Ethiopia Institute of Technology- Mekelle

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    An Evaluation into the Performance of Standard Unit Rates Estimation Practices in Public Constructions: in the Case of Tigray, Ethiopia
    (Mekelle University, 2025-12-11) Atsede Tekle Berhe
    It is essential to understand the financial feasibility of construction projects in a market that is characterized by significant fluctuations. Project success depends on accurate cost estimation, however in Tigray, the least bidder system and differences between the Bureau's Standard Unit Rates and actual market pricing have resulted in cost overruns and delays in public building projects. Furthermore, a major issue identified above 80% the executed projects were under the estimated cost, indicating an overestimation. This paper examines the performance of SURs estimate in Tigray public construction projects and suggests ways to improve. An evaluation of 30 finished projects, interviews, and standardized 45 out of 65 questionnaires were used. The data were interpreted with the help of qualitative insights, and Paired T test, Multiple Regression, Correlation, and Variance analysis were conducted using Microsoft Excel and SPSS version 27. The results showed that, on average, published SUR were 3.43% (24.59 ETB per unit) higher than BUR. Even yet, early Engineering Estimates were 17.9% higher than bid values, showing overestimation, and actual project costs were 11.9% less than the engineering estimation. Project completion timelines also went 83.6% beyond schedule, resulting in significant time overruns. There was a correlation of SUR and BUR, r = 0.728 and according to the Regression analysis, the cost assumptions accounted for R² = 0.975, p < 0.01, of the cost variations; contract price was the most significant. Above 56% of the respondents indicated the SURs estimation are incorrect and around 65% -80% of those surveyed agreed that SUR error was a direct cause of delay, cost overrun and lower quality. Based on the findings, it is suggested updating SUR methodology, updating productivity, changing way of procurement is conducted, and enhancing stakeholders’ cooperation imply improving contractors’ performance, and feasibility of the projects, in the Tigray construction industry. Projects, Standard Unit Rate