Prefab houses: the coronavirus crisis triggers an increase in the industry in Spain

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A prefab house by InHaus / InHaus
11 June 2020, Redaction

Major developers in Spain such as AEDAS homes, others that only dedicate themselves to the prefab business model such as InHaus, and experts such as José Antonio Tenorio, a Spanish National Research Council (CSIC) scientist at the Eduardo Torroja Institute of Construction Sciences (IETcc), affirm that the coronavirus has given a great boost to prefabricated houses and industrialisation. The interest in this type of housing is a consequence of the pandemic and has multiplied during the confinement period with the supply already preparing for what Juan Antonio Gómez-Pintado, president of ASPRIMA (the Association of Real Estate Promoters in Madrid), described in an interview with idealista/news as "the great post-COVID-19 resurgence".

Growing interest in prefab homes

At present, the foreseeable economic instability in sectors such as construction, which accounts for 7% of GDP in countries like Spain, translates into an intense blow to millions of direct and indirect jobs. A circumstance that also occurs at international level since, to a greater or lesser extent, the pandemic has affected the main world powers.

The methodology of industrialised construction allows borders to be crossed by expanding the potential market, thanks to manufacturing located in national territory that can easily be transferred to the rest of Europe or even the United States, depending on the companies dedicated to this segment of construction.

In this complicated scenario, the interest in acquiring a prefabricated single-family home has been increasing since the beginning of the confinement. For many, what was a distant idea has gained more strength when they see the importance of being able to enjoy ample spaces in the home at an attractive price. "Since the activation of the state of alarm in Spain, requests for large-format housing have doubled compared to the same period last year," explain InHaus, a Valencian company specialising in the production of industrialised single-family homes.

This increase in interest has also been highlighted by AEDAS, the first of the four major developers who have launched this industrialisation in Spain, although pointing out that it is still too early to fully assess the effects of COVID-19 on the real estate market. "As far as the end customer is concerned, the fact that we have active marketing of offsite single-family homes (industrialised) in areas of contrasting demand such as Madrid, Torrejón de Ardoz or Villanueva del Pardillo, has meant that, since the first weeks of confinement, we have monitored a progressive increase in interest. However, this positive data is similar to that of other single-family housing developments by the company: we are seeing families who are looking for changes in their lifestyle due to the health emergency and who are interested in buying a newly built single-family home. In this sense, the reduction in delivery times associated with industrialised or prefab construction is valued positively by customers," says Angel Fernández, manager of Industrialisation at AEDAS.

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One of AEDAS' prefab homes / AEDAS

It is precisely shortening the construction period that InHaus considers to be another of the factors that has led to this increase in demand. "In communities like Madrid and Valencia, responsible statements and outsourcing of licence applications have been introduced to help boost the construction sector. This, together with a period of five months in the manufacture of housing thanks to industrialised construction, will mean that the final deadline is reduced considerably compared to the initial outlook," the company states.

A booming business model before COVID-19

The reality is that this business model had already experienced a boost before the coronavirus, but now all the players in the market agree in pointing to industrialisation as the future of construction. "Today, from developers to construction and industrial companies, including building agents, insurance companies and banks, everyone agrees on the great opportunity that our sector has to take the step towards industrialisation. Of course, our company is going to continue investing efforts in this direction, taking into account the results and experience accumulated in these more than two years of life in our industrialisation division", explains the director of this division at AEDAS that has already managed to implement 95 single-family houses adding a total of 448 modules.

Other advantages of prefabricated houses and industrialisation is the safety of employees during their working day, a circumstance that has been able to be demonstrated after the arrival of the coronavirus in the job market. "The pace of work has hardly been affected by the context of COVID-19, thanks to having introduced innovation in all its processes from the beginning. Industrialised construction, being in an environment of an industrial warehouse, allows an exhaustive control of construction in a reduced time frame and with the maximum quality in the execution. The optimised auxiliary means and the management of shifts allow the factory to be in operation 24 hours a day, while facilitating the necessary social distances between workers without reducing production. On the other hand, being in a controlled environment and with a stable climate facilitates the combination of the construction's own PPE with those necessary in the current situation without altering the rhythm of the work", they state from InHaus.

Employment opportunities

InHaus, based in Valencia has also announced that it has received more than 50 CVs per day in recent times from workers and technicians interested in working in this area of industrialisation. "The greater knowledge of industrialised construction has generated an interest in professionals both in the construction sector and among architects themselves," they say.

In this sense, AEDAS says that in recent weeks, the company held a meeting with the Directorate General of the Public Employment Service in the Community of Madrid who was interested in knowing in depth the specific training needs for a sector they have identified as strategic for 2020-2021. "Our opinion is that technicians and middle managers specialised in industrialised construction systems should be trained. In this sense, initiatives such as the recently inaugurated "Curso de Técnico Especialista en Construcción Industrializada" (Specialist Technician in Industrialised Construction Course) given by the "Colegio Oficial de Aparejadores y Arquitectos Técnicos de Madrid" (the Official Association of Quantity Surveyors and Technical Architects of Madrid), are vital for the creation of these new specialised professional profiles that a booming industry is requiring", states Fernández.

It is precisely the involvement of public administration that is one of the keys to the business model's success after COVID-19, according to the manager of AEDAS Industrialisation. "We need an industry that is technically solvent and has sufficient production capacity. For the latter, it is essential that the Public Administration is involved, supporting in a decisive manner the growth of this building industry," says Fernández, who also announced news regarding the short term plans for the division and the possibility of being able to industrialise multi-family housing.

"Industrialization and prefab houses are here to stay"

These companies are not the only ones who see industrialisation as the future of construction. Experts in the field also explain that this business model has definitively landed for good and that it is not just a passing fad. "Industrialisation in the real estate sector is not something new. In fact, it dates back to the 1950s. What has happened is that this business model has arrived in the residential sector after being successfully tested in the tertiary sectors - farm buildings, for example", says José Antonio Tenorio, a Spanish National Research Council (CSIC) scientist. 

This scientist does not dare claim that demand for this type of asset has risen just because of the COVID-19 crisis, because he is not behind any company, but he does claim that it would have all the logic in the world. Furthermore, the expert states how much industrialisation has evolved in recent years. "People may think of the concept of the prefabricated house as a shabby house, something of poor quality and poorly finished, but the reality is that they are many advantages nowadays. These dwellings go through extensive quality controls, just like a car that has been produced on a production line. Nobody thinks about buying a car that has been built in a 'traditional' way. Just because it has been manufactured on a production line does not mean that it cannot have details or specific features chosen by the customer," he says.  

Regarding the work situation surrounding this business model, Tenorio also agrees with the above opinions. "It is necessary to attract and train people for this type of work. For this purpose, administrations and companies must work together to generate attractive and, above all, well-paid jobs. Young people will be more attracted to working in an industrial building than on a construction site for reasons of climate and safety, among others," Tenorio concluded.

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