The Charles Darwin University student accommodation on GPT’s Casuarina Shopping Centre site, Darwin.

30 July 2014 — When China International Marine Containers, or CIMC, saw that the mining investment boom had peaked and was settling into the steady extraction phase, it looked around for how it could use its skills at supplying mining accommodation to something a bit longer lasting.

It didn’t take long to alight on multi-storey prefabricatated housing. In particular, but not always, hotels. Today the company has about 12 projects on the go.

The first multi-storey product that has definitely met the grade and is scheduled to start construction in August will be student accommodation for 303 rooms for the Charles Darwin University on GPT’s Casuarina Shopping Centre site in Darwin.

According to sales manager for the company James Clark, the shift to modular started about a year ago.

“Before that we supplied Rio [Tinto] and Fortescue with resource accommodation,” Clark says.

In Australia the company delivered 5500 dongers or about 22,000 rooms during its mining phase.

The trouble was that all the projects still on offer were all through tender and, as the competition intensified, the company could see a “race to the bottom” with little upside for its business.

It started actively looking around the multi-storey modular market.

First port of call was hiring someone who knew what they were doing to lead operations. This turned out to be John Zendler, now the company’s executive general manager. Zendler had the right track record, as general manager WA and Queensland for Hickory Group and previously as general manager, housing for Ausco.

Clark says the company can build up to 16 self-supporting floors, all manufactured in China.

The units are “completely finished”. In terms of people dealing with the product, says James, “the first person unwraps it and the second person lives in it”.

“With hotels, they’re finished to such a degree that you don’t need a tradesman in the room.”

Hotels are the number one market. The big attraction is that they can shave 50 per cent off the build time on site and it’s a market with big demand.

This is possible because the company spends longer in the design phase but the efficiencies mean that construction on site can start at the same time the modules are being manufactured in China.

Typically such a build might take 18 months, but with CIMC it will be nine months, Clark says.

At the Darwin site, modules will start arriving at end of August, at the rate of 11 or 12 a day. Handover of the site is expected in December this year.

The company, listed on the Hong Kong Stock Exchange and partly owned by the Chinese government, is not new to high rise modular, and has been active in this field in the UK for the past eight years.

CIMC MBS also completed projects for the Holiday Inn and Premier Inn chains.

The official verdict on cost is that there are no significant savings but Clark says the project managers say differently.

“The project manager says, ‘Of course it will be lower cost; I don’t’ have to send in a supervisor to touch up mistakes; I don’t have to have the [specialist] supervision and I don’t need fencing or site toilets for 18 months. There are a lot of costs that haven’t been calculated.”

What about sustainability?

If sustainability is proxy for quality then the prefab multi-storey products from this company meet the bill. High-end appliances are used – Samsung, Sony and European appliances, for instance – so there is a durability element at work.

Clark says the product will meet or exceed BCA [Building Code of Australia] requirements and can be at 7-8 star NatHERS standards. They typically have double glazing and high acoustic quality and seismic resilience but, he says, “generally developers don’t care about being overly sustainable”.

Airconditioners are standard but solar panels and recycled water are not part of the package. Not at this stage anyway.

But as the market demand starts to better penetrate the market for pre-fabricated hosing, there’s no reason why a clever prefab manufacturer wouldn’t be able to deliver this too. On time and on cost.