Report of the Results of the 2014 Off-Site Construction Industry Survey€¦ · This document, The...

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Report of the Results of the

2014 Off-Site Construction Industry Survey

Off-Site Construction Council

ii © National Institute of Building Sciences

2014 OFF-SITE CONSTRUCTION INDUSTRY SURVEY RESULTS

1090 Vermont Avenue, NW, Suite 700Washington, DC 20005-4950(202) 289-7800(202) 289-1092 faxwww.nibs.org

Off-Site Construction Council

Ryan E. Smith, ChairAssociate ProfessorUniversity of Utah

Off-Site Construction Council iii


Introduction

In 2014, the National Institute of Building Sciences Off-Site Construction Council set out to get an understanding of how the construction sector is using off-site construction techniques by conducting a survey of the building industry.

This document, The Report of Results of the 2014 Off-Site Construction Industry Survey, provides answers to the many relevant questions and offers insight into who is using off-site construction in the industry, how it is being used, as well as the perceived benefits and challenges of using off-site construction in projects. This data will serve as a baseline moving forward as the Council works to educate and support the industry in implement-ing off-site construction practices.

Thanks to the help of Building Design and Construction magazine and Engineering News Record, as well as Off-Site Construction Council members, the survey was able to reach a significantly wider audience. We appreciate their support in getting this survey out to the masses.

And, of course, thanks to the Off-Site Construction Council, who compiled this report and will be putting the data to work to help the industry to capture the benefits of off-site construction in practice. I have no doubt this is just the first of many reports to come out of this new Institute Council.

Henry L. Green, FAIA President National Institute of Building Sciences

Report of the Results of the2014 Off-Site Construction Industry Survey

iv © National Institute of Building Sciences


Off-Site Construction Council 1


Report of the Results of the2014 Off-Site Construction Industry Survey

Off-site construction is the planning, design, fabrication and assembly of building ele-ments at a location other than their final point of assembly onsite. An integrated plan-ning and supply chain optimization strategy characterizes off-site delivery.1

From heating, ventilation and air-conditioning (HVAC) duct fabrication to full volumetric modules delivered to a site and assembled, off-site prefabrication in the construction sector is growing and impacting projects at an increasing rate. With the looming shortage of skilled craft workers forecast to exceed 2 million by 2017, prefabrication in a con-trolled, off-site environment may become a necessity for many U.S. contractors attempt-ing to remain competitive with a lower-skilled workforce.2 (Fig. 1) Despite the need and increasing demand, uncertainties accompany the utilization of off-site construction, as with any new process or technology.

1 Glossary of Off-Site Construction Terms. National Institute of Building Sciences Off-Site Construction Council Website. Accessed February 18, 2015. www.nibs.org/resource/resmgr/OSCC/GlossaryOffSiteConstructionT.pdf

2 Cumming Corp. Report on labor and construction market forecast in the U.S. 2015.

ANNUAL % CHANGECONSTRUCTION VOLUME VS. SKILLED LABOR (NATIONAL)

Figure 1Annual Percent Change in Construction Demand versus Labor Supply.

(Data courtesy of Cumming Corp.)

2 © National Institute of Building Sciences


In the fall of 2014, the National Institute of Building Sciences Off-Site Construction Council conducted a survey to identify the opportunities and challenges associated with the use of off-site construction processes and technologies in the United States and gain an under-standing of how the National Institute of Building Sciences can foster the utilization of off-site construction to support the achievement of high-performance buildings. The Council, which recognizes that the transition from site-built to off-site construction will require a profound change in business planning and organizational development, felt a survey of off-site stakeholders would establish a baseline of the current state of practice.

The National Institute of Building Sciences distributed the survey through its communica-tions network and both the Building Design and Construction magazine and Engineering News Record sent the survey to their subscribers. In addition, Off-Site Construction Council members disseminated the survey request to their personal contacts. This report summa-rizes the survey responses.

A total of 312 participants responded to the survey. Their answers, which were anonymous, are shown in the aggregate only. The results demonstrate the current markets, benefits and barriers, as well as next steps to be taken by the Council.

The companies who responded provide a number of services, including construction man-agement/general contracting (46.7%), engineering (38.3%), trade contracting (27.3%), archi-tecture (15.0%) and, finally, owners/developers (8.3%). (Question 12)

The survey responses indicate where off-site construction is most often being utilized. The participants (who could select multiple categories), are using off-site elements for commer-cial construction (57%), industrial (51%), healthcare (45%), education (37%), multi-family (24%) and hospitality (23%). Note: the survey was not intended to address single family residential construction (8.0%). (Question 14)

Most respondents (93%) indicated they had utilized off-site fabricated components to some degree over the past 12 months (Question 1), while 83% expected to utilize off-site construc-tion more often or the same amount in the next 12 months (Question 9).

The survey responses delineate the perceived and realized benefits of off-site construction to project performance. The primary benefit the respondents identified is a reduction to the overall project schedule and, specifically, the duration of the construction phase (perceived 78.0%, actual 73.2%). Participants also noted other benefits, such as the quality of the prod-uct and cost effectiveness. Off-site construction has historically not been a lowest-cost solu-tion for project delivery; however, the responses indicate that it is a cost-effective solution. (Questions 5, 6) When asked about the life-cycle benefits of off-site techniques, comments from respondents highlighted schedule reductions, overall cost benefits, reduced defects and increased quality.

Participants also experienced improved project stakeholder collaboration when employing off-site methods. According to 78% of respondents, off-site construction requires moderate-ly higher or significantly higher levels of stakeholder engagement. However, that increased integration and collaboration throughout the delivery process can result in higher quality and reduced changes throughout construction. (Questions 7, 8) The benefits respondents recognized in this survey confirm previous evaluations by McGraw-Hill Construction.3

3 Prefabrication and Modularization: Increasing Productivity in the Construction Industry. SmartMarket Report. McGraw Hill, 2009.



The survey also reveals the barriers and challenges to implementing off-site construction. (Question 2) According to the respondents, one of the most significant barriers is trans-portation, and more specifically, how far away the factory is located from the construction site. The need for clear program requirements for the building was also seen as a major challenge. In addition, respondents noted that some projects, particularly those with long spans, may not be suited for utilization of pre-fabricated elements and each project has unique requirements that must be met through an appropriate technical solution. Respon-dents noted the lack of industry knowledge as a barrier to the uptake of off-site construc-tion. Survey respondents also indicated that unions might hinder off-site utilization with factory non-union labor. (This has been an actual deterrent in projects on the East Coast.)4

The building component fabrication industry is maturing and will require time to more effectively integrate with site-built work. The survey points to the potential issues that the lack of supply chain integration can present for off-site construction. In addition, con-tractors are learning how to manage off-site products for assembly on-site. Interestingly, respondents stated that the most significant barrier to off-site construction is the design and construction culture. Comments indicate that late design changes, lack of collaboration and an adversarial climate for project delivery leads to difficulties in realizing the benefits of off-site construction.

A significant find from the survey is pinpointing who is making decisions regarding off-site use. The respondents indicated that the construction manager (CM) or general contractor (GC) (a combined 57.1%) is the one most often to decide to implement off-site construc-tion. This is followed by designers, including architects and engineers (A/E) (a combined 51.5%), then the client (27.9%) and others, primarily subcontractors (20.9%). (The survey team speculates this represents component fabricators, such as sheet metal suppliers, when prefabrication is held within a single subcontract agreement.) This finding is informative and suggests that additional education is needed for current decision makers (i.e. CM/GC and A/E), as well as owners, who have the potential to demand the use of off-site construc-tion. (Question 4)

The barriers and challenges to off-site construction discovered in this survey point to gaps in building project stakeholder knowledge. (Questions 10, 11) To fill this deficiency, the Off-Site Construction Council plans to distribute more industry-based surveys to obtain additional data on the state of pre-fabrication in the construction sector. In addition, the Council is proposing to develop an “Off-Site Construction Implementation Guide” for the building industry. This proposed implementation guide will aid project teams in leveraging the use of off-site construction. The guide will include case studies with qualitative informa-tion to give project teams examples of how they might organize their projects to realize the benefits (such as improved schedule and cost effectiveness) of off-site construction. The im-plementation guide would primarily address the following areas: design parameters, stan-dards, details and specifications; contracts; software utilization; phasing of construction; trade coordination; procurement methods; and transportation and installation logistics.

4 Atlantic Yards, a 32 story modular building in Brooklyn, faced a labor dispute between the union and developer of the project in 2013.



The Off-Site Construction Council is seeking additional support from companies and organizations in the building industry to assist in the research; collection of resources and potential case studies; and development of the implementation guide. The guide is intend-ed to be a no-cost resource, broadly available to the construction sector.

For more information about the guide or to support its development, please contact Ryan Colker at [email protected]. To learn more about the Off-Site Construction Council, includ-ing how to get involved, visit www.nibs.org/oscc.



QUESTION 1I have incorporated the following off-site elements in one or more projects in the last 12 months:

Responses reflect the number of answers to the question. Respondents may select more than one option.

140

129 128

9188

80

53

44 43

2926

21

0

20

40

60

80

100

120

140

160



QUESTION 2Rate the barriers to implementing off-site construction:

The rating reflects the average out of 4 possible degrees of barrier responses:Significant, Moderate, Small and No Barrier.

SIGNIFICANT

MODERATE

SMALL

NONE

2.77

2.53 2.47 2.45 2.40 2.37 2.332.23 2.20 2.13

2.03 2.01 2.011.88

1.72

1.51

0.00

0.50

1.00

1.50

2.00

2.50

3.00

Desig

n+

Cultu

re

Dist

ance

from

Fact

ory

toSi

te

Prog

ram

ofth

eBu

ildin

g

Indu

stry

Know

ledg

e

Supp

lyCh

ain

+Pr

ocur

emen

t

Lack

ofSk

ills

Cost

vs.V

alue

+Co

des

Site

Conc

ern

forQ

ualit

y

Man

ufac

turin

gTe

chno

logy

Urb

anSi

te

Fina

ncin

g+

Insu

ranc

e

Rura

lSite

Heal

th+

Safe

tyRi

sks



QUESTION 3Considering the most successful project that utilized off-site construction, what was the distance from the factory to the site:

The responses were sorted into 4 categories of miles.The graph reflects the number of responses within the particular category.

Miles

97

83

120

36

0

20

40

60

80

100

120

140

0-50 51-200 201-500 500+



QUESTION 4During the project planning phase for this project, who was responsible for the decision to use off-site?

Most responses in the “Other” category were either “all of the above” or “the subcontractor suggested using off-site construction.”

27.9%24.3%

27.2%

57.1%

20.9%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

Client Requested Architect Manageror General Contractor

Requested or Required

Other



QUESTION 5Considering your most successful experience with off-site construction, what were the pre-construction expected benefits of using off-site?

78.0%

66.9% 63.5%58.8%

42.6% 40.5% 37.5% 35.1%

12.8%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%



QUESTION 6For this project, what were the actual benefits realized by using off-site construction?

73.2%

62.5%

50.8%

41.1% 38.8% 38.5%31.8%

28.1%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

Sche

dule

Adva

ntag

e/Sp

eed

toM

arke

t

Qua

lity

Cost

- Site

Clie

nt

Safe

ty

Cost

Wea

ther

Conc

erns



QUESTION 7For the considered project, when did you collaborate with the contractor performing the off-site work and, based on your experience, when do you recommend engaging the off-site contractor?

The results of this question show that, based on their experience, the respondents recommend engaging the off-site contractor prior to 50% Design Development to ensure the value of off-site construction.

40

50

60

70

80

90

100

110

120

Conc

ept

50%

Desig

n

100%

Desig

n

50%

Desig

nDe

velo

pmen

t

100%

Desig

nDe

velo

pmen

t

50%

Docu

men

ts

100%

Docu

men

ts

Post

Bid

Project Engagement Recommended Engagement



QUESTION 8What level of stakeholder collaboration is required to implement off-site construction in comparison to traditional construction methods?



QUESTION 9In the next 12 months, how often do you anticipate using off-site construction?

The Same50.0%

More33.2%

Less9.4%

Not at All7.4%



QUESTION 10What types of support could the National Institute of Building Sciences Off-Site Construction Council offer that would benefit your company’s utilization of off-site construction?

69.6%63.8% 63.5%

33.4%

23.5%

14.3%8.9%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

Desig

nSt

anda

rds,

Deta

ils,

Case

Stud

ies

Indu

stry

Data

Perf

orm

ance

)

Net

wor

king

Acad

emic

/Res

earc

hPa

rtne

rshi

ps

Glos

sary

Oth

er



QUESTION 11What aspects of off-site design and construction information and data are you interested in?

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

Desig

n,En

gine

erin

g,

Com

mer

cial

Acce

lera

ted

and

Sche

dule

Met

hods

Proj

ectM

anag

emen

tand

Proj

ect

Deliv

ery

Emer

ging

Mat

eria

ls,Pr

oduc

tsan

dSy

stem

s

Lean

Man

ufac

turin

g

Regu

lato

ry/C

odes

Labo

rSki

lls/T

rain

ing

High

-Rise

-Site

(CN

Can

dCA

D/CA

M)

Mai

nten

ance

and

Dura

bilit

y

Sust

aina

bilit

y,LC

A

Oth

er

68.1%

59.3% 59.0%

44.1% 43.7% 42.7% 41.7%38.6% 37.3%

27.8%24.7% 22.7% 21.4% 20.3%

14.6%

6.4%



QUESTION 12The company I represent primarily provides the following services:

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%46.7%

38.3%

27.3%

15.0%

8.3%



QUESTION 13What is your company’s annual revenue (in millions)?

<$14%

$1 to $1016%

$10 to $5023%

$50 to $10010%

$100 to $50021%

$500 to $1,0007%

$1,000 to $5,00014%

$5,000 to $10,0002%

>$10,0003%



QUESTION 14The project types where my company has utilized off-site construction include:

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0% 56.9%

51.2%

44.8%

37.1%

23.7%24.4%20.1%

8.0%



QUESTION 15In which state(s) was/were the project(s) that utilized off-site construction located?

State Number of Projects in State

Alabama 2Alaska 6Arizona 7Arkansas 5California 32Colorado 16Connecticut 8Delaware 3Florida 12Georgia 9Hawaii 2Idaho 8Illinois 22Indiana 11Iowa 4Kansas 10Kentucky 3Louisiana 10Maine 4Maryland 10Massachusetts 16Michigan 9Minnesota 6Mississippi 3Missouri 13

State Number of Projects in State

Montana 2Nebraska 3Nevada 1New Hampshire 3New Jersey 13New Mexico 3New York 21North Carolina 13North Dakota 2Ohio 14Oklahoma 7Oregon 12Pennsylvania 21Rhode Island 3South Carolina 3South Dakota 0Tenessee 8Texas 32Utah 3Vermont 1Virginia 20Washington 17West Virginia 6Wisconsin 7Wyoming 6



QUESTION 16Which organizations does your company belong to?

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

Air

Con

ditio

ning

Con

trac

tors

of A

mer

ica

(AC

CA

)

Am

eric

an C

oncr

ete

Inst

itute

(AC

I)

Am

eric

an In

stitu

te o

f Arc

hite

cts

(AIA

)

Am

eric

an In

stitu

te o

f Con

stru

ctor

s (A

IC)

Am

eric

an In

stitu

te o

f Con

stru

ctor

s (A

IC)

Am

eric

an In

stitu

te o

f Ste

el C

onst

ruct

ion

(AIS

C)

Am

eric

an S

ocie

ty o

f Civ

il E

ngin

eers

(A

SC

E)

Am

er. S

oc. o

f Hea

ting,

Ref

rig. a

nd A

ir C

ond.

Eng

rs. (

AS

HR

AE

)

Am

eric

an S

ocie

ty o

f Pro

fess

iona

l Est

imat

ors

(AS

PE

)

Am

eric

an W

ood

Cou

ncil

(AW

C)

Ass

ocia

ted

Bui

lder

s an

d C

ontr

acto

rs In

c. (A

BC

)

Ass

ocia

tion

of W

all a

nd C

eilin

g In

dust

ries

(AW

CI)

Bui

ldin

g O

wne

rs a

nd M

anag

ers

Ass

ocia

tion

(BO

MA

)

Bui

ldin

g T

rade

s A

ssoc

iatio

n (B

TA

)

Con

stru

ctio

n In

dust

ry In

stitu

te (

CII)

Con

stru

ctio

n M

anag

emen

t Ass

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of A

mer

ica

(CM

MA

)

Con

stru

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wne

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ssoc

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Am

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a (C

OA

A)

Con

stru

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peci

ficat

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Inst

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(CS

I)

Con

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sers

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ndta

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(CU

RT

)

Des

ign

Bui

ld In

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te o

f Am

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a (D

BIA

)

Inte

rnat

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l Cod

e C

ounc

il (I

CC

)

Inte

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l Fac

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Man

agem

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ssoc

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n (I

FM

A)

Lean

Con

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s A

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Am

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a (M

CA

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Mod

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Bui

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te (M

BI)

Nat

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l Ass

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of H

ome

Bui

lder

s (N

AH

B)

Nat

iona

l Ele

ctric

al C

ontr

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ssoc

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n (N

EC

A)

Nat

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l Fire

Pro

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Ass

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(NF

PA

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Nat

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(NIB

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Pre

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She

et M

etal

and

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Con

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CN

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The

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uild

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GB

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About the Off-Site Construction Council: The U.S. off-site design and construction industry has made significant advances in implementing processes and materials to build and deliver more sophisticated and complex facility types by virtue of system prefabrication, unitization, modularization and panelization. More and more owners are turning to off-site methods for multi-story wood construction, steel framed structures, healthcare facilities, educational structures and large-scale military projects. As an industry, however, owners, architects, engineers and contractors up until now have lacked an unbiased source for evaluating the applica-bility and potential benefits for use of such methods; for determining where and when fabrication is appropriate; and for identifying the range of choices inherent in integrating and collaborating with fabricators.

In 2013, the National Institute of Building Sciences established the Off-Site Construction Council (OSCC) to serve as a research, education and outreach center for relevant and current information on off-site design and construction for commercial, institutional and multifamily facilities.

OSCC Board of Directors

Ryan Smith, ChairUniversity of Utah

Sue Klawans, Vice-ChairGilbane Building Co.

Tom Hardiman, SecretaryModular Building Institute

Martin AndersonAmerican Institute of Steel Construction

Ian Peter AtkinsGensler

John ErbDeLuxe Building Systems

Brad GuyCatholic University of America

George LeaU.S. Army Corps of Engineers

Dan NyceOldcastle Enclosure Solutions

Allen PostPerkins & Will

RJ ReedWhiting Turner

Laurie RobertNRB

Greg RohrPIVOTek

Stacy ScopanoAutodesk

Ryan Colker, Staff DirectorNational Institute of Building Sciences

About the Institute: The National Institute of Building Sciences is a non-profit, non-governmental organi-zation that successfully brings together representatives of government, the professions, industry, labor and consumer interests, and regulatory agencies to focus on the identifi-cation and resolution of problems and potential problems that hamper the construction of safe, affordable structures for housing, commerce and industry throughout the United States. Authorized by the U.S. Congress, the Institute provides an authoritative source and a unique opportunity for free and candid discussion among private and public sectors within the built environment. The Institute’s mission to serve the public interest is accomplished by supporting advances in building sciences and technologies for the purpose of improving the performance of our nation’s buildings while reducing waste and conserving energy and resources.

National Institute ofBUILDING SCIENCESOff-Site Construction Council

1090 Vermont Avenue, NW, Suite 700Washington, D.C. 20005-4950202-289-7800www.nibs.org

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