Deep, S; Bhoola, V; Verma, S and Ranasinghe, U (2022) Identifying the risk factors in real estate construction projects: An analytical study to propose a control structure for decision-making. Journal of Financial Management of Property and Construction, 27(2), pp. 220-238. ISSN 1366-4387
Abstract
Purpose: Construction projects in the real estate sector are important for a nation’s economic growth. However, owing to several constraints and stereotypes, the construction industry is suffering from major capital losses. A review of recent literature revealed that risks occurring in real estate construction projects (RECPs) carried out in developing economies can be divided into four categories, i.e. financial risks, design risks, execution risks and sociopolitical risks. This study aims to identify the critical factors that lead to these risk categories and develop a control structure for RECPs. Design/methodology/approach: A quantitative method, i.e. a questionnaire-based survey, was used for this study. Using a random sampling technique the questionnaire was distributed to selected, highly experienced project managers. To determine whether the factors identified as part of the literature review strongly influence the categories, the factor analysis of the observations was performed. Findings: The observations made in this study lead to the identification of six critical risk causing factors, i.e. lack of efficient planning, execution constraints, external constraints, client-induced constraints, project constraints and partner experience. The observations indicated a lack of knowledge of project management, organizational culture and a claims redressal mechanism in RECPs. Also, this study recommends a blockchain-based control structure to control the occurrence of the risk causing factors identified. Originality/value: This study recommends a blockchain-based control structure for controlling the risks occurring.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | claims in construction; claims redressal mechanism; project management; project risks; real estate; real estate construction project; real estate sector; risk management |
| Index terms: | design risk, questionnaire, quantitative method, decision-making, methodology, construction project, organizational culture, survey, developing economy, project constraint, literature review, risk factor, risk management, factor analysis, sampling, real estate, project management, blockchain, construction industry, economic growth, project manager, stereotype, critical factor |
| Subjects: | real estate economics, data analysis and analytics, data collection methods, risk assessment, profession, control systems, computing systems, decision analysis, sociology, industry analysis, environmental hazards, statistical analysis, economic development, research methods, production management, project management theory and practice, financial risk |
| Topics: | Project Management, Research Practice, Cost Management, Sustainability, Roles and Professions, Risk Management, International Construction, Urban Studies, Digital Applications, Organizational Design |
| Descriptive scope: | 5 PCTEA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here