More of Philadelphia’s apartments are being built in a factory and put together later like LEGOs (2023)

One morning last month, a crane swung massive boxes across a clear blue sky and gently slotted them among the apartments under construction at 23rd and Race Streets. Inside the boxes were toilets in bathrooms, closets in bedrooms, countertops in kitchens — all the makings of homes.

The 160-unit Edgewater II is one of the latest projects by Alterra Property Group that uses modular construction — in which homes are built in pieces off-site and fitted together like LEGOs. LVL North at Broad and Spring Garden Streets is the Philadelphia developer’s largest modular property with 410 apartments. It began leasing this spring.

That’s also when the company broke ground on another mixed-use modular project with 275 apartments at 43rd and Chestnut Streets. The firm plans to keep building this way as much as possible. Given the pace and scale of the projects, Leo Addimando, cofounder and managing partner, said he’s gotten calls from fellow developers seeking tips.

As construction costs have risen, developers “are more willing to try new things,” he said. “And for them, it’s a new thing, even though it’s not a new thing.”

Philadelphia developers have tried the building method on and off for decades with various success. It’s still only a sliver of the total construction industry — between 5% and 10%. But in recent years, modular construction has gotten more popular in the city, and industry watchers say its appeal will only grow, as builders strive to cut increasing costs, attract more workers, and meet renter demand.

The time-lapse video above shows the construction of Alterra Property Group’s mixed-use development at 510 N. Broad Street. (Courtesy of Clemens Construction Company Inc.)

The method won’t take over how builders build, said Laura Dwyer, chair of the Building Systems Council Board of Trustees at the National Association of Home Builders. But more association members are building portions of their projects off-site.

Projects in Philadelphia also have gotten bigger. Off-site building mostly used to be reserved for single-family homes. Now, more multifamily developers are going modular and building more units.

Philadelphia-based Mosaic Development Partners has been using modular construction for more than a decade and sees it as a way to keep rents down.

» READ MORE: 352 apartments proposed for Market Street in West Philly

“It’s something we believe in that makes a lot of sense from a design and affordability perspective,” said Greg Reaves, cofounder and chief executive officer. “We are firm believers that it is the way to build.”

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In recent years, he’s seen bigger players dive into modular.

“That’s what intrigued us to want to think about it on a larger scale,” he said. The company is nearly finished building a 98-unit, mixed-income apartment complex in North Philadelphia’s Sharswood neighborhood. It plans to use modular construction in its development at the Navy Yard.

The demand for apartments in the Philadelphia region is exceeding supply, and “modular construction is definitely going to help the industry meet that demand,” said Carol Christner, chief executive officer of the Pennsylvania Apartment Association.

“It’s a really exciting opportunity for many of our PAA members to be able to expand their portfolio” and “provide housing at various price points,” she said.

Why more developers are going modular

The increasing interest in modular “is being driven by all the cost pressures every developer is under right now,” Addimando said. This spring, costs of building materials were up 19% from the year before, according to the National Association of Home Builders.

“We had to figure out a way to make the equation of construction work,” he said.

» READ MORE: Going modular to cut city construction costs

Building modularly can save 20% on total construction costs, he said. Projects can be constructed in half the time, and rental revenue comes in sooner. Workers build apartments in pieces in a factory as others lay the foundation. Factory work doesn’t have to pause for inclement weather.

Alterra Property Group has found that modular construction is cost- and time-effective when it builds between 100 and 500 units and between four and six stories. Under that, building on-site is more efficient, Addimando said. Above that, builders can run up against building code restrictions.

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Philadelphia-based Volumetric Building Cos., which works with Addimando, started as a construction company in 2009 but has become a major player in modular manufacturing for multifamily buildings in Philadelphia and beyond. This spring, it bought a 356,000-square-foot manufacturing facility in Berwick, Pa., to serve major cities in the Northeast.

» READ MORE: Philly-area home builders continue to struggle even as buyer demand slows

Vaughan Buckley, founder and chief executive officer, said he plans to expand from five factories around the world to 12 over the next five years, while keeping his Philadelphia headquarters and growing his business here.

More builders and consumers are thinking differently about modular than they did years ago. Union builders have warmed up to the approach. The method is more accepted in building high-end homes. Modular designs and systems have improved, and more architects, engineers, and contractors have become comfortable and skilled with the building method.

”I don’t think our buildings look like modular buildings,” said Sara-Ann Logan, vice president of design for Volumetric Building Cos., “but I think they absolutely will not look like modular buildings in the future because we’re just playing more.”

Modular construction “for many years had a negative stigma,” particularly that it was low quality, Addimando said. But pieces are stored and assembled in moisture-controlled factories, and perceptions are changing.

“It becomes a very efficient, very high-quality product once you figure it out,” said Gary Jonas, president of the Building Industry Association of Philadelphia and managing member of the Conshohocken-based real estate firm HOW Group, which has worked on a few modular projects.

“In the past you only heard horror stories about it,” he said. “And now you’re seeing success stories of people doing it right.”

Expanding and diversifying the industry

The industry also sees modular as a way to address a longstanding problem that is only projected to get worse: a lack of workers. Older workers are retiring and younger ones are not choosing the trades.


The construction industry would need to attract almost 650,000 additional workers in 2022 to meet the demand for labor, according to Associated Builders and Contractors, a national construction industry trade association. A 2017 publication by the National Center for Construction Education & Research said that roughly 41% of the construction workforce will retire by 2031.

Offering construction work in a climate-controlled factory with more automated machinery can help attract more workers who can’t physically work or don’t want to work in traditional construction environments. This can diversify the worker pool, including bringing in more women and people of color.

» READ MORE: How Black workers got locked out of construction's best jobs

With a more diverse workforce and a technology-heavy factory environment, off-site construction “can help drive innovation,” said Dwyer at the National Association of Home Builders.

Reaves at Mosaic Development Partners said the industry essentially has been building homes the same way for a century.

“The question we should be asking ourselves,” he said, “is ‘why?’”

How modular construction works

When modules leave a factory, they are as complete as possible, with finishes, appliances, wiring, and plumbing. When pieces get to a site, the project “basically gets put together like a huge Erector Set,” said James Hocker, a regional manager with the Eastern Atlantic States Regional Council of Carpenters.

Modular construction depends on precision. Measurements cannot be even slightly off.

General contractors finish work on-site that can’t be done in a factory, such as connecting wiring and plumbing between units.

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Trade unions used to be more skeptical about modular construction, but, Hocker said, “you have to stay with the trends and how things are moving forward as an industry. Or you’re gonna be on the outside looking in.”

Rates for entry-level positions at Volumetric Building Cos.’ factory in Berwick start between $18 and $25 an hour.

Challenges and hesitations

Unlike in traditional construction, all the planning for modular projects must happen up front. Builders don’t have room to change their minds mid-production or make adjustments on the jobsite.

Jonas at the Building Industry Association said he knows people who haven’t planned enough, “and it’s gone horrifically.” Developers thought they could save time and money, he said, but they found they didn’t have the technical expertise.

“I think people are still a little afraid of it,” Jonas said. “Because the skillset to do it right is so narrow.”

The speed of modular construction also can work against developers as supply chain delays continue. Efficiencies shrink if workers have to return to modules to add missing parts.

In Philadelphia specifically, transporting modules down narrow streets and around sharp corners is a challenge. Space for large developments is hard to find. Building rules in the city’s Council districts vary widely.

From a tax perspective, a regulatory and affordability perspective, Philly is the toughest of the cities in which Volumetric Building Cos. operates, Buckley said.

“If we can do it here,” he said, “we can do it anywhere.”

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Are modular connecting materials and are similar to Lego? ›

Similar to LEGO bricks, modular construction modules are manufactured and designed (typically) in a rectangular, box shape and to be snapped into place quickly and easily. Many construction media outlets have used this comparison (featuring Panel Built) to explain how modular construction differs from traditional.

How many types of modular construction are there? ›

Modular buildings generally fall under one of two types - permanent or temporary.

How do you build a modular building? ›

Building for safety and efficiency the walls are first prefabricated horizontally before being

What is modular construction technology? ›

Modular construction, or offsite construction, is a method of construction that relies on the components being assembled in a factory under controlled conditions and then being finalised on-site. The initial process is also referred to as offsite manufacture for construction or OSM.

How many modular LEGO sets are there? ›

Lego Modular Buildings
SubjectAdvanced models
Licensed fromThe Lego Group
Total sets24
1 more row

What does modular mean in LEGO? ›

Description. Did you know that some of our models are modular? This means that you can mix and combine all kinds of pieces together to make new ones. There are so many possibilities – join us in trying out some combinations. LEGO® Creator.

What materials are used in modular construction? ›

Instead of brick and mortar, modular buildings use either a standard wood-frame construction made of lumber or steel and concrete. Both have their unique uses although, steel and concrete are generally stronger and less combustible.

What do you understand by modular design How can we make a effective modular design explain with suitable example? ›

The process of breaking down a software into multiple independent modules where each module is developed separately is called Modularization. Effective modular design can be achieved if the partitioned modules are separately solvable, modifiable as well as compilable.

What are the types of modular? ›

The 3 Main Types of Modular Construction
  • 2D Panels: Flexible Design and Simple Logistics. Have you ever put together an Ikea bookshelf or other prefab furniture? ...
  • 3D Modules: Increased Productivity and Efficiency. ...
  • Hybrid Modular Construction: the Best of Both Worlds. ...
  • Bringing It All Together.
16 Nov 2020

Why do we need modular construction? ›

The primary benefit of modular construction is time saving and faster return on investment. Since modular construction allows for industrialized assembly that happens concurrently with site preparation, the total time it takes to build a structure can be dramatically reduced.

What is modular work? ›

Modular construction is a process in which a building is constructed off-site, under controlled plant conditions, using the same materials and designing to the same codes and standards as conventionally built facilities – but in about half the time.

Which one of the following is the advantage of pre engineered building Mcq? ›

Advantages of PEB – Pre-Engineered Buildings:

Lower cost: Saving is accomplished in design, manufacturing and erection cost. Large clear span: In PEB the buildings can be given up to 90m clear spans which is the important advantage of PEB with column free space.

In what ways can modular construction cut down on carbon emissions? ›

This reduction of on-site construction results in less operating of machinery, less job-site visits, less scope of onsite work, and less overall commuting of workers and stakeholders – which ultimately, all result in lower carbon output.

Is modular construction sustainable? ›

The short answer is: yes. For example, production processes generate less waste and the buildings are significantly more recyclable. But these are only two reasons why the sustainability and process benefits of modular construction produce a significantly lower environmental impact.

What type of material are Legos made of? ›

ABS (Acrylonitrile Butadiene Styrene) is the type of material we use to make the classic LEGO brick as well as LEGO DUPLO. ABS is a hard plastic, it's very scratch resistant and is optimal for achieving the perfect clutch power!

Is LEGO modular design? ›

Their brick patent leads to the creation of a modular system, which allows LEGO to take a step away from the traditional production of standalone toys. This modular system is a set of basic building blocks that can be combined in different ways to build numerous varying creations.

Who makes the plastic for Legos? ›

LEGO used to receive their raw ABS granules from Bayer, which has a long history of testing 2x4 bricks for LEGO in unusual colors and molds. In 2004 Bayer's ABS division became Lanxess, which now provides LEGO with ABS under the brand name Novodur (colored with Lanxess's Macrolex dyes).

Where does LEGO get their plastic? ›

The plastic is sourced from suppliers in the U.S. that have been approved by the Food and Drug Administration and European Food Safety Authority. On average, a one-liter plastic PET bottle yields enough raw material for ten 2 x 4 Lego bricks.


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