Is “Off-site” Construction Here to Stay?

  • March 30, 2021

Off-site construction (aka prefabrication or off-site manufacturing) certainly isn’t a new concept in construction, but in more recent years, it has started to increase because of its potential to solve one of the biggest challenges facing construction today: the national trade labor shortage. The global pandemic has further accelerated this practice as companies try to limit their employees’ exposure to a crowded work environment. And, of course, as younger generations begin their careers in construction they expect to work in a digital 3d environment. 

Off-site prefabrication is also a significantly more economical approach to reducing labor and materials expense by as much as 14% on a project. With as much upside off-site prefabrication brings to the industry, it’s surprising how long it’s taken to adopt this new workflow, but it’s a process that’s here to stay. 

The difference between modular and prefabrication

Often, off-site, modular and prefabrication are used interchangeably, but there is actually a difference. Modular construction and prefabrication are types of off-site construction, and all modular construction is technically a type of prefab construction. But not all prefab is modular.

Prefab generally refers to specific components of a build, such as wall panels, roof trusses, elevators, precast concrete foundation walls and slabs, etc. Modular construction, also referred to as 3d or volumetric, can be thought of more as LEGO blocks where modules are at least 70% built in the factory then delivered to the site for installation.

Understanding that delineation, it’s easy to see possible applications for each. For instance, modular has traditionally been popular for structures that can be constructed repetitively like hotels, student housing, and certain healthcare facilities. But now, that’s quickly expanding as building activity continues to shift away from traditional construction sites. 

Indicators off-site construction is here to stay

Though the U.S. was actually an early adopter of modular construction in the residential housing market –– with some evidence of it in the 1800s during the California Gold Rush and again in the 1960s –– it never really took root. Even today, it accounts for less than 4% of housing construction. But the tides are turning.

The use of modular construction and prefabrication are now extending well beyond residential, gaining steam in healthcare, hospitality, higher education, and even in the buildout and renovation of data centers, warehouses and high-purity environments. And there are several indicators signaling that off-site construction will become a more significant part of the value chain.

For instance, in 2019, the International Code Council (ICC) appointed an “Off-Site and Modular Construction Standard Consensus Committee” to develop a set of off-site and modular construction standards. Now, for the first time, off-site modular construction will be included in the International Building Code –– the 2021 IBC. The new codes include:

  • ICC 1200 – 202X Standard for Off-Site Construction: Planning, Design, Fabrication and Assembly –– this covers all aspects of the off-site construction process such as planning, design, fabrication, transportation and assembly of commercial and residential building elements. 
  • ICC 1205 – 202X Standard for Off-Site Construction: Inspection and Regulatory Compliance –– this addresses the inspection, approval and regulatory compliance for residential and commercial components, as well as the assembly and completion at the site.

Even though the standards have yet to be finalized, one U.S. city has already committed to adopting them to remove barriers to modular construction and help address the affordable housing crisis. 

Mechanical contracting firms have also reported massive growth in their prefabrication and modular work over the past several years with even more dramatic increases reported in 2021 as stalled projects from 2020 kicked back into gear with renewed urgency. 

And, we’re now seeing more success stories, like the first-of-its-kind prefabricated Starbucks in Canada. The store was assembled in six days with near-zero construction waste.    

Off-site's expansion across all sectors

Though modular construction and prefabrication are most often associated with housing, it is expanding across all sectors of the construction industry. According to data reported in the Dodge Data & Analytics SmartMarket Report, “Prefabrication and Modular Construction 2020,” healthcare facilities, hotels and motels, and college buildings and dormitories top the list for the building types most likely to use prefabrication methods in the next three years.

There’s also been a reported increase in modular construction in the data center and warehouse markets as more owners realize the benefits of prefabrication –– namely schedule compression and the reduction of downtime on renovation projects.  

Of course, off-site construction has also been linked to other benefits like improved cost and schedule predictability, quality, productivity, and safety, along with the reduction of waste generated. But, the ability to realize those benefits often directly correlates with the use of building information modeling (BIM) processes and other advanced technology. 

Off-site construction will undoubtedly become a larger part of the construction value chain, but it will have to grow in tandem with the adoption of advanced technologies and BIM processes to improve coordination and collaboration between all stakeholders and systems. That’s when we’ll truly see quality, and schedule and cost performance make a significant leap forward. 


Interested in working with ZELUS?