Evaluation of Management of Cost Overrun in Selected Commercial Building Projects in Auchi, Edo State

Abstract

Construction project is very essential in the economic development of any nation especially in an expanding economy like Nigeria. This paper explores an evaluation management of cost overrun in preferred commercial building developments in Auchi with a view to enhancing the effective delivery of projects.  The study adopts mixed method research because survey and secondary data were used to collect data. A proforma was used to gather cost data on selected commercial building projects, since structured questionnaire was applied to harness information on the possible causes and mitigating measures of cost overrun. Out of 97 copies of questionnaires administered, 70 were completed, returned and found suitable for analysis. Paired sample t-test was applied to assess cost performance of building project, mean item score was engaged to analyse causes of cost overrun, and mitigating measures of cost overrun. The findings revealed that fluctuations in the cost of building materials and change in the scope of the project were the optimum causes of cost overrun. It further revealed that cost control and risk management during the project phase and timely availability of required finance were the top mitigating measures of cost overrun, the building projects in the study area experienced a fair cost performance of 90.1% and exposed to average time overrun of 9.90%. The study suggests among other aspects that projects sponsored must be financially committed to construction projects because without proper funding, projects will experience cost overrun and in some cases project abandonment.