Adepu, N; Kermanshachi, S; Pamidimukkala, A and Nwakpuda, E (2025) An analytical approach to understanding construction cost overruns during COVID-19. Smart and Sustainable Built Environment, 14(6), pp. 1780-1794. ISSN 2046-6099
Abstract
Purpose – The building sector is vital to a nation's economy, as it has a major influence on economic activity and growth, job creations and the advancement of infrastructure. Intricate challenges that are inherent in crises such as the COVID-19 outbreak lead to material scarcities, project delays, labor shortages, escalated expenses, funding challenges, regulatory obstacles and dwindling investment funds, all of which culminate in costs that are in excess of those budgeted. While numerous studies have explored the ramifications of COVID-19 on project budgets, there is little, if any, data available on forecasting the magnitude of this impact. Design/methodology/approach – This investigation seeks to bridge this knowledge deficiency by devising a predictive tool grounded in an ordinal logistic regression method. An online survey was designed and disseminated to gauge the views of construction field experts about the diverse contributors to excessive costs during the viral outbreak, and a predictive tool, crafted from the survey participants' feedback. Findings – Findings showed that smaller-scale enterprises and contractor-centric establishments faced greater adversities than medium-to-large ones and consultancy-or-owner-type entities. Originality/value – The insights from this research shed light on the amplified risk of higher project costs amid health crises or analogous events, underlining the imperative need for fortified risk management approaches to bolster project outcomes. By factoring in demographics, this research offers policymakers a refined lens through which to customize interventions and promote balanced and enduring advancement in the construction industry.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | budget overruns; challenges; construction; cost overruns; COVID-19; factors; predictive model; project success; recommendations; resilience; scale; sector |
| Index terms: | outbreak, forecasting, project success, logistic regression, cost overrun, construction cost, owner, project outcome, funding, risk management, investigation, labour shortage, demographics, economic activity, construction industry, COVID-19, survey, overrun, project cost, budget overrun, methodology, consultancy, project delay |
| Subjects: | project completion, organization, economic analysis, research methods, demography, data collection methods, risk assessment, financial and cost management, prediction and forecasting, economics, health risk and incident analysis, project management theory and practice, sociology, project controls, statistical analysis, industry analysis |
| Topics: | Organizational Design, Time Control, Urban Studies, Stakeholder Management, Research Practice, Cost Management, Business Strategy, Supply Chain Management, Risk Management, Project Management, Health and Safety |
| 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