How does a design-build contract work?

A design-build contract is one agreement with one firm that takes responsibility for both designing your project and building it. You do not hire an architect, finish the drawings, then hire a builder to bid on them. You sign with a team that does both, and one party answers to you for the result. In Virginia the team can be led by a contractor or by a design professional, but the licensing rules still decide who may do which part.

How the pieces fit together

A design-build project usually moves through phases under that one contract or a pair of linked agreements: a design phase where the firm develops plans and a price with you, then a construction phase once you approve both. Because the same firm owns the design and the budget, it can price options while the drawings are still being worked out. That is the main appeal. The trade-off is that you have a single relationship to manage and fewer independent checks on the design and the price.

Who must be licensed

Virginia keeps design and construction licensing separate even when the contract is combined. An architect or professional engineer licensed under Virginia law does not need a contractor licence to bid on or negotiate a design-build contract or to perform services other than construction services under it.^[1] But the construction services offered or rendered under such a contract can only be rendered by a licensed contractor.^[1]

The reverse is also true. A licensed contractor does not need an architect, engineer or land surveyor licence to bid on or negotiate a design-build contract or to perform services under it other than architectural, engineering or land surveying services,^[2] and those architectural, engineering or land surveying services can only be rendered by an architect, professional engineer or land surveyor licensed under Virginia law.^[2] A business that is not licensed cannot advertise itself with the words "architecture" or "engineering" in a way that indicates or implies it practises them.^[2]

In practice, ask who holds each licence on your project, and look them up. Checking a contractor's licence takes a few minutes on the DPOR website.

What the contract must say

Design-build firms often offer a short proposal or a two-stage agreement, but a residential contract in Virginia still has to meet the same standards. The Board for Contractors expects residential contractors to use a legible written contract clearly specifying the terms and conditions of the work, signed by both the consumer and the licensee or the licensee's agent before work starts or any payment is accepted.^[3] The minimum contents include:

• when work is to begin and the estimated completion date^[3]
• a statement of the total cost, or for a cost-plus contract the type of cost-plus (fee or percentage) and a cap the total cannot exceed, or for a time-and-materials contract a fixed price for labour that includes wages, overhead, general and administrative costs and cost of materials^[3]
• the amounts and schedule for progress payments, including a specific statement on the amount of the down payment^[3]
• a listing of the specified materials and work to be performed^[3]
• a statement that the contractor will comply with local requirements for building permits, inspections and zoning^[3]
• the contractor's name, address, licence number and class^[3]

The design phase is where design-build contracts get vague, because the final scope does not exist yet. Ask the firm to state in writing what the design fee covers, whether it is credited against construction if you proceed, what you own if you stop after the design phase, and how the construction price will be set. Any modification that changes the cost, materials, work to be performed or estimated completion date must be in writing and signed by all parties.^[3] Read more about what a Virginia home improvement contract must contain.

Before you sign

DPOR's consumer guide warns that any bid or estimate you sign may become the contract.^[4] Read a design-build proposal as if it were the contract. DPOR advises getting at least three written bids or estimates using identical plans and specifications;^[4] with design-build, the closest you can get is asking each firm to price the same written scope and list its allowances. See also how much deposit a contractor can ask for in Virginia.

When to call a licensed pro

Design-build is a job for licensed professionals on both sides: a licensed contractor for the construction and, where the project needs it, a licensed architect or engineer for the design. Verify both before paying a deposit, using the lookup on the Virginia Department of Professional and Occupational Regulation website and the rules in the Code of Virginia cited above. Read more remodeling answers, browse remodeling services on Loclis, or see what a general contractor does on a home project.

To compare firms, describe your project once and licensed local businesses reply with their proposals.