Modular integrated construction for high-rise buildings: Measured benefits

By the Development Bureau and the Architectural Services Department of the HKSAR Government, the Hong Kong Science and Technology Parks Corporation, and the Centre for Innovation in Construction and Infrastructure Development of The University of Hong Kong

This article provides an overview of the benefits of modular integrated construction (MiC) in comparison with the conventional construction method for projects. It also illustrates how MiC can contribute in tackling the challenges, such as ageing workforce, declining productivity, high construction costs, etc, being faced by the construction industry in Hong Kong.

From the analysis of the two high-rise pilot projects, it is demonstrated that the adoption of MiC in future building projects can achieve at least 10% cost saving, 30% to 50% shortening in on-site superstructure construction to occupation¹, on-site labour productivity improved by 100% to over 400%, higher construction quality, better site safety performance and enhanced environmental sustainability etc. As reiterated in the 2020 Policy Address, the HKSAR Government will continue to promote the use of MiC proactively for a wider adoption in order to uplift the performance of the construction industry.

Challenges faced by the construction industry

We have been facing severe challenges including ageing workforce, declining productivity, high construction costs, etc. These challenges are evidenced by the statistics, such as more than half of skilled construction workers are aged 50 or above, the declining construction output per worker, and building construction costs ranked among the top three worldwide (DEVB, 2018; Pan et al, 2019). To tackle these challenges and to uplift the performance of the construction industry, the Chief Executive announced in the 2017 Policy Address the adoption of MiC with a view to enhancing productivity and cost-effectiveness. Since then, the HKSAR Government promotes wider adoption of MiC through pilot projects. Commissioned by the Development Bureau (DEVB) of the HKSAR Government, the Centre for Innovation in Construction and Infrastructure Development (CICID) of The University of Hong Kong (HKU) conducted a study on the performances of two high-rise MiC pilot projects, to assess the benefits of this innovative construction method in Hong Kong.

MiC

Modular construction is the most advanced off-site construction technology with three-dimensional units that enclose usable space and are often prefinished. The modular construction approach has been widely adopted globally, albeit various terminologies have been used in different countries or regions as explained and illustrated in the Glossary published by the HKU (Pan et al, 2020a). Examples of that include “prefabricated prefinished volumetric construction (PPVC)” in Singapore (BCA, 2017), “modular building” in the UK (Gibb and Pendlebury, 2006), “permanent modular construction” in the US (MBI, 2013). The worldwide adoption of the modular approach has demonstrated its wide-ranging benefits such as accelerated project delivery, enhanced construction quality and productivity (for details please refer to the strategy paper published by the HKU - Pan et al, 2019).

In Hong Kong, the modular approach has been adopted under the term of MiC, which builds on the modular construction approach but emphasises the integration of advanced manufacturing technologies into the re-engineered building and construction processes. The concept of MiC was defined by Pan and Hon (2018) as:

“a game-changing disruptively-innovative approach to transforming fragmented site-based construction of buildings and facilities into integrated value-driven production and assembly of pre-finished modules with the opportunity to realise enhanced quality, productivity, safety and sustainability.”

In addition, the DEVB Technical Circular (Works) No 2/2020 defines MiC as:

“a construction method whereby freestanding volumetric modules with finishes, fixtures, fittings, furniture and building services installation, etc manufactured off-site and then transported to site for assembly.”

As MiC changes the project delivery process relative to conventional construction practices, it is important to systematically understand its performances.

High-rise MiC projects measured

The Disciplined Services Quarters for the Fire Services Department (FSD), the HKSAR Government at Pak Shing Kok project (PSKDQ) by the Architectural Services Department (ArchSD), the HKSAR Government (Figure 1 left) is a staff quarters development in Tseung Kwan O comprising four 16-storey blocks and one 17-storey block. The typical floor of each block was constructed using 46 concrete modules to form eight dwelling units, with size of about 50 sq m each. In total, the project provides 648 dwelling units, and comprising 3,726 modules that were prefabricated in Huizhou, Mainland China, and then transported by land to the construction site. The performance of this project was measured and benchmarked against a similar ArchSD’s departmental quarters project in Kwun Tong that adopted cast-in-situ concrete method with typical precast building elements.

The InnoCell, a residential apartment developed by the Hong Kong Science and Technology Parks Corporation (HKSTP) (Figure 1 right) of the Hong Kong Science Park, provides co-living and co-working residence space within the park. This 17-storey building provides 393 ensuite units with 418 steel-framed modules that were prefabricated in Jiangmen, Mainland China and then transported by sea and land to the construction site. The performance of this project was measured and compared with a conventional scenario.

Figure 1: The PSKDQ (left) and InnoCell (right) MiC projects

Systematic framework of KPIs

Key performance indicator (KPI) is a factor for measuring the success of a project and specifies whether or not the desired result was achieved. Following the MiC Performance Measurement Guidebook (Pan et al 2020b) published by the HKU, a systematic framework of KPIs was established and adopted for measuring the performance of the two selected projects.

The framework of KPIs is based on the triple-bottom-line concept of sustainable development integrating the economic, social, and environmental aspects of performance. This framework includes 32 KPIs as detailed in Figure 2:

• There are 15 economic-aspect KPIs, which reflect the direct and indirect costs of a project. The economic efficiency of a project is defined as issues dealing with the amount of money invested. For construction projects, the integration of various inputs such as materials and labour determines the economic value of completed buildings.
• There are ten social-aspect KPIs, which are concerned with the impact on the needs of people and communities. Social harmony in construction refers to the engagement of employees, local communities, and stakeholders along the supply chain to meet the needs of people and communities.
• There are seven environmental-aspect KPIs, which evaluate the environmental impact over the construction life cycle. Environmental sustainability is one of the most significant aspects of construction performance, which consists of not only direct impact of the construction and assembly process, but also the indirect impact from the manufacturing of building materials and components.

The systematic framework of KPIs should be adaptable for applications in other building sectors than staff quarters and apartment buildings such as hostels, hotels, and office buildings.

Figure 2: A systematic framework of KPIs for MiC performance measurement

Measured benefits of MiC

The adoption of MiC in these two projects has demonstrated substantial improvements in the economic efficiency with ensured cost competitiveness, increased labour productivity, enhanced construction quality, and accelerated construction speed. It has also significantly fortified environmental sustainability with reduced construction waste, pollution, and energy consumption. Furthermore, impressive enhancements in social harmony were observed resulting from the shortened construction programme and enhanced safety performance. The major benefits of MiC compared with the conventional practices as demonstrated by the KPIs are summarised in Table 1 and elaborated in the sections thereafter.

Table 1: Benefits of MiC compared with conventional practices

Ensured cost competitiveness

From project client’s point of view, the cost competitiveness of MiC has been established by estimating the construction cost savings as well as by establishing the overall economics of the pilot projects.

The assessment using the two pilot cases showed significant savings in construction costs. The estimated unit cost of building works adopting MiC indicates a possible cost reduction of around 6%² for high-rise staff quarters development constructed with concrete modules; and around 7%² for high-rise apartment development constructed with steel modules, both compared with similar projects using conventional practices.

The possible cost savings are mainly attributed to the following areas:

• Reduction in number of on-site labour;
• Reduction in preliminaries resulting from the shortened programme;
• Reduction in temporary works required such as formwork;
• Reduction in the number of material delivery trips;
• Reduction in on-site electricity and water consumption; and
• Enhanced construction quality with no rework or fewer defects.

Projects adopting both concrete and steel MiC have indicated advantages in cost competitiveness over their conventional counterparts. First, this cost competitiveness is evidenced in the cost neutrality that both projects have been delivered without the need for the client to get any extra budget approved originally for a conventional construction. This achievement is remarkable as overseas experiences showed a premium cost of adopting modular approaches in the initial stage of implementation.

In addition to the construction cost, a project client is also very much concerned about the overall financial benefit that MiC can provide. One of the major benefits to the overall project economics can be established by how much earlier the projects have been ready for occupation in comparison with conventional methods. For the PSKDQ project, with nine months advance in anticipated occupation³, it is equivalent to a financial benefit to FSD’s staff of more than HK$58 million (being estimated saving in rental cost of at least HK$10,000 per month for each of these 648 households). For the InnoCell project, with 14 months advance in occupation⁴, it is estimated that the rental income generated for HKSTP will be more than HK$44 million (being estimated rental cost of at least HK$8,000 per month for each of these 393 units).

Increased labour productivity

It was observed that only a few on-site workers were needed for constructing a typical floor with the installation of modules (Figure 3) leading to a significant increase in labour productivity with the adoption of MiC.

• In PSKDQ, the on-site labour productivity for constructing a typical floor improved by 100% as compared with the cast-in-situ baseline.
• In InnoCell, on-site labour productivity was observed to be over 400% as compared with the conventional scenario.

Figure 3: Fast installation of modules

Accelerated construction speed

The adoption of MiC could accelerate the project delivery process, largely as a result of the concurrent module production in the factory (Figure 4) and foundation works on site. In conventional construction, the floor cycle refers to structural works only; while for MiC projects, the floor cycle includes both structural and architectural works.

• In PSKDQ, a five-day cycle was achieved for constructing a typical floor which included over 90% structural and architectural works. As shown in the construction programme, around nine months were saved for the overall project development.
• In InnoCell, a two- to three-day cycle was achieved for constructing a typical floor which included over 95% structural works and architectural works. This is much faster than the six-day floor cycle in conventional construction which only covers structural works. As shown in the construction programme, around 14 months were saved by using MiC compared with the conventional scenario.

Enhanced construction quality

The adoption of MiC contributed to the achievement of higher construction quality with fewer defects, less rectification, and minimised rework. The obtained results include:

• No rework was reported both in the factory and on site for both MiC projects.
• In PSKDQ, the defects in both architectural and structural works were greatly reduced due to the well-controlled finishing works, concrete casting and curing in the factory.
• In InnoCell, the defects were greatly reduced due to the adoption of steel-framed modules that were precisely manufactured and assembled.

Reduced construction waste

With well-controlled factory production (Figure 4) and the reduction of fragmented site-based works, the use of MiC led to a significant reduction in construction waste in both concrete and steel MiC projects:

• In PSKDQ, concrete and rebar wastage was measured and turned out to be much lower than that of the conventional practice, and the amount of construction debris was reduced by over 40%.
• In InnoCell, over 80% of on-site construction debris was reduced, and over 50% of the on-site material wastage was recycled and reused.

Figure 4: Module production in the factory

Reduced construction pollution

Due to the greatly reduced wet concrete works on site, the use of MiC helped achieving a tidier and cleaner site environment as well as the production line in the factory (Figure 4). The levels of construction pollution in terms of water, air, and noise were also therefore much reduced as evidenced below:

• In PSKDQ, wet concrete works were reduced by 75% on site, leading to reduced water pollution generated from washing concrete trucks and curing concrete structures. On-site noise was measured to be around 7% lower than that in a conventional project.
• In InnoCell, the air quality level was much improved due to the 50% reduction in the levels of particulate matter (PM). The noise performance was approximately 10% lower than that monitored for a typical conventional high-rise project.

Reduced water and electricity consumption

With the adoption of MiC, most of the fragmented construction works were transferred from the sites to the factories for module production. As a result, on-site water and electricity consumption in the MiC projects was much lower than that in conventional construction practices. The measured evidence is shown below:

• In PSKDQ, on-site water and electricity consumption was around 70% lower than that in conventional construction practices.
• In InnoCell, on-site water and electricity consumption was estimated to be over 60% lower than that in conventional construction practices. This was due to the reduced cast-in-situ and on-site finishing works and the shortened construction programme; and 418,000 L of water was saved as most of the water tightness tests were conducted in the factory.

Figure 5: Minimised working at height

Enhanced health and safety

The adoption of MiC also effectively reduced health risks and improved work safety. It can minimise or even eliminate the possibility of accidents on site, by minimising workers working at height (Figure 5). Besides, well-organised factory and tidier site environment can allow a quick response to site incidents and provide a much better, safer and healthier working environment for the workers. In the InnoCell and PSKDQ projects, the number of labours working at height was reduced by over 50%, and no accident at all was reported for MiC-related works during the overall construction.

Enhanced employees’ welfare

The adoption of MiC was found to have reduced health and safety risks with a much cleaner and safer working environment, thereby enhanced project employees’ job satisfaction. Besides, the projects with MiC helped to increase training and education opportunities. The “training opportunity” is evidenced in the projects:

• In PSKDQ, weekly safety training was conducted for the workers to properly use the working platform for module installation.
• In InnoCell, each worker received four times training opportunities per month.

Reduced disturbance to the community

A reduced number of material delivery trips to the construction site minimised the impact on the local transportation systems and thus caused much less disturbance to the nearby community. With the adoption of MiC, a significant reduction in vehicular trips to site was achieved in both pilot projects, mainly due to the fact that most of the MiC materials were already integrated into the prefinished and pre-furnished modules in the factory (Figure 6). The “vehicle movements” are evidenced in the projects:

• In PSKDQ, less than 40 deliveries of module transportation were required for all living areas of a typical floor, which covered around 90% of structural and architectural works, and 90% installation of concealed conduits and domestic electrical services.
• In InnoCell, only 30 deliveries of module transportation were required for constructing all living areas of a typical floor, which covered over 95% of structural, architectural and building services works in the domestic areas.

Figure 6: Prefinished and pre-furnished modules from the factory

Increased community’s satisfaction by addressing the urgent social needs

The use of MiC accelerated project delivery and thus should benefit the early delivery of projects to address social needs. The “community’s satisfaction” of addressing urgent social needs is evidenced in the projects:

• The PSKDQ was completed within just 30 months, while it might take 39 months for the development of a similar project if conventional methods were used.
• The InnoCell was completed with the time saving of over 14 months for the overall development.

Improved industry image

The MiC adoption provided evidence that the traditional 4D (ie dirty, dangerous, demanding, and disorganised) perception of the industry could be transformed to 5S (ie shine, safe, speed, sustainable and smart). As a result, the industry should be able to attract more youth and professionals to join. Wider adoption of MiC could trigger more innovation as well as provide more opportunity for application of new technologies in construction industry such as building information modelling (BIM), virtual reality (VR), internet of things (IoT), Blockchain, which could greatly facilitate the design, production, transportation and installation processes. The “innovation and technology” is evidenced in the projects:

• In PSKDQ, module production and installation were integrated with BIM, IoT, and Blockchain technologies for quality and efficient project delivery.
• In InnoCell, a digital QA/QC platform and VR technologies were implemented for module production inspection and module installation training, respectively.

Uplifting MiC to new heights

It was found that MiC outperforms the conventional construction in both concrete and steel cases. First, economic efficiency was substantially improved with ensured cost competitiveness, increased labour productivity, accelerated construction speed and better quality. Cost neutrality was guaranteed, and cost savings were estimated around 7% for steel MiC and around 6% for concrete MiC. With more projects embracing MiC after the learnings from these two pilot projects, the cost saving can be further enhanced to more than 10%. Second, environmental sustainability was significantly fortified with reduced construction waste and energy consumption. More tidy and cleaner construction sites were observed for both concrete and steel MiC. Third, social harmony was greatly enhanced with reduced disturbance to community, enhanced safety performance and ensured employees’ welfare.

It is worth noting that the two high-rise MiC projects cover both concrete and steel MiC building methods and both residential and apartment building types. Albeit the evidence is being based on only two cases, the findings are powerful in revealing that MiC outperforms conventional construction in all economic, social and environmental aspects. The proven performance of MiC for high-rise building projects in particular has made a significant contribution to the industry in addressing multi-faceted challenges such as the ensured cost competitiveness to reduce high construction costs, increased labour productivity by addressing the ageing workforce, and the accelerated project delivery by shortening the overall project realisation time.

To enable the long-term development of Hong Kong and ensure the sustainability of the construction industry, the HKSAR Government has developed Construction 2.0 to reform and upgrade the industry through the three pillars: innovation, professionalisation and revitalisation. Adoption of MiC in building projects is one of the key measures in addressing the multi-faceted challenges. In early 2020, the HKSAR Government has taken the lead in promoting the wider use of MiC in certain types of new government building works as well as building projects funded by the HKSAR Government, and it is envisaged more private MiC building projects will follow.

The wide adoption of MiC is beneficial for the development of not only Hong Kong but also other economies in the Greater Bay Area and overseas. On the one hand, the increased demand will stimulate investment in establishing MiC factories in the Greater Bay Area or in Hong Kong. On the other hand, as Hong Kong is a well-developed economy with international building standards for high-rise buildings and world-leading expertise in design and construction, the knowledge and experiences developed in adopting MiC for high-rise buildings will provide invaluable learning or even set international standards for adopting MiC in other cities.

With the whole construction industry including clients, consultants, contractors and supply chains in public and private sectors joining hands marching for a wider adoption of MiC in Hong Kong, we can bring MiC to a new height, contributing an international brand and reinforcing the global status of Hong Kong.

Notes

1. Counting from on-site superstructure commencement to anticipated occupation.
2. The estimated cost only involved construction cost for building works (ie structural, architectural and building services works and foundation works). The estimation was based on the combination of relevant figures in the public domain, academic publications and interviews with MiC professionals. Due to commercial reasons and other constraints, no actual construction cost data of the project is disclosed.
3. Compare with the construction programme in the submission to the Finance Committee FCR(2018-19)27, which construction was planned to commence in Q1 2018 for completion by Q2 2021.
4. Compare with the three-year construction period as stated in the submission to the Finance Committee FCR(2017-18)54.

References

• BCA (2017). Prefabricated Prefinished Volumetric Construction (PPVC) Guidebook. Building and Construction Authority (BCA), Singapore.
• DEVB (2018). Construction 2.0 Time to change. Development Bureau (DEVB), HKSAR Government.
• Gibb, A. G. F. and Pendlebury, M.C. (2006). Glossary of Terms. Buildoffsite, London.
• MBI (2013). Permanent Modular Construction 2013 Annual Report. Modular Building Institute (MBI).
• Pan, W. and Hon, C. K. (2018). Modular Integrated Construction for High-rise Buildings. Proceedings of The Institute of Civil Engineers-Municipal Engineer, DOI: 10.1680/jmuen.18.00028.
• Pan, W., Yang, Y., Zhang, Z. and Chan, S. (2019). Modularisation for Modernisation: A Strategy Paper Rethinking Hong Kong Construction. CICID, The University of Hong Kong, Hong Kong.
• Pan, W., Zhang, Z. and Yang, Y. (2020a). A Glossary of Modular Integrated Construction. The University of Hong Kong, Hong Kong.
• Pan, W., Zhang, Z., Xie M. and Ping, T. (2020b). Modular Integrated Construction Performance Measurement Guidebook. The University of Hong Kong, Hong Kong.
• Pan, W., Zhang, Z., Xie, M. and Ping, T. (2020c). Modular Integrated Construction for High-rises: Measured Success. The University of Hong Kong, Hong Kong.