Eli5: why are estimated budgets for big construction projects always wrong and end up spending more than expected? Why can’t we get better at these estimates?

Question

Eli5: why are estimated budgets for big construction projects always wrong and end up spending more than expected? Why can’t we get better at these estimates?

In: Economics

Answer 1

So I do this professionally primarily for FAR 15 contracts and some FAR 16.5. The number one reason why they are off is ambiguous requirements. For things like paving a street or roofing a building, we can get with 1-3%. For things like NGAD, we hope to be off by 100M.