Modular Building Institute

Discussion Forum

So Now We Know - Demand IS NOT the Problem!

Original Comment:
Well, we now know definitively that demand IS NOT the problem! When I wrote the article “What if Demand Wasn’t the Problem” less than a year ago (see below), I was unsure of the answer to that question. Today, I can tell you the good news is that the demand has exceeded 10%! The bad news is that the supply is still around 3%.

Last week, MBI staff spoke with one large corporation and a multi-family developer about projects they had in the works. These are projects that the owners want to go modular and have been designed for modular. Both are currently looking for multiple manufacturers. Yesterday, MBI staff spent 4 hours talking to Marriott Corporation about their needs. Currently, Marriott has planned for about 8% of their new hotels to be modular. But they say "at least 40% COULD be modular." That translates into about 600 modular hotels.

So, in the last week, these three companies alone could keep 15-20 manufacturers busy for the next 3-5 years. These three conversations translate into over 20,000,000 sf of space!

Demand is NOT the issue. We are spending a considerable amount of time and effort to convince owners and developers that modular is the way to build. Why don't we just figure out how to build for the companies that want modular and are calling us now?
Started on February 28, 2018 by Tom Hardiman
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Additional Comments:
Thanks Tony for that overview from a Construction Managers perspective.

It was surprising to me to hear your views though, I would have thought that US manufacturing expertise (and scale) would have solved many of these problems for intra-US projects.

But if scale and capital are indeed part of the problem, then we need to have that discussion - "going modular" will provide many solutions around the world for general building construction and specifically the shortage of quality and affordable housing stock in my area of the world, but only if we in the industry are geared up for it. People and government in my region (SE Asia) don't care about any traditional vs modular debate; they just want affordable, fast, quality homes and buildings and don't care how we deliver them:)

On our side, we are looking at licencing our moldular production systems via either licencees or a franchise system across the SE Asian region as a way of deploying capital more efficiently and speeding up roll out and capacity as fast as we can; (NB: almost there on the production system IP, should have completed by May so we are looking forward to an exciting year).

For those who may want to look at how the industry can "get bigger or go home", feel free to contact me ( or phone / whatsapp +60169839715) - website

I'm based in Malaysia and across the entire Asian region, there isn't enough awareness by the industry or anywhere enough quality capacity to service what could be the demand here.

Right now, most developers and architects don't know that modular is even an option for them; and in most cases it's not.

Designing for modular is a particular challenge.

To take a developers concept or an architects design and "modularise" it for manufacturing and final installation takes a certain expertise and mindset that is difficult to find, so we are on-job training our people:)

And then to have the scale of manufacturing for multi-module buildings and the capacity to transport is yet another challenge.

We are developing module manufacturing methodologies that will enable both volumetric shipping as well as flatpacking (even for multi-module buildings) that can be erected and finished on site with minimal heavy equipment (because sometimes we are limited by either cost or availability of heavy materials handling equipment)

But these are mostly technical challenges that can be overcome if the problems are there to be faced, because we have a client that requires us to solve them in order to deliver the final product.

The scalability of the industry is I think something that we in the industry need to look at; can there be more sharing of expertise and ideas?

can we form common standards that make life easier for us all (and for consumers to understand)?

Can we open source the common factors and maintain our edge with innovation and design expertise so we don't duplicate resource and time and the wasted efforts that creates?

As a prime example of common learnings and needs, we need to provide the equivalent of 4" of concrete or brick for our 4 hour fire rated party walls on terraced and joined buildings. How do I provide this with a modular building approach without building a separate (non-modular) joining wall, whether it's a precast concrete wall or a 6"-8"foam filled wall with a spraycreted skin?

I am sure this has been solved by someone (or many of you) in MBI, so if I can collaborate with someone, this is an example of how we can help each other to solve common problems.

I would be interested to hear more from members
Updated on February 28, 2018 by Dennis McMahon

As a Construction Manager I have been tackling this very issue for several significant Multifamily and Student Housing projects Presently in concept planning in Southern California.The increasing challenges with labor availability and trade expertise combined with escalating material costs have created the ideal window of opportunity for offsite manufacturing to become a viable and in many cases preferable construction method. The critical path time savings combined with the consistency of quality expectations and delivery further benefit this evolution.
There are many current obsticles still contributing to difficulties making offsite construction a cost effective reality for most projects. There are very few qualified multifamily off site manufacturers within a reasonable travel distance to Southern California. Recent feedback from the few that exist is lack of availability, increased costs, logistical challenges in regard to modular efficiencies within the manufacturing process effecting design creativity and overall modular unit costs etc.
There is no question that there is a signifigant lack of existing well positioned manufacturing locations capable of servicing the areas of growth such as Southern California. There also appears to be a lack of consistency of manufacturing capablities and production volume availablity.
Overall the industry has not created a consolidated effort to educate and market the offsite modular industries cababilities and availabilities to potential investors and individuals looking for a viable growth industry to develope into new and state of the art facilities capable of providing a quality complex project delivery to key locations which are and will continue to devlope quality complex projects throughout the ever changing economic market conditions.
General contractors lack of understanding of the industry details and coordination combined with general fear that the offsite industry will effect their workload volume instead of seeing the expanded opportunities is another contributing factor . The General Contractors and designers have traditionally had the relationships with Real Estate Developers . This concern permiates the architectural and associated design consultants perception of the industry combined with their previous reluctance to promote this industry which will undoubtedly be an increasing force in the future directly affecting the design industry.
There is no doubt that there is a demand for the offsite manufacturing delivery process to proliferate into a significant factor in the construction industry but until the industry takes significant steps towards educating the end users, contractors,designers and potential new manufacturers while also focusing on a concerted and consolidated increase in quality production facilities in key locations to reduce the transportation costs while maintaining an economical market rate competitive construction SF cost for Real Estate Developers to work with the industry will not gain significant ground in the Multifamily, Student Housing, and Hospitality product delivery elected option for Developers.
Regards, Tony Frost TDK Management Co.
Updated on February 28, 2018 by Anthony Frost

I guess its easy to say "i make modular buildings " but the scale and expectations of clients may be part of the challenge

It would have been interesting to hear why these companies didnt use more modular methods.

Was it supply?

Was it price?

Was it configuration of designs that were just easier or cheaper to build traditionally?

Interested in any follow up posts
Updated on February 28, 2018 by Dennis McMahon

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