Modular construction: what are the advantages and disadvantages?

Modular construction: what are the advantages and disadvantages of modular construction and can it offer a viable alternative to traditional building methods? 

Modular construction is not a new concept. We saw demand for prefabricated buildings during the Second World War due to the need for mass accommodation for military personnel. ‘Prefabs’, as they became known, were also built after the war as a means of quickly and cheaply providing quality housing as a replacement for the housing which had been destroyed.

Now, technology has improved, investment and interest has risen and we are seeing a further demand for modular buildings used to address the housing crisis and to help ease the NHS backlog.

So what is a ‘modular building’?

Modular buildings are made up of separate sections, constructed offsite and delivered to site for assembly. Timescales for modular construction will vary, from a few days to a few months, but importantly; modular construction can offer a quicker and cost-efficient alternative to traditional building methods.

COVID-19, the NHS and modular construction

The NHS came under immense strain with the outbreak of Covid-19. Owing to a backlog in operations that continues today, the NHS released its Covid-19 Modular Building Guidance Document in 2020 during the height of the pandemic, designed to “support the procurement and implementation of modular units on the NHS estate”.  Similarly, the government notably amended town planning regulations which extended permitted development rights; authorising temporary emergency development by a local authority or health service body without requiring a planning application.

Since then, the NHS Shared Business Services has published the Modular Building Framework Agreement (“MDFA”) which runs from 5 July 2021 until 4 July 2023 to cover the purchase, hire or lease of module design solutions. The MDFA can be used by a range of public sector organisations, including those in the education, residential and healthcare sectors.

What are the benefits of modular construction?

The construction industry is often faced with delays caused by a number of factors, such as lack of labour or supplies and adverse weather conditions which conflate to slow down construction onsite, or bring progress to a stop completely. Modular construction offers a practical solution to this.  

Whilst not necessarily immune from all delaying factors, the Modular Building Institute suggests that because standardised components can be produced off-site in a factory setting concurrently with on-site preparatory works, modular construction can allow projects “[to] be completed 30% to 50% sooner than traditional construction.” Notwithstanding the benefits of faster construction, indoor construction environments also significantly reduce the risk of on-site accidents and related liabilities to workers.  Instead of completing wall and roof construction at height, the pre-fabricated modules are instead craned into position; safely controlled from ground level.  Similarly, materials which would ordinarily be stored on-site, potentially open to the elements, are instead kept in a climate-controlled setting meaning that exposure to humidity, rain and snow will be significantly reduced.

Modular construction can also provide a greener and more sustainable alternative to more traditional construction methods, not least because the materials themselves are often eco-friendly from the get go.  But, the more efficient manufacture of modular buildings means that the energy poured into the assembly process is a fraction of that which would otherwise be produced on site, with less waste and fewer deliveries being an added bonus!  Pre-fabricated sections are also far easier to dissemble and relocate to different sites, or add to as the need for space grows.

Finally, advances in technology have meant that modular construction has certainly come a long way since the post-war ‘Prefabs’.  It now offers almost limitless design opportunities, such that the finished product is virtually indistinguishable from their site-built counterparts. 

Does modular construction give cause for concern?

Historically there has been a concern that modular buildings have enabled fires to spread more rapidly, especially as units have tended to be timber framed.  The Ronan Point disaster of 1968 also highlighted vulnerabilities with panel built design, as a gas explosion in a flat on the 18th floor caused a supporting wall in the affected flat to be blown out, with the floors beneath subsequently falling “like a house of cards”.

Similarly, the Association of British Insurers has said it was concerned that if a small part of a modular building suffered damage, the whole building may need to be replaced. This makes repairs more difficult and costlier than structures built using traditional techniques.

From a legal perspective, modular construction is unique and it could create more vulnerability in the project due to the narrow supply chain.  It may also be more challenging to find another contractor to step-in and complete the project in the event that the original contractor is in default or becomes insolvent – performance bonds, guarantees and insurances should be considered at tender stage to mitigate any potential losses which might otherwise be incurred.  It is also recommended that a developer client incorporates sufficient clauses into its building contract to allow for inspection and testing of the product throughout.  Licensing of IP to the developer from the outset will also be vital.

Both the pros and cons of modular construction should be evaluated.

Is the increased cost in construction worth it on the basis that the construction time is potentially reduced? If the project requires increased design flexibility, is it cheaper to build traditionally? It seems that modular construction may be better suited for larger scale projects and build to rent schemes, rather than smaller projects.

In any event, modular construction is innovative and a step in the right direction in achieving Net Zero by 2050.

If you are considering modular construction for your next scheme and require any assistance on drafting and negotiating terms and conditions for your contract, please get in touch with a member of our team who will be able to assist.  

For more information on the issues raised in this article, please contact the Construction and Engineering team.