Industrialized Construction in New York City: Unlocking Affordably-Built Affordable Housing

Strategic investments in an innovative building approach called industrialized construction could accelerate progress toward New York Mayor Zohran Mamdani’s goal of constructing 200,000 new affordable, union-built, and sustainable homes over the next ten years, as shown in this new policy memo from the New York City Policy Forum and the Climate and Community Institute.

The policy memo explains how industrialized construction (IC) methods enable speed and scale while supporting workers and New York communities. IC methods use building components prefabricated in factories, which can reduce the on-site construction timelines by 20–50 percent, reduce construction costs by up to 20 percent, and develop housing with superior energy performance. By reforming their building codes and by using demand aggregation led by the public sector, countries including Sweden, Singapore, Japan, and Canada have used IC methods to produce millions of high-quality affordable homes in less time and at lower costs.

IC approaches for housing currently remain marginal in New York, in large part because New York City and New York State have not aggregated the consistent demand that IC housing factories need to operate effectively. Mayor Mamdani can change this. By committing to using IC methods for a small percentage of its affordable housing pipeline each year, New York City could aggregate the demand needed to unlock significant speed and cost benefits. When implemented repeatedly at sufficient scale, this approach could lead to high-quality affordable homes at a lower cost per unit throughout New York. To achieve this scale, the City should launch a three-phase Industrial Construction for Affordable Housing Initiative over the next five to ten years. This initiative could deliver on multiple fronts for New Yorkers: building affordable housing at scale, supporting high-road jobs, and fundamentally improving the City’s ability to deliver housing faster, more affordably, and with greater certainty over time. By investing in IC methods, New York City can prove that a bold public sector can deliver a more just and affordable city.