The Modular Housing Handbook by Bayliss Simon; Bergin Rory;
Author:Bayliss, Simon; Bergin, Rory;
Language: eng
Format: epub
Publisher: RIBA Publications
Published: 2020-08-15T00:00:00+00:00
Y:Cube, Rogers Stirk Harbour + Partners, Mitcham, 2015
Fig 5 Shorter programme, early release, more profit: diagram comparing the profit profiles of for-sale units and build-to-rent units, and then showing the benefits possible with shorter construction programmes
SAVINGS THROUGH PROGRAMME REDUCTION
Programme reductions possible in MMC delivery can also deliver financial savings of reduced site running capital costs, and through generating earlier revenue as the building is up and being occupied faster. However, earlier completion is not always a benefit to every residential asset class. ‘For sale’ products are programmed to release units onto the market timed to align with the rate of sale, maintaining a steady supply that keeps demand high. Reducing the construction programme would not always be beneficial in this case and could lead to an oversupply of unsold stock and value reduction. In asset classes such as Build to Rent, later living or affordable housing however, letting-up rates tend to be higher, and earlier revenue has a clearer benefit. In these cases, programme savings are linked to how quickly a product can launch on the market and start generating rental income which will benefit development of internal rate of return calculations.
It is important to remember that a large part of cost and programme risk priced into a construction budget covers works happening below ground, which are mostly unaffected by MMC. Basements and foundations on MMC projects are still usually completed traditionally and the risk cost associated with this part of the work will be largely unaffected by the construction method chosen above ground. (In some cases, however, an MMC light gauge or timber frame structure might be lighter than other construction methods, reducing loads on the foundations and their associated cost.
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