CLEVELAND — Modular homes are popping up across Cleveland as builders try creative ways to address a widespread housing shortage.
Now, the city hopes to turn a smattering of projects into a full-fledged industry by luring a modular housing company here. The idea is to build a factory where hundreds of workers will churn out houses that can be placed on vacant lots throughout the region.
On Monday, the city sent a request for proposals to modular housing manufacturers through the Site Readiness for Good Jobs Fund, a nonprofit focused on bringing new life to old industrial properties.
The fund is lining up an unidentified 20-plus-acre site on the East Side for the project. That's land a manufacturer will get at little to no cost.
Officials believe a local factory will make modular construction more efficient and less expensive while putting Clevelanders to work. The city expects to simplify permitting, zoning and inspection processes for modular homes to save money and time.
“Construction costs continue to rise, so this is a way for us to remain competitive,” said Kate Warren, a special assistant in Mayor Justin Bibb’s office at City Hall. “I think it’s also a way for us to compete with the suburbs for residents.”
She’s part of a team that has been looking at the potential of modular construction for months – and sorting through research about the often-misunderstood product.
Modular homes are wood-framed houses built in sections and assembled on-site. They sit on foundations and follow building codes. Once they’re placed, they look almost indistinguishable from a conventional, stick-built home.
But they can go up much faster since they’re built indoors in a climate-controlled environment. And once they’re delivered, they can be enclosed and secured within hours, cutting down on the potential for weather damage, vandalism and theft.
“They’re not dealing with wind and rain and snow,” said Jim Rokakis, a longtime civic leader who approached the site fund last spring about pursuing a modular housing factory. “I’d buy one tomorrow. In fact, I’m actually looking at one.”
'Cleveland's greatest challenge'
A few local builders have dipped their toes into modular construction, selling homes for $230,000 to $300,000. Now Greater Cleveland Habitat for Humanity is tackling roughly two dozen modular homes, with help from federal pandemic relief money from the city.
In Cleveland’s Detroit Shoreway neighborhood, the nonprofit is putting the final touches on four homes on West 83rd Street. They’re all three-bedroom, two-bathroom ranches with spacious basements and detached garages. Only the paint colors outside and the porch styles vary.
Site preparations started last summer, and the homes were delivered in September. John Litten, Habitat’s president and CEO, expects families to move in by Christmas.
At five months, that’s a quarter to a third of the time it takes to build a traditional Habitat home.
“We can have the foundation being dug and laid as the house is being built, which really speeds up production,” said Litten, who was surprised by both the speed and the high quality of the factory-built homes.
He’s thrilled by the city’s attempt to attract a modular factory, which would shorten delivery times and make it easier to develop large-scale projects spanning dozens or even hundreds of houses.
Litten noted that the city’s land bank is sitting on about 18,000 lots. And there are thousands of additional vacant properties in nearby suburbs.
“People do want to live in Cleveland,” he said. “So the need for housing is great. The need for affordable housing is great. It’s really Cleveland’s greatest challenge."
'Carry-on luggage'
The city and its partners hope to pick a few companies to build pilot projects early next year before negotiating a final deal with one manufacturer.
If that timeline holds, the factory could open by the spring of 2026.
The manufacturers’ proposals will be evaluated by representatives of the site fund, the Bibb administration, city council, the Cuyahoga Land Bank and outside consultants.
Brad Whitehead, the site fund’s managing director, acknowledged that it’s unusual to see a modular housing plant in a city. The other Ohio factories are in Sugarcreek, about 90 miles south of Cleveland on Interstate 77, and Bryan, near the Indiana border.
“Usually, these things are sitting out in the middle of the country,” he said.
But he’s confident Cleveland can make a compelling pitch.
“We’re the dirt guys. … Our primary responsibility is making sure we’ve got the dirt for the factory,” said Whitehead, who said it’s too early to talk about the likely manufacturing site.
Earlier this year, the site fund teamed up with local foundations and other groups to commission a study, which made the case for outreach to manufacturers. In October, Bibb wrote to about 30 companies to gauge their interest in building a facility here. Fifteen responded.
The city plans to offer a manufacturer property-tax breaks and other incentives. It’s also possible the project could qualify for state tax breaks or grants tied to job creation.
For builders, Cleveland is looking at ways to help finance up-front infrastructure costs, like utility connections and other site work that can add uncertainty and time to a project.
“All those things cost money,” Warren said. “We’re talking about old neighborhoods with old infrastructure. Replacing sewer lines and lead lines and things like that. We really want to bring everything into the 21st century and get these lots ready to go."
Cleveland also plans to cut red tape by pre-approving a series of modular designs, which could range from 400 square feet to two-story homes of 1,800 square feet.
“We’re kind of thinking about this as carry-on luggage,” said Jeff Epstein, the city’s chief of integrated development. “If your luggage is of a certain dimension and fits in the box, you get to take it on the plane.”
'This was an experiment'
The goal is to build houses that can sell for $150,000 to $300,000, Warren said.
Litten said Habitat’s first houses, which will go to families who put in volunteer time in lieu of a down payment, cost about $250,000 to build.
“It’s not necessarily a savings yet,” he said, compared to conventional construction. “But this was an experiment, and I think there’s a lot of ways for us to bring down the cost.”
On Monday afternoon, Tamika Herring paused to look at the homes on West 83rd Street. She lives nearby and has watched the construction for months, including the careful process when workers used a crane to lower the halves of houses onto slim city lots.
Herring, 45, knows what it feels like to finally get the keys to a long-awaited home. Another local nonprofit helped her become a homeowner a few years ago when she and her grandson were struggling and living in a family shelter Downtown.
“I’m very humble and grateful for that,” she said. “And I’ll never forget it.”
Now, she’s trying to help her mother find a new place to live in a market that’s tricky for renters and buyers alike. Seeing new houses rise on long-vacant lots is encouraging.
“They are gorgeous,” Herring said. “They are beautiful.”
