Can David Chandler and offsite construction restore trust in Australia’s building industry?

In a far-reaching interview with Built Offsite’s publisher, Michael Dolphin, David Chandler OAM, former Building Commissioner of NSW and construction industry veteran, delivered his unvarnished view of Australia’s construction landscape and the promise of offsite and modular construction.

Trust is fundamental to reshaping Australia’s construction industry, and David Chandler has worked at every level of the sector to foster this value. From consumers seeking safe, quality homes, to builders, developers, and elected government officials, Chandler’s influence spans the entire spectrum of the building process. His access to all these critical players has given him a unique perspective on the industry’s systemic failures – and how they can be addressed. “Trustworthiness is now being seen as the most risk-free means of achieving completion and value for money,” Chandler emphasises. Without a foundation of trust, no building – no matter how technically advanced or efficiently constructed – can truly be considered worthwhile. 

Chandler isn’t just focusing on reforming practices but on restoring public confidence in an industry that, in his words, has betrayed its customers too many times. “I am working on testing and delivering an initiative to help modern construction enterprises to embrace, survive and thrive in the modern construction era.” Through the implementation of new standards and his relentless push for transparency, trust, according to Chandler, is key to underwriting a sustainable and successful construction sector in Australia.

A Construction Industry in Crisis

Australia’s construction industry is facing a pivotal moment. After years of regulatory inconsistency, subpar building practices, and growing financial instability, the sector continues to face a crisis of confidence. Offsite and modular construction (OSCM) holds immense promise for addressing many of these challenges. With its ability to streamline operations, reduce waste, and deliver high-quality outcomes, OSCM could lead a long-overdue transformation. But unless the industry embraces this shift and reforms deeply, it risks squandering the opportunity and repeating its old mistakes.

Chandler offers a blunt assessment of the sector’s current state. “I’ve seen what the construction industry has delivered over the past ten years, and frankly, it’s appalling. Developers collapse their companies, walk away, and leave the mess behind.” His indictment of industry practices is damning. For Chandler, OSCM represents a chance to rectify many of the industry’s past failures – but only if the entire sector is willing to confront uncomfortable truths and make necessary changes.

The time to act is now, before the industry faces further decline.

Offsite Construction: The Key to Transformation

Offsite and modular construction is often hailed as the future of the building industry. By shifting much of the construction process away from the unpredictability of onsite work and into controlled environments, OSCM (including hybrid OSCM) promises faster build times, better quality control, and more predictable costs. Despite these clear advantages, OSCM is still struggling to achieve mainstream acceptance in Australia. According to Chandler, the reason is simple: a lack of serious investment and understanding from the private sector. “Offsite construction can solve a lot of the problems plaguing traditional methods, but it’s not enough for businesses to make claims without backing them up.”

Chandler doesn’t mince words when discussing OSCM’s failure to scale. “The private sector needs to understand that OSCM businesses require investment before they can even think about making claims to be mainstream. You simply can’t build an industry on thin capital or small-scale efforts.” The implication is clear – there’s a lot of talk but not enough serious commitment. Many OSCM startups launch with big ideas but insufficient capital or strategic clarity, leading to underperformance and undermining confidence in the approach.

Chandler also pulls no punches when talking about the financial sector’s role. “Banks don’t want to take development risks unless they’re equity participants,” he explains. “They want to lend money, and they want to get it back, full stop.” If OSCM businesses want to grow, they need to engage with the financial sector in a way that demonstrates the long-term viability and superior value of offsite construction. Without this, OSCM risks staying on the fringes, unable to break into the mainstream construction market.

Fragmentation of Risk in Construction

One of the most glaring structural issues holding back not just OSCM but the entire construction sector is the way risk is distributed. In too many projects, different contractors and parties only take responsibility for their part, leaving significant gaps in accountability. As Chandler puts it, “Clients and developers don’t buy buildings in parts – they expect a fully integrated, fit-for-purpose building.” This disconnect between what clients expect and what the industry delivers creates confusion, delays, and financial blowouts when something inevitably goes wrong.

For offsite construction, where modular components are fabricated separately and assembled onsite, the stakes are even higher. Without a well-coordinated process, errors and non-compliances made during offsite manufacturing can snowball into massive failures once the components reach the construction site. “If something goes wrong, who’s responsible?” Chandler asks. “Right now, the industry is too fragmented to answer that question.” The industry’s inability to answer such a fundamental question reveals a deep dysfunction in how risk and responsibility are handled.

Chandler’s solution? Single-point accountability. By ensuring one entity is responsible for the entire project, from design and manufacturing to onsite assembly, the industry can create clearer lines of responsibility and reduce the chaos caused by fragmented accountability. “We need to integrate these processes to give clarity, both to the project and to the consumer.” Without single-point accountability, Chandler warns, the potential of OSCM will continue to be undermined by inefficiencies and risks, and developers will be left pointing fingers when projects collapse.

A Dysfunctional Regulatory Landscape

Chandler is also outspoken about the state of Australia’s regulatory environment. “There are now five versions of NCC 22 adoption across Australia,” Chandler says. “It’s dysfunctional, and it’s costing the industry.” The construction industry operates under a labyrinth of state-specific regulations, which stifles businesses attempting to operate nationally. This inconsistency is a serious barrier to scaling OSCM in Australia and prevents the adoption of a unified approach to construction.

Chandler has long been vocal about the need for stronger federal leadership. “Australia desperately needs a Federal Minister for Construction. This isn’t just about policy – it’s about leadership.” The regulatory landscape, as it stands, is too fragmented to support widespread adoption of OSCM. A unified, national approach is crucial for creating the conditions that allow OSCM to thrive.

But Chandler is realistic about the challenges involved in harmonising regulations across the country. In the short term, he suggests starting with the key markets of NSW and Victoria. “Harmonising between New South Wales and Victoria could have a profound impact,” Chandler says. Standardising regulations between these two major states could serve as a model for the rest of the country, streamlining processes and creating a more favourable environment for OSCM.

Building Smarter with Smart BaU

Offsite construction is not the industry’s only lifeline – Chandler is clear that business-as-usual (BaU) practices need a serious overhaul. “We need to move from BaU to smart BaU, where efficiency and precision are prioritised over outdated practices.” Chandler’s vision for smart BaU centres on measurably improving coordination, reducing waste, and designing projects that minimise rework and delays.

In this context, offsite construction fits perfectly. By manufacturing components in controlled environments, OSCM allows for tighter tolerances, better quality control, and faster project completion times. “By adopting smart BaU/hybrid practices, the industry can cut months off build times and significantly reduce costs.” Chandler points out that rework alone can account for up to 12% of total construction costs – a staggering inefficiency that smart BaU and OSCM can help eliminate.

However, smart BaU isn’t just about technology – it’s about fundamentally rethinking how projects are planned and managed. “This isn’t about marginal improvements; it’s about fundamentally changing how we approach construction,” Chandler argues. The shift to smart BaU will not only make construction more efficient but will also create the conditions needed for offsite construction to reach its full potential.

Addressing the Legacy of Defective Buildings

Chandler doesn’t hold back when discussing the legacy of defective buildings left by unscrupulous developers. “Some of these developers are linked to organised crime,” he says bluntly. “They care as little about where you sleep as what you put in your body.” The industry’s dark history of substandard building practices has left countless buildings across NSW and other states riddled with serious, often hidden defects that threaten both safety and financial stability for owners.

The scale of the problem is staggering. “I estimate there’s at least $2 billion worth of legacy defects in NSW apartment buildings, though I suspect it’s closer to $4 billion.” Yet, despite the enormity of the issue, Chandler believes the government has been slow to act. “The government doesn’t have the appetite or the budget to deal with this mess.” For OSCM businesses, this serves as a stark warning: cutting corners to boost profits will not only lead to financial ruin but will also erode public confidence in the industry.

Rebuilding Trust with Consumers

One of the biggest barriers to the growth of offsite construction is the erosion of trust within the construction industry as a whole. After years of scandals, shoddy practices, and lack of accountability, consumers are understandably wary of any new methods or technologies. Chandler is clear: rebuilding evidenced-based trust is essential. “Trustworthiness is now being seen as the most risk-free means of achieving completion and value for money.”

In NSW, the introduction of reforms such as the RAB and DBP Acts has started to shift the conversation. Consumers are finally asking for iCIRT-rated projects and 10-year warranties before committing to new developments. “Consumers are now asking whether their projects are iCIRT-rated and covered by long-term warranties,” Chandler says. This increased scrutiny is forcing developers – and by extension, OSCM businesses – to prioritise transparency, quality, and compliance from the very beginning.

For OSCM to succeed, this focus on trust and accountability must become the industry standard. Developers need to prove that offsite methods aren’t just about speed and cost-cutting, but about delivering safer, more reliable, and higher-quality buildings than traditional construction methods ever could.

The Future of Construction Lies in Technology

Chandler is optimistic about the role of technology in shaping the future of construction, particularly for offsite methods. “Technology is key to modernising this industry. Innovations like digital twins, AI, and advanced manufacturing techniques are transforming how we build.” These tools enable more precise builds, reduce rework, and shorten project timelines, making OSCM more competitive and cost-effective in the long run.

However, Chandler is aware that not everyone is ready to embrace these changes. “There’s still a lot of hesitation, particularly among smaller firms,” Chandler admits. But larger companies are beginning to see the benefits of digital transformation, and the rest of the industry will have no choice but to follow suit if they want to remain competitive in an increasingly technological landscape.

The Skills Gap: Preparing for the Future

As the construction industry evolves, it will require a new generation of enterprises trained in offsite construction techniques and digital tools. “We also need a new generation of workers who are skilled in digital tools and offsite techniques,” Chandler says. Without this new workforce, the industry will struggle to keep pace with technological advancements and the demands of a modern construction environment.

To address this gap, Chandler is spearheading an initiative to create an academy for modern construction enterprises. “I’m exploring starting an academy for modern construction enterprises, with some companies committing $100,000 a year to fund it.” This initiative aims to train the next generation of construction professionals with the skills necessary to navigate the increasingly complex and technology-driven future of the industry.

Embracing Change for a Better Future

Offsite construction holds enormous potential for addressing many of the challenges facing Australia’s construction industry. But that potential will only be realised if the sector is willing to make the bold reforms and embrace the innovations required to succeed. Chandler’s message is clear: accountability, investment, and innovation are not optional – they are essential.

“We need to overcome the resistance to change,” Chandler says. “The construction industry is slow to adapt, and there’s a lot of inertia.” By embracing new technologies, fostering more viable enterprises, a skilled workforce, and prioritising consumer trust, Australia’s construction industry can enter a new era – one defined by quality, efficiency, and reliability.

The time for half measures is over. It’s time to build smarter, and build better.