Developers still “iffy” about IBS Developers still “iffy” about IBS
Share this on WhatsAppBy Roznah Abdul Jabbar Developers continue to have reservations using the Industrialised Building System (IBS) although the system has been around for 50... Developers still “iffy” about IBS

By Roznah Abdul Jabbar

Developers continue to have reservations using the Industrialised Building System (IBS) although the system has been around for 50 years since the government introduced it in 1966.

IBS is a construction technique whereby components are manufactured at site or off site in a controlled environment, then placed and assembled into construction works. This is meant to improve the workflow and efficiency of the construction process as well as be cost effective. However, not everyone agrees on that final point.

According to president of the Real Estate and Housing Developers’ Association (Rehda) Datuk Seri FD Iskandar, developers are still reluctant to implement IBS in their developments. The Rehda Property Industry Survey 1H 2016 shows that only 20 per cent of developers have done so thus far.

Iskandar said 47 per cent of the survey respondents highlighted cost and availability of skilled workers as the main challenges with IBS.

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“The system is all imported and we lack semi-skilled workers to work the system,” he noted.

Although developers understand the necessity to implement IBS in construction, they also need government assistance such as tax incentives.

IBS was hailed as a solution to the country’s affordable housing shortage problem when it was introduced decades ago. However, the industry in general has been slow in implementing IBS in construction.

“For IBS to become more palatable to contractors and developers, I urge the government to ask the contractors for the majority of the contracts awarded to use IBS,” Iskandar said.

He said once the industry has more players using IBS, it will have the economies of scale to make it cheaper to import the system and the formwork. Training of workers will also be easier.

Iskandar said although IBS theoretically can bring about cost-savings and increased productivity, house prices could be lowered only when the system reaches economies of scale in Malaysia – and provided there are tax incentives and rebates for the raw materials.

Earlier this year, Rehda deputy president Datuk Soam Heng Choon said the association is encouraging developers to use IBS to address the issue of affordable housing supply, adding that Rehda will work with the government to make housing more affordable.

However, Soam said IBS is taking time to catch up in a big way as IBS-based materials are more expensive than conventional materials.

Senior manager of the Construction Industry Development Board (CIDB) Datuk Elias Ismail said that although the use of IBS is a technological force with many benefits, there is little acceptance of this form of property construction technology and awareness among property buyers.

He said that although the system indicates a quality, safe and energy-efficient way of building and construction, and can help to modernise the building industry, it has only been used by developers of high-end properties.

Elias believes IBS can help reduce house prices and CIBD has been building model homes using IBS since 2006.

He said CIDB had been talking about IBS and its implementation even before the hike in house prices, but most developers continue to build in the traditional way.

“The traditional way of building means everything is done at the construction site where the cement is mixed, the bricks are laid, and the timber is cut and nailed. This is different with IBS,” he said.

With IBS, different parts of the house are manufactured in a factory and transported to the site where these parts are assembled. This way of building is far more efficient and modern, he said.

Elias agreed that there is a need for greater awareness and training of construction workers.

“There is also the element of transportation cost. If there are economies of scale, IBS can play a huge role in helping to reduce the price of houses in the country,” he said.

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Meanwhile, president of Master Builders Association Malaysia (MBAM) Foo Chek Lee said the construction industry will continue to encourage prefabrication via IBS and a higher rate of mechanisation.

He said IBS involves the manufacturing of building components that are later transported to construction sites for assembly.

These are for components such as precast concrete framing, panel and box systems; metal formwork systems; and metal framing systems.

In addition, moving the production process to a factory makes for a cleaner and safer construction site.

“While IBS involves an initial high capital investment in mass production, the payoffs are durable and watertight features, and uniformity in quality and speed, all of which contribute to a contractor’s track record and reputation,” he said.

Foo said MBAM lauds the government for incentivising companies for adopting IBS through the Investment Tax Allowance under Promotion of Investment Act 1986.

“There is also a 20 per cent accelerated capital allowance for three years from the Inland Revenue Board on the purchase of moulds used in the production of IBS components,” he added.

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