Business Model Transformation of Construction Companies: From Contract-Based Execution to a Developer–Entrepreneurial Paradigm
Davit Marikyan , Blackrock Home Builders – CEO Los Angeles, CAAbstract
The global economic instability of 2024–2025 intensified the structural constraints of the construction sector and triggered a pronounced erosion of profitability within the classical contracting model. Key drivers include rising costs of construction resources, an escalating shortage of qualified personnel, and tighter regulatory requirements, which collectively narrow the margin space available under traditional contracting arrangements. Under these conditions, the research focus shifts to the regular and increasingly observable transition of construction organizations toward a developer–entrepreneurial operating logic, interpreted as a mechanism not merely of short-term adaptation but of sustained expansion over a longer horizon.
The purpose of the study is concentrated on the theoretical substantiation and construction of a business-process transformation model in which the production–contracting contour is coupled with investment-oriented asset management and with digital transformation instruments consistent with the Industry 4.0 agenda. The methodological foundation includes a systematic review of the financial statements of transnational construction groups, a comparison of profitability levels across key market segments, and an analysis of practice-oriented cases from industry leaders, including Vinci and Skanska.
The results indicate that institutionalizing development functions and managing the asset within a full life-cycle logic generates a synergy effect and increases the controllability of risk, which in a number of configurations supports growth in net profit from an approximate 5% to 15%. The overall set of conclusions supports the hypothesis that entrepreneurial orientation, combined with high digital maturity, constitutes a decisive condition of competitiveness within the current economic configuration. The material has applied relevance for executive and managerial tiers of construction holdings, the investment and analytical community, and representatives of public authorities involved in planning and advancing infrastructure programs.
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References
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