Publication: Effective control measures to minimize cost overrun during construction phase of high-rise residential building projects in Chongqing, China
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Date
2024-03-01
Authors
Wang, Yue
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Abstract
Cost overrun during construction is a common issue in construction projects
around the world, including in Chongqing, China. At present, there are few studies
related to cost overrun at construction stage of high-rise residential building projects
(HRBPs) in Chongqing. The aim of this research is to develop effective control
measures from the contractor's perspective to minimize cost overrun during
construction phase of HRBPs in Chongqing. Firstly, 65 cost overrun risk factors
(CORFs) in construction projects were identified with literature reviews and semistructured
interviews. All the risk factors have been prioritized through the analytic
hierarchy process (AHP) based on their importance to project cost. Out of the 65
CORFs identified, 12 were classified as the critical ones that have a great potential to
instigate a cost overrun during construction to take place in the real project. There were
four risk factors which had the biggest impact on cost overruns, and their weights were
0.04 or above, including “low bid”, “force majeure”, “undetailed/inaccurate geological
survey data”, and “increased loan interest rates”. Finally, control measures were
developed for these four critical cost overrun risk factors (CCORFs). In order to
control "low bid", firstly, strong comprehensive strength and a reasonable enterprise
quota can improve the probability of winning the bid of the construction enterprise which is the construction enterprise needs to work hard all the time. Secondly, detailed
records in the bidding process can help to develop measures after winning the bid.
Finally, after winning the bid, the solution measures for the low-priced list items are
essential. In view of “force majeure”, this study formulated measures to control largescale
infectious diseases. In response to the epidemic, preventive measures and
material guarantees need to be taken beforehand. If epidemic patients are discovered
in the project, they must be managed and controlled as soon as possible. In addition, it
is also important to retain relevant information and reduce the pressure on corporate
funds. In order to control “undetailed/inaccurate geological survey data”, measures
were formulated for the bidding stage and the construction stage. In view of "increased
loan interest rates", the control measures were mainly formulated from both internal
and external aspects of construction enterprises. The measures developed provided a
guideline to control the risk of cost overruns and clear control key points to help
contractors to minimize cost overruns in the construction phase of HRBPs.