The Promise of High-Performance Prefab
Builders facing the triple threat of labor shortages, soaring material costs and lingering supply chain issues can find solutions through innovations in prefab construction.
Every builder recognizes the challenges posed by product and people shortages, along with the need to build more-resilient, durable, energy efficient homes to face the impacts of climate change. Prefab housing hasn’t always been viewed as the solution, but then again, factory-built homes haven’t always resembled what’s available now.
The skilled labor shortage gets some relief from prefab manufacturing, but employees are still needed to keep the factory production line going. Credit: Gary Horbach/Dvele
“In general, prefab is just thought of as a faster and cheaper way to build houses, but that’s the wrong mentality,” says Kurt Goodjohn, CEO of Dvele, a California-based prefab homebuilder. “We’ve invested in creating a product that’s the most resilient and energy efficient it can be. Ultimately, we’re creating a superior product that can be produced at scale.”
Dvele and Green Builder Media partnered to develop Transcend Communities, which will feature self-powered net-zero energy homes with solar arrays, battery storage, all-electric systems and appliances, resilient and durable. The first Transcend demonstration home, under construction now in the Dvele factory, will be installed this spring in the San Juan mountains of Colorado.
“This isn’t your grandfather’s prefab,” says Sara Gutterman, CEO of Green Builder Media. “This is more like a precision engineered car.”
Attitudes about prefab houses vary by generation, according to Green Builder surveys, with less than half of Baby Boomers willing to live in a prefab house compared to 100 percent of Gen Z consumers.
“The massive housing shortage can’t be solved without manufactured housing,” Goodjohn says. “Transcend Communities solve the energy transition to all-electric power, and climate issues because of the resilience of the home designs, the manufacturing process and the materials used.”
Technology improvements over the past decade make today’s prefab homes stronger, more resilient to climate change and extremely energy efficient compared to previous iterations of manufactured homes. Credit: Gary Horbach/Dvele
Facing the Triple Threat
Labor shortages have plagued the construction industry since long before the pandemic. According to Gutterman, they are anticipated to get worse as workers age out, with fewer younger people to replace them.
“Prefab solves some of this issue, because you need fewer workers in the factory and at the onsite installation, and the building process is expedited,” Gutterman says.
The ability to order materials in bulk and store them in the factory provides cost and distribution benefits. Dvele can order supplies when they’re available or when their price improves, even if there isn’t an immediate need. As Dvele scales up, it will benefit from better buying power for materials, according to Goodjohn.
“Cost reduction is already happening, because there’s less waste using our precision manufacturing system,” Goodjohn says.
Software generates design details that result in precisely cut modules during the manufacturing process. Credit: Gary Horbach/Dvele
Tech Improvements for a Better-Built House
While prefab houses offer the benefit of being built in a contained environment—which naturally precludes issues arising from weather and moisture—Dvele’s systems also provide a high degree of quality control.
“We inspect every element of each house as we go, which makes it easier to catch any issues,” says Brandon Weiss, co-founder and chief innovation officer of Dvele. “On a building site, if one person doesn’t show on the right day or someone misses an issue, it may not be noticed for weeks or even years.”
In addition, Weiss says, no one on a building site has the level of attention to detail that is available through the software Dvele uses to design and build their homes.
“The software provides a digital twin of the minutiae that goes into every house as it’s built,” Weiss says. “Nothing gets covered up. If we need to change something, it can be done with a digital push of a button.”
One of the biggest technological changes that makes Dvele stand out is that the design of each home is extremely data rich, Goodjohn says.
“The data flows directly into the manufacturing process to automate production from the design,” Goodjohn says. “We’re focused on making further progress in automation as we grow.”
Software and computer speeds have seen rapid improvements over the past decade, with 3D modeling and virtual reality enhancing the design process, Goodjohn adds. Dvele’s houses exceed all codes and are built to an extremely high set of performance standards, Weiss says.
“We’re performance-centric, so we run diagnostics on every individual project to monitor the performance for homeowners and for long-term improvements,” he says.
Goodjohn refers to the Dvele IQ system, which monitors health and wellness attributes such as indoor air quality, moisture, humidity, radon and energy use, as the “check engine light” on your house.
“We’ve incorporated this intelligence into the home, with predictive maintenance that notifies homeowners when they should take action,” Goodjohn says. “[And, there are] automated features that provide better indoor air quality as needed.”
Pristine conditions in Dvele’s factory provide environmental benefits and quality outcomes. Credit: Gary Horbach/Dvele
Pre-Fab Details Matter
Dvele’s homes for Transcend Communities are designed with a conservation-first approach, according to Goodjohn. Next, materials are carefully chosen for resilience, consistency, energy efficiency and health.
“The steel structural system is the backbone of the homes for Transcend Communities because metal is fire resistant and pest resistant,” Goodjohn says. “We’re creating a home that’s going to last longer and be more energy efficient.”
The houses in Transcend Communities include duplicate systems for higher performance, such as two drainage planes so water and moisture can’t get into the house. Also, each home has solar power with battery storage.
“We use materials that are climate specific for fire resistance, seismic resilience and to prevent damage from rain and hurricane force winds,” Weiss says. “Homeowners in other locations benefit as well from those features because they increase the overall quality of the construction.”
In addition to exterior materials, Dvele’s houses are built with appropriately installed insulation, with no exposure to the elements, Gutterman says. Water filtration systems extend throughout the house.
“The ‘house as a system’ integration of each home with the Dvele IQ system solves an issue that our surveys have found frustrates people: the lack of communication between various pieces of smart home technology,” Gutterman says. “The Dvele platform is set up and streamlined from the beginning.”
Factory-built homes avoid exposure to elements that can add moisture and potentially allow the growth of mold on internal components, as well as prevent damage to items such as wood flooring. Credit: Gary Horbach/Dvele
From Old School to New Rules
Traditional crafters of stick-built houses may be considering panelized walls and other modular components, but the easier scenario is for them to work with prefab companies for the entire house.
“Builders are more likely to embrace prefab partners rather than attempt to build with components on their own,” Weiss says. “We want to partner with developers who will secure the land, improve it with infrastructure and then work with us to install prefab foundations and prefab houses on their sites.”
Many builders are more open to changing the way they build homes because of the challenges of labor and material shortages and delivery issues, Gutterman says.
“These problems push them off schedule, which costs them money,” she says. “Developers who are adopting prefab recognize that it can solve these issues, protect their timeline and offer a more-secure way of building with fewer onsite complications.”
The concept of Transcend Communities, Goodjohn says, is to bring scale and a greater impact from partnerships with developers.
“The opportunity is massive because of the extreme shortage of homes in this country,” he says. “We want to provide a healthier, superior living experience to people in micro communities that are self-sustaining.”
The steel foundation for a Dvele home has 80 percent less embedded carbon than concrete. Credit: Gary Horbach/Dvele
Structural steel is a crucial element of Dvele’s designs for Transcend Communities. It provides resilience and durability, and is fire resistant and pest resistant. Credit: Gary Horbach/Dvele
A Zero Waste Game
“Reduce, reuse, recycle” is the mantra at Dvele’s California factory, where the design and manufacturing process minimizes wasted material, says Weiss.
Every part of the Transcend demonstration home, as well as all other Dvele houses, is designed and tweaked if necessary to meet exact measurements. Precision manufacturing through automation and constant inspection of each stage of the factory building process reduces waste, which is then sorted for recycling and reuse.
“You can hold the amount of waste we generate in one hand—and this is for a 2,000 square foot house,” Goodjohn says. “We use all recycled steel to build, too.”
While Dvele’s Transcend demonstration house is being built in the company’s first factory, which is leased, Dvele is building a new factory that is anticipated to be complete in 2024.
“Our focus since we started has been on the product rather than where we make it,” Weiss says. “But our next factory will be net positive for energy, net positive for water and run with fully clean energy.”
Ideally, all Dvele houses will eventually be delivered by electric vehicles (EVs). But that technology isn’t in place yet, Goodjohn says. Still, the environmental benefits of Dvele’s technology are evident.
“Our prefab foundation system, made with structural steel and automation, has 80 percent less embodied carbon than a concrete foundation,” Goodjohn says. “Our homes use 83 percent less energy than a new stick-built home.”
First Cost Versus Full Cost Home Values
While building at scale and ever-evolving technology will gradually bring down the cost of Dvele’s prefab houses, the initial goal is focused on long-term durability and performance rather than immediate affordability. Buyers, real estate agents, lenders and appraisers typically look first at the price per square foot metric, but homeowners would be wise to consider the full cost of ownership instead, Gutterman says.
“When you look at the total cost of ownership, high-performance homes deliver a better value because operating costs are so much lower, especially with a net zero, all-electric, solar-powered house such as the Transcend demonstration home, which also has battery storage,” Gutterman says. “First-time buyers may look at a lower price point and believe they’re saving money, but they neglect to consider that it could cost them $400 or $500 a month to heat and cool that house. Compare that to a house with a mortgage payment that’s $300 per month higher, but the monthly utility bill is under $100.”
Gutterman also points out that a better-built house will withstand weather issues and won’t need repairs, both of which provide long-term savings.
“Buyers of high-performance homes are also likely to be eligible for tons of rebates for energy efficient heat pumps, induction cooktops and more,” Gutterman says.