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Cost Plus a Fee with a Guaranteed Maximum Price (GMP)
This is really an extension of the Construction Manager At Risk in that the Construction Manager establishes the final budget during the design phase and is guaranteeing that this amount will not be exceed. Included in that GMP is a fee for the contractors overhead and profit, identified as either a percentage of the cost or simply set as a fixed fee. With this GMP identified, the Owner is assured of a Guaranteed Maximum Cost for the project. However, as a Cost Plus a Fee contract, the Owner may be able to realize some savings if the construction costs come in less that what was budgeted.