UK modular housing panelised wall installation

Is Australia heading towards a panelised or volumetric building future?

The race is on for Australia’s state governments to determine their policy on offsite construction.

Australia’s construction sector appears to be navigating a pivotal moment as it positions itself for broad adoption of offsite construction methods, specifically volumetric modular construction versus panelised construction. Each method brings distinct advantages and challenges, prompting a nuanced consideration of their respective merits. (main pic: Australia’s offsite construction future balanced in mid-air.)

Given there is no national uniform approach to offsite construction, each state government is forging its own path to address both their political needs and harnessing local manufacturing resources.

Volumetric versus Panelised

Volumetric modular construction, also known as 3D prefabrication, involves producing fully finished modules within a controlled factory environment. These modules, which include components like bathroom and kitchen pods, are then transported to the construction site for assembly. This approach significantly cuts down on construction time, as the modules are built concurrently with site preparation. Volumetric systems leave the factory up to 95% complete, incorporating structural, architectural, and service elements, and can be configured into multi-level structures. This method is particularly beneficial for projects where speed and consistency are crucial, and where on-site labour is limited​.

Conversely, panelised construction, or 2D prefab, focuses on producing flat-packed panels for on-site assembly. These panels can vary from basic, uninsulated frameworks to advanced, insulated, and pre-finished systems that include windows, doors, and integrated services like electrical and plumbing. Panelised systems are easier to transport and offer a high degree of customisation. They are ideal for projects requiring flexibility in design and rapid assembly, as they can be quickly erected onsite​.

Australia’s state governments: different offsite construction approaches laid bare

The NSW Government is developing a pattern book of endorsed building designs that can be used to guide the creation of new housing. The collection of designs will be for low-rise housing and mid-rise apartment buildings of up to 6 storeys. Buildings can be constructed from compliant kit-of-parts, such as wall and floor panels. Homes NSW is also collating a supplier list of modular builders for potential use in future government housing developments.

The Queensland Government is placing greater emphasis on volumetric modular construction, particularly in light of their commitment to assembling a collaborative of modular builders, and developing QBuild’s (Queensland Government’s builder) volumetric modular construction hubs in Eagle Farm and Cairns.

The Victorian Government has yet to commit to a particular methodology, however, in the recent state government budget there was an allocation to develop a modern methods of construction (MMC) framework. A government steering committee will be established within the next 10 weeks. Additionally, the Victorian School Building Authority (VSBA) have established their own modular construction criteria and assessment protocol for utilising volumetric construction to deliver kindergartens and school infrastructure. Approximately three years ago, the Office of Project Victoria developed an analysis tool for government departments to assess the viability of planned building works.

The Tasmanian Government has set a course for an education and skills-based volumetric modular construction model, providing workforce training, increasing the supply of skilled labour, and creating jobs, with the objective of increasing the state’s skills base through industry alliances.

The West Australian Government established their Modular Build Program back in 2022 with establishing a state-wide panel of six volumetric modular builders. The emphasis of the state’s program is delivering an end-to-end modular housing solution.

The South Australian Government appears to be following a similar trajectory to the West Australian government with establishing an end-to-end volumetric modular solution on tenders.

The Northern Territory Government, as of 2022 delivered approximately 42% of all housing stock using volumetric modular. However, there have also seen some usage of a kit-of-parts approach for remote and regional communities.

Is there an international example?

The Swedish model, widely regarded as a global exemplar of offsite manufacturing of prefabricated housing, predominantly utilises panelised systems.

Among the myriad influences that have led to Sweden’s dominance in the offsite construction space in terms of skills, expertise, and industry structure, the most frequently cited factors are the country’s abundance of slow-growing, premium quality timber and its uniquely challenging climatic conditions.

Interestingly, over 80% of Sweden’s housing market relies on factory-built panels, leveraging high-quality timber and advanced timber processing manufacturing techniques.

This approach has proven effective in producing well-insulated, high-quality homes swiftly, which is essential in Sweden’s harsh climate characterised by long winters and high rainfall​.

Hybrid approach: The key to accelerating offsite construction adoption in Australia

Ultimately, a balanced approach may well be the most prudent path forward. By combining the strengths of both volumetric and panelised systems, a hybrid model can offer the speed and efficiency of modular construction alongside the flexibility and customisation of panelised systems. This strategy allows for the optimisation of different building components, leveraging the best attributes of each method to suit specific project requirements and constraints​.

However, a clear opportunity for state governments exists now to collaborate on standardised wall, floor and roof elements that comply with pre-approved designs would be the most immediate and pragmatic path forward to accelerate the adoption of offsite construction nationally.

A secure pipeline of government contracts that harness these pre-approved elements accessing pre-approved designs would give the building industry the confidence to invest and develop.

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