An insight into the way the offsite sector operates within the EU, came recently via a report from the ‘Task Force on Offsite Construction’ at the European Commission’s High Level Construction Forum. Gary Ramsay, picks out some of its key points.
It often feels like the UK suffers from unique, systemic barriers towards accelerating the adoption of offsite and industrialised construction – but it doesn’t, there are many universal ones. Held online on 30 June, the inaugural meeting brought together 181 participants representing the European Commission, Member States, offsite construction organisations, manufacturers, research and academic institutions and other industry stakeholders. Its purpose was to move the debate around offsite construction beyond general discussion and towards practical measures capable of increasing its adoption across the European ‘single market’.
The Task Force has been established to identify regulatory and practical barriers, examine existing support measures and incentives, gather successful examples from across Europe and develop recommendations that could influence European, national and regional policy. Importantly, the Commission stressed that offsite construction is not a replacement for traditional construction, but as one of several technologies capable of helping Europe respond to its housing, productivity and competitiveness challenges.
Organised around three workstreams: barriers and regulations, market support and incentives and case studies and best practice, discussions revealed that the obstacles to industrialised construction extend far beyond regulation. Fragmented markets, uncertain demand, financing, skills, procurement, supply chains and a lack of confidence are all interconnected barriers that need to be addressed if Europe is to achieve industrial-scale deployment. Does any of this sound familiar to UK operators?
Defining industrialised construction
One of the first issues identified was a familiar one but one where the UK may have solved something – even if in a small way – Europe does not yet have a universally understood definition of what constitutes offsite or industrialised construction.
Participants pointed out that terms such as offsite, modular, prefabricated and industrialised construction are frequently used interchangeably, despite describing different concepts. The discussion suggested that industrialised construction should be regarded as the broader production model, incorporating standardisation, digitalisation, automation, product development, logistics and repeatability. Offsite manufacturing is one component of that wider approach. Some clarity has been clearly communicated here in the UK on what means what, but the lines are blurry between these phrases, definitions and understanding what each truly relates to.
Establishing common terminology is seen as an important foundation for future policy. Without it, regulation, procurement, insurance and permitting can continue to treat industrialised solutions as if they were conventional, one-off construction projects.
The distinction is particularly important because industrialisation depends on repeatability. A factory can achieve efficiency when it produces similar products repeatedly, but those benefits disappear when every project requires a bespoke solution. Participants argued that policy should help create conditions in which standardisation, product platforms and repeatable solutions can flourish without compromising architectural quality or safety.
Regulatory fragmentation
Regulatory fragmentation emerged as one of the strongest themes of the meeting. Manufacturers attempting to operate across Europe face different technical requirements, national building regulations, certification procedures and systems. These differences make it difficult to replicate products and systems across national and regional markets, restricting manufacturers’ ability to achieve the economies of scale on which offsite and industrialised construction depends.
The Commission’s preliminary mapping identified lengthy approval and certification procedures, duplicated testing, a lack of harmonised European standards for modular and prefabricated building systems, with slow planning regimes that can restrict offsite solutions for applications such as rooftop extensions, high-rise extensions and building conversion.
Participants called for greater convergence of technical requirements, harmonised testing methods, consistent certification approaches and greater use of Eurocodes where appropriate. The use of digital tools and simplified administrative processes were also identified as important opportunities.
However, as with all harmonisation, discussion made clear that it should not mean lowering standards. Participants stressed that future European approaches must preserve product safety, maintain a level playing field and accommodate differences such as climate conditions – where the Summer of 2026 has shown can be extreme and unpredictable.
Planning and digitalisation
The great stopper of building progress and a brake on offsite delivery are the vagaries of planning – identified as another area where traditional construction processes can work against industrialised approaches. Systems that have been designed around construction taking place on-site, including inspections and assessments based on the progress of traditional building work – can create untold difficulties for projects where much of the construction is prefabricated and takes place in a factory.
The report highlights digital building planning consents and BIM-enabled compliance checking as potential solutions, alongside faster and simpler administrative processes. Participants also argued that digitalisation needs to extend beyond design models to cover production, logistics, assembly and supply-chain management.
Open digital standards were seen as particularly important. The report notes concerns about closed systems and calls for greater use of Open BIM and standards such as Industry Foundation Classes (IFC) – an open, global data standard used to share and exchange BIM information across different software programs. Better integration of digital tools throughout the construction lifecycle could help connect design, manufacturing and assembly rather than treating them as separate activities.
Skills, knowledge and market confidence
As ever, shortages of skills across the entire construction ecosystem was highlighted. Many architects, engineers, contractors, developers and investors still lack familiarity with offsite solutions. Universities and professional training programmes also remain heavily focused on traditional construction techniques. All issues that are constantly raised here in the UK and continue to be problematic. The perennial advice on involving manufacturers earlier in the process and greater co- operation between design teams is fundamental to optimising the industrialisation approach to project delivery.
Market perception is another challenge. Concerns around innovative materials, particularly bio-based and timber systems, can affect insurance and investment decisions. The report suggests that confidence needs to be built through evidence. Demonstration projects should provide robust information on technical performance, lifecycle cost, environmental benefits, quality and scalability.
Predictable markets
Perhaps the most important conclusion from the meeting is that Europe cannot industrialise construction without creating a sufficiently large and predictable market. Echoes once again of the same situation here in the UK where lack of pipeline has been the death knell of several businesses.
Participants repeatedly identified unstable demand as a major barrier to investment. A factory may require substantial investment in automation, equipment, people and supply chains, but construction projects can be delayed, cancelled or likely changed mid-scheme – a factory cannot easily be switched on and off when a project pipeline changes.
This creates a circular problem. Manufacturers cannot invest without confidence in future demand, but the industry cannot achieve the economies of scale needed to make offsite construction more competitive without investment. The Task Force therefore placed considerable emphasis on moving from project-by-project thinking towards portfolio approaches. A single building may not justify investment in industrial capacity, whereas a long-term programme of housing or renovation projects can. Build-to-Rent, affordable housing and social housing were identified as particularly suitable areas for demand aggregation.
Public sector procurement
The Task Force heard that public authorities could act as early adopters, creating markets for industrialised construction while simultaneously demonstrating its benefits. Procurement that rewards speed, quality, sustainability, productivity, lifecycle performance and replicability could provide a significant alternative to traditional methods that often lean towards the lowest-price option.
Examples discussed included Ireland, Spain, Sweden, France and the UK. The report cites Ireland’s target for at least 25% of newbuild social and affordable homes to use offsite methods while the Basque Government has introduced measures promoting industrialised construction in public housing. In Sweden, framework agreements between publicly owned housing companies and offsite construction suppliers have provided sufficient certainty for manufacturers to invest in factories, product platforms and supply chains.
The report also points to the UK’s work in the education and healthcare sectors as examples where standardised requirements have helped encourage the use of offsite manufacture. Overall, the emerging lesson is that procurement should not prescribe a particular technology, but seek to establish functional and performance requirements, allowing industrialised solutions to compete where they can demonstrate better value. The Task Force suggested that practical guidance for contracting authorities could become one of its useful outputs, helping public bodies understand how to specify and procure offsite construction effectively.
Lessons from successful projects
The Task Force’s third workstream examined case studies to determine what makes industrialised construction projects successful. A central conclusion was that successful projects are not necessarily those with the highest degree of prefabrication. Instead, success depends on aligning the developer, designer, manufacturer and contractor around an industrial delivery model from the beginning.
The Regulatory Evolution for Modular Construction Excellence in Europe (REMODE) research activity, for example investigated the sustainability performance, circularity potential and regulatory context of modular construction systems based on cross laminated timber (CLT). Its findings highlight that regulatory and standardisation frameworks across Member States have mostly been designed for traditional on-site building methods. Key enablers identified include digital module passports, standardised recertification protocols for reused structural components, and targeted revisions to European assessment frameworks.
Other examples demonstrate the importance of long-term programmes. The Community of Madrid VIVE Plan is delivering more than 8,000 social housing units using industrialised construction, while Sweden’s framework agreements have helped suppliers invest in manufacturing capacity. In France, the National Offsite Association (Filiere hors site France) is bringing together public landowners, urban developers and industry specialists Around 10 major public bodies committed to reaching a high level of offsite integration of 50% of their projects.
The report also highlights the importance of local ecosystems. In Vaxjo, Sweden, three decades of timber and offsite projects have helped create a network involving public authorities, developers, suppliers and contractors. Such ecosystems demonstrate that industrialisation is not simply about factories but in need of an integrated value chain and experienced practitioners.
Moving from barriers to action
The overall message from the first Task Force meeting is that Europe already possesses many of the technologies and examples needed to accelerate industrialised construction. The principal challenge is creating the conditions in which those solutions can be deployed repeatedly and at scale. That means addressing regulatory fragmentation, improving planning regimes, developing common terminology and standards, strengthening skills and testing capacity, improving access to finance and insurance, and building confidence through evidence and demonstration projects.
But as in the UK, above all else the offsite industry needs demand. Public procurement, long-term housing programmes, renovation strategies, framework agreements and aggregated project pipelines could provide the certainty for investment in factories, automation, new skills and integrated supply chains. The experience of countries and programmes already using these approaches suggests that industrialisation becomes more viable when policy, procurement, finance and industry work together.
Looking to the future, the next stage of the Task Force will focus on turning the issues raised during its inaugural meeting into practical recommendations and potential guidance. The significance of the initiative is that the European Commission is beginning to frame offsite construction not simply as a construction technology, but as an industrial and economic transformer requiring changes across the entire construction value chain. For the UK, European and wider international construction sector, the challenge is no longer simply whether offsite construction works, but it’s how to create the cultural, regulatory, financial, procurement and market conditions to allow it to work competitively and ‘on repeat’ at scale.
