Offsite construction can play a significant role in tackling issues surrounding housing supply, says John Skivington, director at LHC.
Major challenges in delivering new homes
What do you see as the major challenges facing social landlords attempting to deliver new homes?
In 2004, the Barker Review of Housing Supply highlighted the need to deliver 240,000 houses per year for the next 25 years. Housebuilding has never reached this target, which is a fundamental concern for the government.
With an increasing deficit of housing missing that target, we now need to deliver around 300,000 houses a year.
In the 1960s, when local authorities were heavily involved with housebuilding, 350,000 homes were built per year – a far cry from today’s output. Along with housing reform reducing grant for new homes, welfare reforms in general and the new caps on housing benefit, the government should look back to what has worked in the past and for local authorities and social landlords to be given the land and money to get building.
Can offsite construction help solve the UK’s housing crisis?
Offsite construction is one of the possible options to help boost housebuilding. Despite its chequered history, the offsite sector has come a long way.
Social landlords are increasingly turning to the benefits now offered by this method of building to help tackle the housing supply shortage. Factory-built panelised and volumetric units offer a cost-effective solution, particularly in urban areas where there is an increasing demand for more housing on pockets of brownfield land.
In addition, improved quality, reduced waste and efficient building techniques are helping to drive demand. LHC introduced the first nationally available procurement framework for offsite-built new homes to support this surge. Our framework includes a supply only or a full turnkey solution.
At LHC, we believe offsite manufacturing techniques offer a possible solution for getting quality, affordable new homes built quickly – which is a priority for local authorities and housing associations.
Benefits of Offsite construction
What advantages does offsite have over other methods of construction?
Traditional house builders are experiencing skill shortages that puts pressure on housebuilding costs. Offsite construction offers a solution that provides an ideal alternative to social landlords wishing to build quickly and efficiently.
With many UK manufacturers now using state-of-the-art manufacturing techniques in modern, highly automated factories, offsite construction has come a long way, offering landlords high-quality and cost-effective solutions.
As well as adding valuable building capacity to the market, the benefits of offsite construction include:
- Predictability of costs due to controlled factory production costs;
- Faster speed of build, as much of the work is completed in the factory;
- Consistent product build and high quality finishing with fewer defects than traditional build, due to controlled factory construction that is not weather dependent;
- Value engineering which can help save costs, including reduced preliminary and carpentry costs;
- Reduced onsite labour requirements which helps mitigate against labour and skill shortages;
- Low levels of site waste as much of the work is conducted offsite;
- Reduced risk of theft as there are less easily removable materials onsite;
- Less disruption to local residents with reduced vehicle movement, dust and noise;
- Excellent standards of energy efficiency.
In what ways can procurement frameworks help improve the delivery of new homes?
Fully Official Journal of the European Union (OJEU)-compliant frameworks can provide local authorities, housing associations and other social landlords with easy access to offsite manufactured volumetric and panelised building systems for the construction of new homes.
Users of frameworks can access a list of qualified offsite manufacturers and suppliers, as well as a list of regional contractors. They can also start working much quicker than they would by going down the traditional route of procuring themselves.
By working with technical teams and appointed companies early on in the process, framework users can also access assistance with design and planning. Depending on the type of framework selected, some suppliers have already developed standard house types which help buyers avoid design issues and save time and money, as the houses already comply with building regulations, the Housing Quality Index and funding authority requirements.
How can organisations ensure they get the outcome they require when procuring via a framework?
By engaging with the framework provider, buyers can help determine and establish the key performance indicators (KPIs) required for the project.
Our members tend to focus on quality (technical), aesthetic, functionality, value for money, accessibility, and social and environmental benefits. These variables play a fundamental part in ensuring the correct supplier is appointed to deliver the project and can also meet the required additional stipulations. Our members prefer to build the KPIs into regular milestone meetings, which are also attended by our framework experts to ensure the buyer’s needs are fulfilled.
With LHC, all frameworks have the option to either award directly or run a mini-competition between the companies that have declared an interest in the project (assuming more than one supplier is appointed). A supplier can be recruited as a direct award based on the evaluation criteria (normally on price, quality or value for money – which is a combination score of price and quality). The criteria can be flexed to a buyer’s needs if necessary. The mini-competition offers an alternative if the buyer wishes to benchmark the best companies against each other.
What sort of efficiencies can be achieved through a procurement framework?
Frameworks were created to save time and money, but they also offer additional efficiencies:
- Confirmed competitive market prices – prices in place at call-off stage maintaining best value as established in the evaluation stage;
- Quick and efficient procurement – speedy access to companies and the options of a mini-competition or direct award to enable the final selection of a supplier, or suppliers, for a project;
- Instant access to project data – continuous information throughout the procurement process collected by the framework provider (offered by LHC);
- High-quality standards – standards maintained throughout the project through monitoring in accordance with ISO 9001 quality management system;
- Service levels – guaranteed service levels from inquiry to supply, providing peace of mind that services and works will be conducted effectively;
- Quick project starts – enabled by pre-tendered procurement that reduces cost and time input by public sector organisations and speeds up access to companies;
Advice on design and regulatory compliance – guidance on interpretation and conformity to statutory regulations and planning require.