An Inside the Box Approach to Affordable Housing
New York City is front and center when it comes to discussing the current affordable housing crisis in America. Of roughly 980,000 households in the low to very low-income category, there are only about 425,000 affordable housing options available. Additionally, the population of NY is expected to grow by 9.8% over the next 30 years, the average rent continues to grow, and wages remain relatively stagnant. While there are rent control and minimum wage increase efforts ongoing, Mayor Bill De Blasio has set a goal to build or preserve roughly 200,000 affordable units over the next ten years. How can this be accomplished?
A solution leading the way for affordable housing in NY, that could be applied in any city, is modular construction which can theoretically cut construction time in half and construction costs by 10 to 20 percent. To achieve these efficiencies the process relies on manufacturing prefabricated housing “modules” in a factory, much like a car on an assembly line, and then assembling the modules onsite, much like a set of Lego’s. Repeatable processes and reduction in waste during manufacturing become key factors to cost reduction, with simplified onsite assembly becoming crucial for speed to market. Additionally, data collection on the manufacturing process will lead to new levels of R&D and enable Toyota-esque continual improvements on modular housing design and delivery.
So, is it feasible? To investigate we can look at a company called FullStack who recently delivered a 32-story modular tower in Brooklyn providing 181 affordable housing units. Although structurally sound, the project did not meet its promise of speed and affordability after encountering contractor dispute and city approval process delays due to uniqueness and infancy in the market. Over the next ten years we will likely see the learning curve for modular housing flatten and potentially provide Mayor De Blasio the affordable housing solution he is looking for.
Sources:
https://www.nationalreview.com/magazine/2019/03/25/modular-housing-is-affordable-housing/
https://www1.nyc.gov/site/housing/problem/problem.page
https://www.monroegroup.com/about-us/affordable-housing-statistics/
https://nypost.com/2018/09/13/new-yorks-modular-building-revolution-is-here/
