Significant Contributors to Cost Overruns in Construction Projects of Cambodia

Cogent Engineering, 2017

10 Pages Posted: 18 Jul 2018

See all articles by Serdar Durdyev

Serdar Durdyev

Ara Institute of Canterbury

Maksat Omarov

Universiti Teknologi Malaysia (UTM)

Syuhaida Ismail

Universiti Teknologi Malaysia (UTM) - Kuala Lumpur Campus

Mengheng Lim

Zaman University

Date Written: June 27, 2017

Abstract

Construction industry is one of the leading sectors with its remarkable contribution to the GDP and employment generation in Cambodia. However, one of the major challenges facing the construction industry in Cambodia is poor cost performance of the construction projects. Identifying and addressing the contributors to cost overruns in the residential building projects — which attracts the highest proportion of investment — is crucial for improving the cost performance of the sector. In the absence of related research in Cambodia, this study aims to fill a significant knowledge gap by investigating the key contributors to cost overruns in residential projects which are specific to the operational context of the Cambodia’s residential building sector. Feedback from a survey of the sector’s contractors and project managers was analysed using an exploratory factor analysis. Results showed three principal contributors to cost overruns which were extracted from 26 variables: Project and cost management, project finance and project risks factors. In diminishing order of influence, these accounted for 53, 22 and 16%, of the variance that characterized poor cost performance output in the sector. By focusing available resources and efforts on these key factors in relation to their magnitudes of influence, contractors, project managers and clients could minimize the cost overruns and improve significantly cost performance of the sector and its contribution to the nation’s economy.

Keywords: Cambodian construction industry, cost overruns, residential projects, Cambodia

Suggested Citation

Durdyev, Serdar and Omarov, Maksat and Ismail, Syuhaida and Lim, Mengheng, Significant Contributors to Cost Overruns in Construction Projects of Cambodia (June 27, 2017). Cogent Engineering, 2017, Available at SSRN: https://ssrn.com/abstract=3203188

Serdar Durdyev (Contact Author)

Ara Institute of Canterbury ( email )

City Campus
Madras street
Christchurch
New Zealand

Maksat Omarov

Universiti Teknologi Malaysia (UTM) ( email )

81310 Sekolah Agama
Johor Bahru, Johor
Malaysia

Syuhaida Ismail

Universiti Teknologi Malaysia (UTM) - Kuala Lumpur Campus ( email )

Jalan Sultan Yahya Petra
Kuala Lumpur, 54100
Malaysia

Mengheng Lim

Zaman University ( email )

No: 8, St: 315, Boeng Kak 1
Tuol Kouk, Phnom Penh 12151
Cambodia

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