19.8.10

IBS Vs. Conventional

Hi there.
I’m Syazwani and currently working in Qs consultant firm. I saw your blogs regarding IBS and would like to have some opinions from you. I’m about to run 1 housing project by A Property Berhad and it seems to use IBS system instead of conventional system but it’s still depending on our suggestion and advices about both systems. What the client had requested from us this few weeks is to prepare cost comparison of both systems and what I had found is conventional system is much higher than IBS in a sense of costing, which I felt unlikely to be happened. I’m still seeking for proves saying that IBS is eventually 11-15% more expensive than Conv.(what engineers had explained) but I don’t see any proves yet. So, what I’m trying to ask here is what makes, or what factors that bring IBS sytem/Conventional system is much higher than one another? And based on your experiences, is it make sense that IBS system produces RM85/sqft for 1 unit of terrace house? (this is a budgeted cost by client).

Hi Syazwani,

Many thanks.

The cost comparison can be done in many ways. I trust the cost of using IBS can increase when one consider the total construction cost. This include operation cost which involve cost of transportation, storage, handling, training of installer, use of tower crane (very-very expensive), paid up capital to invest in setting-up prefabrication yard (if any) etc. etc. This type estimation i believe is done by the contractors not developer like in your case. That is why they come with 10%-15% figure. I found several researches also compare cost in this way and even after the construction had completed.

I believe, contractors when come out with tender cost, they normally make comparison on total construction cost not in RM/psf like you did. In many cases, they resist to use IBS not just because IBS is expensive but also due to profit distribution where huge chunk capital needs to be paid to manufacturer. It affects their already thin profit margin plus other risks. As a result, they advice clients to use the conventional instead.

I trust your calculation is correct. In many ways IBS can be cheaper if one compare apple to apple, RM/psf to RM/psf. This can be done if you use the correct technology and when it applies to certain type of projects. I know PKNS and SP Setia use IBS for so long and successful too and they did proved IBS to be cheaper solution than conventional. This involved high-end bungalows and terrace houses and apartment. The key is volume, selection of technology and type of project (I believe IBS is not viable anymore when A Property Berhad want to construct low-end houses where RM85/psf is not in the case).

Perhaps, in developer’s point of view, IBS is cheap not expensive contrary to popular believe. Government should highlight this and change the perspective of developers who can actually dictate the level of IBS adoption.

In addition, the cost can be cheaper if one get volume. If A Property Berhad can have those volumes (and i think they have). It is also advisable to them to set up a prefabrication yard other than to purchase it from manufacturer like Hume or Eastern Pretech for example. Having your own prefab yard, make you able control the price and actually get it cheaper through mass-production. This is done previously and in successful way by PKNS, Sunway and SP Setia.

Thank you. Apologise for my bad English. I type this in hurry, don’t have time to recheck. Have to attend meeting at 10.30.

KAMARUL

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