Walk the Line: Nigel Banks from ilke Homes
Nigel Banks, R&D Director at ilke Homes, talks to us about manufacturing four houses per day, developing homes with zero energy bills, and how offsite complements traditional construction to satisfy the demand for housing.
Nigel Banks
R&D Director
ilke Homes
Listen to the interview here, or read on below….
Tell us about yourself, your role and what it involves day-to-day?
I'm Nigel, I'm the R&D Director at ilke Homes. My background is in housing consulting and working for main contractors. I started at Oscar Faber, which is now AECOM, a global consultancy doing M&E and wider sustainability and building engineering design work. I also worked on supporting the government in the development of building regulations at the time, before joining Keepmoat, who built out several of the schemes that I designed.
Fast forward to today and I work on future design and product, and where the ilke Homes business is going from here. I’m currently looking at key step change projects in three key areas across the business: performance of the homes; new markets we could enter into; and also, opportunities for better products at lower costs.
ilke Homes itself has grown considerably in size over the last few years, in the last eight months alone we have recruited nearly 600 people. We focus on low-rise, medium-density housing schemes.
We now have forty-four completed sites across the country, and have a growing portfolio of new sites, each now typically holding between 100-200 homes. We've certainly moved from the pilot phase into the mainstream.
How did you end up in offsite?
During my time at Keepmoat, we had a factory in Birkenhead called Evolve, which was a volumetric product. When social housing grants were stopped in 2012, we shut the business down but learned a lot to take with us into ilke Homes. Again, during 2016 when environmental policies involving zero carbon homes were scrapped, we started asking ourselves what else we could do at Keepmoat and where the opportunities were. Our Chief Executive at the time, Dave Sheridan, asked if we could make offsite 3D volumetric modular work to tackle trade labour shortages.
We put a team together from Keepmoat and Elliott (who were another company under the same majority shareholder) and started from the beginning. I led the original team at Keepmoat in trying to develop the original concept, and, Elliott built the very first two concept homes in late 2016 and installed them in 2017. We got positive feedback, so the majority shareholders of the business decided to set up ilke Homes in 2017.
In that same year, the Keepmoat Regeneration business was sold to ENGIE, where I worked for 9 months in their start-up energy supply business. I got quite a lot of insight into the energy market, how the domestic energy supply works and how the costs flow through. It wasn’t intentional to focus on offsite, but it was the key R&D opportunity for us to explore at the time.
The ilke Homes manufacturing facility in Knaresborough
How did you go about approaching modular as manufacturing, rather than construction? Where does automation fit?
When we started, we knew we needed to bring together a combination of people who understood both the house building market and the minimum viable product required to operate at scale with modular manufacturing. We've since brought in a lot more manufacturing professionals who have come from the automotive and aerospace industries and bring a very different approach to problem-solving. We've been trying to understand how to build a more manual process first, and then looking to bring automation in later.
The factory is currently producing 7–8 modules a day, close to four houses. When you look at the factory floor, it's 25,000sqm and I would say 10–15% of the floor space has automation. We are generally using automation to cut materials to size. We also have an external wall panelling line, which is making a full set of external walls every hour or so.
I think people from manufacturing would say we're very early in our manufacturing journey. People who've come from construction would say, “wow, this is advanced manufacturing for construction.” It's not a Tesla factory with hundreds of robots moving around, but it is a very different environment to what you'd find on any sort of construction site.
The ilke Homes team is growing quickly as production ramps up
What are some of the highlights in the last year for ilke Homes and yourself?
The launch of the ilke ZERO commitment and the ilke ZERO bills product has been a proud moment. We've always set out to have a high-performing, operational carbon home and we have already delivered six zero carbon sites. The market is there, and I'm excited about where that can go. The first zero bills homes are also on site, and they'll be moved into this summer. I think that the biggest transformation in the business in the last twelve months has come from really ramping up our pipeline of projects to cater for the 4000 homes we have on the schedule. We’ve got much bigger sites and have a lot more control over those sites.
I think one of the big benefits we have is that we are not reliant on trade skills in the factory, 95% of the roles do not require a tradesperson background. We have a lot of people who come from hospitality or retail for example, in a wide variety of roles. We've had high diversity and gender balance in terms of the new workforce, and it has been exciting to see those people join the business.
Looking ahead, what's the biggest challenge you've got right now?
Inflation in the marketplaces is a challenge for a lot of providers when securing a supply chain. When you've got a production line, you need to have all the materials for all parts of the home available and a shortage of materials would be disastrous, it could stop the production line. I think one big advantage we've got is we're the equivalent of twenty major house construction sites in one location, so we’re getting full loads coming in, but it is a challenge. We have quite a long visibility of what materials we need and when, so we can get our orders in early and secure our slots. It is a challenging market environment, but there is still a massive demand for the products we’re building.
What do you think the opportunities are for technology within offsite at the moment?
I think the construction industry has been behind almost every other sector in a lot of areas, namely technology adoption. I think it is to do with how challenging, particularly in the housing market, it is to make use of technology through the asset life phase. For example, we work fully in 3D BIM models and could provide that model to the end client or housing association, but a lot of them haven't got the systems, or wouldn’t know how best to use that model.
But also, in terms of managing your business day to day, a lot of construction businesses are based on spreadsheets, which is fine for a lot of activities. But I think when you're getting to the sorts of scale complexity that we're getting to, bringing in technology to help solve those challenges is important to make sure there are no gaps in the chain, from initial work through to the end ongoing asset management. There is a real opportunity to use technology to do that.
What do you think is needed for offsite to become the main way we build homes in the UK?
“I don’t think offsite is going to become the main way of building homes in the next five to ten years. I think it’s more about creating additional housing supply on top of existing supply chains.”
I think a real challenge for any modular business is getting to such a scale that you could become a significant part of the solution for the businesses that are building 10–20,000 homes a year. Getting to that scale and proving that you can be a meaningful part of that solution is important.
For many, buying a home is unaffordable in many parts of the country. In my opinion, the only way we're going to tackle that overall affordability is to build more homes and tackle the supply and demand mismatch that's been there for the last forty years. I think we're approaching the limit of traditional building as it stands today without significant innovation and productivity increases. There isn’t a huge amount of easy, available productivity gains on traditional construction sites. A different approach is needed to get that additional capacity into the marketplace, and offsite can provide that.
Could you tell us a bit more about ilke ZERO?
ilke ZERO is our commitment that by 2030, we will only build zero carbon homes that will have zero energy bills and will add zero additional costs to traditional construction. People are interested in zero carbon but aren't willing to pay more for it. In the twelve months since we launched, the cost of energy has doubled at least, so being able to offer homes with zero energy bills is a really attractive end consumer proposition. In addition, if we can achieve that at zero additional costs to traditional construction, then that's a real game changer. We are hopeful that this could be a transformational moment for both ilke Homes and the industry as a whole if house builders can voluntarily look to build at higher standards because they can generate additional value.
In terms of the technology involved; from first principles we focused on getting the basics of a high-performing, well-insulated, draught-proof fabric right. We've been above the regulations that have been in place for the last nine years by about 20%, and that reduces the need for heating for example. Then, three key technologies enable us to get to zero bills: solar PV generating electricity on the roof, air source heat pumps providing the hot water, and then storing that energy (in batteries and a hot water cylinder).
We've partnered with Octopus Energy who are providing a bespoke Octopus ilke ZERO tariff that effectively guarantees a zero-energy bill for the home. We're excited about what that means for the people living in those homes, particularly as we move into winter when bills are forecast to hit record highs.
What were some of the challenges in achieving the zero bills status?
One challenge, for example, is the amount of solar PV required to get to a zero bill, so you have to think about roof design. It is also challenging to work out how to integrate these technologies into the home whilst ensuring they are still just as easy to manufacture, and that they work for the end consumer.
We did a big redesign of our entire portfolio to make sure they were easier to manufacture, easier to maintain and easier to install on site. One of the things we've done is start from scratch and get feedback from end customers and clients. Those homes are now on the production line, and we're seeing the benefit of those changes which enables us to ramp up our production. The redesign was a key part of the journey that looked quite easy on paper, but actually, the full end-to-end process to make that work well is a huge journey.
Installing the solar roof for an ilke ZERO bills home
Do you have a view on how we might make the UK’s existing housing stock more sustainable?
50% of the UK’s housing stock is over 50 years old, so it’s a sizable problem to tackle. ilke Homes are totally focused on new build, but if you look at Energiesprong UK you’ll see they’ve got an interesting approach to upgrading existing homes using wall and roof panels manufactured offsite.
And to end, who are you passing the mic to next?
“It makes sense to pass the mic to Emily Braham at Energiesprong UK, so she can tell you more about making the UK’s existing housing stock more sustainable”
