Australia’s MMC push can learn from Hong Kong — without copying it

After almost three decades working in and around Hong Kong’s construction sector, Patrick Fong has seen Modular Integrated Construction develop into an established part of the building industry. Now an Associate Professor in the School of Engineering and Built Environment at Griffith University, he believes that experience offers useful lessons for Australia — but not a model that should simply be transplanted. (main image: Modular Integrated Construction (MiC) module installation at the City University of Hong Kong student hostel development at Whitehead, Hong Kong, illustrating large-scale volumetric modular construction.)

In conversation with Built Offsite, Fong said his years in Hong Kong gave him a close view of how Modular Integrated Construction — or MiC — developed, the barriers it encountered and the conditions needed to support it beyond the factory floor.

“When I was in Hong Kong, what we call MMC here in Australia is known as MiC — Modular Integrated Construction — and it has become a major focus for the industry,” Fong said.

The primary proponents of Modular Integrated Construction (MiC) in Hong Kong include the Hong Kong SAR Government (led by the Development Bureau, which mandates MiC for designated public works projects), the Construction Industry Council (CIC), and key public housing bodies such as the Hong Kong Housing Authority (HA) and Hong Kong Housing Society (HKHS). These initiatives are reinforced by academic and research institutions alongside major contractors and developers, driving implementation across public works, transitional housing, student hostels, and private residential sectors. A prominent application occurred during the COVID-19 pandemic, when the city deployed MiC to rapidly deliver several large-scale temporary quarantine, isolation, and medical facilities across the territory.

But his experience has also convinced him that Australia should not simply copy what Hong Kong has done.

Hong Kong’s restricted land supply means much of its volumetric manufacturing takes place across the border in mainland China, with completed modules transported into Hong Kong by road or barge.

“Hong Kong has very limited land, so most modular units are manufactured in mainland China and transported across the border,” Fong said.

Australia, he said, has a different set of opportunities.

“Australia has the land and the resources to develop its own capability. I believe MMC can become a major part of the industry here if we get the settings right,” Fong said.

The factory is only part of the system
One of the clearest lessons Fong draws from Hong Kong is that industrialised construction cannot be considered simply as a manufacturing process.

“When I look at MMC, I don’t look at it in isolation. We need to look at the whole process,” he said.

“A lot of people see MMC primarily as a technology — as a different way of manufacturing or prefabricating a building. I think we need to look much more broadly than that.”

For Fong, the challenge is to develop the “entire delivery ecosystem” around industrialised construction, including skills, knowledge, procurement, standards, evidence and sustained demand.

“It is not just about producing the modular unit,” he said. “You need the right skills, knowledge, procurement, standards and, importantly, sustained demand.”

That becomes particularly important when factory production is promoted as a means of accelerating housing delivery.

“You can make construction faster, but if the approval process upstream is still very slow, it doesn’t help the industry overall,” Fong said.

“MMC is part of the solution, but it is not the whole solution. We need to look at the entire process and how it can be streamlined.”

Fong saw that problem emerge during the early adoption of MiC in Hong Kong, where approval authorities initially had no precedent for assessing the new systems, particularly in areas such as fire and building safety.

For Australia, the experience suggests regulation, approvals and manufacturing capability need to develop together rather than sequentially.

Predictable demand still matters
Fong also sees a role for government in helping establish domestic MMC manufacturing capacity, although he does not believe factories should remain dependent on continuing public support.

“Government can provide some initial support to companies that are serious about establishing manufacturing capability in Australia,” he said.

“But in the long run, those businesses need to be commercially sustainable. Government cannot continue funding them indefinitely.”

The more enduring requirement, he said, is a reliable flow of work.

“The most important thing is having a predictable project pipeline, so manufacturers know they have enough work to keep the factory operating and the business sustainable.”

Fong also argues that Australia should resist treating volumetric construction as the default form of MMC.

Hong Kong’s experience with transporting completed modules through a dense city has demonstrated the practical constraints that can accompany volumetric construction. Australia’s geography creates a different set of considerations.

“We shouldn’t force everything into one particular method,” Fong said. “If the land, transport and project conditions suit volumetric construction, then use volumetric. If they don’t, panelised construction can also speed up delivery.”

“The important thing is choosing the industrialised method that suits the project, rather than saying everything has to be volumetric.”

Productivity is the broader test
For Fong, the Australian discussion also needs to move beyond how much of a building is produced in a factory and focus more directly on what industrialised construction is expected to achieve.

“When we look at MMC, productivity is another key issue,” he said.

He pointed to delivery certainty, fewer defects, reduced rework, improved safety and lower waste as part of the wider case for industrialised construction.

“MMC is not just about making a box in a factory and stacking it up like Lego,” Fong said. “There are much broader advantages — better delivery certainty, fewer defects and less rework, improved safety and reduced waste.”

That perhaps represents the most useful bridge between Fong’s Hong Kong experience and the Australian industry he is now examining.

The lesson is not that Australia should reproduce Hong Kong’s MiC industry. Its geography, manufacturing base, labour market and building typologies are different.

Rather, Hong Kong offers experience Australia can draw on without having to encounter every problem for itself — particularly around approvals, procurement, manufacturing demand and the need to treat MMC as part of a wider construction system.

For Fong, the opportunity is to apply those lessons while developing an Australian approach. That requires changing considerably more than what happens inside the factory.