Identification of Factors Affecting Cost Overrun in the Construction of Industrial Buildings

Malaysian Journal of Industrial Technology, Volume 2, No. 1, 2017

7 Pages Posted: 11 Jun 2019

See all articles by Davied Insja

Davied Insja

Tarumanagara University

Lukas B. Sihombing

University of Indonesia (UI) - Faculty of Economic, University of Indonesia (UI) - Department of Civil Engineering

Date Written: April 10, 2019

Abstract

Cost overrun in construction project is a common problem, especially material as one of the most in influencing component in project cost. This trend is more severe in industrial construction project where is located in areas with difficult accessibility. In order to minimize cost overrun, this paper aims to identify the factors that affect cost overrun in the construction of industrial buildings. Survey questionnaires were distributed to construction professionals, and data was analyzed through a statistical method. From the 74 factors which were identified, there were 9 factors which affected cost overrun in the construction of industrial buildings, such as material price fluctuations, material distribution costs to the site, material delay costs, specifications and material type change costs, shortage of materials, material damage, material lost, and excessive material quality. These factors will be analyzed in future research.

Keywords: Cost overrun, Industrial construction project

JEL Classification: R50

Suggested Citation

Insja, Davied and Sihombing, Lukas B., Identification of Factors Affecting Cost Overrun in the Construction of Industrial Buildings (April 10, 2019). Malaysian Journal of Industrial Technology, Volume 2, No. 1, 2017, Available at SSRN: https://ssrn.com/abstract=3369394

Davied Insja

Tarumanagara University ( email )

Jl. Letjen S. Parman No.1
Jl. Tanjung Duren Utara No. 1
Jakarta, IN DKI Jakarta 11470
Indonesia

Lukas B. Sihombing (Contact Author)

University of Indonesia (UI) - Faculty of Economic, University of Indonesia (UI) - Department of Civil Engineering ( email )

Kampus Baru
Depok, West Java 16424
Indonesia

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