Qatar Residential Construction Projects

Nasser Al Jurf 1, Salwa Beheiry 2

ABSTRACT
Cost and schedule deviation from the estimated baseline are common in construction projects and have a negative effect on
construction activity, which is a substantial portion of the GDP in most countries. Previous research studies examined the
causes of deviation in several countries including some Gulf Council Countries (GCC) like Kuwait and the UAE, but none
were done on the sizeable Qatari market. Qatar is expected to require an additional 93,000 residential units by the end of
2010 [1] to sufficiently address the rising demand, as a result of rapid population increase relative to supply [2]. Therefore,
this study identified and ranked, using the Relative Importance Index (RII) method, the significant factors influencing cost
and schedule deviation in Qatari residential compound projects. A detailed questionnaire was developed on a likert scale
addressing these factors and was used to solicit the viewpoints of Grade A contractors. The collected project sample had a
total capital investment of approximately $1.25 Billion and the projects were executed within a five year period (2000 –
2005). The study revealed that most contractors viewed material delays as the most prominent issue influencing
construction projects predictability in Qatar. Other top ten factors included design changes, labor shortages, deficient
estimates and cash flow planning.

Keywords: project performance, cost deviation, schedule deviation, residential compounds, Qatar.

1. INTRODUCTION
2. RESEARCH BACKGROUND
Qatar has been considered as one of the fastest growing
economies in the world [3]. In 2005, Qatar’s GDP was Considerable research was carried out to categorize and
$42bn and the capital expenditure on construction classify delay and cost overrun factors in construction
projects was approximately $6.52bn or 15 % of GDP. By projects. Several studies examined specific construction
2007 GDP was $68.8bn and construction and real estate markets including the U.S.A., Turkey, Kuwait and the
activity had risen by 22% to approximately $8bn or 11.5 U.A.E. although, Qatar is expected to require an
% of GDP [4], [5]. additional 93,000 residential units by 2010 to sufficiently
address the rising demand relative to supply and its
Furthermore, the steady economic growth in Qatar in the economy is expected to be less affected by the recent
past decade expanded the job market that relied heavily world market crisis [1], there are no studies identifying
on expatriates. This raised the demand for residential the factors affecting deviation in Qatari residential
buildings especially in the form of modern residential projects.
compounds. Residential compounds, also called
complexes or camps are gated communities that are Deviation is common worldwide and in all types of
typically built in a uniform architectural style and offer construction project. Several research findings indicated
common recreational facilities (swimming pools, tennis that construction projects tend to deviate in cost and/ or
courts, playgrounds, nurseries, club houses, etc). schedule. For instance, it was mentioned by Avots [6]
that in complex projects in the United States it was not
These compounds were sizeable financial investments. unusual to have cost overruns of 50 to 100%. Arditi, et al.
Nonetheless, they were often delayed and over budget. [7] studied cost overrun in public projects in Turkey.
Better cost and schedule predictability (reliability of the
cost and schedule estimated baselines) is an important Construction activity constitutes a significant portion of
planning and control tool for all projects and would the Gross National Product (GNP) of most world
reflect favorably on the industry and the overall countries. For example, Nigeria’s construction
economy. Therefore, this study was designed to examine investment accounts for over 60% of the gross fixed
the factors influencing cost and schedule deviation in capital formation as mentioned by Mansfield and Ugwu
Qatari residential compounds’ projects. The focus was on [8]. Turkey’s construction investment accounts for about
privately owned compounds built between 2000 and 50% of all investments in the country [7] The scale of
2005, and the factors were assessed from a contractor’s capital investment in the construction industry highlights
point of view.
the importance of executing construction projects and success and the success of construction projects
programs successfully. contributes the competitiveness of the construction
industry and impacts GDP in most countries. Moreover,
A study performed by the United States Department of several past studies explored the causes of deviation but
Transportation found the cost of 61% of projects deviated not in Qatar, which is a booming residential construction
with a range of between -10 to +106%, in road market. A study of the factors influencing cost and
construction 86% of projects deviated with a range of -2 schedule predictability in Qatar’s residential compounds
to +182%, in rail projects the average deviation rate was projects is beneficial to both the academic body of
17%, varying from -14 to +74%. Moreover, the UK applied research, to local and foreign investors and to
Transport and Road Research laboratory studied 21 industry practitioners in the GCC and Qatar.
metro systems in developing countries that showed two
metro projects had overruns of +100 and +500%, six 3. FACTORS INFLUENCING PREDICTABILITY
projects had cost overruns of more than 50%, , and three IN RESIDENTIAL COMPOUNDS PROJECTS
had overruns varying from 20 to 50%; the rest deviated
from -10 to +20%. The factors with a possible influence on project cost and
schedule predictability were accumulated from the
Koushki, et al. [9] discussed the problems faced by literature review and consulting with several Qatari
private construction projects in Kuwait, as well as the construction industry professionals. The factors were set
scale of delays in time and cost from the client’s point of on a likert scale and then presented to 20 industry experts
view. The study found project that spent more time on the (engineering management and project management
preconstruction phase, recorded fewer change orders in executives with more than 10 years experience working
the construction phase. Also more experienced for Grade A contractors). The industry experts’ interviews
contractors, completed more projects on time and budget. helped tailor the factors obtained from the literature to
Odeh and Battaineh [10] studied construction delay in Qatar’s residential compounds projects and verify their
projects using the traditional design build approach. They applicability. As shown in Table 1, these factors were
surveyed consultants and contractors. The relative then categorized into two main categories:
importance index was also used to rank factors according 1- Factors influencing project’s cost and/or schedule at
to the responses. The results highlighted that labor any project phase.
productivity was the main reason for delays from the 2- Factors influencing deviation in the preconstruction
contractors’ point of view while consultants viewed phase and/or the construction phase.
inadequate contractors’ experience as the main reason. In
spite of disagreement on the top reason, both consultants 4. DATA COLLECTION AND RESEARCH
and contractors agreed that inadequate contractors’ ALGORITHM
experience and owner interference were among the top
five factors. Utilizing the factors mentioned in the previous section, a
structured questionnaire was created with close-ended
Faridi and El Sayegh [11] conducted a survey on factors questions for ease of data collection and analysis. The
influencing project schedules in the United Arab factors were categorized in a Likert scale assessing
Emirates (UAE). Nearly 50% of their sample of agreement/disagreement of the degree of influence. The
construction projects overran their schedules. The factors questionnaire was sent to Grade A contractors who
influencing predictability were ranked using the Relative specialized in building and maintenance work to collect
Importance Index technique in three different categories, data. The list of contractors was provided by the Qatari
contractor’s and consultants’ perspective, the Central Tenders Committee [13].
respondent’s years of experience in the UAE construction
industry, and an overall ranking. The top five factors Fifteen of the Grade A contractors contacted filled out the
according to the contractor’s perspective were inadequate questionnaire on thirty six large projects. However, only
early planning of the project, preparation and approval of twenty nine of the projects were residential compounds
drawings, poor supervision and poor site management, projects. The projects have a total capital investment of
slow decision-making by owner, and shortage of approximately $1.25 Billion and were executed within a
materials on site. Furthermore, project success relies five year period (2000 - 2005). Similar to the tailoring
heavily on better cost and schedule predictability. Henry, and verification of the deviation factors obtained from
et al. [12] assessed the subsequent impact of the literature review via consulting with an expert panel
predictability on project success. from the industry, the data received from the Grade A
Consequently, the research framework for this study contractor in the questionnaires was also verified by
hinged on the following points; predictability of cost and holding face to face interviews with the respondents in
schedule estimates is essential for construction projects’ Qatar.
 Table 1 Summary of Relative Importance Index and Rank For The Causes and Effect Of Overrun.
Ranking according to effect

Overall Ranking
from/on

Preconstructi

Preconstructi

Schedule and
Construction

Construction

Schedule
on Phase
No. Factor RII

on and
Phase

Phase

Cost

Cost
F1 Deficiencies in general contractor's organization 1.1379 32 - - 3 18 - -
F2 Inaccurate estimates 1.0345 36 7 - - - 7 -
F3 Unrealistic tender cost estimation 1.1379 33 6 - - - 6 -
F4 Unrealistic contract duration estimate 1.6207 18 3 - - 8 - -
Improper pushing from owner on the contractor to
F5 1.8966 9 1 - - - 5 -
reduce contract price
Mistakes and / or discrepancies in contract
F6 1.2759 29 5 - - - - 8
documents
Disagreement related to interpretation of contract
F7 1.1379 34 - 26 - - - 10
specifications or other clauses
F8 Fraudulent practices and kickbacks 0.5517 40 - - 4 - - 13
F9 Delays in refunding accidents damages 1.3448 24 - 21 - 14 - -
Site incidents and delays due to lack of safety
F10 1.6552 15 - 15 - 6 - -
measures
F11 Planning and scheduling changes or deficiencies 1.7241 11 2 - - - - 4
F12 Poor contract administration 0.8621 38 8 - - - - 11
F13 Deficiencies in discovery work 1.3448 25 4 - - - - 6
Slow or improper decision-making from project
F14 1.3448 26 - - 2 15 - -
manager
F15 Inadequate cost and schedule control procedures 1.2069 30 - 23 - - - 9
F16 Construction delays 1.3448 27 - 20 - 16 - -
F17 Rework during construction 0.7931 39 - 28 - - - 12
F18 Design changes 1.9310 8 - 8 - - - 3
F19 Work orders 2.1379 6 - 6 - - - 2
F20 Inflation 2.2069 5 - 5 - - 3 -
F21 Cash flow inconsistency during construction 1.7586 10 - 9 - 2 - -
F22 Contractor’s financial difficulties 1.7241 12 - 10 - 3 - -
F23 Delay in monthly payments from owner 1.7241 13 - 11 - 4 - -
Delays in conducting inspections and testing of
F24 1.1379 35 - 25 - 19 - -
work
F25 Delays in approving permits 1.5172 20 - 16 - 10 - -
Delays from subcontractors and nominated
F26 2.2759 3 - 3 - - - 1
suppliers
Delays in preparation and approval of drawings,
F27 1.4828 22 - 18 - 12 - -
and information flow
F28 Construction methods 1.6552 16 - 13 - - - 5
F29 Design related issues 1.5862 19 - 1 9 - -
F30 Lack of team alignment and conflicts management 1.1724 31 - 24 - 17 - -
Escalation of basic construction material prices in
F31 2.3448 1 - 1 - - 1 -
local market
Change of other materials prices in the local
F32 2.3103 2 - 2 - - 2 -
market
 Shortage of materials and equipments in the local
F33 2.2414 4 - 4 - 1 - -
market
F34 Material procurement cost from outer country 2.1034 7 - 7 - - 4 -
F35 Imported materials issues and limitations 1.5172 21 - 17 - 11 - -
F36 Late delivery of materials and equipment 1.6897 14 - 12 - 5 - -
F37 Frequent breakdowns of construction equipments 1.0000 37 - 27 - 20 - -
F38 General labour shortages 1.6552 17 - 14 - 7 - -
F39 Shortage of skilled workers 1.4483 23 - 19 - 13 - -
F40 Low labour productivity 1.3103 28 - 22 - - - 7
F41 Weather Conditions 0.4483 41 - 29 - 21 - -
F42 Use of client Authority 0.2069 42 - 30 - - - 14

6. RELATIVE IMPORTANCE INDEX market, inflation, material procurement cost from outside
the country, and improper pressure from owner on the
6.1 Relative Importance Index (RII) contractor to reduce contract price. The top five factors
influencing schedule deviation were shortage of material
The 42 factors were ranked using the Relative Important and equipment in the local market, cash flow
Index (RII). Factors that were ranked by respondents as inconsistency during construction, contractor’s financial
having high influence over the cost and/or schedule difficulties, delay in monthly payments from owner, and
deviation indicate high importance on the index scale, late delivery of materials and equipment. Moreover, the
while low influence indicates low importance. top five factors influencing both cost and schedule
The Relative Importance Index (RII) is deviation were delays from subcontractors and
5
nominated suppliers, work orders, design changes,
∑W .X i i (3) planning and scheduling changes or deficiencies, and
RII = i =1
5 ineffective construction methods. The top five factors
∑X i influencing the preconstruction phase where improper
i =1 pressure from the owner on the contractor to reduce the
Where; contract price, planning and scheduling changes or
Wi: response weight to the ith respond equals 1, 2, 3, 4, deficiencies, unrealistic contract duration, Deficiencies in
5 respectively. discovery work, and Mistakes and / or dissonances in
i: response index equal 1, 2, 3, 4, 5, which are for: very contract documents, as shown in Table 1. On the other
low influence, low influence, medium influence, high hand, for the construction phase the top five factors in
influence, and very high influence respectively. sequence were escalation of material prices in the local
Xi: frequency of the ith response for a factor. market, change of other material prices in the local
market, delays from subcontractors and nominated
According to the RII equation the factors were ranked in suppliers, shortage of material and equipment in the local
several ways, their overall importance index, their market, and inflation. Moreover, the top five factors
importance in terms of cost, schedule and both, their influencing both phases were design related issues, slow
importance in the pre-construction phase and the or improper decision-making, deficiencies in general
construction phase, and most significantly their contractor’s organization, and fraudulent practices and
importance level in terms of project size (indicated by kickbacks.
actual cost) and duration. Tables 3 and 4 illustrate the
RII rankings. The Relative Importance Index was also 6.3 Project Size Based Ranking
discussed by Odeh and Battaineh [10], and Faridi and El
Sayegh [11]. As shown in Table 4, the RII ranking was calculated for
projects above/under 45.0 Million Qatari riyals. The top
6.2 Overall Ranking 5 factors influencing projects over QR 45.0M were
delays from subcontractors and nominated suppliers, site
As shown in Table 1, the top 5 factors influencing cost incidents and delays due to lack of safety measures, work
deviation were escalation of basic material prices in the orders, material procurement cost from outside the
local market, change of other material prices in the local
 Table 4: RII by Cost and Schedule Categories
Actual Cost Actual Cost Actual Actual
Factor > QR 45 ≤ QR 45 Duration > 20 Duration ≤
Factor Million Million Months 20 Months
No.
RII Rank RII Rank RII Rank RII Rank
F26 Delays from subcontractors and nominated suppliers 3.875 1 3.083 6 2.813 5 3.846 3
F10 Site incidents and delays due to lack of safety measures 3.692 2 2.167 27 2.813 8 2.462 28
F19 Work orders 3.455 3 3.333 4 3.313 1 2.923 13
F34 Material procurement cost from outer country 3.450 4 3.000 7 2.813 6 3.462 6
Improper pushing from owner on the contractor to reduce
F5 3.368 5 2.500 19 2.500 15 3.385 7
contract price
F4 Unrealistic contract duration estimate 3.333 6 2.167 28 2.375 20 2.923 15
F9 Delays in refunding accidents damages 3.292 7 2.000 34 2.250 22 2.462 30
F18 Design changes 3.211 8 2.833 11 3.125 2 2.692 21
F36 Late delivery of materials and equipment 3.091 9 2.917 9 2.500 14 2.923 14
F22 Contractor’s financial difficulties 3.053 10 2.583 16 2.375 18 3.154 10
F11 Planning and scheduling changes or deficiencies 3.000 11 2.500 20 2.625 11 2.846 18
F20 Inflation 3.000 12 3.333 5 2.500 13 4.077 2
F28 Construction methods 2.944 13 2.417 22 2.750 9 2.538 24
F29 Design related issues 2.833 14 2.417 23 2.813 7 2.308 32
F14 Slow or improper decision-making from project manager 2.789 15 2.083 31 2.000 30 2.769 19
F21 Cash flow inconsistency during construction 2.778 16 2.917 10 2.438 16 3.154 8
F23 Delay in monthly payments from owner 2.765 17 2.667 13 2.375 17 3.154 9
F38 General labour shortages 2.765 18 2.500 21 2.250 21 3.154 11
F2 Inaccurate estimates 2.762 19 1.750 37 1.938 33 2.154 36
Delays in preparation and approval of drawings, and
F27 2.750 20 2.667 14 2.125 26 2.923 17
information flow
F13 Deficiencies in discovery work 2.714 21 2.583 17 2.188 24 2.538 25
F15 Inadequate cost and schedule control procedures 2.700 22 2.083 32 2.063 28 2.385 31
F16 Construction delays 2.684 23 2.250 26 2.375 19 2.308 33
F33 Shortage of materials and equipments in the local market 2.643 24 3.500 3 3.063 4 3.462 5
F25 Delays in approving permits 2.632 25 2.750 12 2.188 23 2.923 16
F39 Shortage of skilled workers 2.579 26 2.667 15 1.938 31 3.077 12
F32 Change of other materials prices in the local market 2.571 27 3.750 1 3.063 3 3.615 4
F3 Unrealistic tender cost estimation 2.556 28 1.750 38 2.188 25 2.077 38
Escalation of basic construction material prices in local
F31 2.538 29 3.667 2 2.688 10 4.154 1
market
F35 Imported materials issues and limitations 2.474 30 3.000 8 2.563 12 2.462 29
F1 Deficiencies in general contractor's organization 2.444 31 1.917 35 1.750 38 2.615 23
F40 Low labour productivity 2.444 32 2.333 25 1.938 32 2.769 20
Disagreement related to interpretation of contract
F7 2.421 33 2.167 29 1.813 35 2.538 26
specifications or other clauses
F24 Delays in conducting inspections and testing of work 2.278 34 2.167 30 1.813 36 2.538 27
F12 Poor contract administration 2.167 35 1.667 40 1.563 39 2.231 35
F30 Lack of team alignment and conflicts management 2.167 36 2.417 24 2.125 27 2.231 34
F6 Mistakes and / or discrepancies in contract documents 2.059 37 2.583 18 2.000 29 2.615 22
F37 Frequent breakdowns of construction equipments 1.941 38 2.083 33 1.875 34 2.154 37
F17 Rework during construction 1.765 39 1.833 36 1.813 37 1.769 40
F8 Fraudulent practices and kickbacks 1.412 40 1.750 39 1.313 42 1.846 39
F41 Weather Conditions 1.250 41 1.417 41 1.375 40 1.538 41
F42 Use of client Authority 1.125 42 1.000 42 1.375 41 1.000 42

country, and inappropriate pressure from owner on the work orders, and inflation. Smaller projects suffered
contractor to reduce contract price. The top 5 factors more from material shortages than larger projects.
influencing projects under 45 Million were change of
other materials prices in the local market, escalation of 6.4 Duration Based Ranking
basic construction material prices in local market,
shortage of materials and equipments in the local market,
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7. CONCLUSIONS 224, 1985.
[8] Mansfield, N. R., Ugwu, O. O. & Doran, T.
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and were executed between 2000 and 2005. private residential projects in Kuwait”,
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Further research in this topic may explore the owners’
24, pp.1167-1176, 2006.
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[12] Henry R. et al, “Exploiting organizational
predictability factors in other types of construction
knowledge in developing IS project cost and
projects in Qatar, or identify the underlying causes of the
escalation in material prices and material delays in schedule estimates: An empirical study”, Journal
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[13] Qatari Central Tenders Committee website. n.d.
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