A Victorian government discussion paper has placed prefab, building information modelling and green design as keys to boosting the productivity of the state’s construction sector.

The construction technologies discussion paper, put together by the Department of Economic Development, Jobs, Transport and Resources, said the construction sector contributed 6.7 per cent to Victoria’s gross value-added, or $21.6 billion dollars a year.

“At 8.2 per cent of the workforce, it is Victoria’s fifth largest industry sector,” the paper said.

The construction materials and technologies industries were of strategic importance to the state’s economy, it found, though there were many opportunities to boost productivity.

It noted the recent Productivity Commission Inquiry into Public Infrastructure, which found that Australian productivity and efficiency lagged behind comparator countries, and put forward a number of potential solutions for industry discussion.

Victoria can become prefab centre of excellence

The paper found that “off-site” construction offered “reduced construction times, costs, project payback times and waste while improving workplace safety”. It also boosted productivity by reducing lost time due to bad weather.

It said there was an opportunity for Victoria to establish itself as “the nation’s centre of excellence in off-site construction both commercially and as a prefabrication skills centre”.

Hickory Group’s prefab construction

Transforming the industry required education and training to get the right skill set, however.

“Wider skills in areas such as engineering and design will need to be acquired, whilst the demand for some lower skilled roles may eventually reduce,” it said. “The need to plan and establish new training centres and programs is essential to facilitate the development of the right skills for the future construction industry.”

It noted that Victoria was well-placed to lead the revolution, with the Victorian-based Hickory Group the “largest and most advanced modular construction firm” in the country.

Barriers that needed to be overcome included:

  • A lack of understanding around off-site construction, particularly by regulators, educators and financiers
  • Limited access to finance due to the sector attracting a higher risk profile from banks
  • Negative cashflow impacts due to the bulk of costs being borne upfront in off-site construction, but payments scheduled around assembly milestones on site
  • Lack of training from educational institutions in modular and prefabrication techniques
  • Lack of scale compared to its Northern hemisphere competitors including China
  • High transport costs and distance to markets
  • High upfront investment required to innovate with building materials
  • Protecting IP, particularly in global markets

While prefab offered good export potential, it was a “double-edged sword”, opening up the potential of import competition.

“The challenge for Victoria is to ensure the local industry continues to innovate and develop towards manufacturing high quality customised products, which are valued and demanded both locally and overseas,” the paper said.

Victoria as a green building showcase

The paper said Victoria could also be a showcase for green buildings and liveability, with flagship projects such as CH2, Pixel and the 60L building leading the market on sustainability.

It also said there was potential for advanced materials to be produced or used in Victorian building projects, such as Waffle Pods, Bubble Deck, pre-stressed and pre-cast concrete floors, smarter glazing products, expanded polystyrene building insulation, cross-laminated timber and carbon fibre reinforced plastic.

The uptake of BIM

Increasing the uptake of BIM on Victorian construction projects was noted as a productivity booster.

“Creating a common project platform for architects, designers and engineers, and the supply chain increases efficiency by reducing errors arising from incorrect or out of date information, and reducing reworking,” the paper said. “Once the project is complete, facility managers can utilise the BIM database to better service and maintain a structure throughout its life cycle.”

While awareness of BIM was high, commitment was still lower than in comparable countries. The Victorian government sees itself as potentially able to play a leadership role.

“Government may be able to play a role both as a champion of BIM, and working to establish standards and guidelines. There could be an opportunity for Victoria to lead on this issue as some major companies in this domain are based here,” the paper said.

“While mandating the use of BIM will provide governments with the capability to more effectively manage assets, it will also require new skills, processes and capabilities of its facility management to realise the full benefits.”

Feedback sought

The paper raises a number of areas it is asking stakeholders to provide feedback on, including:

  • How to capitalise on Melbourne’s status as the world’s most liveable city
  • How to capture the demonstration benefit from green, smart projects
  • How to accelerate the uptake of new materials and technologies
  • What the role of government should be in the take up of Building Information Modelling
  • How to establish Victoria as Australia’s centre of excellence for off-site construction technologies and businesses
  • How to utilise the strength of Victoria’s research base for the benefit of the building materials and building technology industries
  • How to get better at exporting and managing the import challenge

Comments and feedback are requested by 5pm on Monday 21 September 2015, and there will also be opportunities for feedback and discussion at the 2015 Industry Transformation PrefabAUS conference on 14-16 September, University of Melbourne.

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