• Format: ms-word (doc)
  • Pages: 65
  • Chapter 1 to 5
  • With abstract reference and questionnaire
  • Preview abstract and chapter 1 below



Construction of building projects is an endeavour that involves capital expenditure, which is either borrowed or self-financed by clients. The expected outcome of such expenditure is value for money, which is usually dictated by project objectives of cost, time and quality. Project cost, as a project objective, is a crucial determinant of project success in the prevailing economic challenges being experienced globally. Construction cost overrun has become a reoccurring phenomenon in the delivery of building projects. The major thrust of this study was to identify, analyse and model the factors that contribute to building construction cost overruns in Abuja. The study adopted a Monte-Carlo technique in simulating cost overrun using DiscoverSim® version 1.1 (SigmaXL, 2013) simulation and RiskAmp Microsoft Excel add-in software to analyse data obtained from literature review, review of project documents with contract sum of over Five Million Naira executed within Abuja city in addition to interview sessions with construction professionals. The study revealed that significant cost overruns are mainly due to re-measurement and variation. The simulation result elucidated that less than 10% of building projects are completed below the initial contract sum in Abuja which could be due to the fact that projects tend to be initiated and executed without adequate project information such as client brief, design details and specifications. The study recommends the need for minimizing occurrence of re-measurement in building projects through provision of full design information prior to contract award, development of simulation model for specific project categories and establishment of a project cost overrun band that will enable a scientific measurement of project’s value for money benchmarked against initial cost estimate.


Globally, the construction sector is inundated with cost overruns in the delivery of building projects. This experience has brought about loss of clients’ confidence in consultants, added investment risks, lack of ability to deliver value to clients, and disinvestment in the construction industry (Mbachu and Nkado, 2004).It is of essence that the objectives of a building contract are met to the contentment of the parties involved. Cost, time and quality are significant, interrelated and interdependent targets for achieving the objectives/goals expected of building contracts (Ashworth, 1999, Gould, 2002). Thus, it is crucial to keep up a proper balance between the three so that project outputs are realised on time, within the financial plan and with the requisite quality (Akinsola and Potts, 1998). However, it is an admitted fact that in Nigeria, the majority of contracts suffer undue time extensions and /or additional cost to the client and /or inadequate quality of work (Oluwole, 2008b).

Project cost overruns can be either avoidable or unavoidable. Overruns due to design plan or project management problems are avoidable because they could have reasonably been foreseen and prevented (Shanmugam et al., 2006). However, there are some unavoidable costs such as those due to unanticipated events which cannot reasonably be prevented. Cost overruns may add value to projects when extra work is done with the intention of producing a better output. Overruns may also add value when they involve work that was omitted from design plans but clearly needed to be done. However, some overruns may not add value and represent wasted money if they do not result in a better product.

Cost overrun of a project refers to the actual ‘cost increase’ to the client during construction of a building project (Janaka, 1992). It is merely the difference between the value originally envisaged for the project and the value reflected in the final certificate. Cost overruns occur from overspending the allowances, making changes and encountering unforeseen problems. Proper planning can greatly reduce cost overruns.


Do you need help? Talk to us right now: (+234) 08060082010, 08107932631 (Call/WhatsApp). Email: [email protected].


Disclaimer: This PDF Material Content is Developed by the copyright owner to Serve as a RESEARCH GUIDE for Students to Conduct Academic Research.

You are allowed to use the original PDF Research Material Guide you will receive in the following ways:

1. As a source for additional understanding of the project topic.

2. As a source for ideas for you own academic research work (if properly referenced).

3. For PROPER paraphrasing ( see your school definition of plagiarism and acceptable paraphrase).

4. Direct citing ( if referenced properly).

Thank you so much for your respect for the authors copyright.

Do you need help? Talk to us right now: (+234) 08060082010, 08107932631 (Call/WhatsApp). Email: [email protected].

Welcome! My name is Damaris I am online and ready to help you via WhatsApp chat. Let me know if you need my assistance.