Already, 2024 has brought some surprising news in the offsite building or modular arena. As Gary Fleisher, the guru behind the Modular Home Coach blog reported, Veev was purchased by Lennar and there’s a pending lawsuit as well as financial difficulties for indieDwell.
The offsite building industry is also facing last year’s challenges, such as a lack of standardization from the U.S. government on modular construction as well as struggles for companies to find capital for bigger projects.
Yet, there are many reasons to stay optimistic about offsite construction.
Most large cities are dealing with record homelessness as well as housing that is unaffordable for their residents. In Denver, where Elevated has its headquarters, city officials have turned to pods as shelter for the homeless as well as using abandoned hotels. And the limited housing available isn’t cheap enough for residents. As Denverite indicates, “A housing unit is defined as ‘affordable’ when a family is paying no more than 30% of its income on housing costs. According to the [city’s new affordability] report, the average monthly rent in Denver was $2,105, or 30% for someone making $84,000, a salary more than double Denver’s minimum wage.”
Offsite construction can get buildings up faster and cheaper. According to Governing, offsite construction “streamlines the building process and can significantly reduce construction time, and can deliver projects 20 to 50 percent faster than traditional methods at a cost savings of up to 20 percent.” That’s hard for developers and cities, in desperate need of more construction, to overlook.
Some offsite building companies work with partners to handle “wrap-around services,” too — the mental healthcare, medical healthcare, addiction assistance programs, and government agencies to help homeless people find permanent shelter.
But it’s not just the fact that construction can happen quicker and more affordably that matters, or should matter, to cities. Offsite construction can be highly sustainable. Offsite construction practices use recycled materials and processes that reduce carbon footprints.
The offsite construction industry welcomes innovation. Innovation can include the process for how a building is built, the materials used, and more. But it goes beyond the building itself.
Innovation in the offsite construction market includes the wrap-around services mentioned above, better heating and cooling options that cost less and are more sustainable, different leasing or financing opportunities for owners, aging technology, plug-and-play landscape, and smart-home options. Offsite building companies seem more apt to innovate or partner with others on the entire experience of building, leasing, and ownership.
Offsite companies are eager to eliminate every obstacle.
There may be consolidation, companies combining on their common approach, or similar ideas. Some companies may need to continue to grapple with a tight labor market and low availability of capital. There will still be issues getting the U.S. government to centralize offsite building standards. But by continuing to innovate and meet the demands of government employees and people needing homes and buildings, offsite building has a long future.
Elevated would love to help. We’ve been in the modular space for more than ten years, providing solutions such as appliances, flooring, showers and tubs, baseboard heating options, and more. We also have expertise having been in the space so long. Our team provides ideas and information to your company to help them continue to build faster at less expense.