Setting Invoice Triggers Per Phase
The table above describes fee allocation. It does not, by itself, tell a firm when to actually generate the invoice. That requires converting each phase's deliverable list into a specific, contract level definition of done. According to the AIA's own guidance on defining basic services, schematic design deliverables typically include a site plan, floor plans, sections, an elevation, and other illustrative materials along with a preliminary construction cost estimate, while design development is considered complete once the architectural, structural, and MEP systems are coordinated into a single set of drawings with material types and system locations defined.
The firms that avoid missed billing triggers are the ones that write these definitions into the project plan itself, rather than leaving completion as a subjective call made after the fact. When "design development is done" is defined the same way every time, whoever is managing the project does not have to decide whether now is the right moment to invoice. The system already knows. This is the structural fix described in the pillar article, How Do Engineering and Architecture Firms Avoid Missed Billing Triggers on Phased Projects?
Construction administration deserves separate treatment. Unlike the design phases, CA does not resolve into a single completion event. It typically runs for months and is billed on a recurring monthly basis, which makes it closer in behavior to a retainer than to a milestone, even though it sits inside the same overall fee structure as the other four phases.
Handling Phases That Run Over Schedule
Design phases do not always finish on the original schedule. A schematic design phase that stretches an extra six weeks because of client indecision, or a construction documents phase delayed by a late structural consultant deliverable, creates a real question: does the firm wait for the phase to formally close before billing anything, potentially financing weeks of unbilled work, or does it bill progressively as work is actually completed within the phase?
Guidance on work in progress management for AEC firms points to the second approach as the more resilient one. Rather than treating a phase as an all or nothing billing event, firms that track percentage of completion within a phase can invoice progressively as the work advances, even if the phase itself has not formally closed. This avoids the specific failure mode where a delayed phase quietly pushes the entire billing trigger back with no visible record of why, which is exactly the kind of drift that produces the aging, hard to collect balances described in How to Calculate Which Projects Are Actually Cash Positive.
At minimum, any phase running materially behind schedule should be flagged in the same weekly review that tracks billing status across the rest of the portfolio, covered in Why Project-Based Firms Lose Track of Receivables (and How to Stop It), so a schedule delay on one project does not silently become a billing delay that nobody notices until the project closes out.
Frequently Asked Questions
How do architecture firms structure milestone billing?
Architecture firms structure milestone billing around standard AIA-style phases, schematic design, design development, construction documents, and construction administration, each triggering its own invoice on completion.
What percentage of an architecture fee is billed at each phase?
A commonly cited industry distribution allocates roughly 15 percent of the fee to schematic design, 35 percent to design development, 30 percent to construction documents, 5 percent to procurement or bidding, and 15 percent to construction administration, though exact percentages vary by firm and project type.
What happens when a design phase runs longer than scheduled?
When a phase runs over schedule, firms should either bill progressively within the phase based on percentage of completion, or clearly document that the phase invoice is now late relative to the original schedule rather than letting the delay quietly push the billing trigger back with no record of why.
