For decades, construction has lagged behind other sectors in productivity. Modular construction offers the industry an opportunity to make a step change: shifting many aspects of building activity away from traditional construction sites and into factories with off-site, manufacturing-style production.
Modular (or prefabricated) construction is not a new concept, but technological improvements, economic demands, and changing mind-sets mean it is attracting an unprecedented wave of interest and investment. If it takes hold, it could give the industry a huge productivity boost, help solve housing crises in many markets, and significantly reshape the way we build today. Our new report, Modular construction: From projects to products, dives deeper into the issues.
In many countries, modular construction is still very much an outlier. But there are strong signs of what could be a genuine broad-scale disruption in the making.
What is modular construction, and how has it evolved?
In broad terms, modular construction involves producing standardized components of a structure in an off-site factory, then assembling them on-site. Terms such as off-site construction, prefabrication, and modular construction are used interchangeably. These terms cover a range of different approaches and systems, from single elements that are clipped together using standard connections and interfaces to 3-D volumetric units with full fixtures.
Modular construction has been a cost-efficient option at certain historical points, but its popularity has been short lived. It enjoyed postwar booms in the United Kingdom and the United States, when there was a need for speedy reconstruction and social housing, when wartime factories lay empty, and when there were shortages of steel and labor. But its popularity waned as supply and demand began to even out in the United States; a 1968 UK apartment-tower collapse also sparked concerns about the safety of prefabricated buildings.
Today, modular construction is experiencing a new wave of attention and investment, and several factors suggest it may have renewed staying power. The maturing of digital tools has radically changed the modular-construction proposition for instance, by facilitating the design of modules and optimizing delivery logistics. Consumer perceptions of prefab housing are beginning to change, particularly as new, more varied material choices improve the visual appeal of prefab buildings.
Perhaps most important, we see a change in mind-set among construction-sector CEOs, as many leaders see technology-based disruptors entering the scene and realizing it may be time to reposition themselves.