Stan Chiu of HGA Architects & Engineers Stan Chiu of HGA Architects & Engineers

Prefabricated and modular construction is rapidly rising in popularity for healthcare developers and providers. Modular construction is not only more cost effective and has a faster construction timeline—two benefits that have attracted multifamily and hotel developers—the standardized facilities that come with modular construction also create more efficient operations and provide a better patient experience.

“For integrated teams, there has been a surge in ground-up prefab as a more efficient way of delivering projects,” Stan Chiu of HGA Architects & Engineers, tells GlobeSt.com. “That is about saving time and money, and sometimes could be about increasing quality. You can generally hold that under creating more value. Parallel to that, there is a strategic angle as well. Organizations are looking at prefabrication as a way of returning better value and as a way of establishing standards that will live past the construction and onto the operation of the environment. It is a way of creating consistency from project to project.”

Design teams also see prefabrication as a streamlined approach to construction, particularly in healthcare, which can have a lot of moving parts. “There is a sub benefit of prefabrication, and that is shortening the amount of time that designers spend with users to determine what goes in what room,” says Chiu. “That is a good benefit of having standards. Instead of getting 100 designers to make 100 decisions, we are pulling everyone into a room to make one decisions.”

Standardization is really the key benefit. In healthcare, operating a building is far more costly than construction. Chiu pins it as a 10:1 ration for operations cost versus construction costs. “Standardization is easier to build,” he says. “That could be easier on the development side, but on the operations side, it is a massive benefit. Some organizations see that as a model, and prefab is a fantastic vehicle for delivering that. Providers are coming in and everything is the same, it is going to create a more effective operation, and operators see that as a way of driving clinical quality.”

There is also a significant decrease in construction time. On a recent project, using modular construction reduced a 27-month timeline by 2.5 months, and saved $2.8 million on a total budget cost of $30 million.

The benefits are vast, and they have driven a new demand for modular healthcare facilities. “In healthcare, more than half of our clients are asking about, and we have a number of projects going that are all about maximizing prefab,” says Chiu. “It is super prevalent now. It emerged about four years ago, but it is everywhere.”

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.