diff --git a/cabal-install/src/Distribution/Client/ProjectBuilding.hs b/cabal-install/src/Distribution/Client/ProjectBuilding.hs
index 734b8eb8b2c..567d6aec4e4 100644
--- a/cabal-install/src/Distribution/Client/ProjectBuilding.hs
+++ b/cabal-install/src/Distribution/Client/ProjectBuilding.hs
@@ -106,7 +106,7 @@ import Control.Exception (Handler (..), SomeAsyncException, assert, catches, han
 -- import Data.Function     (on)
 import System.Directory  (canonicalizePath, createDirectoryIfMissing, doesDirectoryExist, doesFileExist, removeFile, renameDirectory)
 import System.FilePath   (dropDrive, makeRelative, normalise, takeDirectory, (<.>), (</>))
-import System.IO         (stdout)
+import System.IO         (hPutStrLn, stdout)
 
 import Distribution.Compat.Directory (listDirectory)
 
@@ -944,6 +944,16 @@ buildAndInstallUnpackedPackage verbosity
 
     bracket_ initLogFile closeLogFile $ do
 
+    let
+        entering = withLogging $ \mLogFileHandle -> do
+          let hdl = fromMaybe stdout mLogFileHandle
+          hPutStrLn hdl $ "Entering directory '" ++ srcdir ++ "'"
+        leaving  = withLogging $ \mLogFileHandle -> do
+          let hdl = fromMaybe stdout mLogFileHandle
+          hPutStrLn hdl $ "Leaving directory '" ++ srcdir ++ "'"
+
+    bracket_ entering leaving $ do
+
     --TODO: [code cleanup] deal consistently with talking to older
     --      Setup.hs versions, much like we do for ghc, with a proper
     --      options type and rendering step which will also let us
@@ -1229,6 +1239,16 @@ buildInplaceUnpackedPackage verbosity
 
         bracket_ initLogFile closeLogFile $ do
 
+        let
+            entering = withLogging $ \mLogFileHandle -> do
+              let hdl = fromMaybe stdout mLogFileHandle
+              hPutStrLn hdl $ "Entering directory '" ++ srcdir ++ "'"
+            leaving  = withLogging $ \mLogFileHandle -> do
+              let hdl = fromMaybe stdout mLogFileHandle
+              hPutStrLn hdl $ "Leaving directory '" ++ srcdir ++ "'"
+
+        bracket_ entering leaving $ do
+
         -- Configure phase
         --
         whenReConfigure $ do