What does cost plus contract mean in construction?
Short definition
A cost plus contract reimburses allowable project costs plus an agreed fee or markup.
Longer explanation
This structure may be used when scope is uncertain, early construction is needed, or the owner wants cost transparency.
Example in context
“The project team reviewed the cost plus contract during the construction phase.”
Common users
- Owners
- Architects
- Contractors
- Construction managers
Related terms
Related resources
Construction Contract TermsContract and agreement terms used for pricing, obligations, general conditions, payment, changes, and claims.Project Delivery TermsDelivery method, team structure, preconstruction, risk allocation, and contract strategy terms.GMP vs Cost Plus ContractLearn how a guaranteed maximum price differs from a cost plus construction contract.