Globalisation Impacts Housing Forms

Thursday, April 9th, 2015
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Ever since the steel shipping container first came into use in the late 1950s, it has affected global commerce in myriad ways. More than 17 million shipping containers are currently in service around the world, according to industry group the World Shipping Council.

The containers are made of Cor-Ten steel, weigh about 3,600 kilograms each, can be stacked up to seven units high, and come in lengths of 20, 40, 45, and 53 feet. Because of their inherent strength, and also because they are plentiful in countries that import more goods via container than they export, a few are being used not for transporting goods around the globe, but for buildings.

This is perhaps the most obvious sign that globalisation impacts housing forms.

An American developer has built multi-unit, code-approved housing from recycled containers. Christian Salvati is managing partner of Marengo Structures in New York. His company has built what he claims is the largest code-approved container project in the US in New Haven, Connecticut. Using 27 previously used containers, Salvati has created an apartment building with six 100 square metre units, each with two bedrooms and 1.75 baths.

Building the project using containers has been different than building wood-framed structures, Salvati said. Contractors don’t know how to bid the project, so give bids that are “ridiculously high” because they’re unfamiliar with working with metal.

“It’s not complicated,” Salvati said. “You’re cutting through metal. I buy drill bits for a wood project, and might use five drill bits for an entire project. We use five drill bits a day (on a container project.)”


Salvati’s team prefabricated much of the structure off-site, then assembled all 27 containers on-site and began joining them. He uses double-pane windows with fibreglass frames and low-E glass. Insulation is a combination of rock wool and sprayed foam. Salvati said he likes using rock wool because it’s a “by-product of the industrial world,” and because it doesn’t burn.

Some builders have criticised the use of containers because of the presence of toxic pesticides in the wood floors of the containers. Salvati has addressed this with 7.5-centimetre poured concrete floors on the first floor, and wood floors on the second floor that use an encapsulating spray finish. Future projects will have all floors use poured concrete because it stiffens the entire structure.

“It’s a monolithic structure that holds the heat,” Salvati said.

Building codes have proven to be a challenge, according to Salvati.

“One of the biggest issues in terms of dealing with local authorities is that this is completely new,” he said. “They don’t have anyone to call. There are very few people that have built with containers. And even fewer inspectors who are versed in container construction.”

Compared to a stick-built project, Salvati said, where he builds up and in, with container builds “we start with the object, and we make the cutouts we need. So basically, you already have the space, you just have to transform the space such that you can accommodate what you want to put in.”

After the structure is assembled, interior processes differ little.

“In terms of the interiors of the building, it’s standard,” Salvati said.


From a cost perspective, Salvati said the project was about 25 to 30 per cent less than a standard project, but also required extensive oversight of contractors because of their unfamiliarity with a different way of building.

Australian builder NovaDeko has taken a different approach by factory-building modular homes to container size of either 2.4 or 3.4 metres wide. This allows them to make use of the global shipping infrastructure to transport their finished homes anywhere via ship, rail, and truck.

Matt Chernishov, the company’s Australian national manager, said the company can build new pre-fab homes cheaper than re-using containers.

“We build all of our homes from individual members of steel at a rate that is cheaper than buying second hand containers,” he said. “Much of the steel used in our homes was once a car or an old shipping container or an old steel building.”

Factory construction offers potential advantages over site-built homes, Chernishov noted.

“Labour is significantly reduced because there is no carting to and from a building site,” he said. “Pods are easy to access (not on a sloping site in wind, rain and mud). No need for scaffolding or working at heights, we have all of the safety gear available on wheels and on a flat surface.”

Thanks to the factory location in low-cost China, the overall cost can also be much lower than site-built homes in high-cost countries.

“It’s not cheaper even in China to reuse shipping containers,” Chernishov said. “In China, used shipping containers are in demand for export. In import-heavy countries like Australia or the UK, shipping containers are cheap because it is too expensive to send them back empty to China, however the cost of labour and other materials to build homes with them is very high.”

In addition, Chernishov noted, building homes in China also yields savings in material costs.

“Overall production cost is significantly reduced because materials are sourced directly from manufacturers in China,” he said. “Most western building materials are made or processed in China so there is no retailer margin on any of the materials that we use.”

NovaDeko has created a system to sell homes much like any other consumer good. Consumers go online, choose the model and features, choose the delivery option, and pay. They still need to arrange for permits and site work such as the foundation and utility hookups, but it’s now simple to just go online, buy a home, and have it delivered a few weeks later.

Looking at the designs, both Salvati and NovaDeko have produced attractive options. Sticking with container dimensions, 2.4 metres in width does not yield a feeling of roominess, so this style of building will probably remain a niche. Joining two or more units of 2.4 metres width addresses that issue, maintaining their ease of transport with standard options, while adding cost and complexity.

As for overall cost, that will certainly be one of the main drivers. Salvati said he’s saving substantial money – roughly 25 to 30 per cent – using recycled containers, and he expects to save more as he builds more units.

NovaDeko has been unable recycle containers cost-effectively, so the company builds from scratch in its Chinese factory. The company offers two-bedroom, one-bath homes for around $76,000, which does not include kitchen appliances, site work, and several other necessities. That does not represent the cost for a complete home, but is an attractive price point.


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