The COVID-19 epidemic has created unprecedented challenges for global economies, affecting every industry, including the building construction industry in Nepal as well. This research aims to examine the impact of the COVID-19 epidemic on the building construction industry in Nepal. This study examines institutional, psychological, individual, operational, contractual, and financial factors. To achieve the objective, data were collected from 330 Nepalese construction professionals using a structured Likert scale questionnaire and analyzed with Smart PLS version 3 software for partial least squares structural equation modeling. The reliability and validity of both the measurement and structural models were tested and found satisfactory. All six factors were found to be significant at a 5% level of significance. Among all factors, the institutional factor was found as the most significant factor with a t-value of 7.654 and a beta value of 0.679, emphasizing the crucial role of institutional support in Nepal's building construction industry. The psychological factor also emerged as the second most significant influential factor (t value: 6.087, beta value: 0.463), underscoring the profound effect on the mental well-being of professionals in the field. The finding highlights the critical importance of institutional support and the profound influence of psychological factors on the well-being of construction professionals, necessitating targeted interventions to support the industry's recovery and resilience.