Benchmarking of built asset costs - how much data is in the public domain

Will Myles (wrmyles.ch@gmail.com), 3 years ago in Thought leadership

When it comes to delivering and operating built assets, client organisations can’t be sure they’re getting value-for-money. Couple this with project delays and budget overruns, and the result is often unmet expectations.

In many industries, clients can assess their performance by comparing it against others. Benchmarking the capital and operating costs of built assets is no easy task – almost every built asset and project are unique, standards are inconsistent or non-existent, and data (when available) is held in different forms in various places (and often behind ‘closed doors’).

Knowledge and insight are available in the industry – within client datasets and specialist firms – but data is seldom easily accessible and rarely in the public domain.

ICMSCosts recently reviewed the freely-available and publicly accessible datasets which could be used to facilitate the benchmarking of built asset costs – specifically, unit cost data for assets, cost inflation indices, and location cost factors.

We found that:

• Limited cost data is publicly available, often with a mighty caveat from the provider of “rely on this at your peril” – and for good reason. Data is often displayed as averages and the assumptions underpinning it are often unclear – critical factors such as location, scope, scale, quality, complexity, or the basis on which space has been measured

• Unit cost data appears to be more readily available for private sector comparators than public sector ones

• The available data relates mostly to real estate assets rather than infrastructure assets, such as roads, railways and bridges

• In some countries, construction cost indices (i.e. changes in industry costs over time) or tender price indices are published. But construction is a complex area, and the user can’t always be sure what is in the index basket and who in the supply chain the data is relevant to

• Previous work has been done by the World Bank and others into the relative costs of construction internationally on a purchasing power parity (PPP) basis, and by larger consultants into global location factors for construction activity

• Overall, when it comes to data availability, data relates mostly to countries with mature, competitive cost management industries – such as Australia, Canada, New Zealand, the UK, the US and certain EU and SE Asian countries. Beyond those countries, fewer sources are available.

The emergence of ICMS as the international standard for cost reporting provides the means of comparing projects and assets regionally, nationally and internationally – overcoming traditional data silos. At the heart of ICMS is data – for project attributes and project costs.

To benefit from performance benchmarking and others’ knowledge and experience, clients need to be as willing to share as they are to learn. This requires a trusted environment, and a trusted facilitator whose role is simply to make better data available to stakeholders.

ICMSCosts brings together industry professionals who know this problem all too well, and who are passionate about creating the right platform and environment for data sharing to take place.

We are creating a global, independent database of project lifecycle costs for real estate and infrastructure. We will support client organisations with better data – enabling better decision-making and, ultimately, saving taxpayers or shareholders money.

If you have major capital programs and are looking to save stakeholder money by enabling better access to better data, drop us a note at info@icmscosts.com.