For decades, the construction sector has lagged behind other industries in productivity performance. Now there is an opportunity for change: shifting many aspects of construction activities away from the traditional on-site projecten om een off-site production style.
Although modular or prefab construction is not a new concept, it is attracting a new wave of interest and investment due to changes in the technological and economic environment.
A study of McKinsey identified and quantified the potential benefits and challenges of prefab construction. Additionally, it investigated whether prefab construction will have a more widespread and sustainable impact this time.
The conclusions
Costs
As one of the largest sectors in the world, a fundamental shift in construction could have a major impact. Recent modular projects have already demonstrated the ability to accelerate project timelines by 20-50 percent. The approach also holds the potential for significant cost savings, though that is still more of an exception than the norm today. Analysis suggests leading property players willing to make the shift and optimise for economies of scale will be able to save more than 20 percent on construction costs.
Prefab 2.0
Prefabricated housing construction has only really gained a foothold in a few places worldwide, including Scandinavia and Japan. It has been in and out of favour in markets such as the United States and the United Kingdom since the post-war era. Nevertheless, there is reason to believe that the current resurgence could be different. The industry is embracing new materials and digital technologies that are improving design capabilities, precision and productivity in manufacturing. Furthermore, it has become increasingly easier logistically.
In contrast to the old reputation of prefabricated buildings as ugly, cheap, poor-quality options, today's builders are focusing on sustainable and tasteful homes at the higher end of the market.
A firm footing
Several factors determine whether a particular market is likely to embrace modular construction. The two biggest determining factors are the demand for real estate and the availability and relative cost of skilled construction labour. In places such as the West Coast of the US, the southern part of the UK, the east coast of Australia and major German cities, there is a labour shortage. Coupled with this, there is large-scale unmet demand for housing, making prefabricated construction particularly relevant.
Challenges
Realising the full cost and productivity benefits of modular construction is no simple task. It requires:
- carefully optimise material selection,
- finding the right solution between 2D panels, 3D modules and hybrid designs,
- investments in (prefabricated) technology,
- investments in logistics,
- Government regulation.
Finally
In many countries, modular construction is still considered a niche market. However, there are strong indications that a genuine large-scale disruption is underway. It's already attracting new competitors and will most likely result in new winners and losers across the entire property and construction ecosystem.
Interesting? Read more about Steel framing and prefabricated construction in our other blogs
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Ripstaal Group specialises in the processing and finishing of various types of steel.
At Ripstaal Group, we've known for a while that prefab building is the future. That's why we've invested in our technology and production facilities to meet the growing demand. This is how we manufacture façade elements to make existing buildings more sustainable or to redevelop them. In addition, we build prefab chalets, care homes and garden offices. Piece by piece, examples of the future of prefab construction!
Interested in prefabricated construction and would you like to know what Ripstaal has to offer? Please fill in the form below. You can find more information on our Steel framing page. Other contact options are here.
