Ryan Smith and Ivan Rupnik shared key takeaways and topics for future research identified by the Department of Housing and Urban Development’s (HUD’s) Offsite Construction for Housing Research Roadmap during the “Research at HUD: Past, Present, and Future of Offsite Construction” event during the 2022 Innovative Housing Showcase.
“The concept of promoting modular, panelized, and manufactured construction is hard, but we recognize it is part of the housing supply solution,” HUD deputy secretary Adrianne Todman said while introducing the research road map. “This particular space has been particularly interesting [to learn about] in terms of what the future will bear. That is why the concept of this research road map is just so important. My hope is that it is just not HUD’s road map. We are all in this ecosystem of learning and growing, and [I hope] that this becomes our road map.”
While off-site construction methods and housing have been present in the market for decades, the adoption rate has been slow, and the sector still faces numerous regulatory, knowledge, and cost barriers. However, Smith, Rupnik, and Stephen Ayers, interim CEO of the National Institute for Building Sciences, identified off-site construction as a potential channel to address affordability challenges currently present in the housing market during the event.
“Off-site construction offers the option to deliver more affordable and accessible housing through scale, schedule improvements, quality improvements, safety enhancements, and sustainability,” Ayers said. “However, both the industry and policymakers face a number of challenges before we can substantially increase adoption in the marketplace.”
Rupnik said that while the U.S. has had off-site construction dating back to the post-World War I period, off-site construction—including volumetric modular construction and HUD code-compliant manufactured housing— accounted for only 13% of the housing market in 2018.
“Since 1968, U.S. construction productivity has dropped by half. Whereas agriculture, manufacturing, and the overall economy have improved since around 1970, construction has dropped,” Rupnik, a founding partner of global off-site construction industry advisory and knowledge exchange network MOD X and associate professor at Northeastern University, said. “Off-site construction has been seen as a solution to that productivity problem. According to McKinsey, manufacturing style production or factory-built construction was seen as having a potential boost of 1,000% [to productivity]. This number comes from other industries that have seen these results.”
Rupnik said in addition to off-site construction technology, context—including the overall housing market, materials, labor availability, and regulatory restrictions—business platforms, and product platforms are areas the industry “needs to do our homework on before we can live up to the promise of these new technologies that could deliver affordability.”
Smith, a founding partner of MOD X and director of the the school of design and construction at Washington State University, highlighted the core areas for research identified by HUD’s road map: regulatory framework; standards and system performance; capital, finance, and insurance; project delivery and contracts; labor and workforce training and management; and business models and economic performance.
“From this research road map and using the Project Technical Committee [for the research road map], we feel the top priority is address[ing] the regulatory framework and capital, finance, and insurance. If we don’t overcome the way in which products are funded and insured to really allow off-site construction to occur and succeed, [the industry will struggle],” Smith said. “The second research topic area priority is standards and systems performance. The third, almost equally on foot with the second, would be product delivery and contracts, labor workforce training and management, and business models and economic performance.”
Smith said it is important to develop a research culture for off-site construction and reduce disciplinary silos to produce data to help demonstrate the value. Additionally, Smith stressed the importance of documentation and dissemination of best practices, the adoption of pilot projects demonstrating value, and the development of education and training for an off-site construction workforce are key areas that can help the sector grow within the U.S.
