Opinion: Modular construction could help Canada overcome its housing bottleneck | Daily Hive

On-site assembly modular construction process for the Estrella rental housing building in Prince Rupert. (NorthStar Development)

Written for Daily Hive Urbanized by Jeff Brown, who is the executive vice president of NorthStar Development. He has more than 20 years of experience in commercial real estate and also owns and oversees Westwynd Real Estate Services.

Canada’s housing conversation has reached a turning point. The Government of Canada and Government of British Columbia recently announced a new partnership to accelerate homebuilding by investing in house-enabling infrastructure, reducing barriers to new construction, and supporting priority communities across the province.

It’s an encouraging shift, but it overlooks a fundamental challenge: even if every project were approved tomorrow, do we actually have the capacity to build the homes that Canada needs?

According to the Canada Mortgage and Housing Corporation (CMHC), Canada will need to nearly double its housing construction pace, building between 430,000 and 480,000 homes annually through 2035 to restore affordability. CMHC itself recognizes that hitting those targets takes significant improvements in productivity, technology, workforce capacity, and construction methods, not policy reform alone.

Nowhere is that reality more apparent than in remote and labour-constrained regions like northern B.C., where many of the province’s largest industrial, infrastructure, and resource projects are driving economic growth while simultaneously intensifying the need for housing.

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Prince Rupert, one of the priority coastal communities identified in the recent federal-provincial partnership for future infrastructure investment, is a prime example. Despite being home to Canada’s third-busiest port and a growing workforce in healthcare, education, and logistics, the community went nearly 30 years without a new apartment building.

Remote communities face challenges that differ significantly from those in major urban centres. Recruiting skilled trades, transporting materials, accommodating workers, and managing construction schedules all become substantially more complex and expensive. Every additional month on site increases labour costs, logistical risk, and overall project uncertainty.

These are realities that traditional housing discussions often overlook. When NorthStar Development began planning Estrella, a 40-home, purpose-built rental community in Prince Rupert that was completed earlier this year, we recognized that conventional construction would make an already challenging project even more difficult. Instead, we chose an off-site modular approach, allowing the building to be manufactured in a controlled facility while site preparation occurred simultaneously.

The result fundamentally changed the project’s economics. Estrella was completed in approximately 14 months, roughly six months sooner than a comparable conventional build. In a market where transporting, housing, and coordinating skilled trades account for a significant portion of project costs, cutting six months from the on-site schedule generated interest savings, reduced labour requirements, simplified trade coordination, and resulted in fewer deficiencies.

estrella prince rupert bc modular construction northstar development

Off-site factory modular construction process for the Estrella rental housing building in Prince Rupert. (NorthStar Development)

In total, the modular approach saved more than $1.7 million. Those efficiencies improved overall project viability and enabled us to deliver a community where 80 per cent of homes rent at below-market rates to support local workers in healthcare, education, and the port and logistics sectors.

Governments have acknowledged that modular construction can help Canada build at the scale required. That support is welcome, but endorsing modular in principle is not the same as making it viable in practice. Right now, a patchwork of regulations across the country is limiting the very advantages that make modular worth pursuing.

Start with building codes and permitting. Modular delivers savings because a factory can build the same design, the same way, over and over. That rinse-and-repeat repetition is the whole point. However, codes and approval processes shift from province to province and from one municipality to another, which means a design that complies with one city’s regulations might need to be re-engineered for the next. Every one-off change chips away at standardization, and with it, the cost and schedule advantages that made modular attractive in the first place.

Then there is the trip from the factory to the site. Because modular units travel over public roads, manufacturers must design modules that comply with the dimensional and permitting requirements of every jurisdiction along the route. Differences in maximum widths, heights, lengths, axle load limits, routing requirements, and escort vehicle rules make it difficult for factories to standardize module sizes and establish predictable production lines.

Our modular manufacturing partner recently encountered this firsthand while shipping modules from Manitoba to British Columbia. In Winnipeg, regulations restrict when oversize modular elements may be moved on roadways, limiting transport to three-hour windows in the middle of the night. Moving an entire building’s worth of modules under these strict conditions turns a logistical exercise into a marathon, and that is only one of the municipalities along one route.

On-site assembly modular construction process for the Estrella rental housing building in Prince Rupert. (NorthStar Development)

Construction completion of the Estrella modular rental housing building in Prince Rupert. (NorthStar Development)

This lack of harmonization blocks what should be factory production’s biggest advantage, the ability to build ahead. In a harmonized system, factories would ideally continue to produce standardized modules or components for future builds, maintaining consistent production levels and spreading fixed overhead across more output, as in almost every other manufacturing sector. Because nearly every order has to be tailored to a different mix of codes and transport rules, that is rarely possible. Production lines sit idle between projects, costs climb, and those costs directly impact housing prices.

To be clear, modular construction is not automatically less expensive or a solve-all solution. Dense urban developments with established labour pools may continue to benefit from conventional construction, but if Canada’s goal is to build more affordable homes faster, the conversation needs to shift away from asking whether one construction method is better than another and toward asking which approach gives each community the best chance of delivering the housing it needs.

That question becomes increasingly important when viewed alongside Canada’s broader construction outlook.

Productivity in residential construction has declined over the past two decades, even as productivity across much of the broader economy has improved. Weak productivity has increased construction costs, lengthened delivery timelines, and made it harder to build the housing Canadians need. If Canada hopes to nearly double housing starts over the next decade, we cannot expect to get there using the same delivery models that are already struggling to keep pace.

Improving productivity does not mean replacing skilled trades or abandoning traditional construction. It means embracing innovation where it delivers measurable value, whether that is modular construction, prefabrication, digital coordination, or standardized design. It also means governments following through on their support for these methods by harmonizing the building codes, permitting practices, and transportation regulations that currently hold them back.

Estrella demonstrated what can happen when construction methods are matched to local realities rather than defaulting to convention. It is not a blueprint for every project, but it is evidence that thinking differently can unlock housing that might otherwise never be built.

If we are serious about solving these complex housing issues, we need to stop asking how we have always built homes and start asking how we can approach the building process more strategically. That shift in thinking, backed by the regulatory changes to support it, may prove just as important as any policy reform currently on the table.

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