ZEMCH 2015 - International Conference Proceedings | Page 23

published by individual researchers, Iranian and UK governments, and other research bodies are
studied. The outcomes of the study are then discussed in detail to identify the critical factors
which affect the feasibility of application of MMC in the Iranian construction industry. Some recommendations are then drawn based on the findings of the research as the way forward.

2. Detailed comparison between the Iranian and UK construction industries
This section intends to discuss the abovementioned criteria in order to identify differences between the Iranian and UK conditions and to highlight opportunities and risks facing MMC in Iran.
To emphasise the interactions between the identified criteria, all factors involved in a particular
topic are included even though this necessitates some repetition.
2.1 Demand and Supply
The UK construction industry accounts for 8.7% of the country’s GDP (BERR 2009). The share of
the construction industry in the Iranian economy is around 5% of GDP (CBI 2014) of the Iranian
economy (CBI 2013a). In 2003, the private sector was responsible for around 90% of the residential
buildings in the UK (Lovell 2003) which decreased to just above 78% in England during 2012-13
(DCLG 2013). Prior to the “Mehr Housing” programme which was introduced by the former Iranian government, private sector was responsible for around 95% of the res idential buildings in
Iran. This figure, according to the published documents by the Central Bank of Iran, decreased to
around 63% in 2011/12 (CBI 2013b). The share of the private sector returned back to more than 95%
in 2012/13 (SCI 2013a). The housing sector is one of the few Iranian industries where the government’s share is much less than the private sector, giving developers and potential investors the
freedom to follow their plans in applying MMC without much control from the government.
Iran needs around 1.5 million new houses to be constructed annually by 2025 to answer its cumulative housing demand (BHRC 2009). According to the Statistical Centre of Iran, housing production was 693,670 units in 2007 (SCI 2008), 621,492 in 2009 (SCI 2010), 701,806 in 2010 (SCI 2013a),
765,024 in 2011 (SCI 2012), and 729,933 in 2012 (SCI 2013a) and 770,410 in 2013 (SCI 2014), which means
an average of around 705 thousand units per annum since 2007 (Table 1: Housing output 2007-2013).
The annual housing production should therefore increase by an average of 800,000 to answer
the current demand. This figure rises to more than 1000,000 housing units if the shortfall of the
previous years since 2007 is brought into the account. Although the Iranian government has been
trying to increase the housing supply, housing demand has been increasing inexorably year by
year as the current housing output is not capable of dealing with such huge demand.
Table 1: Housing output 2007-2013
2007

2008

2009

2010

2011

2012

2013

New housing units

693,670

650, 000 (Est.)

621,492

701,806

765,024

729,933

770,410

Average

704,627

Year

The UK situation is different in terms of the housing demand and supply. The demand is estimated to be around 233,000 housing units per annum during the next twenty years (CIH 2012); however, the recent housing recession considerably affected these figures. Housing supply in 2010 and
2011 was 103,000 (CIH 2011) and 146,000 (134,900 units according to DCLG (2012) units respectively
(Pawson and Wilcox 2013).
The cost of an MMC factory including staff training is over £10 million in the UK (Lovell 2003) and,

Feasibility of Application of Modern Methods of Construction in Iran

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