Abstract
Purpose: Given the indispensability of finance to any construction process, this research aimed at carefully evaluating the effectiveness of various finance allocation strategies in public and private building projects in Akwa Ibom State. The set objectives of this study include to discretely assess the effectiveness of major financing allocation strategies in public and private building projects, and comparatively deduce which strategies are more effective in each sector.
Design/methodology/approach: To collect the data required for analyses, 120 copies of structured questionnaire were administered to construction professionals that have previously handled private and public building projects in Akwa Ibom state. Out of the 120 copies of questionnaire purposively distributed, 103 (85.8%) were returned. Descriptive statistical methods were used to carry out the data analysis.
Findings: Results of this study indicate that the investigated milestone payment method and concession methods (BOOT, BOO, BOT), are more effective in the public building projects than in the private. In contrast, the direct labour (DL) payment method is inferred to be more effective in the private projects than in public projects. In addition, honouring of interim payment certificates (IPCs) has been established to be more delayed in public building projects than in the private projects; and overruns in time and cost are more experienced in public building projects than in the private projects.
Research limitations/Implications: Whereas, the three major towns (Uyo, Ikot Ekpene and Eket) where assessed, the study would have preferred to cover more local governments and compare their financing strategies in the public and private projects. However, the three local governments are considered to have greater construction works and data collected from them were significant.
Practical implications: Consequent on the findings of this research, though the milestone payment method is more effective in the public sector, its use in the private sector enables a more organised scheme of construction activities. This will also help in guiding both the client and contractor on when to expect funds – in milestones.
Originality/value: Previous researches on the project finance allocation strategies, focused on Nigeria as a whole; whereas, this study assessed how public and private building projects are financed in Akwa Ibom state.
Design/methodology/approach: To collect the data required for analyses, 120 copies of structured questionnaire were administered to construction professionals that have previously handled private and public building projects in Akwa Ibom state. Out of the 120 copies of questionnaire purposively distributed, 103 (85.8%) were returned. Descriptive statistical methods were used to carry out the data analysis.
Findings: Results of this study indicate that the investigated milestone payment method and concession methods (BOOT, BOO, BOT), are more effective in the public building projects than in the private. In contrast, the direct labour (DL) payment method is inferred to be more effective in the private projects than in public projects. In addition, honouring of interim payment certificates (IPCs) has been established to be more delayed in public building projects than in the private projects; and overruns in time and cost are more experienced in public building projects than in the private projects.
Research limitations/Implications: Whereas, the three major towns (Uyo, Ikot Ekpene and Eket) where assessed, the study would have preferred to cover more local governments and compare their financing strategies in the public and private projects. However, the three local governments are considered to have greater construction works and data collected from them were significant.
Practical implications: Consequent on the findings of this research, though the milestone payment method is more effective in the public sector, its use in the private sector enables a more organised scheme of construction activities. This will also help in guiding both the client and contractor on when to expect funds – in milestones.
Originality/value: Previous researches on the project finance allocation strategies, focused on Nigeria as a whole; whereas, this study assessed how public and private building projects are financed in Akwa Ibom state.
| Original language | English |
|---|---|
| Pages (from-to) | 35 - 49 |
| Number of pages | 15 |
| Journal | Journal of Contemporary Research in the Built Environment |
| Volume | 1 |
| Issue number | 2 |
| Publication status | Published - 30 Sept 2017 |
Keywords
- Financing strategies
- public building projects
- private building projects
- Akwa Ibom State