Biggest US Apartment Owner Leaps Into Modular Homes

According to WSJ, Greystar (headquartered in Charleston, SC), unveiled Ltd. Findlay, its first modular development in the U.S., following several successful projects in the U.K.

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The Coraopolis complex features 312 apartments across six buildings, with amenities such as a gym, amphitheater, and bocce courts.

This milestone is part of Greystar’s broader plan to scale modular construction domestically. Six additional projects, all within 600 miles of its manufacturing hub in Knox, PA, are already in the pipeline.

Why Modular Matters

Modular construction involves fabricating building components in a factory, transporting them to the site, and assembling them like giant Lego blocks. 

This approach addresses chronic construction challenges, including rising costs, labor shortages, and material inefficiencies.

• Speed and Cost Savings: Modular construction reduces build time by 40% and labor needs by 66%, with potential cost savings between 5% and 10%. At Ltd. Findlay, modular methods lowered costs by 10% compared to similar projects in Pittsburgh.
• Sustainability: Modular projects minimize waste by assembling components in controlled environments, a significant advantage in sustainable construction practices.

Barriers to Expansion

Despite its benefits, modular construction faces hurdles:

1. Financing Challenges: Lenders often require higher upfront capital and impose stricter terms due to unfamiliarity with modular models.
2. Regulatory Complexity: Varying building codes and inspection standards complicate permitting processes, necessitating additional certifications.
3. Transportation Costs: Moving prefabricated modules limits the viable distance from manufacturing facilities.

Greystar has taken proactive steps to educate lenders and navigate regulations, including securing certifications for its Knox factory and offering facility tours to potential financiers.

The Bigger Picture

Modular construction remains a niche market, accounting for only 6.6% of the U.S. market in 2023, but its popularity is growing. 

Global modular construction revenues could reach $1.1T by 2040 due to rising construction costs and shrinking workforces.

Other major developers, including Marriott and Related, have also embraced modular solutions. Meanwhile, industry advocates like the Modular Building Institute are pushing for standardized building codes to streamline adoption.

What’s Next for Modular

Greystar’s foray into modular construction signals a broader industry shift. With demand for affordable, efficient housing solutions at an all-time high, modular development is poised to move from a niche alternative to a mainstream necessity.

“Modular has been seen as a choice,” says Jose Luis Blanco of McKinsey. “Now, it’s becoming a necessity.”