Google Buys Modular Homes to Solve Housing Crunch
Photo courtesy of Factory OS.
With soaring home prices in Silicon Valley making it hard to recruit employees, Google's parent company Alphabet Inc. had ordered 300 apartment units from a modular homebuilder.
The Wall Street Journal reported that Alphabet contracted with Factory OS, a modular-home startup based in Vallejo to build 300 prefabricated homes for temporary employees housing. Other tech companies in the region, including Facebook, have invested in working housing as well to address the shortage of available affordable housing.
Employers and residents in Silicon Valley have faced a severe housing shortage for years and tech companies are becoming more active in trying to help solve that problem. In 2016 Facebook announced that it planned to spend about $20 million in Menlo Park and East Palo Alto, Calif., two cities that surround its campus, to create a fund to build new housing. Facebook has pledged to plan and design 1500 units in Menlo Park, of which 15 per cent will be classified as affordable housing.
In Silicon Valley, Santa Clara, Alameda and San Mateo counties all posted all-time median price highs in April, CoreLogic reported. The price for the typical previously owned home was $1,050,500 in Santa Clara County, which is steadily holding above the $1 million level; $805,000 in Alameda County; $590,000 in Contra Costa County; and $1.4 million in San Mateo County.
Factory OS specializes in modular construction, in which a complete home or an addition is built in a climate-controlled factory and then delivered to the home site, has been around for decades.
The company, which operates in a former naval base on Vallejo's Mare Island, said that with modular construction homes can be built 40 percent faster and with a savings of 20 percent over conventional construction. The bulk of the home is built in modules in the factory, and final assembly takes place on site.
The Journal cited on example of tenants saving $700 per month due to reduced construction costs.
Read more about prefab and modular homes.