Art not science in mega-projects

Capture.PNGThe rise in mega-projects as a percentage of total construction spending reflects considerable increases in investment to the segment. Although the trend has been skewed by results from 2016, which saw a total increase of around 100% of investment into mega-projects, from $2.2 trillion to $4.4 trillion. Across the period as a whole, 2005 until 2016, investment grew by 28% per annum on average, while total global spending grew by 3% per annum.

According to the study of 500 US-based mega-projects, they tend to face relatively burdensome overruns. Oil & Gas projects saw the most significant cost overruns, with downstream projects clocking an average of 53% above budget, followed closely by mining projects, also at 53%. Real estate has relatively the lowest cost overrun, at 24%. In total, just 5% of projects came in on time and on budget.

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