Derek Robertson was a Politico Journalism Institute Fellow in June 2017.
Detroit has long been known for turning raw metal into useful even beautiful objects; most often they came with wheels. Now, as the battered and bankrupt city undergoes a development renaissance, housing developers are doing it again, transforming boxy steel shipping containers into sleek new homes.
On a sunny mid-July afternoon Leslie Horn, CEO and a founder of Three Squared Inc., a Detroit-based company, evangelized for a process she believes could revolutionize the housing industry. Her company has built two model units on Trumbull Avenue, not far from the site of the old Tiger Stadium. It has plans to build another 40 units over the next 15 months.
“Once we get done erecting the building ... well, we’re done,” Horn said. “We’re trying to do as much as we can in the factory—windows, exterior doors, frame out as much as we possibly can according to code, and then with good coordination with the general contractor we could be done inside of 60 days from the time we start erecting the building to keys-in-the-door.”
Horn says the units in future developments will sell at market rate, ranging anywhere from $260 to over $300 per square foot. For a four-container unit like the one that occupies the bottom two floors of their model, that could be anywhere from $166,400 to $192,000. Horn says partner realty company The Loft Warehouse has had four times more hits online for the container project than their other developments, and that Three Squared’s inboxes are filling up with requests to be notified when they start selling.
This 2,800-square-foot building is made of nine shipping containers and took only six hours to build. | Tanya Moutzalias/MLive Detroit
The easy availability, low cost and industrial strength of containers as building material have been their main selling points since a patent was filed for the concept in 1987 by inventor Phillip C. Clark. A new 40-foot-long container, about 320 square feet of space, sells for roughly $2,800 used and $5,600 new; insulation, depending on quality, can run from $100 to $1,000. But it’s the rest of the retrofit—plumbing, electrical, heating and cooling, all the stuff that makes a home more than just a box—that can boost the final price well into the the hundreds of thousands of dollars, making the final product less of a solution to the affordable housing crisis than one might think at first.
Peter DeMaria, a California architect who designed the first shipping container home in the United States in 2006, said he believes there will be a massive shift in scale and standards, but he also warned against the expectation that improvements in the building process will drive down costs.
“The thing is, [building] code is not written to accommodate these containers—people are scrambling to satisfy code, and then you also have to supplement the construction with additional steel, including things that are not in the [industry standard] Steel Construction Manual.”
While Horn says that her company can offset these costs with diligent research and planning—she said her company spent $500,000 in research and development before the Trumbull Avenue development was built—some critics question the idea that container housing could ever be considered affordable housing, more appealing to design-savvy hipsters than useful for solving a homelessness crisis.
Mark Hogan, a California architect who penned a critical op-ed on the subject for architecture news site ArchDaily, echoed DeMaria’s warning. “They’re not a cheap way to do anything, because everything you’re doing requires welding and generally specialty contractors that are much more expensive than a typical contractor who’s used to building things out of studs,” Hogan said.
“[In my editorial] I was responding to the [idea] that it’s an affordable way to create a lot of housing, and it’s not ... A lot of people just like the way it looks, and that’s fine if you want to build a luxury home with containers.”
In 2008, Three Squared Inc. first proposed using large shipping containers as housing. Here, CDSG construction workers stack containers in Detroit. | Jessica J. Trevino/Detroit Free Press/AP
Horn of Three Squared disagrees. The company is planning a Low Income Housing Tax Credit-eligible apartment project with the city of Philadelphia. The LIHTC was implemented in the 1980s to incentivize private developers to build affordable multifamily housing, providing dollar-for-dollar credits to private companies that choose to go into the business.
But many developers think the aesthetic factor should not be dismissed lightly. Jonathan Hartzell is a founding partner with the Detroit Shipping Co., which plans to break ground on a nearly 10,000-foot container-built food hall in the city this fall. It will take 21 standard containers to complete.
“To me, the idea was just supercharming,” Hartzell said. “I really wanted to use containers and interpret different styles with them—we kept adding and changing things through the development process, but we never lost the container component.”
Janice Abbott, CEO of Atira Women’s Resource Society in Vancouver, Canada, shepherded an affordable housing development for women in the city in 2013. She shared Hartzell’s affection while acknowledging the containers’ potential limitations as building material. “Obviously, there are limitations, you’re building with LEGO blocks to a certain extent. The more creative you get, it drives the cost up, so if the goal is to keep cost down you need to use them in their current form and modify as little as possible.”
This is another area where Horn begs to differ, offering as a main selling point for container development its adaptability to individual taste. The exterior of Three Squared’s model offers a simple and elegant example with its combination of siding, brick and raw container material. Plus, she says, it just fits so neatly with Detroit’s manufacturing legacy.
“I fell in love with the city, and spirit of the people in this city,” Horn said. “And this is the right place for us, because Detroit is the mother of innovation. It always has been and it always will be. There are so many firsts that occur here—why wouldn’t we want to create some more history?”
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