Episode 19 - Parlin Meyer, BrightBuilt Home
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Prefab Review
Hi, my name is Michael Frank, and this is The Prefab Pod presented by Prefab Review, where we interview leading people and companies in the prefab housing industry. Today, we're speaking with Parlin Meyer of BrightBuilt Home, a modular home company out of Portland, Maine. Welcome, Parlin.
BrightBuilt Home
Thank you. It's great to be here.
Prefab Review
Well, so we're really excited to learn about your company. But first, you know, we're in sort of a niche industry, so we wanted to learn how did you get involved in this space.
BrightBuilt Home
My personal involvement with the space has come from various angles. I joined this particular venture back in 2013. I actually was brought in by a local architecture firm by the name of Kaplan Thompson Architects. This was, at that time, a relatively small firm that was largely focused on the residential realm and specifically high-performance and net-zero residential. When I joined the team in 2013, we were working together to try to develop an idea at that time of tapping into the offsite manufacturing industry in order to be able to bring high-performance homes and net-zero homes to a broader swath of the population. So that's kind of how I came to this specific firm and the specific venture that is BrightBuilt Home. I also had some other previous personal involvement in working in the industry. I was connected with the Solar Decathlon from the Department of Energy and other various efforts. So I had exposure to off-site construction and prefab ideas prior to joining BrightBuilt.
Prefab Review
Are you an architect by trade or did you come at it from some other kind of building background?
BrightBuilt Home
I am. I have a master's in architecture.
Prefab Review
Got it. Cool. So at its core, what is the focus of BrightBuilt?
BrightBuilt Home
Our focus really is steeped in that initial mission of trying to bring net-zero homes to more people and make it more accessible, more attainable and in that mission, tapping into that existing infrastructure of the construction industry in order to make the process more efficient, make the process more predictable in terms of cost and as a whole, through those efficiencies and through the streamlining of the process, ideally bring the overall cost of construction and the overall project cost down to a more sustainable price point. So that's that's been our mission from the get-go. That remains our driving force. And we continue to work on ways to improve, modify, streamline, find efficiencies and continue to drive those price markers down as much as possible, whether it be in smaller footprint designs or in efficiencies in the process itself.
Prefab Review
And when I look at your homes on your website, a lot of them sort of have, you know, sort of a kind of a farmhouse feel to them. Is that just sort of the sensibilities in your company in Maine or is there something about, and we see that with some other quote unquote, high-performance builders, especially like passive home companies. Is there something about that design that lends itself particularly well to your goals around your net-zero energy consumption?
BrightBuilt Home
Yeah, to some degree, yes, and to some degree, it's drawn from the local vernacular, but what's driven the local vernacular is what's sensible for this climate. So the 12th pitch, steep roofs that you see that are so typical of the farmhouse style, so to speak, is shedding snow and, of course, given the latitude that we're at, especially here in Maine, it also just so happens to be a pretty appropriate roof angle for solar panels. So there's a lot of practicality that drives the design for sure. There definitely seems to be a market interest in that vernacular. So there's market driven aspect as well. But it's a combination of everything really that's driven the design. That said, well, we don't put modern designs and modern imagery out there on our website, persay, we absolutely could do more modern designs and we are doing more modern design, specifically in our psychic line, which is our smaller footprint line of homes that are geared towards accessory dwelling or secondary camps for that style of home. So while we do, you're absolutely right, our website largely features, yeah, largely shows that vernacular, that sort of farmhouse style with some contemporary elements, we're very open to doing more contemporary components as well.
BrightBuilt Home
Well, let's dive into the ADU part. So, again, our company we help people do projects across the country. But I mean, basically hope we're not biasing ourselves too much, two of our three biggest markets are the Bay Area and Los Angeles. And California as a whole has a lot of legislation that kind of, I would say, makes it easier to get permits for accessory dwellings. So we do do a lot of them on the West Coast. Are ADUs an increasingly popular thing in this sort of footprint that you all serve? Which I assume that's the basically the Northeast, right?
BrightBuilt Home
Yeah, we're primarily in the Northeast. We basically work from Maine to Virginia currently. We are looking to expand that in the coming years. But yes, the buzz around ADUs, I would say it's getting louder every year, it seems. There's a lot of interest in it, certainly from the standpoint of housing density and potential for short term rental income and those sorts of things. There's a lot of interest in it.
Prefab Review
And multi-generational living is what we see a lot too.
BrightBuilt Home
Absolutely. I will say it does seem to be a little bit different from the West Coast in terms of how readily embraced it's been. And what we found, so we launched our ADU line, the psychic line, a few years ago in response to that market interest and the notion of ADUs, most of the buyers of the ADUs have actually been people who are putting the homes on on their own lots. They are not necessary dwellings to an existing home.
Prefab Review
So this is really more of a small home movement than accessory unit.
BrightBuilt Home
I know, we were pretty surprised to find that that's really the bulk of the people who are at least getting to the finish line in terms of making the purchase and moving forward with the project. It is a generally freestanding home. It's either folks who want to downsize substantially or in some cases it's a it's a second home, it's a vacation home or a remote dwelling.
Prefab Review
It's kind of consistent with the idea of small homes on your little plot in Maine or whatever. That's cool. So just sort of moving back towards, like kind of what you do at your core, do you own your own factory or are you mostly contracting with others for the actual modular construction?
BrightBuilt Home
Yeah, we partner with other factories, so we are an architectural firm. We were launched by an architecture firm and we are at our core, design. And so our mission has been very design driven and very systems driven. So we also wanted to have the ability to be fassl within the marketplace and not be limited to a restricted geographic area. So by structuring things in the way that we did, whereby we develop relationships and partnerships with various manufacturers, we're able to expand the geographic range in which we work. And so, yes, we don't own a factory of our own. We have currently three factories with which we're working, along the northeast eastern seaboard. And again, we're hoping to continue to build on that.
Prefab Review
That's awesome, you can pass if you don't want to, can you talk about which factories you work with?
BrightBuilt Home
Yeah, currently we're working with Simplex Homes in Pennsylvania, New England Homes/ Preferred Building Systems, that's two jointly owned companies under the same roof, in Vermont and New Hampshire and KBS builders.
Prefab Review
And so we talk to people with all different models. And that's great, by the way, because that means maybe we'll get some homes from you guys on the West Coast sooner or later. But so when you're doing diligence on a factory, like, will they be a good partner for us? And I know that one of the things that, some particularly now and I think there's a lot of demand for housing that I've heard from other firms like yours is, hey, it's actually hard to find a firm like on the West Coast, There’s some that build like, seven bespoke houses a year, that scale doesn't register. What are you looking for in the relationship with the factory?
BrightBuilt Home
It's a great question and every factory is so different in how they're set up and how they work, their history, how they were formed, where they are now. I think philosophically, we tend to gravitate toward the factories that are sort of based at least, or foundationally based in mom and pop thinking, and it's, I guess, pun intended, factories that are willing to think outside the box. So open mindedness and a willingness to be innovative with their processes. And some factories simply say flat out, it's not what we do. We don't want to bring in a specialty installation.
Prefab Review
Like a Champion Homes factory is probably not the place for you.
BrightBuilt Home
Right. If they're going to be doing mass production work, it probably isn't going to fit. So mom and pop style, family owned factories or factories that have been established for many years and aren't part of a larger mass-manufacturing consortium tend to be good fits for us because they have the flexibility in how they're set up to try and do new things. They're accustomed to doing custom work and custom builds. They're not doing mass production multiunit churn-outs on a recurring basis in order to to make their business model work.
Prefab Review
How do you, and this is a question I don't have the answer to, how do you assess quality? It's sort of an internal joke that every time we get a press release, someone says they build to a new, smaller quantity of precision, like we build to one sixty fourth of an inch, but we consider that to be sort of a vanity thing. But just in terms of saying like the quality that these people build too, we think it'll work, how do you assess that?
BrightBuilt Home
Well, we definitely try to visit the factory. We have conversations with the different builders and the different departments involved to get a sense of exactly how integrated they are as a unit. So finding companies that have in-house engineering, that have in-house drafting, that have in-house quality control and a follow up punch list, things like that, those are good indicators to us that it's a collective group that is invested in the final product. And certainly visiting the factory, walking the line, visually, inspecting the work that they're doing prior to when they're going to be producing one of our homes, the degree of openness they have to some of the specificity of our specifications. That's an important factor. If they push back on various elements of what we're asking to do with assembly and our detailing, that's usually a little bit of a flag to suggest, OK, if we're seeing pushback on the conceptual end, you're probably going to find difficulties in the follow through. So yeah, I mean, there are a number of factors that contribute to when we feel good about moving forward with a relationship.
Prefab Review
And then if I'm just a customer and I want to build your home, do I end up just doing a design contract with you and a production contract with the factory, or do I do both of those with you?
BrightBuilt Home
Essentially the former except that the contract for the production contract actually is a construction agreement with a site builder. So, you know, as you're probably well familiar, in most instances with prefab and particularly modular, the module manufacturer is separate from the site builder, the person who does the foundation and the stitch and all that stuff. So that entity, that builder, the local builder, the local boots on the ground, is the person who oversees the project from the foundation and all the site stage, all the way through to the arrival of the modules and finish out of the house after the fact. And it is through that person that the modules are ordered from the factory.
Prefab Review
So that person has a GC relationship over the whole process, over the construction.
BrightBuilt Home
Yes. So it's in some ways a traditional architecture relationship where the client contracts with us for the design and then a contract with the builder for the construction.
Prefab Review
So does that mean then in terms of talking about costs, does that mean that your business model, in terms of just kind of looking like an architect, you end up getting like 10 to 15 percent of the final figure?
BrightBuilt Home
What you said but not 10 to 15 percent? But yes. Yeah, it does. It does essentially look like that set up, that arrangement. Yeah, modern day. I will say that because this is what BrightBuilt has done, it has set up this entire process. As the project coordinator, an architectural designer who works directly with the client through the process is with the process all the way through. There isn't a point at which we say, OK, we're done here. We're sort of involved all the way through. There is a milestone or an event in which we we feel, what's the word I'm looking for, not philosophically, but figuratively pass the baton on to construction so that the client has a clear delineation of to whom they address their questions or they are running point with
Prefab Review
When you were laughing at costs, was that because you end up taking a higher or lower percentage of 10 to 15 percent?
BrightBuilt Home
At least on the East Coast, 10 to 15 percent would be very unusual and a high percentage, well, not extremely unusual for custom architectural work. Right. You can get 10 to 15 percent.
Prefab Review
So where do you end up? Do you end up being in the five percent range? What is more accurate?
BrightBuilt Home
So that's another value add, I think, with BrightBuilt is that you get effectively either a customized or semi-custom, you can even do a custom design with us for substantially lower architectural fees than you would find in any other architecture firm.
Prefab Review
Is that just because you have a lot of experience doing this? So you're kind of working off sort of that boilerplate negative, but sort of using somewhat set stuff. Or just try to understand, why are you able to drive better value?
BrightBuilt Home
It's because of the process that we put in place. So it is in part because we're starting in some cases from a known design. If someone's choosing a design from within our portfolio to start from, but then we have designed over a hundred and sixty homes in six years and no two of them have been alike. So while people may start from a common point, they invariably deviate from that. And we do some pretty significant modifications to the design to make it a home for the client, the home specific to the client and the client’s site.
Prefab Review
That makes sense. So one of the things that really varies based on the company is, there's a few companies we work with that are basically like if you want to change almost anything on the home outside of, like sort of cosmetic fixtures, they’re like, that doesn't work. And there are a bunch of companies that are basically the sort of designs we list on our website are more or less kind of advertisements and inspiration, but no one ever builds those. It sounds like you're a little closer to the latter in terms of your relationship with customers.
BrightBuilt Home
Those representative models are placeholders to serve as a starting point, but not necessarily what we have an exact facsimile of that, mostly just homes you've built in the past.
Prefab Review
So you sort of already have plans in at least engineering specific to those sites.
BrightBuilt Home
Well, the plans themselves were developed as a collective portfolio to launch BrightBuilt. So some of the plans initially were only renderings. They were just conceptual plans. So since, we've launched and planned homes derived from those plans.
Prefab Review
That makes sense, I was just looking at the website and some of them are actual photos.
BrightBuilt Home
We actually have built every single one of the designs currently shown in the portfolio. There are a few that are newer builds and so we don't have finished photography up yet. But all of those designs have now been built. With some variation.
Prefab Review
So if I'm building one of your homes, in let's say, I don't know, pick a wealthy suburb of Boston just because we tend to try to normalize our prices around expensive areas. So whatever, Lexington, Massachusetts or something. And I understand that there is a ton of variability, but let's assume a flat lot and let's assume a two thousand square foot house or something like that. Would you try to help me kind of break down, what the sort of costs might look like? And it sounds like there’s sort of like a module cost, a local building cost, design costs. Something might be a little separate. Whether it's on a per square foot basis or however, what might that end up looking like to customers?
BrightBuilt Home
Yeah, this is something obviously that we're pretty reticent to put out there as you know.
Prefab Review
And I totally understand why.
BrightBuilt Home
It is totally variable and even a flat site in Lexington does look very different from a flat site Maine.
Prefab Review
And I mean, the key difference, right, is local labor cost would be considerably more expensive. Right?
BrightBuilt Home
Yeah. And the other factor, too, is that one the one thing that I think has to be always understood, any time any pricing is explored by any client is what exactly that number includes. So I know that there are many different entities out there and many of them in some ways wisely,
Prefab Review
Slap a price for modules and it's not a true cost to build or something like that.
BrightBuilt Home
Sorry, I didn't catch that.
Prefab Review
I said we're you going to say slap a price on the cost for modules. But that isn't representative of
BrightBuilt Home
What I was going to say is just speak to the cost of the house itself and exclude site cost.
Prefab Review
Exactly, right.
BrightBuilt Home
But we have never done that. We have always talked about all numbers, all in turn-key, right.
Prefab Review
Which is totally the right way to do it in terms of like what most customers actually care about.
BrightBuilt Home
But that what that means then, is the cost per square foot numbers that I'm putting out there represent that turn-key number. They include the site. They include.
Prefab Review
Oh, yeah,we do the same thing. Yeah.
BrightBuilt Home
So what we're seeing right now and right now, as you are probably well aware of the numbers, lumber is expensive, wildly, just in almost a weekly to a monthly basis.
Prefab Review
We're speaking on March 3rd, 2021 everyone.
BrightBuilt Home
Yes. So right now, at this point in time, lumber costs have even doubled or tripled in just the last three months. So what we are seeing in current day pricing ranges from about $250 - $325 per square foot, I would say for fairly, but nothing that has marble entire interior. Where the variables are fairly known and fairly the middle in terms of selection. So basic but not blowing the roof off again. And that's about the price point. Now, of course, it can go up to $350 - $375 as those variables increase as site costs become more expensive.
Prefab Review
And you're saying those are generally the ranges. So you're saying so if we were talking about like an expensive Boston suburb, like the one I mentioned, you would be in the kind of $300+ per square foot probably.
BrightBuilt Home
I would say we would be starting at $300 - $320 per square foot in the really high end markets. But that said, that is another advantage that we offer, particularly in those really high end markets,
Prefab Review
Because you have cost arbitrage on some of the process.
BrightBuilt Home
Right. Yeah. I mean, you're not doing everything from start to finish with the local labor pool and with the local labor costs. And so you're offsetting a substantial portion and up to 70 percent of the build out of the home is being done elsewhere, where labor rates are typically lower than your local region. And so you're able to offset and that's not to disparage. I mean, that's its own philosophical question, I guess, right there. But that said, as far as the consumer goes, if you are in a high end market. Taking advantage of off site, taking advantage of prefab can make a ton of sense to be far more competitive as a possible .
Prefab Review
We've also found that it's just less annoying from a logistical standpoint of trying to get all your subs lined up in these areas that have a pretty high demand as well. So, yeah, we're obviously a believer in that as an advantage. And there's a reason that I think many of our kind of popular markets are areas that are either very expensive, very seasonal: meaning like a ski area where there's a short building window, like have a fire, right. Like all these areas that kind of have like sort of peaking demand. It seems like it's a good way of offsetting that. Yeah, absolutely. So how do most customers find you?
BrightBuilt Home
Really through organic searches on Google search words? We do have a strong we have a very strong readership of our newsletter. But of course, that's after they found us. So before Covid, we would have a lot of events and we would go to some local shows and various places where we would be able to get word out to people who were looking for homes and could be exposed to us that way. But yeah, I would say the vast majority of people find us through just organic searches, looking for net zero homes, modular High-Performance, various typical search words.
Prefab Review
That make sense. When we're talking about kind of the emphasis on high performance homes with you all, how far down, we've had people go very far down that rabbit hole and in a good way, but are you looking for certain rates of insulation or is it mostly just like we want to offset the amount of energy in the home with whatever PV solar panels. Yeah. What are sort of the extent of that detail that you emphasize? And does that depend on a customer basis or is that just a general standard?
BrightBuilt Home
We definitely have a very preordained standard for performance. We are striving to design and build homes that have good amounts of insulation in the walls, good amounts of insulation in the roof, the foundation. High-Performance window packages, so the envelope, the building shell is very important to us and we've developed our specific specifications around that. And that then means that the overall heating and cooling requirements of the home are substantially reduced and therefore it takes a lot less of a solar array or input of energy to run the home. So getting to net zero is much more achievable. And in terms of, yes, there are some initial upfront capital costs in doing that. But what that also means is that from day one, you're out-of-pocket costs are less than they would have been if you had built a code standard home. So the cost of utilities, cost of heating and cooling, a home that isn't high performance means that literally from day one, you're saving money. Well, if you go for the high performance, then offset that with solar and go for net zero. So, yes, the building performance is a key element to our principles and our philosophy as a company.
Prefab Review
That's awesome. OK, so it's been awesome learning a bit about your company. I want to move on, because we have an expert like you on the call, to our fire around. These are like a handful of questions of one minute or less, and they're mostly questions we get from our audience. So it's great to have people like you, so pass on anything you don't know about or want to pass on. But your input is great. So one of the questions being a company from Maine is we occasionally get requests asking about modular for islands. And I know there are a number of islands off the coast of Maine. Do you have experience shipping modules to islands or looking into that?
BrightBuilt Home
We do. We have done it. And we have a couple of our projects that are islands. There are more than just a few islands off the coast of Maine. We have thousands and many of them are occupied and built on its I guess because of that we have some infrastructure in place in the state of Maine and there are various transportation barge companies that can bring heavy equipment out to islands. And you don't even necessarily need a bona fide ferry for offloading those. In fact, oftentimes the big equipment gets offloaded onto beaches or specific boat ramps because it's easier to transfer from a barge to those surfaces.
Prefab Review
Do you end up having to bring cranes out as well for that stuff?
BrightBuilt Home
You always have to bring crane .
Prefab Review
And just curious, what does that add in cost? I mean, we've done a little bit this is a crazy extension of going West Coast to Hawaii. I think that adds about 50 dollars a square foot, which I assume is probably more than this adds. But just curious.
BrightBuilt Home
Well, that actually sounds less because what we usually see is about a 25 to 30 percent island up charge.
Prefab Review
Oh, really? OK, so maybe we're getting good value there. I guess usually the things they come on are a little bit they're probably a little more industrial in terms of the ship size.
BrightBuilt Home
Yeah, I guess it's not even a comparative. They're used to shipping things there.
Prefab Review
Exactly. Yeah. Interesting. OK, so what are the things to look for as a consumer when understanding and feasibility? We get this question a lot like, hey, this piece of land looks good and we actually obviously have a checklist we send to people. But what are the things you tell customers to look for?
BrightBuilt Home
For land, well, up here we tell people to look out for any. for any signs of ledge, because that can mean a very expensive excavation if you have to blast, we also recommend that the building site is as close to the road or the utilities connections as possible, because if you make a longer driveway and or go deeper into property, it adds substantial cost. For our homes where we are looking to do net zero and we're taking advantage of solar and radiant heat. We advise that the quote unquote backyard or private side of the home be facing south. We're going to have with biggest windows possible and really just have it wide open to the sun. And so ideally, that's not also the road facing side of the house, if possible. So, yeah, those are the main factors, I'd say distance from the road or just to utilities. To some degree how much clearing is required. We happen to live in Maine, in the state that is the most forested in the entire country. And so clearing trees has sort of a different mentality than it does elsewhere. But ideally, we're not clearing trees if possible.
Prefab Review
That makes sense. ne thing that we have people flag, I feel like there's usually a way around this, but is power lines. How much of an issue is that like being kind of in the way of where crane would be? Or do you usually find a way around that?
BrightBuilt Home
We usually find a way around it pretty easily in very tight urban infill sites it might be an issue. It's not generally an insurmountable issue. There are circumstances in which we have to take lines down for the day, the day that the crane is setting the modules. So that's an inconvenience, obviously, to the neighbor. But I would say that's extremely rare. So usually it's something you can work around pretty easily.
Prefab Review
Last one, if I'm doing a modular project, and maybe you all do this, when should I start working with a landscape designer and an interior designer? Because that's sort of contributing to design parts of home.
BrightBuilt Home
I think in any case, any time you have an integrated team or an integrated design team, the sooner the better, really. So that everybody is involved in the dialog from the get go and understands the evolution of the process. That said. I would say that in terms of sequencing. You would want to start with at least the initial conceptual ideas of the architectural plans first, and once you have the concept taking shape, bringing the interior designer in at that point would make sense. And as things further take shape and you have a house that's clearly situated in a site, that's when it's good for the landscape architect to become involved.
Prefab Review
Especially in areas that have design review end up, definitely feels like bringing the landscape designer in pretty early.
BrightBuilt Home
We live in no man's land up here where some places like in Vermont and in some towns in Maine, there is no code, there is no review. And so it's very different from the West Coast where things are very meticulously reviewed. So it depends on where you are. Landscape architects may have much more of a pivotal role in its early stages.
Prefab Review
Yeah, cool. Well, it's been awesome learning a bunch more about your company. It sounds like you all are doing really cool work. Final question before we get you out of here, what are you most excited about for your company or for the industry for the near future?
BrightBuilt Home
I'm most excited about how excited the marketplace is getting about prefab. It really to me has always made so much sense. And the analogy that is commonly used in the industry you're probably very familiar with, is the idea of you wouldn't build a car, you wouldn't order a car and have them come and bring all the loose parts to your driveway and assemble the car for you. And yet that's still how we build houses, which just seems to me to be preposterous, especially when you see it in that context. So I'm just really excited that there seems to be a groundswell of interest and excitement about prefab and construction and and locked in with that, the opportunity to build high performance, better performing homes is a tremendous gain for us as a country and as a marketplace and just as the residential building sector in general. I think there's a lot of potential. There's a lot of excitement in what lies ahead. And I think prefab is the perfect fit for what's coming down the pike.
Prefab Review
So we're certainly biased, but very much agree with you on all that. Thanks again. For more information for everyone about Parlin and BrightBuilt Home, you can visit their website, www.brightbuilthome.com. And as always, you can visit us at prefabreview.com. Thanks again.
BrightBuilt Home
Thank you so much.