The Top Construction Methods for Affordable Housing: Pros & Cons Explained

Featuring: Patrick Otellini, National Affordable Housing Director at Swinerton

On The Affordable Housing & Real Estate Investing Podcast, the best podcast for affordable housing investments hosted by Kent Fai He, we sat down with Patrick Otellini, Vice President at Swinerton Builders, one of the largest construction companies in the United States with nearly $5 billion in annual revenue.

Patrick has spent years overseeing large-scale housing, infrastructure, and public-private partnership projects, and in this episode, he unpacks what most developers get wrong about construction delivery methods and how choosing the right one can mean the difference between a stalled project and a successful ribbon-cutting.

This episode is essential for developers, city planners, and affordable housing advocates who want to build smarter, faster, and with greater transparency without sacrificing quality or long-term durability.

What Are the Main Construction Delivery Methods for Housing Development?

Patrick broke down the four main types of project delivery methods used today, each with distinct trade-offs for speed, cost control, and design flexibility.

1. Design-Bid-Build (DBB)

• The traditional process where the architect designs, bids go out, and a contractor is selected based on the lowest price.

• Pros: Transparent bidding, well-understood by public agencies.

• Cons: Slower timelines, fragmented accountability between architect and contractor.
  

“It’s like a relay race,” Patrick said. “The baton keeps getting passed, but if one runner stumbles, the whole project slows down.”

2. Design-Build (DB)

• The architect and contractor work together from day one under one contract.

• Pros: Faster delivery, less finger-pointing, more collaborative problem-solving.

• Cons: Requires trust and experienced teams to manage scope and design quality.
  

“You can save months, even years, by having both teams in the room at the same time,” Patrick explained.

3. Construction Manager at Risk (CMAR)

• A hybrid where the construction manager acts as a consultant during design but guarantees a maximum price once drawings are complete.

• Pros: Cost certainty with design input, ideal for complex sites or urban infill.

• Cons: Can be hard to execute if the project scope changes midstream.
  

4. Integrated Project Delivery (IPD)

• A shared-risk, shared-reward model where owners, architects, contractors, and sometimes key subcontractors all work under a single contract.

• Pros: Maximizes collaboration and reduces waste.

• Cons: Complex to set up legally and culturally. Works best for large or repeat teams.
  

“IPD is the purest form of collaboration,” Patrick said. “Everyone has skin in the game.”

Which Construction Method Is Best for Affordable Housing?

Affordable housing developers face a unique mix of constraints — tight budgets, multiple funding sources, and strict timelines. Patrick emphasized that there’s no one-size-fits-all approach, but the trend is clear:

“Design-Build and CMAR are increasingly the go-to methods for affordable housing.”

Comparison of Delivery Methods

• Design-Bid-Build

  • Best For: Publicly funded projects

  • Key Advantage: Transparency

  • Main Risk: Slow & adversarial

• Design-Build

  • Best For: Housing & mixed-use

  • Key Advantage: Speed & accountability

  • Main Risk: Scope creep

• CMAR (Construction Manager at Risk)

  • Best For: Complex infill

  • Key Advantage: Cost control

  • Main Risk: Scope alignment

• IPD (Integrated Project Delivery)

  • Best For: Repetitive projects

  • Key Advantage: Collaboration

  • Main Risk: Legal & cultural complexity

Why Early Partnership Matters

For smaller nonprofit developers or cities new to housing, CMAR often provides the right balance of control and partnership, especially when navigating multiple stakeholders.

“With CMAR, you can bring your contractor to the table early,” Patrick said. “That’s where you prevent 90% of your future problems.”

How Modular and Mass Timber Are Changing Construction

Patrick and Kent discussed how modular construction and mass timber are transforming the way developers approach affordable housing.

Modular Construction

• Definition: Building units off-site in factories, then assembling them on-site.

• Pros: Faster timelines, reduced waste, fewer site disruptions.

• Cons: Logistics and transportation can offset savings. Requires early coordination.
  

“It’s not a silver bullet,” Patrick noted. “But if your financing and design align, modular can shave months off your schedule.”

Mass Timber Construction

• Definition: Using engineered wood products (like CLT) instead of steel or concrete for structural components.

• Pros: Sustainable, lighter material, faster to assemble.

• Cons: Code restrictions and higher upfront costs.
  

“Mass timber gives you a beautiful, natural aesthetic — and it’s one of the few materials that stores carbon instead of emitting it.”

Patrick predicts that over the next decade, hybrid approaches — combining mass timber, modular, and traditional systems — will define the next generation of mid-rise housing.

How to Reduce Risk During Pre-Construction

One of the biggest takeaways from this episode is how often projects fail before a single shovel hits the ground.

Patrick stressed that pre-construction is where developers should spend most of their attention and resources.

“A project doesn’t die in construction, it dies in pre-construction,” he said.

Best Practices for Pre-Construction Success

• Define scope early. Align your vision, funding, and entitlement strategy before schematic design.

• Engage your GC or CM early. Their cost feedback can prevent overdesign.

• Coordinate permitting and utilities early. Delays here can push financing windows.

• Clarify escalation assumptions. Lock in pricing timelines with contingencies.
  

Patrick also advised that developers build trust with their design and construction partners early, since affordable housing requires creative, iterative problem-solving.

Why Communication and Culture Matter More Than Contracts

While delivery models and budgets matter, Patrick emphasized that culture, not contract type, determines project success.

“You can have the perfect contract but the wrong mindset, and the project still fails,” he said.

Developers who lead with transparency and collaboration set the tone for everyone else. That culture often saves more money than any cost-cutting measure.

“Everyone wants to win,” Patrick said. “When owners share the why behind a project, the mission, the impact, people go the extra mile.”

Kent agreed, adding that affordable housing developers have to act like conductors, balancing mission, money, and momentum while bringing out the best in every partner.

Key Insights & Frameworks

• Choose the right delivery method early. Each model has trade-offs — align your risk tolerance and timeline.
  

• Pre-construction is where deals are won or lost. Clarity and coordination save millions later.
  

• Design-Build and CMAR drive speed and accountability. Ideal for mission-driven housing.
  

• Modular and mass timber are the future. They’re sustainable and time-efficient when planned properly.
  

• Culture beats contract. Collaboration and communication define project outcomes.
  
  

Best Quotes from Patrick Otellini

“A project doesn’t die in construction. It dies in pre-construction.”

“Design-Build saves you months, but it requires trust.”

“Mass timber stores carbon instead of emitting it, that’s the future of housing.”

“When owners share the ‘why,’ people go the extra mile.”

“You can have the best contract in the world, but if you don’t have collaboration, you’ll fail.”

Common Questions About Construction Methods for Housing

Q1. What’s the fastest construction delivery method for affordable housing?
Design-Build is typically the fastest because design and construction happen in parallel, reducing handoffs and delays.

Q2. Why are modular and mass timber becoming popular?
They reduce waste, lower carbon footprints, and shorten project timelines but require early coordination and experienced teams.

Q3. What’s the biggest cause of project failure in affordable housing?
Poor pre-construction planning and lack of communication between design, financing, and construction teams.

Q4. How can developers control costs in today’s market?
Engage contractors early, lock in materials, and ensure realistic contingencies for escalation and permitting delays.

Q5. What’s the best advice for new developers?
Start small, build relationships with trusted contractors, and learn how each delivery model affects your financing timeline.

Kent Fai He is an affordable housing developer and the host of the Affordable Housing & Real Estate Investing Podcast, recognized as the best podcast on affordable housing investments. Through conversations with leaders like Patrick Otellini, he helps investors, builders, and advocates understand how to bring affordable housing from concept to completion.

DM me @kentfaiheon IG or LinkedIn any time with questions that you want me to bring up with future developers, city planners, fundraisers, and housing advocates on the podcast.