Cost Certainty and Timing of Cost Certainty in the Construction Projects of Public Universities

Previous research assumed that construction contract award provides cost certainty for construction owners. However, research indicates that construction projects suffer from cost overruns implying that owners do not always achieve cost certainty before construction start.

This dissertation is to reveal the actual timing of cost certainty and determines the project delivery systems that are associated with cost certainty and timing of cost certainty in building construction projects. The objectives are to (1) reveal the actual timing of cost certainty, (2) determine the effect of the project delivery systems on the timing of cost certainty, (3) determine the development of cost certainty performance, and (4) determine the association between the project delivery systems and cost certainty, and (5) provide practical recommendations for owners to improve their cost certainty performance.

The sample consisted of 63 new constructions for public universities in the U.S. built between 2010 and 2021. The research adopted a mixed-method research design allowing to statistically tests associations and qualitatively analyze the written responses concerning the improvement of cost certainty performance.

The analysis revealed that the timing of cost certainty occurs at 7.42 months on average after construction start directly influenced by the final construction cost, the design duration, and the construction duration. Second, the moderated multiple regression indicated that the project delivery systems have indirect associations with the timing of cost certainty via design and construction durations.

Third, the one-way ANOVA for repeated measurements suggested that the cost certainty improves throughout design and construction. It also indicated that involving builders late is associated with faster evolution of cost certainty in comparison with involving builders early.

Finally, the thematic analysis suggested three practical recommendations. These are (1) onboarding the right builder and subs at the right time, (2) the owner actively managing scope throughout the design and construction process, and 3) leveraging opportunities to buffer unexpected costs.

This research contributes to the body of knowledge on building construction cost management. It helps public universities in the U.S. comprehend when to expect to be certain about their construction final cost and select the project delivery system that suits their needs of cost certainty.