Construction Resources-Related Factors Leading to Cost overrun in Construction Projects

Construction Resources-Related Factors Leading to Cost overrun in Construction Projects

This study aims at investigating the resource-related factors that contribute to cost overruns in the Palestinian construction industry, gauging their significance from the viewpoint of stakeholders (contractors, consultants, and owners), investigating the extent of cost overruns, and their effects on the Palestinian construction industry. A structured questionnaire survey was conducted using 33 resources related factors, 154 questionnaires were completed and returned from participants, resulting in a response rate of 79%. Various analysis techniques such as weighted average, correlation coefficients ranks and One-Way ANOVA test. The study highlights a dominant presence of small to medium-sized enterprises in the Palestinian construction industry, and the common occurrence of cost overruns in construction projects. The top five resource-related factors are: availability of skilled labors, availability of equipment, labors productivity, financial difficulties of contractor and cash flow, inaccurate cost estimate, respectively. Moreover, results reveal that the top important effects were: losses in contractor and owner profits, delays in construction projects and loss of contractor reputation, respectively. Finally, the study offers practical implications and essential recommendations for contractors, consultants, and owners aimed at preventing and mitigating cost overruns in construction projects.