The purpose of this study is to identify main factors when cost estimate is being exceeded in the construction industry both nationally and globally. If the cost estimation is exceeded, it may result in losses for the company, which can be severe and cause extensive damage. Therefore, a study is necessary to see if it is possible to perform a more detailed cost calculation.Cost overruns occur in both bigger and smaller projects. Factors causing cost overruns do not always have to be of the same category. Identifying negative factors as a guideline is troublesome due to the fact that one project outcome might not necessarily be other projects result.In collaboration with Småa AB and our starting point in “The white city”, an examination was performed to identify the factors leading to the costs being exceeded. Study consisting of literature and interviews with the production manager for the White City. At the end of the study the purpose and questions will be answered. Suggestions and solutions will be provided.The work was ongoing during a prevailing pandemic, that has affected the entire world, Covid-19. The pandemic has limited our site visits and interviews. Most of the work has been done digitally.

Sweden’s real estate portfolio has a major renovation requirement. A large part of the renovations that need to be carried out are pipe replacement projects. These are major projects and not all housing associations are aware of the extent financial consequences it brings. Therefore, planning in the economy throughout the project are important. This thesis aims at seeing what affects a production estimate to differ from the actual final cost.ÅF infrastructure division thought that their calculations of the estimated cost for production too often differs to the actual final cost. At a first meeting with ÅF, it appeared that there has been discussion and thought for solutions to the problem for some time. The thesis is based on 3 issues that will provide answers on how to make a better production estimate.In order to answer the questions, project managers have been interviewed and literature has been studied. The assigned reference objects have been analyzed and compared in tables. This thesis has resulted in the insight of that the project managers at ÅF are relatively good at estimating the original cost of what the contractor produces for the pipe replacement projects. After the analysis, recommendations have been presented that can be developed and implemented in the ÅF approach to calculate their estimated cost of production even better. By calculating the costs that are not included in the original cost for the contractors in a more methodical manner, based on experience, the production cost can be optimized.The work has been going on for a limited time with delimitations and a selection of projects. The results presented in the report should be applied with caution and awareness about the differences in the projects.