Companies are performing predictive analysis, using supply data from the past five years and expected demand from upcoming projects, to aid decision-making and reduce costs.
“Now the prices change frequently. But a substantial amount can be saved by ordering at the right time – and in the right place,” said Naren Vijay, executive vice president of Lumenore, a unified business intelligence and analytics platform. “We are working on a few projects. We realized that in real estate, most of the data is dispersed. We do analytics, build big data for them, and help them optimize the cost of construction. »
The developers said that the cost of steel has more than doubled and that of cement by almost 38% in the past two years, which has led to an increase in the construction cost of at least Rs. 500 per year. square foot.
“Developers have started embracing technology and using advanced technologies in cost management to gauge demand and plan their supply strategies accordingly,” said Saurabh Sharma, Indian director of David Adamson Group, a consulting firm. international construction consultancy based in the UK. “Technologies like BIM help developers stay ahead of the curve and anticipate project needs accordingly.”
Rising crude prices and supply chain disruptions have caused a lot of financial stress for the construction industry. Prices for building materials have skyrocketed, leading to cost overruns in various construction projects.
“Advanced techniques such as predictive analytics have gained ground in the industry. Using historical data, machine learning techniques and statistical algorithms, predictive analytics can identify the likelihood of future events,” said Aditya Kushwaha, CEO and Director of Axis Ecorp, which executes data analysis for real estate projects. “These models are now also used to determine the development of commodity prices.”
While input costs were already climbing, the pace quickened following the Russian-Ukrainian war.
“Industry can use forecasting technology that will help understand future demand, essential items to buy right now, required inventory, cost of raw materials, and other important things. Through the use of the ‘AI and machine learning, the real estate industry can predict demand and consumer preferences by easily analyzing a huge amount of data,’ said Gaurav Kumar, Head of Construction Chemistry Business Unit – SNF India.
CREDAI NCR, an industry body which represents property developers in and around Delhi, said input costs have recently increased by around 30-40% and the cost of a few items has more than doubled over the past two last years.
Apart from Delhi-NCR property developers, Maharashtra CREDAI members are also considering a work stoppage due to escalating costs.
“Predictive analytics tools can easily project a revenue picture for any commercial or residential project by evaluating data, identifying price trends and identifying various risks,” said Vinit Dungarwal, Principal at AMs Project Consultants Pvt. ltd. “Therefore, the cost of raw materials can be predetermined and resources can be conserved.”