If The Housing Crisis Were A Race Between A Porsche And A ‘Red Queen,’ Who Would Win?

The U.S. faces a housing shortage of more than 5.5 million units, and yet most homes are still built in time-consuming, labor-intensive ways that were standard practice more than a century ago.

Some suggest that the old model of homebuilding, which depends on on-site laborers hammering away on stick-built housing, is due for an extreme makeover — particularly if there is to be any hope of growing the housing inventory.

“This industry as a whole is approaching the Red Queen Effect, meaning that we are running as fast as we can but not making any progress toward solving the problem,” said Spencer Marks, co-founder and chief operating officer for Canadian prefabrication startup Arthrotó. “That is because the methods we've been using to build houses are being outpaced by the current demand, and as a result, we’re falling behind in housing supply.”

Correcting this shortage will require builders, architects, regulators and the public to embrace new approaches, Marks said.

Arthrotó applies prefabrication and modular construction methods to convert unused office space, where vacancies have reached a record high, to residential use. Marks and Doug Hayden, Arthrotó co-founder, president and chief strategy officer, said others in commercial real estate need to be similarly creative in how they approach its challenges. 

As an example of the new thinking this task demands, Hayden pointed to a homebuilding initiative led not by a major building contractor or developer, but by a car manufacturer and industrial robotics company.

Porsche Consulting and ABB Robotics announced in October they had joined forces to “transform” the homebuilding process through increased automation. The joint venture noted that only 55% of construction businesses use robotics. By contrast, 84% of automotive-related companies and 79% in general manufacturing have adopted automation.

“Greater, more intelligent automation is the answer to widespread labor shortages, and this collaboration will boost productivity, allow greater customization, and enable more sustainable and efficient construction practices,” ABB Robotics President Marc Segura said in a statement.

Technology, however, is not a panacea, and Hayden said other challenges will need to be addressed to solve the problem. These include outdated building codes and a shortage of skilled construction workers.

Virtual Event For A Real Problem

Technology, building codes and labor shortages will be among the issues discussed at a webinar hosted by Arthrotó on Feb. 22 concerning The Future of Housing In North America. Hayden said he hopes the event will help to change people’s “optics” about housing and raise their comfort levels with potential solutions.

“Everybody's grappling with how to make houses cheaper, faster and just as resilient as we build today,” he said. “The event is intended to help us start to view housing solutions through a very different lens, not the one that was developed a century ago.”

Among the webinar’s expected participants is Lindsey Wikstrom, a founding partner of New York-based architecture practice Mattaforma, which emphasizes sustainable solutions. Like Hayden, she said America’s housing crisis cannot be fixed by technology alone. 

Instead, people need to reframe how they view the problem. This includes contractors who use building methods that were routinized generations ago, local building departments whose dusty codes reinforce those old ways and consumers who might need to embrace the idea of “vertical neighborhoods” in place of suburban sprawl. 

“We have great solutions to this challenge, but it takes time for people to learn new things,” Wikstrom said. “It takes a big investment in time, for instance, to teach your local building department how to do something new.”

Nathan Nasseri, founder and CEO of ResVR, a proptech provider for homebuilders and residential developers, said a shortage of skilled tradespeople also fuels the housing crisis.

“For every three skilled journeymen who are retiring, only one is replacing them,” said Nasseri, a webinar participant who describes himself as a technology advocate for residential construction. “Automation, prefabrication and any technological advantage that we have today must be utilized. We can't rely on outdated construction methods to solve a growing problem.”

‘The Worst Thing We Could Do’

Arthrotó’s Hayden said the Feb. 22 webinar will be an opportunity to bring more creative thinking to bear on the housing crisis. Panels at the virtual conference will explore topics including What Are We Doing Today To Ensure An Affordable Housing Future? and What Does Homebuilding Look Like In 2030 And Beyond?

Answering questions such as those will require open minds and innovative solutions, Wikstrom said.

“The best thing that architects can do is think creatively with clients about this situation and be open to all of the technology at our fingertips, including prefabrication,” she said. “I think the worst thing we could do is to keep doing the same thing because that's not going to solve anything.”

Office-to-residential conversions are one proposed tool to address the housing shortage while also reducing the glut of office space in urban areas. That topic is close to the heart of Arthrotó, whose specialty is office conversions, as well as of Jonathan Zimmerman, president and founder of Willard Jones Real Estate and another webinar panelist.

Chicago-based Zimmerman said he is looking for solutions to address low office occupancy among Class-B and C buildings in the city’s Loop central business district. If those solutions can also dethrone housing’s so-called Red Queen, all the better.

“The lack of affordable housing is a big deal, and if we're ever going to get downtowns back to what they used to be, then we have a golden opportunity right now to take advantage of all this empty office space and use it as a means to solve the housing crisis,” he said. 

Click here to learn more about The Future In Housing In North America webinar.

This article was produced in collaboration between Arthrotó and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.