Wednesday, January 23, 2019

A New Modular Home in Arlington Fits Right In

Building a new home in an older neighborhood, especially in a town like Arlington, VA, usually has the neighbors looking over the builder’s shoulder asking all sorts of questions about what the house will look like and will it be a good fit.

By the time David Gigliotti, VP of Carbide Construction, was approached with those questions the modular home from Excel was already set and weather tight by the time the neighbors got home from work.

And the neighbors were saying other things like “How did you do this in one day?” and “That is a beautiful home”.

The Excel modular features 3 bedrooms and 3 bathrooms. Carbide Construction finished the Attic/Loft area to create another bedroom with full bathroom.

In the basement, he finished it off with a bedroom, family room and full bath.

Highlights and features installed in the modules at the Excel factory included:
  • 1x8 Square Edge Base Molding
  • Andersen 400 windows with Dark Bronze Interior and Dark Bronze Exterior
  • 1x4 Square Edge Casing
  • In multiple areas throughout the house you’ll find a 2 piece crown
  • The first floor bath features 1x4 flats that we designed and installed.
  • Solid Core Interior Doors
  • Oak Treads and Risers
  • Tile Floors.
  • Merilllat Tolani Maple Cabs in Kitchen
  • Tile at the main and master bath as well as the vanity tops and faucets.

A tip of the hat to David Gigliotti and his staff at Carbide Construction and to Excel Homes for a great looking home just across the river from the White House.

Tuesday, January 22, 2019

New Modular Factory to Open in Former Arcon Factory

Modular Steel Systems a manufacturer of wood and steel framed modular buildings is pleased to announce that they have successfully completed negotiations for the lease of the former building # 2 of the Arcon Homes property on Airport Road in Selinsgrove, PA.

“Our steel framed business has grown substantially over the past several months as builders realize that this light weight, durable framing method can be executed in a factory environment, providing quicker completion times, higher quality and a controlled price. This increase in sales has made it possible for us to expand our current manufacturing capabilities out of our Bloomsburg facility and bring this new operation on line to build our steel framed business. “stated Victor DePhillips, Chief Operating Officer of Modular Steel Systems.

The Bloomsburg, PA facility will continue to build wood framed Single and Multi-Family products to satisfy it current backlog while the Selinsgrove facility will start with two major inner-city projects under contract for steel framed Multi Family.

A Local press announcement will follow with details for a job fair to be held in Mid February that will make job opportunities available in all phases of the operation.

“We are looking for assemblers, foremen, purchasing , engineering and management employees that want to grow with this new venture. We are optimistic that we will find the people we are looking for considering the quality of the workforce that has and continues to exist in the area” Stated Jonathan Davidson, President of Modular Steel Systems Inc. “And we look forward to becoming a member of the Selinsgrove manufacturing base.

In the interim any interested prospective employees can call 570-520-4062 and ask for Ed Heinz, General Manager MSS, Bloomsburg PA.    

Have You Ever Wondered Why Millennials Quit Working for You?

I have been looking for quite some for a cartoon showing why many Millennials jump from job to job in their early careers and today I found it.

Monday, January 21, 2019

7 Mistakes to Avoid for the Custom New Home Builder

New custom home builders are a brave lot. With margins being tightened and increased pressure from your customer to build the perfect home and the usual cyclical housing downturn staring us in the face, you cannot afford to make many mistakes and continue to stay in business.

Even simple mistakes can mean the difference between your being successful and being broke.

Success and failure are both in the palm of your hand

Here is a list of seven common pitfalls that you should avoid:

1. New home builders tend to undercharge for their homes.

There are two main reasons for this. First you don’t know how to correctly set an effective price for your homes and secondly, you think that you have to give the lowest price to get the homeowner to sign on the dotted line.

If home builders were selling a staple that everyone needed on a regular basis, it would be very easy to find a fair price for your product. But you don’t. For many of your potential buyers, this will be the only house they will ever build and you think that if you don’t give them the lowest price, you will lose the sale.

If this is how you operate, it’s time to sit down with your accountant or a consultant and work on implementing a well thought out pricing system. If you lose a couple homes because the buyer won’t pay for your home, be thankful. If they can’t afford one of your homes in the first place can you imagine the struggle getting your money will be and your profit is always in the last draw!

2. Builders tend to concentrate too much on sales.

Most modular home builders are sole proprietors and tend to gauge success by the number of homes sold. You tend to think the more sales you make, the bigger and better your business will be.

That can prove to be so Wrong….. While having a lot of homes to build is usually a good thing, using the number of homes as your yardstick to measure success will get you in trouble. Too many homes in the pipeline without spending the time to plan for that many will put you on the path to failure. You will overpromise and underdeliver. Add in under-pricing your homes and soon you will be one of those builders that go out of business leaving folks with deposits gone and no house to show for it.

3. Forgetting taxes can spell disaster

You have to pay your taxes. There is no way around it. One of the toughest challenges you’ll face is getting a draw from the bank and just having enough money left over to meet your personal and business expenses.

If you do this through the entire draw schedule, you will be faced with taxes to pay and no money left over to pay them. You need to include your taxes in the price of the house. If you aren't sure how to calculate what to add to the house price, contact your accountant.

4. No business plan.

You’ve heard the old saying, “If you fail to plan, you plan to fail.”

Home builders are notorious for not having a business plan. It would seem absurd to even consider starting to build a new home without a set of floor plans and a schedule, so why don't you have a good set of “floor plans” for running your business?

It can be as simple as planning out your next 3 months. What do you want to accomplish? How are you going to do it? How do you measure if you are on track? These are not hard questions. During the first month, start planning for the second three months. Eventually you will start to see the advantages of having a business plan.

5. You don’t know how to hire or keep good employees.

Many small home builders with one or more employees do not have a clue how to effectively manage or train them. You hire whoever comes in the front door looking for a job you need filled and send them into the field to represent you and your business.

Now that our industry as well as just about every other is experiencing an acute labor shortage and the increased risk of drug addiction it simply reinforces the need to check out the job applicant very carefully.

Your employees, whether you only have one or a staff of them, are your business’ most valuable asset. It has been proven that they can make or break you business. You need to think real hard about the position you need filled and if the person you’re looking to hire is that person. It is better for your business to not hire just to fill a slot.

But if you find a good employee, you must have a system in place to show them that their efforts are noticed and rewarded.

6. You fail to provide outstanding customer service.

This would seem to be a no-brainer as every builder strives to provide good customer service. It’s expected but if you fail to deliver, the homeowner will not only yell at you, they will tell every one of their social media circles, Angie’s list and some have even created blogs to tell anyone reading to stay the hell away from you.

If on the other hand, you provide outstanding customer service, the customer tends to only tell a couple of people but don’t be fooled by that, those comments are called referrals and that’s what you need to keep your business healthy and profitable.

Bad publicity is NOT good publicity for new home builders.

7. You don’t develop new home building skills.

If you try to do business like you did last year, your business will slip away. There are just too many things to learn! HERS Ratings, Energy Star, Green Building and new codes requirements are just the tip of the iceberg.

You also have to learn more about management, business strategies, organizing and other things too numerous to mention about the nuts and bolts of home building.
If you aren’t constantly learning, you will fall behind and soon the other builders will be building homes for your prospects. Modcoach and team will be introducing new programs to help keep you up to date on new methods and products for your homes as well as a new learning platform to help keep you successful. It’s going to be a great year and you don’t want to miss it.

Friday, January 18, 2019

Up in the Sky! Is it a Bird? No, Just an OSHA Drone

It sounds like a bad dream for a safety professional: an OSHA inspector sitting in his truck could soon be launching a drone over top your jobsite looking for hazards and violations. Perhaps workers on the roof, crane operators and set crews as well as general worksite labor may soon have an OSHA inspector see it all without even stepping foot on your property.

It’s not as far-fetched as it may sound.

OSHA has authorized the use of drones by certain inspectors to collect evidence during inspections in certain workplace settings.

But before you panic, currently, OSHA inspectors are only allowed to use drones for enforcement purposes in areas that are inaccessible or pose a safety risk to inspection personnel.

The other caveat? OSHA must obtain express consent from the employer prior to using a drone on an inspection. In addition, personnel on site must be notified of the aerial inspection prior to the drone’s launching.

So, for now, most employers can breathe a sigh of relief when it comes to drone inspections. But, it is something that employers should keep on their radar, in case OSHA decides to expand the usage of this technology. Certainly, any covert usage over an employer’s worksite could bring up many constitutional issues, but as technology advances, and drones become more commonplace, employers may want to incorporate the issue into their OSHA inspection procedures.

A unique problem modular home builders could face is who gets the fine if the drone picks up the set crew working on a roof without proper safety gear or a crane operator lifting modules in high wind or improperly strapped. Is it the builder who should be fined?

Wednesday, January 16, 2019

Autovol Plans Automated Modular Factory in Idaho

Prefab Logic, in conjunction with Autovol™ ownership, is leading the development of a revolutionary, first-of-its-kind factory that will set an entirely new benchmark for automated volumetric modular construction. The factory will be based in Idaho’s Treasure Valley, and will operate under the name Autovol. The Autovol factory will establish best-in-class standards for a new category of smart construction.

The Autovol factory will be located on a 52-acre site on Star Road in Nampa, Idaho. Prefab Logic is designing the factory in partnership with a leading factory robotics development company soon to be announced. The Autovol model will further solve the affordable housing crisis by providing a dedicated, high-capacity factory for multi-unit modular projects.

For Prefab Logic co-founders Curtis Fletcher and Rick Murdock, the Autovol factory is the next big step in their growing investment in the modular industry.

“Autovol will greatly accelerate the big and positive impact on cost and productivity that current volumetric modular construction already delivers to our projects,” Fletcher said. “This factory will create new breakthroughs in construction speed, capacity, efficiency, and excellence.”

Murdock will lead Autovol as its CEO. Effective January 1, 2019, Murdock’s roles and responsibilities at Prefab Logic will be assumed by new Vice President of Operations, Doug Pill. Already a leader in volumetric modular innovation, Prefab Logic helps factory owners and developers design, develop, and run volumetric modular construction factories, with several other major factory projects completed and in the works. Once Autovol is developed, Prefab Logic will foster a network of affiliate factories and share key automated construction technology and learnings gained.

“Autovol will open up with automation far beyond what’s being done in any modular factory today. It’s Construction 3.0,” Murdock said. “Prefab Logic experts have worked-in, designed, operated, and studied today’s best-in-class modular factories worldwide. We’ve enjoyed our role as modular pioneers, and we’re thrilled with what this next pioneering phase will do for communities that need affordable housing as well as developers and factory owners ready to change the game.”

Construction preparations at the Autovol site began in October, 2018. The factory is set to be operational in early 2020.

Prefab Logic is a leader in volumetric modular consulting based in Boise, Idaho. Prefab Logic provides independent design, manufacturing, and factory startup services built on decades of successful real-world experience with all phases of volumetric modular construction. More information at

Autovol™ is the name and operating entity of the innovative automated volumetric modular construction factory currently in development in Nampa, Idaho. Autovol is being designed and developed by Prefab Logic, a leading volumetric modular construction consultancy based in Boise, Idaho.

Troubled Katerra Gets Another $700 Million Investment

Masayoshi Son’s $100 billion Vision Fund is preparing another major investment in real estate tech, with plans to lead a $700 million round of financing for Katerra, the construction startup founded by former Flextronics International CEO Michael Marks.

This financing round would value the four-year-old company at more than $4 billion, according to The Information. The SoftBank fund invested $865 million in Katerra last January, after which the company was valued at $3 billion.

Katerra and SoftBank declined to comment, and the identities of the other investors in this financing round are unknown.

California-based Katerra, founded in 2015, has faced some growing pains since its last cash injection. In August, The Information reported that the company’s flagship factory in Arizona had to be shut down soon after it opened because it lacked proper building permits.

At the time, one former Katerra manager said that “every day is a fire drill.”

The company’s revenue was reportedly in the high hundreds of millions of dollars in 2018, and sources expect that number to exceed $2 billion this year.

SoftBank’s last investment in Katerra was one of the largest real estate tech deals of 2018, coming just behind two other SoftBank deals – $3 billion and $1 billion fundraising rounds for the company formerly known as WeWork.

Katerra has also found itself entangled in some of the Vision Fund’s political troubles lately. In October, just weeks after the Saudi government was implicated in the murder of journalist Jamal Khashoggi, Marks travelled to Riyadh to sign an agreement to build several factories in Saudi Arabia. Other U.S. tech executives, such Uber CEO Dara Khosrowshahi, had declined to attend the same event.

Tuesday, January 15, 2019

An Insider's Response to my "Fragmentation and Regulations Continue to Impede Modular Housing Growth" Article

On January 12th I wrote “Fragmentation and Regulations Continue to Impede Modular Housing Growth” about two problems facing the modular housing industry today.

This morning I received an “Anonymous” comment written by someone still working with what appears to be a long history in our industry.

Their observations of these two highly charged problems sheds more light on why the modular housing is the best option for future construction but more importantly why that is not materializing.

A "must read" comment:

Coach, Having been around when the states in the Northeast gradually changed over to allow modular to be factory inspected and not invasively field inspected I would like to offer the following for you and your readers. The states fear at the time was that the industry would build and inferior product and that their inspectors had more real knowledge than any inspector or third party doing sections in a modular plant.

Talk to any Third party agency and ask them what they had to go thru to get certified, accepted or licensed by a state and you will see that the process is not easy. Read thru any Q.A.M. and you will see that the documentation is not just few copies placed In a book someplace and ignored. But the process was established to give credibility to the Third Parties and the process being used for inspections. This was the best most states could come up with to prove to their locals that the state as protecting their constituents. Initially it was a rocky start with locals demanding the right to know more than what the states were saying needed to be provided.

Most states helped the industry fight back against the locals with phone calls, letters and copies of the way the legislation was passed. It did help,but it still was not easy.

In my opinion the system took a turn for the worse when the codes consolidated and the code became more and more restrictive and prescriptive. Building officials or the agencies they hired required more and more information to satisfy this higher degree of structural design and compliance. What was simple header built into a wall became a structural element that required at least a page of calculations that had to be sealed by a licensed professional, while all along our stick built cousins go submit and plan with structural elements extracted from the Wood Frame Construction Manual.

Now to your point of fragmentation. Consider that there is such a thing as an "On Frame Modular" available in the southeast and not a product widely recognized in the Northeast and that is the start of the industry going off the rails.

Next consider that in some regions the Modular industry is still confused with the "HUD" industry and it gets even worse. How many articles do you have to read about a manufactured home (HUD) being thrown out of a subdivision, but was labeled as a modular home, before you begin to see why the industry does not get traction.

Another point to consider is that as an industry it is hard for us to work together and agree on a cohesive marketing plan that will benefit the entire industry and just those special few.

What do we do to foster or nurture the future of our industry? Do we actively train or offer training to potential builders of our product? What will the future hold for us is we are not bringing up the next generation of builders to promote our building system and grow the industry?

Look, this industry is not anywhere near what it was many years ago. Our ability to build more complex products to expand our market place has improved immensely. We handle the complexities of the building code requirement that are thrown at us to survive and we make it a standard operation procedure in our factories. I jokingly think to myself that if the coal mining industry thinks that over regulation makes doing business almost impossible they should spend a day in our shoes in our factories.

In closing I am more concerned about the overall future of the single family detached home building industry as we know it.

Does anyone have clue as to what the millennials want for housing? And how will those needs fit into our business plan?

Monday, January 14, 2019

LGA Recruiters Lists their January Career Openings

The available open positions and job listings just keep coming in. If this is your year for changing jobs you need to check this list from LGA Recruiters.

They are also looking to prepare you for job openings in Start-Ups across the country. Check out their Start-Ups section below.
Contact Lynn Gromann at 888-831-0327 or if you would like further information on an available candidate or on an open position. The Active Candidates section below represents candidates looking for new career opportunities. The Open Positions section represents companies, who are looking for candidates to fill their open positions.

Active Candidates
EXECUTIVE VP Operations / COO - 26 years Commercial MOD, wants Southern states VP Operations / COO - 15+ years MOD, wants Northeast

SALES Sales Rep - experience in Park Models, HUD / MOD, wants PA Sales Manager - 25 years MOD / HUD / wants SE or close Director of Sales & Marketing - 28 years MOD experience, wants SE, S, SW

PRODUCTION / OPERATIONS / PURCHASING Operations Manager - 27 years HUD / MOD, wants Midwest Assistant Production Manager - 21+ years, wants East Coast VP of Manufacturing - 26 years Commercial MOD - possible relocation

ENGINEERING / QUALITY Project Engineer / Quality - 9 years HUD / MOD - Southern CA Engineering Manager - 11 years HUD / MOD, wants PA or commute Engineering Manager - 17+ years HUD / MOD - wants DFW area only

MATERIALS Materials Manager - 30+ MOD experience, 7 as materials, wants Midwest

Open Positions

START-UPS Numerous positions will be open for new plants in the near future. If you have an interest in being in on the ground floor of one, send me an email stating so at

EXECUTIVE / FINANCIAL Plant Controller / HUD-MOD / South

MATERIALS / PURCHASING Inside Sales / Estimator - Commercial MOD - Midwest Estimator - Multi-family MOD - Rocky Mountain Region Materials Manager - MOD - Pacific NW Materials Manager - Multi-family MOD - Rocky Mountain Region

PRODUCTION / OPERATIONS Production Manager - Commercial MOD - Northeast Production Manager - HUD / MOD - Midwest Production Manager - MOD - Rocky Mountain Region Production Manager - Multifamily MOD - Rocky Mountain Region Production Supervisors - HUD / MOD - South Production Supervisors - Commercial MOD - Northeast Plant Manager - Residential MOD - Upper Midwest

ENGINEERING / QUALITY Engineering Manager - Commercial MOD - Northeast Engineering Manager - MOD - Pacific NW Engineering Manager - HUD / MOD - Southeast Drafters - HUD / MOD - Southeast Quality Assurance Manager - HUD / MOD- Southeast Quality Assurance Manager - HUD / MOD - South

SALES Sales Rep - MOD - Northeast Sales Rep - MOD - Midwest Sales Manager - HUD / MOD - Midwest Sales Rep - HUD / MOD - Southeast Sales Rep - MOD - South Sales Manager - Multifamily - Northeast Sales Rep - Residential MOD - Pacific NW

Saturday, January 12, 2019

Fragmentation and Regulations Continue to Impede Modular Housing Growth

For more than 50 years there have been numerous studies of the modular housing industry and the conclusions reached by all of them is that our industry is very fragmented and over regulated.

Today we hear about all the wonderful things modular and off-site construction is doing to meet the demand for affordable and custom housing but the underlying problems from 50 years ago are still the same ones we are facing today.

Fragmentation within our industry was first noted in the 1975 study by Field and Rivkin. They simply mentioned it as a problem and it is still a major one.

There are five major fragmented modular housing regions in the US.

The West Coast has a few true custom modular home factories but the demand for their homes is relatively small compared to the modular factories that are producing cookie cutter affordable multistory apartments and housing for the disadvantaged. All the new technology you hear about at the big off-site conferences and seminars is almost exclusively directed to the West Coast type of modular construction.

When the media trumpets the virtues of modular construction it is mostly about the money flowing into the West Coast market to build ‘state of the art’ factories to feed the West Coast housing monster.

The Midwest and the Southeast are where most of the houses, both modular and manufactured (HUD), are produced and shipped. There are a few custom modular home factories located in these regions but the vast majority are producing either HUD and/or Hudular type modular homes.

The Southwest region is dominated by HUD manufacturers. Enough about them.

The MidAtlantic and New England states see the widest variety of modular housing. There are HUD factories in these states along with a couple of ‘plan book’ type modular factories and a good number of true custom modular home factories.

Fragmentation becomes obvious when you look at the top two associations serving the modular housing industry, the Modular Home Builders Association and the NAHB’s Building System Council.

Both would love to serve the entire country with their services but in reality neither has been able to reach very far beyond the East Coast states. The reason is quite simple. Not only are the individual regions of the country different in their approach to modular, they don’t have much common ground to discuss when they actually try.

It’s like trying to teach a pig to sing, nobody knows how to do and nobody really cares to do it. The different regions see no need to try to understand what the others are doing.

Every study done about modular housing since 1975 has cited fragmentation as a big reason for there being no nationwide modular home company with factories in almost every state.

HUD on the other hand has the “FOUR C’s”, Clayton, Champion, Cavco and Commodore and when HUD (manufactured homes) conventions and meetings take place anywhere in the US these four and dozens of other HUD factory brands show up as the problems they face are universal.

There really isn’t much that can be done to improve our industry’s situation. Remember that singing pig?

Over regulation of the modular industry has also been with us long before that 1975 study and it appears to be getting worse.

Looking at a site built home, even if it uses panelized walls, trusses and floor panels, finds that giving the plans for to the local or city code and plan regulators is all that is needed. These code and planning people have been trained to look at a set of site and/or off-site plans, mark them for defects and send them back to the builder or developer, wait for the corrections and then approve them.

Each local jurisdiction must follow their State’s latest code regulations and cannot reduce them on their own but they can add more regulations and make the state’s approved regulations tougher for their locality.

However when it comes to modular housing things take a turn for the worse. Apparently many state governments don’t think the local code and planning people are smart enough to figure out a set of modular home plans and have added layers of bureaucracy to the process.

First the states said that modular houses built in a factory need to have their plans approved before it can go to the production line and since the factory ships to many different states there has to be an independent third party inspection service that can review each individual plan no matter where it will be shipped. These third party inspection services were already doing plan review and approval stamping for HUD so they were the logical choice to review and give approval stamps to modular housing.

Or so it would seem. However the government thinking is that third party inspection services and local code enforcement aren’t quite up to the task of reviewing a six sided volumetric module and installed “Manufactured or Industrial Housing” departments to make sure those less competent third party and local people actually knew how to review a modular home plan.
Today we find many states not only requiring a third party to sign off on the plans prior to it going into production they also require a couple of “good old boy” state regulators to review the plans again and return every one of them to the factory to correct a missed code number or some minuscule item.

Is this being done to help build a better modular home? Probably not but if they don’t find problems with every single plan sent to them the state may wonder why they required an entire department to review them in the first place.

These state reviewers follow the old rule of “Nobody has ever built a perfect house” and will hold up your plans until you do what we say.

This is not Modcoach saying they do this; it’s every factory person I’ve ever met, most third party inspectors, every builder and it has also been mentioned in every study of modular housing since 1975.

Can you imagine what would happen if all of sudden factory engineers and third party inspectors could submit their plans to the trained staff at the local code and planning departments just like their site built siblings?

You would see a huge increase in the number of modular homes being sold by local builders, factories expanding their production and a much smoother pathway to building a customer’s new home.

These aren’t the only things all those studies found that have been impeding modular housing's growth.

Rising transportation costs, poor information flow within our industry, an adversarial problem between factories and builders, the competitive nature within our industry and market resistance are just a few more areas that are hindering our industry’s growth.

Can these impediments be overcome? They have been a constant for the past 50 years and I see no reason to believe there will be many solutions within the next 50 years.