“Restart, reset, reinvent”: The Future of Off-Site Construction

“Restart, reset, reinvent”: The Future of Off-Site Construction

Key Contact: James Williams

Author: Harriet Kennerley

In a flagship speech delivered this summer, UK Prime Minister Boris Johnson described his approach to reviving the country’s post-Covid-19 economy as one of “build, build, build” –  putting construction and new infrastructure at the heart of the government’s growth strategy. It was telling that Johnson delivered his speech in front of a “modular home” – a house manufactured in controlled factory environment using a production line system.

Such dwellings are likely to be a significant part of the UK’s built environment in the years ahead, as decision-makers show an increased enthusiasm for a sector which goes by a number of names – including off-site construction and Modern Methods of Construction (MMC).

In a recent speech, Julie James, Minister for Housing and Local Government in Wales, said the Welsh Government wants housebuilders to “consider complementing traditional construction methods with new technologies and processes for housebuilding”.

“Off-site manufacturing producers based in Wales have capacity and an appetite to manufacture homes,” she added.

Why off-site is on the march

Modular homes are manufactured and then are taken on-site, which their enthusiasts say uses significantly less time and labour compared to traditional onsite construction. Potentially delivering homes in a matter of days, not weeks, means less noise, less fuel, less traffic, reduced disturbance to surrounding communities and improvements for health and safety. In any effort to, in the PM’s words, “build greener and build faster”, the ability to manufacture homes 50% quicker than conventional methods allow is a one of the key upsides to offside construction.  The benefits of MMC were demonstrated earlier this year by the delivery of 2,400 beds in two field hospitals in the Covid-19-hit Chinese city of Wuhan in just 12 days.

However, there remain underlying reservations about this construction method which cause concerns for buyers, developers and financial providers when considering investing in property built using MMC.

Challenges facing off-site construction

Physical drawbacks

The nature of off-site construction means the more uniform and repetitive the products and spaces can be, the better. This is less of an issue for apartment buildings and offices, but more of a downside when asked to create distinct or non-repetitive homes, potentially defeating the time and cost advantages for buyers and suppliers in some circumstances. A greater number of complex decisions are needed up front in the process, as it requires architects, engineers and contractors to be familiar with the modular fabrication stages. This front-loaded design process forces buyers and owners to make final selections on appliances and finishes well before the work even begins, meaning a relative lack of flexibility from the outset.

Transportation risks

Factories manufacture modular buildings potentially hundreds of miles away from where they need to be pieced together; transportation and rigging companies spend significant time and effort identifying suitable roads and planning the logistics of moving the modules to where they need to be. Contracts need bespoke provisions setting out obligations to adequately pack and load modules and to allow for insurance covering transportation issues and off-site storage.

Securing finance

Many funders have previously been hesitant about providing finance for modular construction projects. The funder is lending against elements of development which are being built off-site and away from the property which is where they have their security. There is the added risk that a developer will want to know that the homes they are providing funding for will be eligible for a mortgage which is difficult concern to square when a development is being worked on piece-by-piece in a factory with all of the previously discussed risks to be considered.

Quality concerns

A key criticism of some modular components is that elements built off-site fail to meet the quality standards expected of traditional on-site methods, with many developers still thinking that modular buildings do not look as “solid” or well-designed as traditionally built structures. However, NHBC, the firm which issues insurance and warranties for thousands of new homes across the UK each year has recently announced new accreditation processes designed with “innovative construction” in mind. The firm highlighted the importance of a strict assessment from factory to home, in an attempt to combat quality concerns and make more innovative ways of construction more appealing.

Taken together, efforts to tackle such obstacles should help to build confidence in innovative construction methods. When the design of off-site components follows established principles and quality measures are put in place alongside consistent and robust reviewal processes, the benefits of off-site manufacture should be obvious, and many existing anxieties can be settled.

Members of Acuity Law’s construction team will be publishing a series of articles over the coming months which will focus on the development of MMC and off-site construction, tackling some of the key concerns and proposed solutions highlighted in this article, alongside more intricate areas of this future-focused approach to construction. To speak with a member of our team regarding any of the issues raised, please contact our construction team.

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