Factors Contributing to Building Construction Project’s Cost Overrun in Jordan

Authors: Ghaleb Y. Abbasi, Sufyan Al-Mrayat

Abstract:

This study examined the contribution of 36 factors to building construction project’s cost overrun in Jordan. A questionnaire was distributed to a random sample of 350 stakeholders comprised of owners, consultants, and contractors, of which 285 responded. SPSS analysis was conducted to identify the top five causes of cost overrun, which were a large number of variation orders, inadequate quantities provided in the contract, misunderstanding of the project plan, incomplete bid documents, and choosing the lowest price in the contract bidding. There was an agreement among the study participants in ranking the factors contributing to cost overrun, which indicated that these factors were very commonly encountered in most construction projects in Jordan. Thus, it is crucial to enhance the collaboration among the different project stakeholders to understand the project’s objectives and set a realistic plan that takes into consideration all the factors that might influence the project cost, which might eventually prevent cost overrun.

Keywords: Cost, overrun, building construction projects, Jordan.

References:

[1] A Wibowo, “The Contribution of the Construction Industry to the Economy of Indonesia: A Systemic Approach”, Unpublished master’s Dissertation, Diponegoro University, Indonesia, 2009.
[2] Jordan Statistical Yearbook, The Department of Statistics in Jordan, Amman, Jordan, 2022.
[3] Niu Jing-min, Thomas G. Lechler, and Jiang Jun-long, “Success Criteria Framework for Real Estate Project”, Management Science and Engineering, Vol. 4, Issue 3, pp. 10-23, 2010.
[4] S. Mulla, and Ashish Waghmare, “A Study of Factors Caused for Time & Cost Overruns in Construction Project & their Remedial Measures”, International Journal of Engineering Research and Applications, Vol. 1, Issue 5, pp. 48-53, 2015.
[5] Ghaleb Sweis, Rateb Sweis, Malek Abu Rumman, Ruba Abu Hussein, and Samer E. Dahiyat, “Cost Overruns in Public Construction Projects: The Case of Jordan”, Journal of American Science, Vol. 9 (7s), pp. 134-141, 2013.
[6] J. Mukuka, O. Aigbavboa, and D. Thwala, “A Theoretical Review of the Causes and Effects of Construction Projects Cost and Schedule Overruns”, International Conference on Emerging Trends in Computer and Image Processing (ICETCIP), Pattaya, Thailand, pp. 522-525, 15-16 December 2014.
[7] N. Azhar, U.F. Rizwan, and M.A. Syed, “Cost overrun factors in construction industry of Pakistan”, First International Conference on Construction in Developing Countries (ICCIDC–I), Karachi, Pakistan 4-5, pp. 499-508, August 2008.
[8] J. M. Al-Najjar, “Factors Influencing Time and Cost Overruns on Construction Projects in the Gaza Strip", Unpublished master’s Dissertation, The Islamic University of Gaza, Palestine, 2008.
[9] Ghanim A Bekr, “Identifying Factors Leading to Cost Overrun in Construction Projects in Jordan”, Journal of Construction Engineering, Technology and Management, Vol. 5, Issue 3, pp. 26 -33, 2015.
[10] Sultan Tarawneh, Mohammed Sarireh, and Esraa Radi, “Time and Cost Overruns in Jordanian Building Construction Projects”. Natural and Applied Sciences Series, Vol. 35. No.1, pp 53-73, 2020.
[11] Jordan Construction Contracting Association Annual Report, Amman, Jordan, 2023
[12] S. Gao, and S.P. Low, “Research Methodology”, Lean Construction Management. Springer, Singapore. https://doi.org/10.1007/978-981-287-014-8_7, 2014.