The Katerra and building technology story
High tech modular building will revolutionize
the North American AEC industry within
three years, consultants assert
Florida Construction News staff writer
Is a technological/business model
revolution about to overtake Florida's
construction industry – yet we hardly
see it coming?
If building materials consultant
Mark Mitchell’s perception is correct,
Katerra, a new high-tech start-up
combining technology, design, distri-
bution and modular (factory) con-
struction will soon reshape the
industry in manners similar to the
way Uber tore apart the local taxi in-
dustry and Craigslist decimated local
newspapers. “In its own way, I predict this will
have as much effect on residential
and commercial new construction,”
writes Mitchell, based in Boulder,
CO. “Lack of efficiency will make the
way (building products) manufactur-
ers do business now irrelevant in
new construction. They may be rele-
gated to competing with each other
in the repair/remodel, big box and
smaller high-end custom construc-
tion.” Of course modular building has
been around for decades, serving
several niche markets in Florida and
elsewhere. The difference this time
is the integration on a multinational
level between technology, design,
manufacturing and delivery – and
massive capital funding for the new
enterprises. Currently leading the pack,
Katerra’s company headquarters are
the Sand Hill Rd. tech venture capi-
talist epicenter in Menlo Park, CA,
with a construction office in Scotts-
dale, AZ and design office in Seattle.
It also is building a Cross Laminated
Timber (CLT) factory in Spokane, WA.
The start-up purportedly has a val-
uation of about $2.5 billion, accord-
ing to PitchBook Data. Early
investors have raised as much as
$244 million – and published reports
indicate the company is preparing to
raise another $200 million this year,
at least.
Currently the organization,
founded in 2015, has projects under-
way in California, Oregon, Washing-
ton, Idaho and Nevada, but there is
little stopping it from expanding its
scope and geographical range.
Katerra says it has about 1,000 em-
ployees in four countries and already
is among the top 25 general contrac-
tors in the U.S.
“Katerra is bringing fresh minds
and tools to the world of architecture
and construction,” the company says
in its corporate outline. “We are ap-
plying systems approaches to re-
move unnecessary time and costs
from building development, design,
and construction.”
“With the latest technology at our
fingertips, efficiency no longer has to
come at the expense of quality or
sustainability. Led by a team that
combines expertise from the most
groundbreaking technology, design,
manufacturing, and construction
companies, we are transforming
how buildings and spaces come to
life.” “The way we think about a con-
struction site is to turn it into an as-
sembly site and make it a factory like
we used to do at Flextronics,” CEO
Michael Marks said in a published re-
port. (Marks led Flextronics in the
1990s and early 2000s.) “The thing
that is so messed up in the real es-
tate business is how many different
parties are involved in getting any-
thing done.”
In his weekly newsletter, Mitchell
– who provides marketing consul-
tancy services to a diversity of build-
ing product manufacturers – says the
coming construction technology/
manufacturing revolution envisaged
by Katerra will take place when the
company approaches “builders and
developers with an offer they can’t
Florida Construction News — MARCH 2018 – 11