£2.5bn joint venture with China to build affordable modular homes in UK

Howard Chapaman, Buildingtalk Editor, welcomes the announcment of a £2.5bn joint venture between a UK Housing Association and a Chinese construction company to build 25,000 modular homes over the next five years.

Joint venture to build affordable homes

Your Housing Group, that currently manages 33,000 affordable UK homes, is to partner with China National Building Material Company (CNBM) to build more new homes, alongside the Welink Group, a renewable energy company.

The joint venture deal will also be a platform to engage with other Local Authorities and Housing Associations as partners to help solve their housing market needs.

The press in China, reporting on the joint venture, say the plan to open six highly cost-efficient pre-fabricated house-building factories in the United Kingdom, capable of producing 25,000 homes a year, will “reduce construction costs to a target of £400 per sq m, significantly less than the £1,000 per sq m average in the UK market”.

Your Housing Group Chief Executive Officer, Brian Cronin, announced the £2.5bn joint venture with CNBM could see up to 25,000 homes being built per year by 2022.

He said that the house building industry is fully aware of the deficit of homes across the UK and Government want to see Housing Associations making the necessary changes needed to increase provision. The housing shortage within the UK is only going to be addressed by radical innovation and new ways of tackling the crisis.

The joint venture has the support of the Government. CNBM will build six factories in the UK, creating 1,000 new jobs. This new initiative will help towards the UK Government target to build a million new homes by 2020 by building 200,000 each year. Last year only 142,890 homes were built.

Off-site construction for affordable modular homes

Currently only 15,000 modular homes are constructed off-site and transported to site. Off-site construction is a quicker and cheaper building process and his new CNBM joint venture alone could result in new factories producing 25,000 homes each year.

The offsite construction sector is expanding rapidly with many large companies such as Legal & General and Laing O’Rourke developing modular build capabilities.

Ajmal Rahman, chairman of Welink Group, said that the CNBM joint venture will address the housing shortfall and kick-start the delivery of the new homes people need across the UK and address fuel poverty issues through by incorporated solar and energy efficient design.

Modular build is faster, more efficient and less disruptive to local residents. This development in Streatham Hill, London went from foundations to 3 storey building in 2 weeks. (Photo credit: PocketLiving.com)

New skills and apprenticeship opportunities

Brian Cronin from Your Housing Group said the joint venture was an opportunity to build more social and affordable homes across the UK. It will also provide new skills and additional apprenticeship opportunities plus it will help develop more effective housing and supply chains.