Off-site Construction Research Centre

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Canada’s construction problem isn’t temporary, it’s structural

For decades, the construction industry in Canada has been operating under growing pressure. Productivity has remained largely stagnant, skilled labour is becoming harder to find, and at the same time, the country is facing a housing shortfall prediction of more than 3.5 million homes by 2030.

These are not isolated challenges. They are deeply connected and they point to one reality: The way we build today is no longer enough to meet the demands of tomorrow.

A shift in thinking: What Industrialized Construction really means

Industrialized Construction (IC) is often misunderstood as just modular construction or prefabrication. In reality, it represents something much bigger- a shift in mindset.

At its core, IC applies manufacturing principles to construction. Instead of relying solely on labour-intensive, on-site processes, it brings together:

• Mechanization
• Automation
• Advanced manufacturing
• Digital design and workflows

It spans multiple approaches. From off-site construction and 3D printing to productized building systems and process optimization.

But the real value of IC doesn’t come from any one of these elements alone. It comes from how they work together as a system.

The real challenge: It’s not the technology

If Industrialized Construction holds so much promise, why hasn’t it scaled across Canada?

Through research led by the UNB Off-site Construction Research Centre, one insight became clear:

The barriers to IC are not technical, they are systemic

Across the industry, stakeholders consistently pointed to challenges such as:

• Misaligned regulations and approval processes
• Financing and insurance models that don’t fit IC projects
• Procurement systems that prioritize lowest cost over long-term value
• Limited data on industry capacity
• Gaps in skills, training, and awareness
• Cultural resistance to new ways of building

In other words, the industry is trying to adopt a new way of building within a system designed for the old one.

Barriers to IC adoption

Challenges to adopting IC

• Financing & insurance
• Transportation & logistics
• Government misalignment
• Cultural issues
• Training & education
• Data gaps
• Regulations & codes

From insight to action: Building a national roadmap

To address this, the project took an evidence-based and collaborative approach. We engaged stakeholders across industry, government, and academia through:

• Workshops in Toronto and Edmonton
• In-depth interviews
• A national survey
• Global benchmarking and literature review

This wasn’t about theory: it was about capturing real challenges, priorities, and opportunities from across the Canadian construction ecosystem.

Six areas that can unlock real change

Roadmap development process

1. Literature review
   • Insights from international best practices
   • Previous studies on IC in Canada
2. Regional workshops (Toronto, Edmonton)
   • Explored barriers to adopting IC in Canada
   • Began identifying actionable strategies to drive innovation and growth
3. Virtual interviews
   • Filling data gaps identified during the workshops
4. Public survey
   • Ranking identified actionable strategies
   • Expected timeline for implementation
   • Gathering additional industry perspectives
5. Qualitative analysis
   • Developing actionable strategies for IC advancement
   • Quantified ranking of actionable strategies
   • A structured implementation timeline
6. Results

The outcome of this work is a strategic roadmap built around six key focus areas:

1. Policy and Regulatory Frameworks: Align approvals and codes with industrialized methods
2. Procurement and Performance Systems: Enable early collaboration and recognize the value of IC
3. Financial and Insurance Solutions: Reduce risk and unlock investment
4. Awareness, Competency, and Collaboration: Build industry understanding and skills
5. Industry Capacity and Capability: Improve visibility of manufacturing and supply chains
6. Research and Data Sharing: Strengthen the evidence base for decision-making

Each of these areas targets a different part of the system, but together, they form a coordinated path forward.

A key insight: The system needs to evolve, not just the projects

One of the strongest findings from the research is that isolated innovation is not enough.

Pilot projects and individual success stories exist across Canada. But without alignment in policy, procurement, and financing, these efforts struggle to scale.

This is where Canada can learn from global leaders.

Countries like Sweden, UK, China and Japan have successfully advanced industrialized construction not just through innovation, but through alignment:

• Strong government support and funding
• Clear regulatory frameworks
• Integrated industry–research collaboration
• Scalable manufacturing ecosystems

The lesson is simple: Technology enables change, but systems make it possible

Global best practices, lessons in IC

• Ireland
  • Mandated OSC in public housing 
  • €1B+ industry investment
  • Supportive government programs
• United Kingdom
  • National MMC framework adopted
  • £11.5B funding for OSC
  • Strong cross-sector collaboration
• NZ
  • Fast-track modular approvals
  • BIM for design accuracy
  • Seismic-resilient systems
• China
  • Policy-driven modular growth
  • Financial & technical incentives
  • Advanced BIM integration
• Sweden
  • 84% homes built off-site
  • Green codes + sustainability focus
  • Vertically integrated builders
• USA
  • National OSC research roadmap
  • Emphasis on pilot projects
  • Strong government-industry links
• Japan
  • 15% of homes modular-built
  • Flexible company-led regulation
  • High automation + customization

From roadmap to implementation

A roadmap is only as valuable as its ability to drive action. To support implementation, each initiative has been evaluated based on:

• Stakeholders involved
• Timeline (short, mid, long-term)
• Ease of implementation
• Expected impact

This allows decision-makers to prioritize efforts and move forward in a structured, phased way.

Canadian model for collaboration: Hub and spoke

Western: R&D IC Cluster
North: R&D IC Cluster
Prairie: R&D IC Cluster
Central: R&D IC Cluster - NRC CoE Hub for IC
Eastern: R&D IC Cluster
Atlantic: R&D IC Cluster

A central recommendation of the roadmap is the creation of a national hub-and-spoke model for research and innovation.

• The National Research Council Canada acts as the central hub, coordinating efforts at a national level
• Regional clusters across Canada act as spokes, driving innovation based on local strengths and needs

This model balances national alignment with regional flexibility, enabling stronger collaboration across the ecosystem.

Progress is underway, but momentum matters

Since the roadmap was finalized in 2025, early progress has begun.

• A Canadian MMC framework is being developed to standardize how IC is defined and implemented
• Discussions around policy and regulatory alignment are gaining traction
• Industry awareness is increasing

At the same time, several priorities remain critical:

• Streamlining regulations and approvals
• Creating consistent market demand
• Strengthening collaboration across sectors
• Investing in research, innovation, and workforce development

Call to action

Next steps: Turning strategy into action

1. Adopt national IC framework
2. Streamline policy to enable IC and OSC
3. Create sustainanle demand to de-risk innovation investment
4. Align stakeholders across government, academia, idustry
5. Invest in R&D and workforce upskilling

Looking ahead: A different way of building

Industrialized Construction is often framed as a way to build faster. But it's true potential is much broader. It offers a way to:

• Improve productivity across the industry
• Deliver housing at the scale Canada needs
• Reduce environmental impact
• Build a more resilient and future-ready construction sector

The opportunity is clear but realizing it requires coordinated action. Canada does not lack innovation.

What it needs is alignment across policy, industry, and research.

This roadmap is a step toward that alignment, and with it, a step toward transforming how we build in Canada.