Legal & General has confirmed its move into offsite housebuilding by launching the largest modular homes factory in the world.
The insurance giant could produce thousands of homes a year after investing £55m in the factory.
L&G has signed a long-term lease with local company Logicor on the 550,000 sq ft warehouse, based in Sherburn-in-Elmet near Leeds.
It is understood the Yorkshire factory represents the start of a major push into modular housebuilding from the insurer, with up to £500m set to be invested in a series of facilities.
L&G said it plans to “modernise the homebuilding industry by providing modern, precision-engineered, factory-manufactured houses” through its new Legal & General Homes subsidiary.
The factory will employ up to 500 local people and is expected to produce its first house in June.
Legal & General Capital managing director Paul Stanworth said: “Modern modular housing in the UK has so far been restricted to the top end of the market.
“The scale of our Sherburn facility will enable many more people to benefit from new, environmentally friendly construction techniques which have already become mainstream in Europe.”
The factory will deliver a range of homes, including apartment blocks, terraced, semi-detached and detached houses. L&G said offsite manufacturing could reduce time spent on site by 70 per cent.
L&G Homes chief executive Tom Ground said: “Legal & General Homes aims to deliver a new solution to the problems we face in the UK, addressing the shortage of suitable, affordable and sustainable housing by manufacturing higher-quality, energy-efficient, lower-cost housing.”
The move into offsite building comes as L&G continues its push into the UK housing market.
Last month, it confirmed it was investing £600m in build-to-rent housing as part of a joint venture with Dutch pension fund PGGM, having first considered entering the sector in 2014.
The partnership has acquired three sites in Bristol, Salford and Walthamstow, which will deliver 650 homes in total.