A prefabricated wall assembly receives an exterior covering of a building. The prefabricated wall assembly comprises a frame assembly and an outer foam layer. The outer foam layer is coupled to the frame assembly. The outer foam layer extends from the frame assembly to an exterior surface of the outer foam layer. The exterior surface of the outer foam layer is configured to receive the exterior covering of the building. The outer foam layer comprises a plurality of particles and a binder that define a plurality of pathways. The pathways extend vertically through the prefabricated wall assembly from the top member to the bottom member of the frame assembly for allowing airflow and drainage between the frame assembly and the exterior covering.