PROPERTY CONSTRUCTION
The construction sector over the past two years has undergone a trial by fire , given the emergence of the “ Black Swan ” event that was COVID19 . As a direct result of the pandemic , construction projects were delayed and disrupted by postponements and cancellations . The effect of the pandemic was all-encompassing and put the industry under an unprecedented level of pressure that exposed it to risks which reverberated through the project stages of , estimating , contractual clarifications , execution and project close-out .
GLOBAL RISKS
The sector has faced challenges in the supply of materials , labour and management shortages , as well as workforce mobility issues between the various projects being executed . The stop-start nature of lockdown restrictions meant that the efficiency of the project management process was difficult to maintain . Now , in the aftermath of the pandemic , the ripple effects of the disruption have put the sector in a challenging position as it begins to rebound to its pre-COVID operating levels .
THE TOP 10 RISKS FACING THE GLOBAL CONSTRUCTION SECTOR ARE AS FOLLOWS :
1 . Economic slowdown
2 . Commodity price risk , scarcity of materials
3 . Cash flow / liquidity 4 . Business interruption
5 . Accelerated rates of change in market factors
6 . Cyber risk / data breach 7 . Workforce shortage
8 . Capital availability
9 . Damage to reputation / brand
10 . Pandemic risk / health crises
SOURCE : AON 2021 GLOBAL RISK MANAGEMENT SURVEY
66 JUNE 2022 SA Real Estate Investor Magazine