KUALA LUMPUR (Aug 10): Home-grown building materials wholesaler and distributor Unitrade Industries Bhd is expanding its rental services, with the addition of modular houses, to address demand for accommodation following amendments to the Workers’ Minimum Standards of Housing and Amenities Act 1990 (Act 446).

Adopting a business-to-business model, Unitrade’s modular houses are mainly marketed to the construction sector as on-site workers’ accommodation as well as to entities that are looking to build a centralised labour quarter, the group said in a statement on Wednesday (Aug 10).

Apart from dormitories, its prefabricated houses could also be implemented as site offices, canteens, clinics, and laundry rooms, said the group. Previously, Unitrade’s rental division mainly entailed temporary structural support equipment, such as scaffolding, steel plates, and hollow sections.

The amended Act 446, which aims to ensure decent accommodation for workers, came into full effect on Sept 1, 2020. Among the guidelines for dormitories are a minimum bedroom space of 3 sq m for each employee.

“Since the enforcement of the amended Act 446, many companies have been struggling to meet the necessary guidelines in a cost-effective manner. Compared to before, construction players now require more conventional cabins and on-site floor areas to house the same number of workers. With our double-storey modular houses, we could potentially disrupt the market, as they take up smaller floor space and thus cost less on a per headcount basis. Most importantly, the modular houses comply with Act 446,” said Unitrade executive director Simson Sim Xian Zhi.

A set of Unitrade’s modular houses with a 130-worker capacity takes up 198.75 sq m of floor area. In contrast, conventional cabins occupy more than double the space at 448 sq m for the same capacity.

“Beyond the affordability and space-efficiency, we believe our rental model has an added edge, particular for small- and medium-sized contractors who wish to minimise capital expenditure. Since our recent soft launch, the response has been very encouraging. In fact, we have secured orders to rent out modular houses for about 2,000 workers.

“Currently, we are in discussions with several commercial customers to house a further 4,000 workers. With Indonesia recently lifting the ban on sending migrant workers, we expect a higher influx of workers and stronger demand for our modular houses in the months ahead," he added.

“As we grow this rental division, our recurring revenue stream will also improve, giving us better earnings visibility and long-term stability. Besides that, this is also synergistic with the building materials wholesale business, as we further improve our service comprehensiveness among construction-sector clients,” Sim said.

Unitrade shares were down half a sen or 1.96% at 25 sen at the time of writing on Wednesday, giving it a market value of RM390.62 million.