Developer Solving for More Housing With Modular Buildings

Amid unaffordable home prices for buyers and rising construction costs for builders, real estate developer Rick Holliday's Factory OS is expanding prefabricated housing's horizons by manufacturing entire apartment buildings. 

In 2014, Holliday was working to build 800 to 1,000 high-density apartments and condos, but “the numbers wouldn’t work,” he says, adding, “You couldn’t get the construction costs down enough.” This was the start of Holliday's pivot toward modular, requiring less money and labor. The New York Times reports that the global construction industry is worth $10 trillion, and creates the shape of our homes and cities, yet, "it is one of the world’s least efficient businesses," as the productivity rate is the same now as it was in 1945. Furthermore, the labor pool is 23 percent smaller than in 2006, meaning that the industry may not be big enough to supply the new housing that the country needs. “If we don’t build housing differently, then no one can have any housing,” Holliday says.

Factory OS pays about $30 an hour with medical insurance and two weeks of vacation. That’s about half what workers can make on a construction site, but the work is more regular and, for many, requires less commuting. In addition to not being rained on, one of the key differences between a construction site and Factory OS is that any worker can be trained to do any job. For old-school trade unions, that is a declaration of war. “The business model is ‘Hooray for me,’” without regard for anyone else, said Larry Mazzola Jr., business manager of UA Local 38, a San Francisco plumbers’ union with about 2,500 members.

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