I would like to see all loitering and vagrancy laws removed from the books. A homeless person is not loitering, they are surviving. Shift the war on the poor to a real war on poverty. This will have positive effects all through the Affordable Housing system and it is cheaper to provide housing than it is to keep someone in jail.
In many large cities in the US, there is a crisis caused by a shortage of affordable housing options. This has led to a host of social challenges. In this series called “How We Are Helping To Make Housing More Affordable” We are talking to successful business leaders, real estate leaders, and builders, who share the initiatives they are undertaking to create more affordable housing options in the US.
As a part of this series, we had the pleasure of interviewing Ed Macnab, CEO of 3DPHC — 3D Printed Homes Corporation
He should have retired a couple of years ago but, before he could, he got himself tangled up with a couple of guys that thought that Construction 3D Printing could be one solution to the Affordable Housing crisis in Canada and around the world. He brings a broad base of experience in construction and the oilpatch, electronics and IT, and various startups including a tech venture, Futurelink Distribution Ltd., that grew to a market cap of over 600 million dollars, and then finishing as an International Project Manager for Pomeroy IT Solutions. He is now evolving into an advocate for Construction 3D Printing on the international stage.
Thank you so much for doing this with us! Before we dig in, our readers would like to get to know you a bit more. Can you tell us a bit about your “backstory”? What led you to this particular career path?
This is really a post-career for me, but it’s really important that Affordable Housing and Housing Affordability be addressed now. Canada and the US have faced homelessness and housing affordability issues for many years, and it is now spectacularly out of control. Conventional construction cannot keep up with demand, and builders are powerless to control their costs to the extent necessary. Building materials are forever increasing in price. Canada faces a persistent shortage of skilled tradespeople. It takes months to build a house and, when it is done, the price is beyond the reach of more than half our citizens. This is pushing more people into the rental market, forcing those prices ever upwards. Affordable Housing is now a survival requirement for a lot of families: and it is something increasingly difficult to access. We’re driven to change that.
Construction 3D Printing can build small and medium-sized houses, ready for finishing, in a day or two. The process is automated, so our construction workers carry iPads instead of SkilSaws. The machine works through the night, and it doesn’t stop for lunch, coffee, or smoke breaks. The process wastes nearly nothing, resulting in fewer trips to the landfill with offcuts and scraps. The finished structure is strong, robust, energy-efficient, fire-resistant, and resilient, and this matters to landlords as much as homeowners.
Can you share the most interesting story that happened to you since you began your career?
Shortly after we incorporated, our bank invited us to participate in their small-audience, local crowdfunding program. We put together the required content and set a very modest target of 5000.00 dollars.
We hit our goal!
This validation from outside our small Team was a very real inspiration and affirmation that we were on the right track.
Are you able to identify a “tipping point” in your career when you started to see success? Did you start doing anything different? Are there takeaways or lessons that others can learn from that?
We have done no conventional marketing or advertising but we are getting noticed. Through social media and our website we now have nearly a hundred early adopters that want us to build their homes. This is a pretty large pre-order book and a real-world validation that we are on to something big. Our profile is now high enough that I am getting invited to podcasts and speaking engagements. In April I discussed 3DPHC’s value proposition at the Canadian Housing and Renewal Association’s Innovation Forum on their panel, “Building Better: Contrasting Innovative Approaches to Housing Construction”.
Every startup would do well to ensure that they have someone on their team that is comfortable in a public speaking role. Make sure that they know their stuff and make them available.
None of us are able to achieve success without some help along the way. Is there a particular person to whom you are grateful who helped get you to where you are? Can you share a story about that?
Twenty-five years ago, I had the pleasure of working a startup with Cameron Chell, a tireless Olympic Athlete with an amazing capacity for work. We started a venture with almost nothing and built it into an IT juggernaut. Along the way, we invented cloud computing and video-on-demand, though they both failed. They were ahead of their time and the bandwidth infrastructure did not yet perform as needed for those products. Cameron’s attitude and refusal to “think small” stuck with me, and I owe him for that. He was then and still is a “local Elon Musk.”
Do you have a book, podcast, or talk that’s had a deep impact on your thinking? Can you share a story with us? Can you explain why it was so resonant with you?
I do. The small book “Utopia for Realists” by Rutger Bregman remains a driving force to my thinking. In the book, he notes several social experiments around the world that have succeeded in eliminating poverty and homelessness. The formula is remarkably simple and one of the most successful pilot programs happened here in Canada from 1974 through 1979, when a change in government killed the program. The residents of Dauphin, Manitoba were given what amounts to “free money” as a basic minimum income to lift them above the poverty line. More people worked, people’s health improved, crime went down, homelessness ended, alcohol and spousal abuse dropped, and a lot more kids finished high school. The experiment was a raging success and it was killed out of political ideology. Wikipedia has a decent article about it under the search term “Mincome.”
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
Sure. William Gibson wrote, “The future is already here — it’s just not very evenly distributed.” It is a simple truth that, while innovations can be conceived anywhere, they get developed most often in first world countries This continues to shift wealth and comfort to the places where it is least needed. At 3DPHC we certainly intend to take care of Canadians first, but we already have plans to take this technology to the Caribbean where hurricane-resistant housing is desperately needed. We want to move the future out to where it is needed most.
Ok super. Let’s now shift to the main part of our discussion about the shortage of affordable housing. Lack of affordable housing has been a problem for a long time in the United States. But it seems that it has gotten a lot worse over the past five years, particularly in the large cities. I know this is a huge topic, but for the benefit of our readers can you briefly explain to our readers what brought us to this place? Where did this crisis come from?
This is a really complex question, and my answer is just as relevant to the USA as it is to Canada.
First, let’s define Affordable Housing as housing for which either the monthly rent, the purchase price, or the financing is subsidized by some level of government, a charity, or a humanitarian organization. Some jurisdictions call this Community Housing.
For longer than I have been alive, a house on a small plot of land has been viewed, perhaps subconsciously, as a commodity as much as a home. As a commodity, we hope that its value will increase and be a backstop for our financial wellbeing in our golden years. This is really hard to argue against because our whole financial wellbeing model is based on it. Everyone wants and most of us need our house to appreciate in value. The real estate brokerage and resale business depends on this continuing. That’s one factor.
Conventional building methods are time-consuming and labor-intensive. We face a persistent shortage of skilled labor needed to build more housing. This is a drag on construction times. Materials are subject to price vagaries that are out of our control and ever-increasing. The process of starting with pre-sized lumber, plywood, and drywall is inherently wasteful as pieces are cut to fit, with the offcuts resigned to the landfill. That’s a second factor.
In addition, government policy at all levels, no matter how well-intended, has hamstrung efforts to build more housing of all types. For one, grant and loan programs tend to be narrowly focused, complicated to qualify for, and the application process has been difficult and time-consuming. When added to local NIMBYISM, it’s a wonder any projects get completed. Those are just two issues that make it difficult to create a more Affordable Housing supply. There are many more. Combined, they’ve played a significant role in allowing housing demand to outpace supply, driving costs of all types of housing upward.
Now, Generation Squeeze reports that it takes prospective home buyers far longer to purchase a home than ever before. For example, it will take the average person twenty-eight years to save up a twenty percent down payment for a home in the Greater Toronto Area. For more vulnerable groups in need of affordable housing, it often means that they can’t access housing that they can afford or that meets their needs at all. As more people are priced out of the homeownership market, they must rely on rental and Affordable Housing options.
It’s a perfect storm in an industry that hasn’t seen a disruptive innovation since the invention of gypsum drywall over 100 years ago. The situation is dire, and yet there is hope: governments, businesses, and support organizations are beginning to unite in their desire to address Affordable Housing shortfalls. But, the only way to make up for the lost time is to build more quickly, more efficiently, and more sustainably. The key? 3DPHC homes.
Can you describe to our readers how your work is making an impact to address this crisis? Can you share some of the initiatives you are leading to help correct this issue?
Construction 3D Printing is, in a very real way, bringing robotics to the construction industry, with all the advantages that come from automation of dangerous or repetitive tasks.
By automating the heavy lifting and the scaffold work we open construction jobs to those in wheelchairs or even housebound individuals working remotely. You no longer need to be “a strapping young man” to be a construction worker. This is a great way to entice young and imaginative people to work in the industry.
Since so much of the work is automated, we can cut construction time from months to days.
The print material is mixed on-demand so waste is negligible. This reduces cost and is obviously good for the environment.
Even though construction costs are reduced by 30–50%, the finished structure is more elegant and artistic, more durable, weather-resistant, and cheaper to operate than a conventional house. Passive House or other energy efficiency standards become easier to achieve and less expensive to implement.
Our first focus will be retail construction of tiny homes and backyard suites, facilitating age-in-place for our senior citizens or young people leaving the nest, and for transitional housing for recent immigrants and the homeless. Zoning approvals are already in place in cities large and small, with more on the horizon so we can generate cash flow almost immediately. This will sustain us while we wait for the bureaucracy to approve and finance larger Affordable Housing projects.
Our second, and parallel focus will be to construct Affordable Housing installations consisting of twenty or more small homes around a community centre, whether they are intended for transitional housing, low-income families, homeless veterans, or seniors.
A follow-on consequence of building more economically with 3D Printing is that Affordable Housing providers are left with more money in their reserve funds. This reserve can act as a kickstart to their next project or be used to enhance social services to their clients. Because their living units cost less at the outset and less to maintain, the total amount of taxpayer money required for subsidies is reduced, so we all win. Because the units are cheaper heat and cool, the residents benefit from smaller monthly outlays for utilities.
As this technology matures and we gain experience, we expect to be called upon to build high-rise apartment buildings for Affordable Housing providers as well.
Can you share something about your work that makes you most proud? Is there a particular story or incident that you found most uplifting?
It has to be our Team’s extraordinary dedication to the cause of reducing homelessness and housing stress. Every one of us knows, deep to the core, that this is a ‘righteous mission” and that we will succeed. We have had several requests to print very large houses, ranging from 4000 to 12000 square feet. While we haven’t turned them down flat, we have told them that their request must go to the back of the line, to be built only if we have a machine idle and not doing our preferred work. It’s paramount to our cause that we build homes that will be affordable to every demographic.
In your opinion, what should other home builders do to further address these problems?
They have a choice for a while yet, but just like with any other emerging technologies, you have to adapt or fall by the wayside.
They can continue to do what they have been doing all along, building homes in the upper price stratum, or they can innovate and make their products more accessible to more people. The first option is safe in the near term. Housing demand is high enough that they will be able to sell everything that they build, but that won’t last forever.
The second option carries some risk, but failure to innovate will result in being priced out of the market for all but a very few custom builders.
We honestly expect that conventional housebuilders will end up using Construction 3D Printing to erect the vertical walls in record time, then use their existing finishing crews to create upscale or extravagant interiors for their well-heeled clients. We can see contract 3D print companies springing up to fit this new niche.
Of course, now that the power of digital construction has been unleashed, there should be a continuous stream of innovation in this space. We should expect to see some wild, exotic, futuristic designs get built fairly soon.
Can you share three things that the community and society can do to help you address the root of this crisis? Can you give some examples?
One of the biggest impediments to innovations in housing is that big boogeyman, NIMBYISM, and it has deep roots. It is a sad truth that rich people don’t like poorer people moving into their neighborhoods. People in million-dollar houses don’t want Affordable Housing complexes built on their block. This is, I think, rooted in the cultural philosophy that YOUR house is an investment asset and its appreciation in value is critical to your financial wellbeing. We need to understand, on a gut level, that the less well-off have a right to a decent home and the dignity that comes with housing security.
Another major impediment to the rapid rollout of this, or any potentially disruptive technology, is the entrenched standards and permitting processes. As of today, there are no standards for Construction 3D Printing so every new printed building will have to rely on regulatory exemptions. That is time-consuming and expensive. There is an active ISO/ASTM Working Group that is drafting the necessary standards, and 3DPHC has two of our Directors sitting on that working group. This technology, its processes, and its materials are new and building inspectors quite rightly rely very heavily on old knowledge to do their jobs and ensure that our homes are safely built. We have to prove to them that our methods are as safe as or safer than the old ways, and we are working on that.
Closely related to both NIMBYISM and the inspection and permitting process is the often cumbersome ordeal of getting municipalities to provide properly zoned and serviced land for Affordable Housing and then approve the development permits. It doesn’t seem to matter if the city is undertaking the project or if it is being managed by a third-party agency, suitable land is terribly difficult to acquire. We see real progress on this front all across the USA and Canada, but we need more municipalities to join in, freeing up land for community housing. If you live somewhere that does not have a “Red Tape Reduction” strategy in place, start talking to your councilors, representatives, and senators. Make some noise.
If you had the power to influence legislation, are there laws which you would like to see introduced that might help you in your work?
First, I would like to see all loitering and vagrancy laws removed from the books. A homeless person is not loitering, they are surviving. Shift the war on the poor to a real war on poverty. This will have positive effects all through the Affordable Housing system and it is cheaper to provide housing than it is to keep someone in jail.
Second, and we are seeing this in some jurisdictions, I would like to see it mandated that every new subdivision be required to implement a percentage of the living units dedicated to Affordable Housing. If the builders won’t do it voluntarily, then force them to either do it or provide serviced land for an agency that will. We will gladly build on land specially dedicated to their Affordable Housing commitment.
What are your “5 things I wish someone told me when I first started leading my company” and why? Please share a story or example for each.
- I was told that the journey would be hard, and starting on a very tight budget only increases the challenge. It’s even harder than I anticipated. There is so much to do and if you are poorly funded at the start, everyone has to take on a bigger share of the necessary duties. There will be more hats to wear than heads to put them on. Each member of your founding Team must be willing to take on tasks that make them uncomfortable. The CEO’s job is, in part, to help them stretch and do more than they thought they could. For a while, I was CEO, CFO, CTO, Sales Manager, Business Relationships Manager, and the public face of the company. As CEO, be prepared to annoy some of your partners some of the time. Your founding partners are also entrepreneurs and, as such, they are smart, strong-willed people. You will sometimes be challenged to keep the Team on track. In the earliest days, it was all excitement and consensus because the ideas and objectives were really big, loosely defined, and off in the future. As we approach our goals and define our focus, different viewpoints must be heard and carefully considered. Our best example is that the as-printed walls have a distinct texture to their finish. Some of the Team love it and see it as a feature. Others see it as so weird that it MUST be covered up or smooth-coated. Obviously, we will let the market decide and will plan for a mixture of both.
- As you sweat bullets working to forge business relationships and partnerships, expect some to fail. It seems that every first meeting, no matter who initiated it, goes really well as you get to know each other. There is shared excitement and that is invigorating. Inevitably some will fall by the wayside and some of those will be major disappointments. Not everyone sees your vision and others will want you to prove yourself before they join your quest. Others may see your vision and be afraid of it. Dust yourself off and go meet more people. We have lost budding relationships with desirable business partners only to discover that the next one was far more suitable.
- Social media can be a powerful tool for start-up companies. Learning how to use the tools properly, making content that starts people talking, and engaging strongly with your community all help in amazing ways. When we decided to emerge from the shadows, we used only social media. We started making small announcements about milestones and accomplishments. We referred people to our website and the Contact Us page. Momentum built organically and our message gained traction, leading to requests for pre-sales. Now, here I am being interviewed for a major magazine, all due to social media.
- And lastly, government officials and agencies actually want to help you … it just doesn’t seem like it. This one may be hard to wrap your head around because you have likely heard a thousand stories to the contrary, but my experience has been largely positive. If you go into meetings with these folks, make sure that you understand their mandate. That is “What could they do for you under the right circumstances?” Once you know their mandate, do your homework to make sure that you are at least close to a good fit for their program. Be upbeat, positive, and friendly. Remember, you are asking them for help. Whether you are asking for money, advice, or networking connections.
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
I want people who are relatively well-off to understand that safe and affordable housing should be a right and that we as a society must internalize that feeling until it becomes a driving force in our lives. Safe and affordable housing has so many knock-on benefits that it’s hard to list them all, but here are a few.
- Reliable and secure housing is mental health care.
- Secure housing is addiction reduction.
- Safe housing is a crime reduction strategy.
- Reliable housing aids in domestic abuse reduction.
- Affordable housing increases workplace participation and reduces unemployment.
Community Housing, Affordable Housing, Housing First, and Right to Housing organizations exist all across the USA, Canada, and the developed world. Find one, join up, and contribute what you can, even if all you can do is spread their word across your social media.
Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might just see this, especially if we tag them. 🙂
I have to cheat here, because there are two, and for opposite reasons.
Angela Merkel, former Chancellor of Germany, is the ultimate model of strength in the face of adversity. As CEO of a startup company, I need some of that as we face challenges at every step of our development.
At the same time, I think every entrepreneur admires Elon Musk to some extent. The man seems to have infinite energy and a grand imagination. More than anyone he has decided that he will simply make the future he wants and ignore the naysayers. His willingness to fail is legendary. If he could sit still long enough for a lunch, I would be most honoured.
How can our readers further follow your work online?
This was very meaningful, thank you so much, and we wish you only continued success.