ENIAC, the first general-purpose electronic computer, 1946 – Photography courtesy of the US Army. U.S.[/caption]
[Originally published 2nd quarter 2011, in arcCA 11.2, “The Business of Architecture.”]
__________
Author MacKenzie Smith is Research Director for the MIT Libraries and consults widely on digital library technology and policy issues.
__________
In 1963, the very first interactive CAD software—SKETCHPAD—emerged from MIT and enthralled designers across a wide range of industries, quickly reaching architecture and now established as the default tool for modern building design. AutoCAD, Revit, Digital Project, Microstation, Rhino, Maya: the list of software products that architects depend on is long and growing. In particular, 3D CAD parametric modeling was the enabling technology behind a wave of creativity. From Gehry’s Guggenheim Museum to Jeanne Gang’s Aqua Tower, any complex shape imaginable could be attempted with the help of software that encodes the laws of physics. But while using 3D CAD may have sparked a revolution in building design and a new era of creativity, it has a down side. Writing CAD software is not something an architect learns to do in school; it requires incredibly sophisticated programming. In fact, there are only a handful of geometric modeling kernels underlying all the hundreds of available 3-D CAD software systems. So CAD is an incredibly powerful tool for architects but creates a new dependency on the companies that create and sell that software. CAD is a highly competitive industry, and therefore highly secretive and proprietary. Having a better, faster technique for translating shapes on a screen into geometric formulas is what sells one software product over another.
An even more insidious side effect of CAD use in architecture is found in the world of architecture libraries and archives. Architectural practice aspires to constant innovation, but begins by understanding the past. Libraries and archives have always stood guard over the collective history of architecture and design, stewarding millions of drawings, plans, elevations, blueprints, images, correspondence, project records, and so on. These archives are used to train each new generation of architects and document the history of the profession. Architectural historians and researchers from a wide range of disciplines depend on these archives. While the need for these libraries and archives is unchanged, their ability to steward the records of the digital era is under enormous pressure.
[caption id="attachment_19890" align="alignleft" width="250"]
top, U.S. Institute of Peace, Safdie Architects, photo by Timothy Hursley / bottom, Ray and Maria Stata Center, MIT, Ghery Partners, photo in the public domain[/caption]
When records are digital, preserving them involves saving bits rather than atoms. But successfully saving bits isn’t enough, because every digital document depends on software to make use of it. Looking at a twenty-year-old digital article or image is often frustrating, since the software needed to open it is long gone—remember WordStar or VisiCalc? How would you study a SKETCHPAD design if you happened to find one? The challenges of preserving digital documents are as complex as those of creating the software in the first place, especially complex software like CAD.
For many firms, a typical building project archive now consists of a hard drive containing tens of thousands of digital files: 3D models, 2D drawing sets, emails, spreadsheets, images, videos, RFIs, ASIs, and more, all in their original formats and lacking any tags or metadata to help identify the files or relate them to each other. One 3D CAD model might consist of a dozen interrelated files, named by whatever convention the 3D software product happened to use. Figuring out which files belong together and how to open them takes insider knowledge that usually stops with the project architect.
And since the software products are usually upgraded every few years, a CAD model created just a few years ago may not open with the current version of the same software. Even software that provides tools to migrate a model from an older to a newer version may unintentionally introduce changes to the design object. To illustrate what can go wrong with CAD software versions, in 2006 the Airbus A380 airplane was delayed by a year at a cost of $2.5 billion due to use of different versions of CATIA in the design process by different divisions of the company. The versions were incompatible, so that designs for the wiring system done by one group couldn’t be integrated into the 3-D model produced by the other group.
As architecture libraries and archives have begun to get digital records for building projects, they are starting to work on strategies to cope with some of these challenges. At MIT, we conducted a two-year project called FACADE (Future-proofing Architectural Computer-Aided Design) to study the problem of what to keep from the project hard drives, how to tag them for future discoverability, and how to preserve the 2D drawings and 3D models for posterity. With the help and inspiration of the late Bill Mitchell at the School of Architecture and Planning, we collected records for three notable buildings that had made heavy use of CAD as our research collection. The oldest was Morphosis’s Caltrans District 7 Headquarters in LA (Bentley), followed by Frank Gehry’s Stata Center at MIT (CATIA), and finally Moshe Safdie’s U.S. Institute of Peace in Washington D.C. (Revit). These project records collectively provided excellent examples of the digital preservation problems, and with them we were able to work through a number of possible approaches to saving digital archives for posterity.
While the strategies we developed weren’t simple, we found that there are things that can be done to improve the chances of survival of these records, and that they’re worth saving.
First, keep everything in its original format, and the software used to create it. While it’s likely possible to find a copy of Microsoft Word 2007 in 2017, copies of specialized 3-D modeling software will be harder to come by. Keep in mind, though, that a lot of CAD software runs on desktop computers and requires a license key to open. Those keys normally expire when you stop renewing your license or when the company publishes a new version and deprecates the old one. So keeping the software is a good idea, but you may have difficultly using that software when you need to open the file.
[caption id="attachment_19892" align="alignleft" width="235"]
Screenshots from the FACADE Project[/caption]
Next, for really important documents from the project, like the key design files, save copies of them in a standard format. For CAD, the best options are IFC or STEP, depending on which CAD program was used and what export formats it supports. Making these standard-format copies is a manual process, requiring knowledge of both the CAD software and the particular model being exported. The FACADE project employed graduate students from the School of Architecture and Planning for this work, but many firms have CAD experts who could do this. And while the CAD files are probably the most at-risk and problematic type of files you’ll want to archive, don’t overlook key files in other proprietary formats. For example, key documents created in Microsoft Office tools like Word, Excel, and PowerPoint can be saved in the Adobe PDF/A (an archival version of PDF) or as plain text files, which are much more likely to last than the undocumented formats that Microsoft uses internal to their products.
Third, put pressure on software vendors to do a better job of supporting long-term archives. CAD companies should help create good standards for archiving CAD models and support those standards in their products, especially companies that specialize in tools for the AEC industry. They should be open to escrowing copies of their software with trusted organizations (e.g. the Library of Congress, National Archives, or AIA). And they should also do a better job of documenting their internal data formats so that new software could be written in the future to read those files.
An interesting twist to this story is BIM. The vision for BIM is that it’s a living document, never “finished” and evolving over time alongside the physical building. That’s a great vision for the IPD and ongoing maintenance process, but poses the question of what the “design of record” should be for the future architecture student or historian. BIM is, in a way, a database that changes all the time, and in the field of digital preservation dynamic data of that sort is a big problem: what should be kept for the historical record, and how to do that. Should we make snapshots of the model at key points? Will there be standard file formats for those snapshots as reliable as those we’ve developed for other formats over the years? What if the library or archive doesn’t even get the BIM until twenty years after construction? BIM professionals are aware of these questions, but what we have here is a collision of interests: the best technology to preserve the actual building competes with the best technology to preserve the building’s history.
A last consideration is the growing use of project information management systems like Newforma. These products conveniently collect together all those project documents we now get on the hard drives, including the models and drawings, but they aren’t designed as long-term archives, nor do they typically provide support for exporting project records to digital archives. What was formerly a tedious manual process of combing through files on a disk is now a much harder process of extracting information from a proprietary tool that itself changes every couple of years. So, again, the potential for improved efficiency in building projects may lead to decreased efficiency (or complete inability) in saving the records of those projects for future use.
Why is digital preservation relevant for practicing architects and their firms? Mainly enlightened self-interest. If there’s ever a need to refer to an old design, consult a change order or ASI from a completed project, or consider an addition to an old building, you need usable digital archives. The best time to prepare digital records for archiving is while they’re young and healthy, not decades later when the firm is closing down. And while libraries and archives will do what they can to save the records they get, developing better tools and processes for the designers themselves to do this may mean the difference between having a historical record of architecture or not.]]>
Can CAD Be Saved? Preserving Digital Designs is Harder Than You Think
Architecture and Enterprise: Potential and Pitfalls
Crissy Field Center, San Francisco – Photograph courtesy of Project FROG[/caption] [Originally published 2nd quarter 2011, in arcCA 11.2, “The Business of Architecture.”] __________ Author Mark Miller, AIA, is a founder and principal of MKThink, a strategic design and innovation firm that solves problems at the intersection of architecture, the environment, and human factors. __________
Lessons and Opportunities from the Experience of Project Frog
The Entrepreneurial Accident Our great architect-as-entrepreneur experiment started out by accident. The genesis of Project FROG, arguably the nation’s leading clean modular building technology company, arose from a desire for a bit of PR. In 2005, we met with the publishers at Metropolis magazine regarding the suitability of our firm’s work for a high profile issue on education. The increasingly glazed look of the editor indicated that my pitch (for a story about what I thought were the most exciting architectural projects the world needed to know about) was not working. With the tone of her “Got anything else?” I knew I was running low on options. I ventured, “There is a more confidential assignment that we are working on…but it has never been shared.” The editor looked up and leaned forward. “We have been working on the problem of 300,000 classrooms in the US, and we have a prototype that looks like this (sketched furiously on a hotel stationery pad).” She was in, granting us good coverage if we published with them first. The only problem: we had no images, only basic research, and a bit of brainstorming by the office over beers on a Friday. We had thirty days before the reporter with a deadline was to visit our office. The resulting article brought attention and inquiry from around the world. We were excited. We dodged, bought time, researched, and sketched more. The New York 2012 Olympic Committee called, we sketched a bit more. Then came the tsunami in Indonesia followed a few months later by Katrina, and we realized that we were in the center of a global problem with no viable solution. [caption id="attachment_19848" align="aligncenter" width="597"]
Ilima Elementary School, Oahu – Photograph courtesy of Project Frog[/caption]
Transforming Concept into Company
In 2006, we realized that we were well out of our safe range. Fortunately, we reached out for technological and business advice. On the technology front, our saving grace was the connection with two brilliant Silicon Valley talents: Manley Tantuico, an industrial designer, and Bekir Begovic, a metal fabricator. After they recovered from their amusement at our overly complex architectural approach, they patiently explained the obvious benefits of an industrial design approach: strive for a clean, simple, and repeatable solution made of as few distinct parts as possible, then organize the product into pieces, parts, components, and assemblies. Though obvious to an industrial designer, this was revolutionary to us. Soon to follow was the introduction to relevant software tools that support this methodology.
Financially, we were in even more foreign territory. The “problem” (i.e. the Market) we were addressing was large. We had a mission supported by the passion of some very talented creative minds. But we had the financial capabilities of a modest-sized, first generation architecture firm. So we did what came naturally to us: we sold units. Within a few weeks, we had two big contracts to build two campuses using our system. The problem was that we had quite a few product elements to finish, very tight project schedules, and understanding yet demanding clients.
We were able to capitalize a new company through a seed funding round of investment capital from a close network of friends, family, and associates. We recruited a very small business team and survived the completion of the first round of contracts. We hung on and were able to raise a large round of funding from Rockport Capital Partners, a Boston and Sand Hill venture capital firm, just as the fall of Lehman Bros marked the country’s decent into recession. I awoke to find myself the CEO of a venture-capital-backed company. The real estate market was collapsing, and we needed to get down to the business of creating project confidence and acting like a proper, growth-oriented, commercial enterprise. My vocabulary had to expand quickly beyond the realm of building to include “liquidation preferences,” “option pools,” “exit strategies,” “pipeline,” “venture debt,” and “optics.” I had to take a Myers-Briggs test, have “key-man” insurance, and see legal fees approach 10% of our annual spending.
We were in a brave new world, but the achievements were compelling, and the enthusiasm of the staff was motivating. Our belief was that we could change the way buildings were built. Energy consumption would drop 40%. Projects could be completed in weeks and months, not years. Schools would be healthier, providing environments that would support and stimulate the brain’s ability to retain and process knowledge. Crissy Field Center (San Francisco), the Watkinson School (Hartford, Conn), and Jacoby Creek (Arcadia, CA) exemplified this vision though the first generation of post VC funding solutions.
[caption id="attachment_19850" align="aligncenter" width="600"]
Photo left: Crissy Field Center, San Francisco, CA / Photo right: Center Watkinson School, Hartford, Conn Photograph courtesy of Project Frog[/caption]
The company was growing, as were the issues. The investors determined that a professionally trained business team could best manage growth and expand funding, so a new CEO was brought in. I began a transition out of operating Project FROG and returned to the leadership team at MKThink.
Strengths of Architects for Innovation
That I am contributing this article, having come full circle from being a consulting architect and dabbling inventor as CEO of MKThink, to serving at the helm of Project FROG, and back again, reflects both the architect’s limitations and potential for driving the entrepreneurial experience. First, the potential: consider this outline of key factors of successful innovation, which are shared with architectural training and practice:
- Industry ripe for innovation: It starts with our industry, which remains unnecessarily rooted in traditional methodologies. Also, the issues of our era—global connectivity, sustainably economic practices and environmental management— are non-traditional problems that benefit from prescient application of technology combined with social commitment. Other industries have made these connections for huge societal advancement. Broad and deep opportunities exist for industry advancement by applying these lessons to our methods: problem-definition, design process, systems integration, and ultimately architectural product development.
- The ability to innovate: Solving problems thoughtfully, effectively, and efficiently through creative means is the basis for architecture and also the basis for innovation. Architects commonly focus these skills on a one-off solution that addresses an individual project and then start again for the next assignment. This same sense of investigation, systematically applied to repeating problems, could transform the building industry.
- Integration of knowledge: Successful architectural practice requires skills in integration of broad fields of knowledge into a coherent and useful result. Applying these skills and knowledge creatively for each commission requires innovation on a daily basis. Taking the step to apply these traits to solve problems that are repetitive, rather than individual, is the main shift that distinguishes a good inventor from a good architect.
- Problem-solving-through-collaboration skills: Successful contemporary businesses thrive on the collaboration of individuals with solid team-building skills. Leading business schools establish very expensive curricula, and recruiters treasure-hunt for talent with these attributes. Innovation requires a team of dedicated, forward thinking, creative people to work together to achieve a superior outcome. This is how architects already practice. The successful integration of designers, engineers, and policymakers into a financially responsible result is at the heart of what we do.
- Small business skills: Successful innovation is an essential primary ingredient for small business enterprise. Tight budgets, managing vision and risk, an ability to be creative and effective on financial fumes, and motivating teammates with non- financial incentives typify successful innovative ventures. Successfully managing a similar recipe also defines the majority of architectural practices.
- Limited experience with investment business practices: Taking the ideas of others and transforming them into commercial success is a profession unto itself. Seldom can innovators, especially new innovators, manage the development of technologies into viable new businesses. There are requirements for capital, intellectual property issues, and legal and corporate procedures different from a service enterprise. The venture capital industry offers high profile and potentially appropriate means to propel innovation to commercial success. Yet, experience and caution are critical, as this road has a unique set of procedures, tendencies, and patterns, refined to serve the investment partners first and foremost. The VC portfolio approach will sacrifice an individual company for the hard realities of the portfolio as a whole.
- Credibility and partnership with financial backers: Our professional world is not one that has established supporters in the financial communities. The recent history of innovation and entrepreneurial success has been in technology fields, particularly those that are low on capital intensity and high on consumer appeal. The long cycles of building and the lack of consistent investment precedent lack the appeal of software technology or social networks. Also, the independent lateral thinking and confident nature that comes from the experience of an architect (which suit creativity and innovation so well) may be at odds with the control and consistency favored by the equally strong willed investment community. They are fond of claiming that for each successful business venture there are a hundred great ideas, and that the difference between a hit and a failure is in business proficiency. These conflicts commonly characterize involvement with the venture capital process, and may be why so few company founders remain through the growth stages of the companies they found.
- Financial success becomes the metric for professional success: There is some validity to the contradictions noted in the last point. Architects tend towards broad definitions of success. Investors have one metric of success: financial return. Having worked with investors who present themselves as socially minded, environmentally minded, or otherwise motivated by ideals, I have found that professional investors do not confuse investment with philanthropy. The presentation of “socially-inspired” investors in practice is more a means to organize investments and knowledge around industries of interest. Perhaps some socially minded investors will accept some degree of the “social return” measured in a few percentage point of flexibility, but the similarities to traditional methods are closer than the differences. Architects do not often calculate this way. If we did, we would be in another field entirely. Thus, success in this area requires an artful balance of your priorities with an open-eyed recognition of your investor’s goals.
- Entrepreneurship takes focus and commitment: The investment community is correct to value not just the innovation, but also the roles that bring those ideas to market. Thus, innovative pursuits by an architect would be difficult if positioned as either the diversification of an architectural practice or a sideline activity. Success through the various obstacles requires total commitment to the end goal while maintaining a willingness to cooperate with very different types of professionals who expect that commitment.
California Prefab: Current Market Report
Silvercrest Homes[/caption]
[Originally published 2nd quarter 2011, in arcCA 11.2, “The Business of Architecture.”] __________
Authors: Paz Arroyo is Civil Engineer from Chile. She worked as a project engineer at a consultant company and later as chief of the Integrated Management System Department for a construction company. Currently she is pursuing her PhD at the University of California, Berkeley, where she is interested in lean construction and sustainability. Merry del Val is a practicing architect in Madrid, Spain, with professional experience in Singapore, Europe, and the US. She received her MArch degree in UC Berkeley and her Bachelor of Architecture in ETSAM Madrid, where she is currently pursuing a PhD in Architectural Construction. Jeremy Fisher is a Master of Science in Architecture candidate at UC Berkeley and has worked in the construction industry for over 16 years. Before returning to school he worked with ZETA communities, managing the construction and installation of their first home in Oakland. He is now a researcher in the Energy Performance of Buildings Group at Lawrence Berkeley National Laboratory. Nicolas Gasztych is a Architectural Engineer. He has contributed to this article during a one-year graduate exchange program at University of California, Berkeley. Noy Hildebrand holds degrees in architecture from RISD and in building science from U.C. Berkeley. She currently resides in Melbourne, Australia. Lynn Hiel is a recent graduate from the Civil Engineering & Project Management Masters Program at the University of California Berkeley with a minor in sustainable design. She is interested in the opportunities prefabrication presents to integrate green engineering and lean management strategies, in function of sustainability in design and construction.
__________ Since the financial crisis of 2008, the prefabricated building industry has undergone recession, forcing both well-established companies and venture-capitalist start-ups to reflect on their goals and respond in diverse ways, according to the differing situations of their assets and liabilities. Historically, affordable manufactured homes have been produced through low cost materials and high volume production. The next generation of prefab companies is applying IT industry approaches to R&D, sustainability and improved quality. Lacking high volume production and still largely funded by venture capital, it remains to be seen which, if any, of the models will succeed. Six students from the UC Berkeley graduate course entitled “Off-Site Fabrication,” taught by Professor Dana Buntrock, have examined this question. Based on original interviews with management and employees conducted during visits to fabrication plants and constructed projects, the following article is a brief synopsis of three case studies, providing a sample of the current prefabricated building industry in California: Silvercrest Homes, Zeta Communities, and Project FROG. For more on Project FROG, see the following article. SILVERCREST When Silvercrest Homes was founded in 1969, most other modular housing manufacturers led a dictatorial marketing campaign focused on high-volume production. Within a market dominated by standardization and uniformity, Silvercrest saw a business opportunity: customized homes to accommodate each market segment’s particular needs. According to Al Whitehouse, Silvercrest/Champion Homes General Manager, Silvercrest at its peak reached a target market ranging from families to the elderly and all homeowners in between. Silvercrest Market Approach During the market crisis, the costs of core commodity materials escalated. To survive in these conditions, Silvercrest fixed the budget they allocated to these variable costs and did not absorb the periodic price increases, which material cost erosion necessitated. Silvercrest had to consciously develop a home series that had a lower material content in one form or another and drop down from their original target. In addition, an uncontrollable retail marketing backlash has forced the company into an even tougher financial situation. In the Silvercrest production process, the customers pull the system. The company only starts to build a house when there is a buyer, usually a developer. Since the market downturn, the company has closed 68% of its plants in 11 Western states, which has also impacted developers such as Sandalwood Estates, who relied on Silvercrest for decades, according to Sandalwood Estates Community Manager Kathy Fiebiger. Since the closure of the Silvercrest Woodland plant, the over four-fold increase in transportation costs is no longer economically viable for this developer. The market for Silvercrest homes has also reversed. Originally, Silvercrest was the largest provider of modular homes for large private properties. Today, 70% are installed in mobile home parks, and only 30% are on private property. As a result of all these factors, Silvercrest has been forced to deviate from its original market stronghold of higher quality and more expensive homes. They have developed a product series equivalent to those of their competitors and are selling these homes at even lower price points. Currently, Silvercrest is also hoping to diversify its market by working on a variety of commercial projects, including offices, churches and synagogues, veterinary hospitals, and daycare centers. Silvercrest Production Six years ago, Silvercrest began implementing Lean Manufacturing methods in an effort to improve production efficiency for the future. According to Mike Hutchinson, Silvercrest/Champion Homes Quality Control Manager, they invested heavily in training all personnel and adopting policies of “continuous improvement” to change the company culture. The new Lean production schedule depends on the plant’s activity, backlog size, and product order urgency. If enough orders are ready, a batch of ten houses is released to production. Silvercrest has not yet realized the potential benefits of Lean management, but their creative approaches to optimize production efficiency and more collaborative relationships with their supply chain and customers will potentially be a tremendous advantage once the economy recovers. Silvercrest may be capable of offering better quality houses for a low target price. ZETA ZETA, an acronym for Zero Energy Technology and Architecture, is a venture capital start-up founded in 2007. Their target market is high production, sustainable, and net-zero energy modular building solutions for mass-market adoption in the United States. ZETA Co-Founder Shilpa Sankaran notes that, observing the collapse of popular “prefab” companies, it became apparent that a business model focused only on single-family homes was not scalable. After their first successful project in Oakland, California, in order to increase production capacity, they leased a 91,000 square foot production plant in Sacramento. ZETA Market Approach ZETA’s target markets are not only multi-family and single-family housing, but institutional and educational facilities as well. This scope requires them to be flexible in both their business plan and production system, according to Sankaran. They have adapted their original business plan to include not only design and production, but also funding sources, planning, zoning, code compliance, and state approvals, in order to facilitate developers throughout the process in adapting to prefabricated systems. This concept of flexibility raises the issue of standardization vs. customization. Ideally, the product should include as few customizations as possible. The reality, as ZETA General Manager Kara Tarango notes, is different: “You don’t dictate what you are going to build, the market dictates. The only thing you can dictate is how your product will adapt to the market.” ZETA Production ZETA originally tried to incorporate IT industry production systems into the modular building industry. However, a modular building company might produce 10 products a day with 10,000 parts, while a computer plant produces up to 10,000 products a day with 10 parts. These fundamental differences resulted in numerous production challenges during the design and construction of their first project. In response, they incorporated traditional factory building expertise and leased a high production capacity modular building production plant. The new plant consists of a low-tech automated tiger saw, along with insulation, polyurethane glue, and paint spray stations. The rest of the production assembly line utilizes standard construction equipment optimized for labor efficiency. Their designs and materials are high quality, sustainable, and energy efficient. All buildings are “Net-Zero Ready,” allowing customers to add renewable energy to achieve net-zero energy. Unfortunately, since the production plant was leased, ZETA has not yet utilized their full production capacity; only five buildings have been produced. Due to the fact that ZETA is addressing the residential, commercial and institutional markets, they may have a market advantage over the other companies. Given their flexibility in market approach coupled with a very high production capacity, they are well positioned to be successful. Project FROG: “Better, greener, faster, cheaper” Project FROG is a venture-backed San Francisco-based firm specializing in high performance, prefabricated classrooms. Run by business professionals and designers, this company differentiates itself from other modular building companies in its approach and structure, as well as its intended market. From the start, explains Evan Nakamura, Senior Director of Product Development, Project FROG avoided the capital-intensive investment of their own production facilities, opting instead to closely partner with fabricators to develop and produce the building components. The company focuses on developing turnkey buildings with a systematized, pre-engineered kit of parts to achieve efficiency with flexibility. Project FROG Market Approach Originally, Project FROG saw its business opportunity in the increasing demand for fast, flexible, and affordable portable classrooms, which until 1998 were required to comprise 30% of the classrooms in California schools, according to the California Portable Classrooms Study (http://www.arb.ca.gov/research/apr/past/00-317_v3.pdf ). FROG classrooms present a healthy alternative for existing portables, but since “FROGs” are prefabricated but not “relocatable,” they have had to follow the same lengthy funding process as permanent classrooms. Project FROG Production: the Kit of Parts Project FROG is based on the concept of product development, similar to Apple or Boeing, which through design iterations creates a highly systematized kit of parts, produced by a network of fabricators. One of FROG’s novelties is its implementation of energy and cost modeling to achieve climatic adaptation and precision fabrication through the combination of interchangeable components. The key challenge here is to find the optimal point between manufacturing efficiency and the customization demanded by clients. The kit of parts, which specifies very precise connections and tolerances, requires a carefully managed network of suppliers and transportation schedules. Because of decentralized production, all components are first assembled on the building site, requiring additional costly labor if unforeseen issues arise. The company has invested significant venture capital in order to explore and implement the customization necessitated by climatic response, clients’ needs, and technological systems. With costs similar to those of traditional buildings, speed and technology seem to be FROG’s primary assets. Selling greenness and technology while keeping prices low remains a tough challenge, especially in this economic downturn. Conclusion Since 2008, all three companies have had to reorient their market approach to incorporate greater market diversity and production flexibility. Furthermore, all three are struggling to find the balance between customization and high volume production in order to survive. While the older establishment has focused on achieving economies of scale more efficiently through the implementation of lean strategies, newer companies anticipate that innovative production tools and IT, as well as higher levels of customization and quality, are key to the future of manufactured architecture. Another key distinguishing factor is the scope of the companies’ networks in their target market territory. Silvercrest has only limited tools in place for a new market, but can depend on its reputable roots. On the other hand, the start-ups face a more tenuous future; Zeta is having trouble launching, while FROG seems to be only slightly more successful, with lower capital demand and a more template-based approach. Despite their strong sources of capital and firm expectations that architecture needs manufactured production, will they gain enough leverage to become a viable and sustainable business? This is a challenging time for the construction industry as a whole, and, in spite of its promise, the off-site fabrication community is not immune to this drastic economic downturn. However, California, more than most states, has long been a leader in off-site fabrication practices. Japan, our seismic sister across the ocean, has demonstrated the value of rapid and large-scale production plants as we were completing this article. Several hundred extremely small housing units were in construction within a week of the March 11th earthquake and tsunami. Will our industry be ready when it’s our turn? Editor’s note: As of press time, GE has led a $22 million investment round in Project FROG and begun construction of one of its prefabricated environmentally sustainable buildings at GE’s Learning Center in Ossining, NY.]]>Architect as Developer: The San Diego Story
[caption id="attachment_19770" align="aligncenter" width="598"]
The Q – Jonathan Segal Architect – Photograph courtesy of Jeff Durken[/caption]
[Originally published 2nd quarter 2011, in arcCA 11.2, “The Business of Architecture.”]
__________
arcCA asked three architect-developers in San Diego, where the species seems to flourish, to tell us about their motivations and experiences. Lloyd Russell, AIA, has been a practicing architect since 1997. He was AIA San Diego’s Young Architect of the Year and was a featured speaker in the Emerging Talent Series at the Monterey Design Conference in 2007. Jonathan Segal, FAIA, is principal of Jonathan Segal Architects, which provides real estate development, architecture, construction, ownership, and property management all in house. The firm initiates urban renewal in the most blighted areas of Downtown San Diego, for other new development to follow; and promotes this form of practice to other architects so they also can have control, pride in their work, and financial independence. Ted Smith is a principal of Smith and Others, an alternative architectural practice founded in 1973; Kathleen McCormick joined the practice in 1981. Smith chairs the Masters in Real Estate program for architects at Woodbury University. Here, Russell and Segal join in a dialogue; Ted Smith’s narrative follows.
__________
What prompted you to undertake your first development project?
Lloyd Russell: There was no work happening at the time, so we used to joke that the only way to get hired was to hire ourselves. At a time when architects are getting marginalized in the building industry, it is empowering to be in the middle of things bringing a project to realization. And, if you do it well, you get to own it. It’s also putting your money where your mouth is. Architects promote the profession with the argument that we add value. Well, why not realize that value?
Jonathan Segal: I never wanted to have a client after working at two firms and seeing the lack of respect the clients give to the architects and the compromises they were forced to make. Just as significant was the pittance they were paid in comparison to the contractor.
Did you have training or experience that specifically prepared you to do development? LR: I used to believe what my teachers at San Luis Obispo were telling me, namely that architecture would save the world. Problem was, I had to drive thru LA to get to school from San Diego, and I could not rationalize what I was seeing from the freeway through that paradigm. So I got interested not just in how buildings were built but why. And who made those decisions. JS: I’m Jewish. But all architects have the tools required to do development.
 Centre Street Lofts, Lloyd Russell Architect
Photo by Harrison Photographic |
 Richman/Poorman
Smith & Others |
Are you also the general contractor for your projects? LR: Owner-builder, technically. JS: Not in the beginning, but after building a few projects and seeing the generals take no responsibility for the work I paid them to do, I finally woke up and vowed never to hire another contractor again. They add no value and only subtract from the process, and now we always build our own work and have never looked back.
Did you have training or experience that prepared you to act as G.C.? LR: I worked construction trades through school and after graduation without telling anyone I was a graduate. I got an earful on what contractors think about architects. JS: Yes: the same experience that all architects have. Contractors don’t have any better skills than we do, and they have zero passion in our process. Passion is at the heart of every project.
What is your approach to risk management? LR: I prefer to develop multifamily for rent instead of for sale. Ironically, when you take on all the responsibilities/liabilities of multiple roles, you get to a tipping point where the risk becomes less, because you won’t sue yourself. JS: Build your own stuff; get the subcontractors to indemnify you, not the other way around; build apartments, never condos.
What do you most enjoy about your mode of practice? LR: It’s more a lifestyle than a practice. You make different decisions on when, where, and why to take on a project when you have a stable cash flow from prior projects. JS: Multi-tasking and seeing our sculptures take shape. Most importantly, we have a sustainable practice that has rental income and creates long term balance sheet growth. It’s time to help all other architects do what we do. Ted Smith: I first developed a house for my family. I’m not sure you call that development, but I guess it is. That was in 1975. Five years later, the economy was crashing, no one was hiring architects, and I couldn’t make my mortgage payment, so I borrowed one last $20,000 from a hard money lender and builtmy first real development, where I was counting on renting space to pay the bills. That was the first of a series of shared houses with six suites in each, with private exterior entrances, that I called GoHomes. These turned out to be popular, and I built five such houses over as many years, each with six to eight suites, providing very affordable ownership in pricy Del Mar Terrace. Over this same period, the demographic of the neighborhood changed from surfers and academics at UCSD to yuppies, with property values as their main interest. The new people didn’t like affordable housing, so I left the Terrace and joined my good friend Rob Quigley downtown, where he and Kathleen Hallahan had built their new home and office in Little Italy. Kathy McCormick, my collaborator and by the way girlfriend, was looking at the Sunday paper, and she saw a lot that cost about the same as the lots in Del Mar Terrace, but you could build a big building there, and there were no Nimbys. So we moved our practice downtown and built San Diego’s first (as far as we knew) townhouses, something Kathy was championing, along with a bunch of GoHomes. We called the building the Richman/Poorman building, since it combined high-end row houses with tiny apartments in one building. We found these experiences extremely rewarding, being able to invent the building type, which seemed much more substantial than decorating some developer’s bad idea. We could serve a population that we understood and direct the development to places that were more friendly to the environment than, say, the big custom homes we had been designing in Fairbanks Ranch. This ability to control the project remains the overriding motivation behind deciding to be an architect/developer. Of course, we also had learned that it was easier to borrow money from banks than to collect it from clients, and the income from apartments was recession proof, freeing up the anxiety that comes with the cyclical traditional practice of architecture. I was untrained when I began, and that naiveté is probably the only reason I would have tried development. Certainly, a project like the GoHomes would not have come from someone with wisdom. If I had understood the complexities, I probably would have shied away. I’ve always built the projects I have developed. I had built my first house, and I always understood that the construction is where the money is. I also learned that it was less trouble to be the contractor than argue with one. I learned to build on the job, and any mistakes I made were well worth the substantial savings. My staff has always been young architects, whom I would partner with to accomplish the projects. This is expensive, because you end up giving away a lot more than you might if you had the money to hire, but a group is more powerful than an individual, and I have always been a bit of a socialist when it comes to being fair and providing opportunities. When one develops, profits are way down the road, so it is good to have all the staff on board, agreeing to show up and work for some common goal way off in the future, and a group helps establish a discipline that working alone does not. Everyone agrees to show up first thing in the morning and work until dark. Also, many jobs just require a number of people to accomplish, like framing or building a foundation or placing the windows. We always do about half the subcontracts, as well as act as the GC. I have had many young, talented architects help make the projects, and they have nearly all been partners. Only on very large projects have they been joined by paid staff. As soon as projects become larger than, say, four units, a rich man is required to cosign the loans. So these projects are not for beginners without wealth. Small projects are also the projects that need to get built, infill. Normal developers don’t want to build small, because the effort is the same no matter the scale. I prefer a street of individual ownerships, an expression of community, over a full-block building that seems more to express a developer’s big money dreams. The big (and mostly bad) projects get built anyway. It’s the fine-grained projects that require a very large amount of work for their size. The purpose of the Master in Real Estate Development program at Woodbury University is to teach these skills to young architects, who are the ones schooled enough in what is good urbanism to take these infill projects on. The big guys can go ahead building the full blocks, tracts, and industrial parks. I manage my risks by doing as much as I can by myself and by careful choice of partners. That way, when something goes wrong, it is our fault. I can get a screwdriver and fix it, rather than hire a lawyer. I also build for a market of young, artistic people, the kind who see the world in a good way. I am less comfortable building for people with money. If they have money, they are probably not my market; and, besides, they are probably the kind of people who will sue me, rather than be reasonable. This has worked well for me. I haven’t been sued as a developer, except once almost by a disgruntled partner. I figured out how to buy the unhappy partner out, and it all was OK. That is one instance in what has been thirty years of development at this point. So, risk management has more to do with picking partners than buying insurance. I enjoy development, because it builds wealth, and it builds those projects that would not be built by the normal industry. I love being in control, and I am always advising young architects to stop traditional practice as soon as possible. It seems to me that the normal practice of architecture is a foolish endeavor, where wonder is promised in school only to run up against the sad reality that is normal practice or services for hire. Traditional practitioners, except in extremely rare cases, make way less money and have way less control, so the architecture is worse and the income intermittent. Of course, there are exceptions to anything one says. Certainly there are many good architects, who, with savvy political skills, navigate the treachery of traditional practice and even make great buildings, but I’ve never been too good at trying to sell an idea; I’d rather just decide to do it. It’s enough trouble just to sell an idea to myself.]]>
People Know Brad Pitt Wants To Be an Architect, but They Can’t Name Any Real Architects
[Originally published 2nd quarter 2011, in arcCA 11.2, “The Business of Architecture.”]
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Julie D. Taylor, Hon. AIA/LA, is founder and principal of Taylor & Company, a Los Angeles-based public relations and marketing services firm. She is active in AIA/LA and CanstructionLA and is the Editor of SAH/SCC News for the Society of Architectural Historians/Southern California Chapter.
When Brad Pitt lusts for blueprints, and Frank Gehry “stars” on “The Simpsons,” and the term architect is used to aggrandize every other activity, one might think the profession is better understood than ever. Perhaps so. But can anyone outside the profession name five living architects? Could your clients?
Besides a few stars, it is common still for architects to bear blame but not glory, to be eclipsed by clients, and to be relegated backstage at grand openings and groundbreakings. There may be nobility in being an unsung hero, but it doesn’t generate new business. The answer to unwanted anonymity is more consistent communication. Marketing is the nexus between communication and sales. And sometimes, I’m afraid to say, architects can be their own worst enemies when it comes to verbal expression. You must communicate to potential clients and allies in a way that promotes your business as well as the ethos of the profession. The economy seems to be inching its way back. Yet competition among architects for each commission remains fierce. More than ever before, architects need to understand—and more important, aggressively partake in—marketing and public relations. Myth #1: Marketing is a 4-Letter Word You did not spend all those years in school and all that time in licensing exams to be a marketing expert, right? However, without a notion of what marketing is, you won’t have the chance to put all that great talent and time to use. The real four-letter word for marketing is W-O-R-K. It takes work and it leads to work. Marketing is not for other people; it’s for you. Marketing is the overall term that pertains to the process of getting work. Under that rubric fall business development, marketing communications, and public relations. A few definitions:- Business Development: The direct means of securing clients through lead development, networking, RFQ, RFP, committee membership, interviews, design competitions.
- Marketing Communications: Relaying messages about your practice through website, corporate identity, newsletters.
- Public Relations: Partaking in activities giving you greater exposure to the public realm, such as awards programs, speaking engagements, exhibitions, and media relations.
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In Praise of Fallow Fields
arcCA 10.4, “Faith & Loss.”]
[caption id="attachment_4183" align="aligncenter" width="836"]
Livermore Fields – Photograph courtesy of Kurt Lavenson[/caption]
Author Kurt Lavenson, AIA, is principal of Lavenson Design in Oakland. He migrated from Pennsylvania to California in the late 1970s and worked in the trades while studying architecture and photography. After discovering that he preferred construction sites to working inside an architect’s office, he spent the next fifteen years as a designer/ builder. He currently operates a solo architecture practice where he blends design principles, psychological insight, and a touch of alchemy in the quest to create great residential spaces.
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fal·low [fal-oh]
1. (of land) plowed and left unseeded for a season or more; uncultivated.
2. not in use; inactive: My creative energies have lain fallow this year.
~From www.dictionary.com
Let Everything happen to you: beauty and terror. Just keep going. No feeling is final.~From a poem by Rainer Maria Rilke
The economic downturn has hit my architecture business rather hard. For years, decades actually, I have had a list of clients waiting patiently for me to design their projects. I plowed steadily through my workload, and the waiting list extended into the future just as steadily. Now the backlog is gone. I have worked my way through most of the jobs and have large blocks of unscheduled time. I live and work only in the present tense, not quite sure of the outlook next year or even two quarters ahead. This can be awkward to discuss with friends and colleagues. I see the pained look flicker across their faces when I answer the ubiquitous “so how’s business?” with an unequivocal “really slow.” Apparently, I have offered more than they really wanted to hear, violating an unspoken rule by giving voice to loss. Occasionally I go further, adding “…and I like it.” Perhaps I am expected to say business is great, or at least pretty good, or, at the very least, picking up again. It is apparently safe to talk about loss in the past tense, but not in the present. Some colleagues are relieved to discuss loss in the open, taking comfort that they are not alone, but most react as if it might be contagious and pull back. For my part, I am learning to embrace the slowdown for its cathartic qualities. The stillness has within it another kind of wealth—one of reflection, grounding, and opportunity. I have come to appreciate the fallow period. Until the modern era of chemical fertilizers, pesticides, and herbicides, it was common practice for farmers to let alternating sections of their fields go fallow to regenerate. This gave the soil and organisms a chance to rebuild the nutrient base for the subsequent crops to draw upon. More recently, as emphasis shifted toward maximum production, the soil was never allowed to rest. Nutrient flows were subsidized and accelerated by artificial means. As we have learned, these methods deplete natural resources, pollute the aquifers, and often yield toxic food products. The latest counterbalancing result has been the rise of organic and sustainable farming, including fallow soil periods—a less “efficient” but healthier alternative. I see a metaphor here for the fatigue in the construction industry and the economy as a whole. The boom cycles are unsustainable without artificial subsidies and become unhealthy when pushed past their natural limits. We are realizing, not for the first time but maybe for the last, that an economy that primarily measures success in terms of speed and quantity of production will eventually yield toxic products and cannibalize its own resource base. I am not arguing against efficiency, just appreciating the elegance of certain natural processes that may appear inefficient, like the plowed fields left unplanted and uncultivated for a season. They are actually quite efficient and self-sustaining. When we think with a long-term perspective, not doing can be as valuable as doing. There is opportunity in stillness. Many now claim their design practices to be focused on sustainability. I’m not convinced, however, that specifying bamboo floors and solar arrays is enough to deserve that moniker, if the underlying business cannot survive without constant production. What if our own business practices were designed to incorporate fallow periods? Perhaps it would make the business itself more sustainable if it were designed to allow, or to celebrate, pauses in the economic cycle. I have an image in my head from my childhood on the east coast, where we would awake to “snow days.” Schools and businesses were unable to open due to an overnight blizzard. Roads were impassable. Everything was closed. They were wonderful ad hoc days, filled with inventive play, family bonding, and regeneration of spirit. The interruption of business as usual was a blessing, and the days that followed were better for it. This example is obviously more simplistic and rosy than the depths of a recession, but most of us have heard similar descriptions of communities banding together during severe natural disasters, as well. The point is that the surprise and the loss of control can be considered normal occurrences. They are unpredictable and overwhelming at first, but ultimately manageable and useful in their own way, even if that way is not obvious at the outset. How many of us have said at one time or another that we learned more from a test we failed or a job we lost than from the others? The specifics of a truly sustainable business model will vary for different practitioners and firms. For some, the consequences of a slowdown are more dismal than for others. What is common to all is the need to become less afraid of loss and stillness. Embracing fallow periods allows change to enter the equation. Clearly, we don’t need to seek sadness or emptiness; we just need to stop pretending that we can entirely prevent them and to end our amnesia about natural cycles. We need to find balance. If we become adept at managing seasonal or cyclical slowdowns, we can build healthier businesses focused on more modest booms and less drastic busts. Architects understand process and change more than most people. We are visionaries, expert in the creation of new patterns. It is important to use these skills right now to redesign our own livelihoods. The economist Juliet Schor, in her book Plentitude, addresses the concept that there are other forms of wealth and strength available in the economy if we learn, or remember, how to value them. She suggests that, historically, as more labor time went into the marketplace, time for community disappeared along with relationships. We lost “a potent form of economic wealth which people can turn to during financial instability or adverse climate events.” We became too busy to cultivate this source of wealth and security. Perhaps we can add it back into the balance sheet now. Similarly, the concept of “slowness” might now be associated with value rather than with scarcity or failure. Slowness allows time to savor, reconsider, and choose wisely among opportunities. Slowness is sometimes just thoroughness, which is a prerequisite to mastery. If a sign of craziness is doing the same thing repeatedly and expecting a different result (to paraphrase Einstein) then why are we simply hoping for the economy to “recover”? Do we really want to go back to what we were doing? Or would it be better to lie fallow, pause, reconsider, and redirect? In other words, if where you are now is what you want in the future then plant the same “crops” again. If not, then plant something different. This is your chance. The emptiness of the fallow field becomes less frightening when we have faith and confidence that it will produce again in the future, or more specifically that we can make it produce what we really need and want in the future. Rather than being dead, the bare ground is alive and filled with potential. Recently, I spoke with Sim Van der Ryn, a leading proponent of sustainability before most of us knew the word. Sim emphasizes whole systems thinking and approaches design as a naturalist and a philosopher. I still draw upon the lessons he taught when I was an undergraduate student of his at Berkeley in 1980, following his tenure as the California State Architect. He had us study the rhythm of energy flows, urban farming … and compost. We spent a lot of time on how things decay and regenerate. We learned to delight in the breakdown of materials into basic nutrients that became available for the growth of new forms. Only then did we get back to the creative business of design. In the tradition of great teachers, Sim distracted students from their assumptions and expectations about architectural form and opened a pathway to the underlying organic principles. Similarly, we might now set aside our negative assumptions about the current economic decay and look for the lessons and opportunities that lie under the surface. Sim also introduced his students to the hazards of monoculture—the planting of vast tracts of land with a single crop in the name of efficiency. Monoculture makes that entire crop vulnerable to singular disaster. One particular bug infestation or disease wipes out everything or requires radical intervention and subsidy. The parallels between that scenario and the recent business sector failures are rather striking. I asked Sim to share some comments with me about the fallow field metaphor. After hours of conversation and a lunch made from ingredients that Sim raised within 100 yards of his table, I had only one word circled on my notepad: Presence. We always came back to presence. In order to advance and to evolve, it is essential to stop doing things that distract us from the wisdom that resides within nature and within ourselves. If ambitious, hyper multi-tasking is a skill of the head, then mindful presence is a skill of the heart. Valuable knowledge and insight reside in the heart, where they are often ignored in the rush to success or the panic of a crisis. Taking time to pause allows us to connect with them and to become available for a fundamentally new kind of productivity. Endings are required before we can have new beginnings. They are inflection pointsin the cycle. The cusp of profound change is similar to the demolition phase on a construction project. Before building something new, it is necessary to destroy old structures that are interfering—to clear the ground. We have to accept loss, and sometimes destruction, in order to grow. We must release the past and its hold on us. During a biographical interview for USC, Frank Gehry described a period in 1978 when, at the age of 49, his work came to a sudden halt. During dinner at his home, in a conversation with his biggest client, the president of the commercial developer Rouse Company, he admitted that he had not really liked most of what he had been designing. So they parted ways amicably, and a few days later Gehry had to cut his staff of fifty down to three. He called the experience “seeing the devil” and said it wasn’t the first or last time something like that happened to him. But the moment was also a turning point when he committed his attention to the kind of design work that aroused is passion. The rest, as we say, is architectural history. He is now one of the most notable and celebrated architects in the world, having fundamentally redefined building form and process. Gehry allowed himself to acknowledge his sense of loss and disappointment. He spoke from the heart. He stopped what he was doing, took the hit, and remained present. Then he was available to follow his inspiration and to use his gifts in new and more meaningful ways. So, the next time you pass a fallow field or experience one coming into your life as a metaphor, breathe deep and welcome its regenerative power. Embrace the stillness and the potential.]]>