Offsite Construction Gets a Boost From Housing and Urban Development

The U.S. Department of Housing and Urban Development's new roadmap aims to bolster offsite construction for affordable and multifamily housing.
By Joseph W. Sollod
August 2, 2023

As housing prices around the world continue to rise, many people are finding it increasingly difficult to find suitable, affordable housing. This has left communities looking for a solution, and many of them are turning to offsite construction.

Thanks to the accelerated project timelines, cost savings, lower materials wastage and improved quality of offsite construction, developers are now able to create more affordable housing units and get them to the market faster. As offsite construction progresses in popularity, so does the need to further advance the development of innovative solutions to help improve the usage of these solutions.

Establishing Research Priorities for Offsite Construction

In January 2023, the U.S. Department of Housing and Urban Development (HUD) developed a report, "Offsite Construction for Housing: Research Roadmap," which outlines important research areas to further advance offsite construction within the housing industry. The roadmap illustrates what industry experts consider to be the most pressing concerns, barriers and opportunities in offsite construction.

The roadmap focuses on six interconnected topics that help drive advancements in residential offsite construction, including single-family and multifamily housing. These research topics include:

1. Regulatory Framework

2. Standards and System Performance

3. Capital, Finance and Insurance

4. Project Delivery and Contracts

5. Labor and Workforce Training and Management

6. Business Models and Economic Performance

These topics raise key questions and subtopics that should be addressed to increase the efficiency and quality of offsite construction methods, such as modular and prefabricated construction, while reducing costs and environmental impact.

Regulatory and Policy Framework

The first topic explores the obstacles that are found within regulatory and policy frameworks that may hinder the adoption and implementation of offsite construction methods. This topic recommends analysis of existing regulations and policies related to building codes and standards, zoning, licensing and permitting to understand how they may affect the use of offsite construction methods.

Researching the regulatory and policy frameworks will help develop new policies and regulations that support offsite construction methods and can help improve the permitting and approval processes.

Standards and System Performance

The second topic focuses on developing standardized performance metrics for offsite construction systems and components by analyzing the performance of current systems while developing standardized metrics to evaluate their performance. The systems will be evaluated based on their performance in areas such as structural integrity, energy efficiency and indoor air quality.

Researching the standards and system performances will establish a common framework for evaluating the performance of offsite construction systems to help promote greater consistency and quality across the offsite construction industry.

Capital, Finance and Insurance

The third topic dives into the financing and insurance solutions that can help advance the adoption and implementation of offsite construction methods. This research will explore the capital, financing and insurance options available for current construction projects and analyze any obstacles surrounding their availability or effectiveness.

Researching the current capital, finance and insurance solutions will help with developing new solutions that can further improve the cost-savings and risk-mitigation benefits of offsite construction. It will also help to further introduce new sources of capital funding for construction projects.

Project Delivery and Contracts

The fourth topic investigates the current project delivery and contract models used throughout the construction industry to determine their strengths and limitations when applied specifically to offsite construction. Project delivery and contract models are used to organize and execute construction projects and provide contractual agreements that govern the relationships between stakeholders.

Researching these current models will help develop new models that better fit the requirements of offsite construction projects. It is clear that more research is needed to understand the potential benefits of using integrated project delivery methods to streamline the offsite construction process.

Labor and Workforce Training and Management

The fifth topic dissects labor and workforce obstacles that can potentially limit the adoption of offsite construction methods. This research will analyze the construction industry’s workforce and the training and management practices currently being deployed. The research will also analyze the benefits of using innovative manufacturing technologies such as robotics and 3D printing to help reduce the need for manual labor and enhance worker safety within factories.

Researching the labor and workforce training and management will help to develop new approaches to attract a skilled and diverse workforce for offsite construction jobs. This could result in new training courses and certification opportunities for professionals looking to advance their careers.

Business Models and Economic Performance

The sixth topic analyzes the current financial and economic performance of offsite construction projects to determine which factors play into their success or failure.

Researching these factors can help develop new business models and strategies that will support the adoption and implementation of offsite construction methods from an economic standpoint. This could include introducing new revenue streams and opportunities through factors such as increased productivity, reduced waste and improved quality control.

Underscoring the Importance of Codes and Standards

Along with improved research, adopting and implementing building codes and standards for offsite construction is essential to accelerate the industry and build more consensus and uniformity. Standards developed by the International Code Council and the Modular Buildings Institute (MBI) on the planning, design, fabrication and assembly process (ICC/MBI Standard 1200-2021) and inspection and regulatory compliance (ICC/MBI Standard 1205-2021) play an important role in helping to standardize terminology and establishing a common process for offsite projects. Additional standards are in development including ICC/MBI Standard 1210 for Mechanical, Electrical and Plumbing Systems, Energy Efficiency and Water Conservation in Offsite Construction.

HUD’s roadmap recognized the International Code Council for its contributions to progress in offsite construction and identified the need for continued research and education around the regulatory process.

Recommendations for future HUD-supported research and projects include fostering a platform for sharing knowledge, data and lessons learned; facilitating and funding pilot projects for new technologies and practices; developing an education and training program for code officials; coordinating with other federal agencies; and networking with offsite organizations internationally.

HUD is now developing a strategic plan for offsite construction, gathering lessons learned from regulatory approaches around the world (including the United Kingdom, Japan and Sweden). Prior research, including Operation Breakthrough in the 1960s and 1970s, is also being reviewed for additional context; HUD’s strategic plan is due in 2024.

by Joseph W. Sollod
Joseph W. Sollod - Sustainability, Resilience and Innovation Associate--Government Relations, International Code Council

Related stories

Closeout: The Water Is Wide
Harkers Island Bridge Replacement, Carteret County, North Carolina
Liftin' on a Prayer: Jon Bon Jovi's New Nashville Bar
By David McMillin
For DPR Construction, building Jon Bon Jovi’s new five-story bar in downtown Nashville meant working around 16,000 daily pedestrians, a packed entertainment schedule and a very tight footprint.
Great Expectations: Is Your 2024 What You Thought It Would Be?
By Grace Calengor
From interest rates slowing to AI implementation to lagging effects from 2022 and an impending election, can your construction company keep up with what 2024 has in store?

Follow us

Subscribe to Our Newsletter

Stay in the know with the latest industry news, technology and our weekly features. Get early access to any CE events and webinars.