At Horizon North's Kamloops plant, workers assemble entire homes indoors.
As they capitalize on the provincial government’s push to build more social housing, B.C.’s modular home manufacturers want to conquer foreign markets, too
Louie Quilt hefts a sheet of drywall into a box about the size of a cabin sitting in the middle of the shop floor, the next step for what will become a compact studio apartment for a not-so-well-off resident of Burnaby this spring.
Originally from Williams Lake and the Tsilhqot’in Nation, Quilt has just finished his first four months working at this Horizon North plant in Kamloops, where housing is being churned out in a way that Henry Ford would admire.
There are five production lines in this former bingo hall on Tk’emlups te Secwepemc industrial land, where three to four modular units a day are manufactured—complete with kitchens, bathrooms, rubber roofs, high-quality insulation, even furniture—deploying a high-tech system that uses virtual reality to check plans, iPads to track testing and quality, and pre-packed sets of building components.
For Horizon North and the other dominant players in the province’s modular home business, and for the government of B.C., this is part of a small revolution. It’s one they hope can ease the intense pressure that many parts of the province are experiencing with homelessness and the lack of simple, basic, cheap apartments that used to be prevalent in North American cities.
“It’s really assembly, like in car manufacturing,” says Joe Kiss, the engineer who heads Horizon North’s modular division, as he walks around the plant talking about the company’s reliance on Toyota-inspired lean manufacturing strategies.
Those methods, combined with building homes indoors instead of in a muddy field, are what everyone is hoping can produce a lot more housing for hundreds of millions of dollars less than conventional techniques.
The B.C. prefabricated housing sector, which consists of a couple of dozen companies, got a huge kick-start last year. The province committed $291 million to building 2,000 modular units, mostly for housing homeless people. Horizon North, which is based in Calgary but manufactures in Kamloops and Aldergrove, is projecting $150 million in sales of its modular housing in 2019, partly thanks to that government boost.
In its February budget, the NDP committed another $76 million for more modular housing for the homeless. Government agency BC Housing is starting to see non-profits, whose new projects it funds, turn to modular to reduce costs. It can save as much as 25 percent compared to traditional methods of building, CEO Shayne Ramsay says.
That’s key when many cities’ ambitious plans to solve homelessness and housing shortages are being hit hard by challenges on many fronts.
“There’s a lack of skilled trades, an escalation of the cost of materials, and there’s risk because you have to build to deadlines,” says Craig Mitchell, director of innovative solutions at Penticton-based Metric Modular. Metric, which also has a plant in Agassiz, was formed two years ago when Britco, the powerhouse company that has produced work-camp lodging for years, split into two. Mitchell estimates that it’s now making $60 million worth of manufactured homes a year.
Producing modules in a factory helps solve some of the problems the building industry is facing. With their assembly-line approach, Horizon and Metric have access to a bigger pool of employees than traditional construction companies. They employ more Indigenous staff—who make up some 10 percent of the payroll at Metric and about 15 percent at Horizon North—and more women than the norm for their industry.
Both can also produce housing year-round, storing units in plastic wrap until sites are ready.
Modular housing is relatively popular in Europe, but it only accounts for 3 percent of construction in North America, according to Mitchell. On this continent, it’s mainly been relegated to work camp–type digs or cheap units for trailer parks. Until Alberta’s oil crash, Horizon North focused on work-camp accommodations. It pivoted to social housing to avoid layoffs, just as the NDP government was ramping up its program.
This booming new B.C. industry is one the provincial government is overtly thrilled to support. Housing Minister Selina Robinson and Premier John Horgan have toured the factories, which use B.C. spruce, pine and fir—wood that will get value added to it here instead of being shipped to another country as raw logs.
That assistance is propelling the province’s modular housing builders to look at other markets eyeing Vancouver’s solutions to housing. In 2017, those companies sold $21 million worth of pre-manufactured homes to buyers outside Canada. Now they’re hoping for more.
Industry researcher David Fell thinks this province has an advantage: “In B.C., the sector as a whole is small now, but for the companies, [the sudden growth] is huge.”
Fell, a lead scientist in business innovations for FPInnovations, a forest sector research non-profit with a lab at UBC, says Canada in general, and B.C. in particular, is ahead of the North American trend toward more prefab housing because it’s so experienced in building multifamily. “As we get bigger buildings, the need for precision goes up,” he explains. “Prefab plays well in that world.”
Fell says the boom isn’t over, since China has mandated that 30 percent of all new buildings be prefab by 2025.
“We’ve had inbound calls from the housing officers in San Francisco and Seattle,” says Horizon North CEO Rod Graham. “Now we say, Let’s go to Vancouver. We’re building a brand-new product here.”