B.C. industry hopes to create a model for modular housing across Canada

A speedy method of construction that is popular in Europe is in the national spotlight, and B.C. is playing a key role.

Modular construction, which involves factory-built structures that are brought to a site and stacked up into various forms of housing, is a major topic of discussion and investment, with Prime Minister Mark Carney announcing $13-billion allocated for modular housing across Canada.

Modular BC, a group representing the province’s factory-built modular home industry, is working on standardized plans to deliver modular multiplex housing as a playbook for use across Canada, in an effort to speed up the delivery of housing and possibly bring costs down. The association said it will soon finalize a deal with the National Research Council to conduct a study that will look at increasing modular construction’s share of the province’s home building industry from 4.5 per cent to 25 per cent over five years. The work will involve an economic study and a factory-built modular comparison study. Modular BC director Paul Binotto said it aims to create standardized, permit-ready and scalable four- and six-plex modular designs.

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Mr. Binotto said that the province’s Bill 44, which requires local governments to allow small-scale multi-unit housing, paves the way for a national standardized modular multiplex program.

“It’s a playbook developed for multiplexes, and a modular standardized program, but also a playbook developed in British Columbia for the rest of Canada,” he said.

“We’ve created a perfect storm here for us to have the ability to bring in standardization, because now, we’re not doing it region by region or city by city; this is an overall provincial scope, so it helps manufacturing,” he said. “We help contractors go from building one, two, three houses a year, to building 10 or 12 houses a year.”

Modular housing has long been established in countries that embrace building innovation, like Denmark, Sweden and Germany, and it is growing in Spain and the U.K. It’s not new in Canada, but it has always operated outside the conventional development industry. Now that the federal government is showing so much interest in the construction method, modular construction might finally get its due as an energy-efficient, low-waste, relatively quick building method that could help deliver the affordable housing the federal government is calling for as part of its Build Canada Homes program, announced last month.

The program aims to deliver deeply affordable housing to low-income and middle-income households, making use of public land – including 88 federal properties – and the creation of an innovative housing industry that can scale up the delivery of housing via modular construction.

“Build Canada Homes will place an intense focus on using cost-efficient and modern methods of construction such as factory-built, modular and mass timber,” the Prime Minister’s office said in a release. “Through bulk procurement and long-term financing, Build Canada Homes will mainstream these advanced methods of construction.”

The government cited a potential building timeline reduction of up to 50 per cent and reduced costs by as much as 20 per cent.

Michael Geller, a long-time developer who’s received approval on a 39-unit modular housing development in Nanaimo, said he’s surprised at the interest and the $13-billion investment. Mr. Geller has long advocated for modular construction and has built modular developments in the past. When he worked at Canada Mortgage and Housing Corporation in the seventies, they had similar standardized housing designs. Those standardized CMHC houses were built across the country, he said.

“Mass timber and manufactured housing are certainly the flavour of the month this year,” said Mr. Geller. “The potential construction of these multiplexes using these modules, or factory-built structures … means if you want something built in your backyard or next door in an established neighbourhood, the idea of doing it in months instead of years is compelling. One of the great myths of modular housing is that it has to look boxy, and that’s not true.”

But as enthusiastic as he is, he said there are still roadblocks to modular construction.

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A major hurdle for developers who order modules is that financing is designed for on-site construction. Funds are released by the lender at certain stages of construction, but modules are factory-built and require significant payment upfront. If the federal government wants to advance modular construction, it needs to help developers sort the financing, say industry experts.

Also, Mr. Geller doesn’t believe it’s necessary to create a standardized national multiplex design when so many module manufacturers already have ready-to-go designs.

Michelle Bates, operations manager at Gordon’s Homes in Nanaimo, B.C., said her company is helping with the NRC study. They develop custom-built modular homes as well as standardized multiplex and row house designs.

“What happens is the units are built inside in a factory setting, so they’re climate-controlled. They are tested and monitored as they go down the line,” she explained. “They meet all of the new building code requirements, including the energy-efficient requirements, and they are tested on site after they’re constructed to ensure they still meet those requirements.”

The benefits of modular are less on-site construction and even job creation, which is part of the Modular BC plan.

“When they’re on site and they’re put together, you’re at 90 per cent completion by the time that home gets to site and it’s craned on,” said Ms. Bates. “So, you just have the interior finishing to do and the spots where it joins together, the siding on the outside, and your site prep. And the amazing part is it’s built in B.C. or built in Canada.

“Whatever factory they’re in, you’re using local resources. You’re using local labour and local materials. So not only are you going local, you’re supporting Canada.”

Company director Chris Cross, former president of the Canadian Home Builders Association of B.C., said the factory-built home doesn’t have to be the drab, boxy housing of the past. It’s also not to be confused with manufactured housing, which can be relocated.

“It shocks everybody, you know, because they’re so used to the old terminology of a ‘trailer,’ and it’s not even close to that any more. It’s all completely changed.”