Funding modular construction was the topic at Howard Kennedy's January Economic Breakfast Briefing (EBB), the panellists being Emma Burke (Maslow Capital), Adina David (Greystar) and Laith Mubarak (Click). One point that was noted during the discussion was how modular construction could be effectively used in airspace development.
Air rights supporters continue to urge the government to amend permitted development rights to allow airspace development, with figures suggesting such modification would provide the opportunity for 180,000 new homes to be built above existing blocks of flats, including 60,000 on top of public buildings in London. Furthermore, the opportunity available to supermarkets to sell the airspace above their buildings has been identified as significant.
Airspace and modular
Using modular construction for airspace development appears to be a win-win situation. One current major issue with the development of airspace is the effect on current occupiers of buildings that are being developed.
A traditional approach can take considerable time and cause substantial nuisance to existing occupiers when the airspace above is being developed. However, if the modular construction approach is used, the on-site time can be dramatically reduced. Laith Mubarak has stated that they have been able to place units into position over a single weekend.
Developers can also benefit, with the time taken to build the units reduced due to the work being undertaken off-site in controlled conditions in a facility, reducing the build period. This in turn saves costs. It also encourages quality control as environmental conditions are stabilised. For some developers this environment also enables waste to be recycled more efficiently which in turn encourages sustainability.
As a result of this efficiency, modular construction of the airspace has also been flagged as a method of providing much needed affordable housing within urban areas in a speedy way. This could be attractive to authorities looking to deal with the housing shortage.
Inevitably, MMC does face some hurdles when constructing air space development. Oversailing issues are an obvious concern when having to put units into place. Furthermore, the units that are being produced in factories across the UK are of different specifications. This is causing issues should one facility not have the capacity to provide all of the units for a development.
Accordingly, this was one factor that led to Click setting up their own facility to develop units for their own airspace development projects.
Another hurdle is the fact that the process is relatively new. It will still no doubt take a while until funders and others are sufficiently comfortable with the security being offered.
Modular construction would appear to be a good fit for airspace developers due to the advantages of construction off site and the reduced disruption to existing occupiers. At the EBB Laith Mubarak concluded that "once lenders understand the benefits of modular construction, it will enable them to generate additional revenue from the sector". Perhaps as forward-thinking developers continue to use modular construction to utilise the airspace above existing buildings, the industry will more widely recognise the opportunities that this method of construction presents when developing upwards.