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Dive brief:
- San Francisco-based builder Webcor has joined a list of general contractors with internally financed arms through Webcor Venturesa new entity designed to boost construction company investment in emerging construction solutions, announced on November 15.
- Webcor Ventures placed its inaugural investment in Oakland, Calif.-based modular construction company R2 Building, according to the press release. Webcor acquired a 10 percent stake in the business, according to Rochelle Buckner, the contractor’s communications manager.
- Webcor said the investment aligns with its commitment to innovative and sustainable construction methods that address key industry challenges such as efficiency and productivity, affordability, speed to market and scarcity of labor, according to the press release. It follows in the footsteps of other builders with venture capital arms, including Boston-based Suffolk, which runs Suffolk Technologies, and Redwood City, Calif.-based DPR Construction, which owns WND Ventures.
Diving knowledge:
Webcor makes this investment as the US modular construction market is expected to grow from $21.49 billion in 2023 to $34.82 billion in 2030, according to the press release.
R2 Building bases its construction model on cruise ship construction, according to its website. The company recently launched its Type I non-combustible steel building system for high-rise construction, which includes precast foundations, unified stair towers, elevator towers and mechanical shafts, along with models of complete apartments, according to the release.
“Randy Miller and the team at R2 Building bring a wealth of knowledge and experience in the highly complex industrialized construction market,” Matt Rossie, president and CEO of Webcor, said in the statement.
Webcor’s involvement will allow both companies to scale their efforts while benefiting from shared expertise, according to the builder.
However, the field is not without drawbacks, while modular construction presents fewer hazards in the workplace that the traditional building is not entirely free of risks. Contractors looking to incorporate modular buildings into their workflow can do so you will find a steep learning curve and issues throughout the manufacturing process, such as design, assembly, and transportation.
In addition, the failure of modular construction giant Katerra in 2021 sent shock waves through the industry and served as a warning about the pitfalls of modular construction.
