New Construction: Pre-Fabricated, Modular "Container" Homes

New Construction: Pre-Fabricated, Modular "Container" Homes

Denver, CO · Member since 2017 · 11 posts · 4 votes

I several questions for any investors who have experience with pre-fabricated/modular/shipping-container type of homes. (Single family or Multi-Family).

I'm considering the idea of buying a vacant lot in any given Denver neighborhood, (Curtis Park, Cole, Berkely, University, etc.) and putting in a pre-fabricated home. The thought here would be to try to sell immediately. 

Generally speaking, pre-fab homes come with existing HVAC and Electrical systems, flooring, insulation, etc. and some brands even promise they will meet the specs for the local building codes anywhere on the continental U.S. 

Additionally, some of these homes even have garages, solar panel connections, etc. 

Current estimate I have shows:

I understand they require the use of a crane to erect, and will need to have some form of foundation/slab on grade. 

From all research I've done, everything from academic articles to news articles etc., is that these homes are cheaper, reduce the need for architects, various contractors, and dramatically reduce building time. (10 weeks from start of fabrication to final completion on-site).

  • Price for these homes: $(100k-180k) ~ ($120.00/SF - $150.00/SF)
  • Price for vacant lot: $(100k-300k) ~
  • Misc. permitting, appraisals, brokers, etc. : $(15k-20k) ~

I see a lot of delta here between a potential final asking price and a total project cost.

All in all, I think that there is a market for this type of modern, "environmentally friendly" type of home, and I've seen news-stories on successful storage container homes that were built in Denver.

Should I believe all of the hype, or am I drinking too much kool-aid? Is there any real difference here or is it no different pursuing building a stick-built home?

Please let me know your thoughts, particularly if you have direct experience with this type of home.

Thanks!

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Investor · Denver, CO · Member since 2016 · 10 posts · 6 votes
9y

We've ran every number we can on modular type buildings for both single family and ADU here in Denver and it simply doesn't work out. We have multiple MX-3 zoned lots as well as CU-1 and CU zoned lots and we haven't gotten a single one to pencil out. We've met and spoke with about every modular builder from out of state that could ship something to CO. I'd love to talk to someone who is a true investor who's made it work. The few people who have made it, its been their passion project and made it work as a one off sweat equity standpoint but from a true investment and scalable model, I've yet to see it work.

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  • Mike NussPro Member
    Real Estate Entrepreneur · Portland, OR · Member since 2014 · 451 posts · 328 votes
    9y

    @Jay Hinrichs this is seriously the third time I've had a close contact mention Carl in less than a week. 

  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    @Mike Nuss  Carl and I been friends since about 92  when I bought Murray HIll park and I hired him to do the Underground..  we have partnered on many things.. but not much in the last decade

    we partnered on the airplanes though..although he took full ownership and I just rent from him.. but I still consider my self an owner since I bought it brand new with him.. LOL.. plus our hanger out at aurora.. ( man cave)

    great guy.. very busy.. focused on social things and he likes buying relic buildings  ( Brassiere) and redoing them..

  • Mountain View, CA · Member since 2016 · 29 posts · 3 votes
    9y

    Sorry to bring this up but it may be related to this thread.

    Why don't we buy the "high quality" modular homes from China and assemble it here. Remember that all materials we use to build house in US are also from China. I think this is possible good idea to consider but the main problem is how to find an inspection services or your city inspectors who are willing to go to China to inspect in every necessary phases.

  • Mountain View, CA · Member since 2016 · 29 posts · 3 votes
    9y

    Also recently after doing a bunch of research I feel like the US is now behind China as they have been growing modular construction in a rapid speed.

  • Denver, CO · Member since 2017 · 11 posts · 4 votes
    9y
    Originally posted by @Matt D.:

    Sorry to bring this up but it may be related to this thread.

    Why don't we buy the "high quality" modular homes from China and assemble it here. Remember that all materials we use to build house in US are also from China. I think this is possible good idea to consider but the main problem is how to find an inspection services or your city inspectors who are willing to go to China to inspect in every necessary phases.

     Matt, the inspectors would most likely wait until the building was assembled and completed here in the U.S. 

    If the Chinese manufacturer was analytical in their development, they would specialize their pre-fabricated panels to be malleable (when it comes to MEP), so that the structure conformed to each jurisdiction-code that they were shipping them to. 

  • Ken BuckPro Member
    Specialist · Crested Butte, CO · Member since 2015 · 104 posts · 25 votes
    9y

    I can help out with a duplex modular with wood floors, granite tops throughout, solid core doors, pella windows delivered for @ $130/sf

    Send me a message, I've been working with modular for 2.5 years and finally found a way to thread the needle 

  • Ken BuckPro Member
    Specialist · Crested Butte, CO · Member since 2015 · 104 posts · 25 votes
    9y

    And single family too

  • Property Manager · Johnson City NY · Member since 2011 · 77 posts · 1 vote
    8y

    @William Savage I am fascinated by futuristic character of pre-fabricated/modular type of homes and particularly planning/development city communities. With your engineering background and interests have you progressed much in this arena during the year time since this particular BB post?

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