Offsite vs. Onsite – Understanding Value

Lorne Derksen

President – Alliance Truss Group

2015 International Wood Symposium

29 January, Vancouver, B.C.

The Alliance Truss Group

Foundation install

Onsite framing (subsidiary

Nuframe)

Manufactured building

components

Framing Materials

Structural Engineering (affiliate

Horace Engineering)

“We believe that nearly any wood frame project that can be built in

the field can be built offsite.”

Single family

Multi-family

Commercial

Institutional (i.e. schools)

Disaster Relief/Third World

Housing

Apartments

Townhouses

Large complex single family homes

with oversized windows, tall raked

walls etc.

Schools

Commercial

Warehouses

Agricultural buildings

Disaster relief housing

Civil/Institution Formwork

Industry regularly prefabs

But does offside construction always make sense?

• Cost

• Improved Schedule (cost again)

• Absolute Deadline •Such as the 2010 Olympic Village

•Hotels , care homes any revenue generating facility

What makes sense to a Developer or General

Contactor?

On Site Advantages

Land expense

Leasehold /building expense

Heavy equipment expense

o Plant machinery

o Heavy transport trucks & trailers

Power expense (supplied by

contractor)

Office equipment

Onsite framer has no:

Cost comparison

Off Site Labour Costs

$25.00 / hr *

* This is net of payroll taxes and benefits as in the case of our company that has both field crews and offsite crews all payroll taxes and benefits are the same. ** Anecdotal based on the minimum reported amount by major multi-family crews in informal survey *** Alliance’s Rate

Worksafe BC - premium to the hourly wage

12 - 16%** 3.5% ***

Total Difference – Adjusted for Worksafe Premium

47% !

$16.50 / hr *

OnSite Labour Costs

Cost Comparison - Labour

Cost Savings

Off Site Advantages

Successful Production efficiency requires:

Lower direct labour costs

Lower safety premiums

Lower production costs due to

automation

Improved material handling

Lean manufacturing processes

So what does all this mean?

ADVANTAGES IN MID-RISE & Rowhomes (Townhouses)

• Framing Bids – similar cost to onsite

• Up to 30% schedule improvement

• Less material waste

• Site Restrictions demand off-site

• Smaller carbon footprint

• Speed to market

Caveat – Rowhomes

overhead due to schedule improvement maximized for single phase projects and negated proportionately as more phases added.

Single Family Homes – Offsite Prefab Panels

• Penetration Lowest

• Seen mostly in higher end homes where

the homeowner desires higher quality &

faster construction (e.g. Timberframe

Package Home manufacturers)

• Effective when Contractor wants to

minimize impact on neighbor's for infill

construction (Smallworks Laneway Urban

laneway Housing)

• Remote locations

• Owner builders

Offsite Construction Benefits:

• Assured and Faster Schedules

• Less Waste

• Environmentally Friendlier

• Drier – Better Quality

• Pre build Virtual Framing

Advantages

Based on cost Where is the sweet spot for Developers?

Multi-family Midrise

• no premium with all the added benefits of

offsite

Multi-family Rowhomes/Townhouse

• all the benefits of offsite construction for a

reasonable 10% premium over onsite

framing

Single Family Dwellings

• 20 25% Premium for all the benefits of

offsite construction

AFFORDABILITY

vs. ESCALATING LABOUR COST HIGH LAND COSTS – DENSIFICATION NEW CONSTRUCTION TECHNIQUES NLT’s ENERGY EFFICINCIENCY REQUIREMENTS SEISMIC REQUIREMENTS LUMBER SUPERCYCLE ENVIRONMENTAL IMPACT

Offsite construction has a far greater potential to help solve these problems

OFFSITE MANUFACTURING CONTRIBUTION TO AFFORDABILITY, SUSTAINABILITY, ENVIRONMENT

ESCALATING LABOUR COST

better suited to training unskilled workers to be productive

& safer faster utilizing automation

HIGH LAND COSTS – DENSIFICATION

allows construction on smaller footprint & infill sites

NEW CONSTRUCTION TECHNIQUES NLT’s

virtual framing allows shop drawings for required tolerances

ENERGY EFFICINCIENCY REQUIREMENTS

can cost effectively add rigid insulation, building wrap,

rainscreen saving time and family

SEISMIC REQUIREMENTS utilizing virtual framing can drive embed layouts, collector stud/hold down directly into prefabricated panel, and identify conflicts with architectural requirements

LUMBER SUPERCYCLE vastly superior material utilization through lumber optimizing saws, and batching

ENVIRONMENTAL IMPACT smaller carbon footprint by reducing onsite personnel creating shorter worker commuting, greater wood fibre utilization with minimal waste, and rebuilding due to elimination of conflicts during the virtual framing stage as opposed to the physical building stage

Architect

Engineer

Component Manufacturer

Builder

Collaboration = Productivity

Roles of Architects and Engineers Understanding one fundamental difference between offsite construction vs. onsite and

our greatest strategic advantage – Virtual Framing.

• Design Virtually

• Build In reality

• Fewer Changes

• Fewer Headaches

• Requires Everyone is up to

speed

The Virtual Framing Process

Virtual Framing – A better Method

BIM – Building Information Model

An Example

• Pre-consult with building component manufacturers professionals at design stage to streamline bid process

• Understand the virtual framing process is integral and utilize it’s advantages

• Help standardize window and door RO’s with manufacturers

• Improve RFI and feedback loop

communication

• Utilize available technology such as Mitek’s MX plugin for Autodesk 3D and ITW’s VisionRez

Full 3D model imported

The Tale of a young man’s Education -- Mine

What did I learn?

Innovation: Vancouver Airport Discount Mall – Steel Roof Structure Converted to FIRE TREATED wood Trusses