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Modular construction company Low Carbon Construction (LCC) is aiming to deliver 10,000 homes a year from 2019 onwards using innovative temporary ‘onsite’ factories.
Simon Allso, the main shareholder in the group, told Inside Housing that it plans to become one of the country’s largest house builders from next year.
LCC intends to use temporary modular factories that it calls ‘Offsite/Onsite’, which are assembled on the development site and then removed once building is complete.
Mr Allso said this method would mean more uniform costs between high and low-value parts of the country as the cost of constructing the homes would not differ.
Construction can be more expensive in areas of higher housebuilding due to increased competition for materials and labour, although the cost of housing is also dictated by land.
LCC aims to reduce the cost of land through grant, taking over developers’ Section 106 contributions at reduced land prices, and buying discounted land from local authorities.
The company’s strategy is an attempt to avoid the problem of demand faced by conventional methods of offsite construction.
With a large factory site, high demand is required to bring down prices, but without this pipeline prices are too high to attract demand – a problem widely seen as a major factor in the slow growth of the offsite industry in the UK.
LCC itself previously had a factory in Portsmouth, but was forced to close it in September 2015.
The smaller, onsite factories are designed to deliver 250 homes a year each, and according to Mr Allso LCC will build as many as are necessary on each site.
Mr Allso told Inside Housing: “The goal, which we’re well on the way to, is 50 individual strategic land purchases in 2018, giving us 30,000 individual plots, and from 2019 10,000 units a year. That’s what we’re geared up to do with our supply partners. That is proving, since we launched this, a low target. We now know that it’s going to be more than that.”
The homes themselves will be built using structural insulated panels (SIPs), meaning they use very low levels of carbon for heating.
LCC has a number of supply partners which build the homes, with the company itself providing the technology and the land. LCC intends to work with local authorities on tenure mix and Mr Allso said that housing associations were welcome to buy the homes as well.
LCC’s current target price for a three-bedroom house is £695 a month to rent or £179,995 to buy. If buyers wish to rent out the homes, they must use LCC’s target rent plus inflation.
Its intention is for the prices to be uniform across the country.
A number of offsite developers – including Legal & General, a consortium including a Chinese government firm and an Indian real estate giant – have entered the modular sector in recent years with large ambitions. However, in every case progress has proved slow.