Evaluation of the Accuracy of Cost Estimates of High-Rise Building Rehabilitation Projects Using Activity-Based Costing (ABC)
Abstract
Multi-storey building rehabilitation projects have unique characteristics that differ from new construction projects, including the uncertainty of the existing building conditions, the complexity of activities, and the potential for design changes during implementation. In the context of projects that use public budgets, such as the East Kalimantan Provincial BAZNAS and MUI Building Rehabilitation Projects funded through the 2023 Provincial Budget, accurate cost management is very important to ensure efficiency, transparency, and accountability in the use of the budget. However, the commonly used cost estimation method is still volume-based, which is less able to represent the complexity of the actual cost in rehabilitation projects. Therefore, this study aims to evaluate the accuracy of estimated costs for multi-storey building rehabilitation projects using the Activity-Based Costing (ABC) method, which is able to allocate costs based on activities. This study uses a quantitative descriptive approach, with the main data in the form of an engineer estimate document worth Rp 952,982,000.00. Project activities are classified into nine main categories: SMK3, preparation, demolition, architectural work & finishing on each floor, concrete & leatering, and MEP (addition of generator and electrical installations). The results of the analysis show that the architecture & finishing activities absorb almost 70% of the total costs, while MEP contributes about 10-12%, and additional structural work by 11%. The application of the ABC method provides a more accurate and transparent picture of the distribution of costs between activities, so that it can help project managers in developing more realistic budget planning, identifying high-risk activities, and optimizing cost control. In addition, the ABC method also supports accountability in regional budget management, in accordance with the mandate of Government Regulation No. 12 of 2019. Thus, this method is recommended to be applied more widely to government building rehabilitation projects.
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