A Conceptual Benefits Realization Model for Minimization of Transaction Costs in Building Energy Efficiency (BEE) Affordable Housing Delivery

Abstract

Energy efficiency is fundamental to enhancing homes affordability. There are several unique challenges to affordable housing that owner-developers need to address in order for energy efficiency to make significant economic sense. Issues such as Transaction Costs (TCs) plays a significant role in achieving building energy efficiency (BEE) for affordable housing delivery. It is evident that split incentives, information asymmetry, institutional transition, opportunistic behavior, and ill-informed users incur different levels of TCs and affect stakeholder’s willingness to take part in BEE for affordable housing. A better understanding of the nature and structure of TCs is indispensable to enhance the market-drive and investment for BEE affordable housing. Uncertainty, specific investment, frequency, and bounded rationality seen as the key dimensions of TCs. The research focuses on how to minimize TCs involve in BEE affordable housing delivery. It was found in the literature that, the level of TCs for building energy efficiency estimated at 20.5% of total project costs. A conceptual competency-driven benefits realization model is proposed for minimizing TCs taking into consideration the peculiarities of the current housing projects delivery. This research aims to establish the significance of leveraging on BEE project team-competency and commitment organized within a strategic Benefits Realization Management framework to optimize client‘s benefits regarding minimizing TCs. The focus is on the aspect of a developer’s competencies and their project team commitment concerning minimizing TCs that structured within a Benefits Realization Management (BRM) practice. This model is proposed as a pro-active enabler tool to achieve Value for Money in BEE affordable housing projects. This paper is part of a series of publications.

Risks Caused by Information Asymmetry in Construction Projects: A Systematic Literature Review

“…The remaining articles marked as Level III only used the terminology connected with information asymmetry somewhere in the text without any further elaboration on the concept. The topics investigated in these articles were diverse, and included the following: the analysis of work choices of contractors [109]; dynamic contract terms in projects [110]; network analysis of keywords in articles [18]; cost overruns of large construction projects [111]; risk identification and analysis on a company level [112]; decision support system for housing condition assessment, refurbishment and contractor selection [113][114][115]; communication performance challenges in PPP projects [116]; optimization of social procurement policy outcomes [117]; effect of contract completeness on contractors' opportunistic behavior [118]; allocation of risks in construction projects [44,119]; minimization of transaction costs in building energy efficiency [120]; blockchain in smart contracts and supply chain management [35]; contractors' risk attitudes [121]; improvement of the quality of projects [122,123]; environmental responsibility behavior in megaprojects [124]; safety supervision for prefabricated building construction [125]; and opportunistic behavior of private companies in a PPP project [126].…”