Peter DeMaria and Diego Rivera of Mid-Rise Modular unpack the intricate dynamics of integrating modern architectural methods into successful multi-story modular projects. Peter and Diego also share their insights on the logistical challenges and precision required in modular construction. The discussion highlights how aesthetics and technical expertise must harmonize to produce efficient and visually appealing buildings. They also touch on the role and potential of AI, as well as the importance of research and development, repetition, and standardization—particularly in cost-intensive areas like bathrooms and kitchens—to enhance efficiency and quality.
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John McMullen (00:00):
Hello and welcome to Inside Modular, the podcast
of commercial modularconstruction brought to you by
the Modular Building Institute.
Welcome everyone.
My name is John McMullen.
I'm the Marketing Director hereat MBI.
Today I'm joined by PeterDiMaria and Diego Rivera of
Mid-Rise Modular.
Among other things, Peter andDiego are here to talk about the
(00:22):
modular building design processand what younger designers
should know about being part ofa modular project team.
Peter and Diego, welcome.
Peter DeMaria (00:30):
Morning, john, good morning.
John McMullen (00:32):
Tell me about yourself, Peter.
We'll start with you.
What's your background and howdid you get started in modular
architecture?
Peter DeMaria (00:38):
Thanks, John.
I started out in architectureschool.
If I really want to go back far, I was able to meet Buckminster
Fuller when I was a young fella.
John McMullen (00:48):
Oh wow.
Peter DeMaria (00:49):
And I was in undergraduate school, was in art
school, where I'd never be anarchitect because my brother was
in architecture school workinghis tail off every night and I
was out having fun at artistparties in New York, right.
But it all changed when I had agreat professor, and I think
that's happened often for manypeople.
There's always a mentor orprofessor out there that really
(01:09):
changes the way you view theworld and at that point I was
able to meet Bucky Fuller and itwas quite inspirational.
It put me on a different path.
I went off to architectureschool at the University of
Texas in Austin and thenmigrated west to Los Angeles,
opened my own architecturalpractice and did primarily
traditional work.
Got to about 2003, 2004, gotfrustrated with the cost of
(01:35):
things and started to explore.
I was teaching at that time,took a year sabbatical and
clearly went around the world tosee what was an alternative way
of building.
That wasn't stopping me much ofthe way the traditional wood
frame construction was doing andI unveiled, you know, the cargo
container at having the mostpotential but the least amount
of research had been done on it.
(01:56):
So I was really fortunate, hadsome great clients in 2005 and
built what I believe is thefirst legal cargo
container-based building in theUnited States.
It was a two-story residencedown in Redondo Beach and that
kind of set me off on analternative path, the
traditional architecturalpractice that I had, and I
really leveraged out what youcould do with that container and
(02:18):
the next logical jump was tomove into the world of modular.
And once I got into steelmodular I understood all the
benefits of it and I've notlooked back.
And right now Diego and I havecome together and I think we're
creating something that's reallygoing to serve the masses.
We think we've come uponsomething that's really valuable
and we want to share it.
(02:39):
We want to bring it out thereto the world and have the most
amount of impact on the peoplewho need housing and a great
housing solution most.
So that was like 30 years in anutshell, right.
So now I find myself here inLos Angeles and travel back and
forth from Austin, texas, to LA,and Diego and I have been
(03:00):
actually working parallel toeach other for the last almost
two decades, but we didn't knowthat we were in each other's
backyards until we met thanks tothe Modular Building Institute
at the World of Modular about ayear and a half or so ago, and
we've been doing fantastic eversince.
John McMullen (03:17):
Well, that's an amazing background.
Thank you, peter Diego.
Tell me about yourself and yourbackground.
Diego Rivera (03:23):
Oh my God, that's interesting when you go after
Peter.
So let's see if I can do betterthan that.
You know I'm going to give it atry.
Same thing, you know learn onthe hard way.
Went to architecture school,became an architect, went to
school here in LA called SCI-Arc.
After I graduate I realizedthat after one hundred and fifty
two hundred thousand dollars indebt, there was nothing in my
brain besides a big ego of abunch of architects who teach me
(03:46):
how to do things.
So I took a year sabbatical andwent through all the trades as
a Latino living in California,took advantage of the color of
my skin and got jobs moppingroofs, installing drywall, doing
ligage.
Now I go to every job.
Hey, I'm un trabajo, so I'llget a trabajo.
I get a job, work my way in.
After a week especially moppingroofs I was like, hey, I know
(04:09):
how to read plans, okay, come tothe office.
So then you're becoming anestimator A couple of weeks in,
a month on, it was like, hey,listen, I actually went to
architecture school, I'm justlearning the trades, thank you
for the opportunity and workedmy way out about a year through
all the trades until I learnedabout ligage.
So within that process, thatjourney, I got hired by a fiber
(04:31):
cement manufacturer in LatinAmerica to go preach fiber
cement with ligage across theworld.
So I was like the youngarchitect who graduated in the
United States, going to thirdworld countries utilizing
framing systems with a substratewhich was a fiber cement.
So that took me to a journey ofabout 10, 15 years where I got
(04:52):
to learn a lot about manufacture, iso 9000, iso 14000, and all
the qualifications that thosebig manufacturers have.
10 years into that, got married, got kids, decided to come back
to the States Mom and dad andeverybody was here.
So I came back to the States,kept working for the fiber
cement manufacturer, working onICC, doing architecture
(05:13):
inspections, writing the code,everything that has to do with
fiber cement and ligage.
And then about 14 years agosomebody told me that there was
an industry, there was a guy inSouthgate putting a panel shop
that he may need help.
So I step in, start working,got into the 2D world that we
call it, you know, panel worldand been doing light gauge
(05:35):
panels, low bearing type oneconstruction in the California
market for over 14 years.
But, like Peter said about ayear ago, I said you know what?
This is easy.
You know because we're buildingfor DPR, for all the general
contractors, the big guys, thebillion-dollar GCs.
And then I said you know what Iwant to see, what happens when
you put this together and you doa volumetric thing.
(05:56):
So I went to the World ofManager, met Peter right there
and we took on the challenge ofgenerating mid-rise.
I've been a steel guy all mylife I have never built a house
in wood.
That's why we choose mid-rise,complying with codes and
everything else.
We want to go about fivestories where we're not
competing against wood.
It's impossible to competeprice-wise.
You know they're two differentproducts.
(06:17):
I think every system has itsplace in this industry and, as
an industry, we should behelping each other and this
industry and as an industry, weshould be helping each other.
And that's the journey thatwe're on right now Create two
lines of divisions.
We still have a ligage panelswhere we're very successful here
in California and that pays thebills, and now we're taking a
couple of modular jobs where nowwe're grabbing those 2D panels
and building them into a 3D unit.
John McMullen (06:40):
Very good.
Both of you have, it soundslike, extensive backgrounds in
traditional construction,traditional design.
What challenges did you bothface when you first started
tackling modular projects?
What was your biggest?
Peter DeMaria (06:54):
hurdle.
I connected with Diego a yearand a half or so ago.
It didn't matter how well Icould draw, how well I could
design, how detailed my drawingswere.
At the end of the day, someonehad to fabricate this and, as an
(07:20):
architect, the architect now isworking with a client and
convinces the client, say, hey,let's go into the modular space.
So at that point you have to beable to deliver a modular
fabricator or a team that isgoing to execute.
Okay, in the traditional worldI can go out there and get three
or four bids right andinterview everybody, but at the
end of the day, there's some youknow strong predictability.
Diego Rivera (07:36):
You're going to find a reputable builder who's
going to do a decent job youknow, the beautiful thing about
what we're doing with peter is Itelling Peter you dream I'll
build it.
You dream where those walls go,you dream the architecture.
Let me take care of whathappens inside those walls.
So building what's inside thewalls is the secret.
And coming from the 2D world,the panels and the connections
(07:58):
and the different inspectionsthat you have on a load-bearing
job you know nine stories, sixstories incorporating that into
your MEP pads, your mechanicalsand everything else.
It is challenging to understandhow boxes are.
But when we come from the panelworld, when we pre-manufactured
panels before foundations arealready been poured, it's been a
game changer of meunderstanding the needs that a
(08:20):
volumetric architect needs.
And also for Peter to emerge,the pre-construction, where
basically construction is aboutlogistics, correct, so we're
playing a logistics game againsta financial outcome.
So we both believe asarchitects that the secret is in
the drawings and that'ssomething that this industry
locks.
(08:40):
The ratio of people that wehave in our team is, for every
one brain thinking and drawing,we have four hands working.
So if you don't have that ratioin your company of brains
against hands and you're notbelieving in digital twin, it's
very challenging to spend moneyon robotics role formings and
equipment, and try to get thereturn on investment when the
(09:00):
brain is not there.
Peter DeMaria (09:02):
Part of what we're doing at Midrise where
Diego's team and in our shopthey're working down a tolerance
level of a 16th of an inch,role-forming our own studs and
joists.
We have all the equipment100,000 square foot factory
inside, 100,000 outside so wehave the capability of doing all
these things.
What we're doing now is alsoworking with fellow architects.
(09:24):
Typically, architects do notbring in another architect to
work with them unless there's asmall boutique firm and they
need an associate architect.
But in our case we share ourtechnology, we share our details
, we share our fabricationcapability, right with the hope
that these other folks will wantto adopt it.
We have no worries about beingthe so-called white label okay,
(09:45):
of what's being fabricated.
We're behind the scenes.
We're kind of almost hired as aconsultant to the primary
architect, much the way astructural engineer would be
hired and we sign all the NDAsand the non-competes.
We're not interested in takingany clients from the other
architects.
We simply want to work withthem and kind of float the
industry boat together.
We have plenty of work on ourown I can design.
(10:07):
There's only so many buildingsI can design right.
But the opportunities arebrimming.
There's so much going on rightnow and that's where our efforts
are focused, and we've beenreally fortunate in the last
year and a half to do somethings that I didn't think were
possible.
But what has unlocked it isexactly that first point that
(10:28):
the ability to fabricate and tofabricate not just put it
together but to do it with alevel of efficiency that does
translate into all those greatthings in the world of modular
being.
You know speed, speed, speedand quality and things are
getting very, very competitivein terms of pricing, but that
speed and quality give you areturn speed, speed, speed and
quality and things are gettingvery, very competitive in terms
of pricing, but that speed andquality give you a return on
(10:48):
your investment I think isunmatched by the other
technology.
So I think that's been thebiggest hurdle.
I know that was a long answerto a short question, but that is
what's been the hurdle for thelast, over almost two decades,
to find that.
But now I believe we, I thinkwe have it.
John McMullen (11:06):
So tell me about your modular design process now.
How does it start and how hasthat process sort of evolved
over time since you started?
Peter DeMaria (11:15):
Right now it's happening.
It's a little bit differentthan it was originally.
Originally, we'll work with aclient who comes to us.
We'll show them traditional wayto put the buildings together
and then we show them thebuildings together and then we
show them the modular benefits,and those clients will work with
us directly.
We will design that building.
But my design work does notstart in the traditional manner.
Just about everything that'sfeeding my design palette has
(11:39):
almost nothing to do with thedesign of the building per se.
I'm worried about logistics.
I'm worried about logistics.
I'm worried about shipping.
I'm worrying about the buildingrattling as it's being moved to
the job site.
And I have modules.
How large of a module can Imove down the street and how big
of a module can I pick up?
How far can my crane boom out?
(12:00):
I haven't spoken aboutaesthetics, creating a positive
environment where people's livesare going to thrive.
That didn't come into thepicture yet.
So what happens is I'm almostlike a chef who's in the kitchen
and I have to figure out howall these appliances and all
this equipment works before Ican really start mixing things.
And that's also a hurdle forarchitects who are not in the
(12:21):
modular world.
They're not used to doing that.
So there's a kind of relearningof the parameters by which you
design.
So that's part of our DNA now.
That's something that's anatural extension of us.
So when we're working on aproject it's rather easy for us
to sit down with the client, hitthe ground running and really
move forward.
(12:41):
When it's another architect whocomes to us, I think in general
architects are trained.
They're problem solvers acrossthe board.
They're trained, they'reeducated to be problem solvers
and whenever someone comes tothem with a project, yes, we do
those projects.
Can you do a gas station?
Yes, you do single family homes?
Yes, you do nuclear powerplants?
(13:03):
Yes, because they know theyhave to solve challenges and
they're not scared to go afterthose projects.
So when they come to us andthey've designed a building and
say, okay, we've designed ourbuilding in a traditional manner
, can you make it modular for us?
And I think, okay, if there wasany level of discipline there
and order and how the buildingis organized, it works.
(13:25):
And other times you have toreconfigure things and you kind
of have to fit it into the icecube tray per se.
So the design phase can dragout a little bit, but typically
the client is the one who willdrive that.
The clients are the one who goto the architects.
Listen, I want to dabble inthis world of modular.
Can we do it and how do we doit?
(13:46):
Those are the people we reachout to, those architects who
have those clients and say youknow, let, let us help you, let
us make that part of your, yourarsenal, your palette and your
creative outlet.
So the process once thosearchitects get uh up to speed on
the um, the know they'll get iteasily.
Diego Rivera (14:06):
And then to add to that, the next step what are we
doing?
Our end is what?
Well, peter is dreaming.
We're telling him hey, peter,this is just a cookie, you can
use the oven or the toaster,Don't be using that big oven
because you're going to kill thecost.
So what we do for that is webelieve in parametric models.
So we'll take the architecturallevel even from the bidding
(14:26):
stage.
I usually tell people when theyuse Bluebeam or any of those
softwares to do estimating, Icall it finger painting.
We don't finger paint here.
We grab the house or the modelor the building that we're doing
it.
We do a parametric Revit modeland out of that parametric model
we get all the data that isneeded to be able to be
efficient on the price.
So that's how we price ourbuildings and as we move forward
(14:49):
on the contracts and on thedeals that we're working with
our owners, we have the abilityto this parametric models to
make decisions on equipment, onsize of the electrical panels
and everything else, and have animmediate impact in the budget
before we make any decisions andbefore we even buy an outlet.
So I think that's where wecomplement each other, where
(15:10):
Peter has the ability to dreamwithin the needs of the budget.
And then we come behind almostas an inspector, just making
sure that at the end of the dayis feasible for the price based
on what the project and the siteis needed.
John McMullen (15:24):
From an architectural point of view and
you both have brought up greatpoints that go outside of the
bounds of just pure architecture.
But from an architectural pointof view, are most modular
projects similar, or the onesthat you do?
Are they similar or does eachproject sort of have a unique
module design that requiresstarting from scratch?
Peter DeMaria (15:45):
Well, you can look at it both ways.
I think if you're going to bemore efficient in this space,
you're going to want to come upwith some standardization,
because I think that's where thelevel of efficiency comes from.
Can you do custom projects?
Sure, but when that happens,most of the folks who are
attracted to modular want to getthings done quickly.
They want to do things ofexcellent quality and they're
(16:08):
trying to do things of greatvalue, a decent value prop in it
all.
Once you go custom, it fallsback into the traditional world
of doing things.
Now we have created a littlepalette.
You know we would love to belike In-N-Out burgers, right
where they've got three or fouroptions on the menu and that's
it.
But the intense amount ofresearch and development has
(16:29):
gone into creating that module,creating that standardized
module, because you have to makesome assumptions about how the
masses of society want to livein a one-bedroom or a
two-bedroom or a three-bedroomapartment or something along
those lines, and you make someblanket statements, but very
often it's not about how we havelived in the past.
When we're designing, it's howdo we want to live, and that
(16:50):
becomes the drawing inspirationbehind what we do right?
And then you combine that withall those technical things we
were talking about before, itbecomes this mix, heavily mixed
level of aesthetics andtechnical prowess and you cannot
leave the technical out andvery often you say, listen,
we'll design it and someone elsewill figure out how to build it
(17:11):
right.
That never happens with us andit's interesting that Diego
mentioned, you know, aparametric model, one of the
benefits we have in our shop.
If we have this shop with rollforming machines and you know 30
, 40 guys putting thingstogether there, we have six or
seven project managers who areworking exclusively in Revit,
(17:32):
autocad and they put thesemodels together.
But they all started out on thefloor of the factory.
They all started out runningthe roll-forming machine,
fastening everything together,and they've all been with us at
least eight years.
So that means that when they'reat that Revit table and they're
inputting information, theyknow firsthand how it comes
(17:55):
together.
There's no disconnect betweenthe people drawing and the
people who are fabricating.
That's massive, that's huge.
That's why Diego and I gottogether.
I said, diego, you've gotsomething going on that I
haven't seen, that I know isrequired and and I see it
firsthand and it's wild becauseI'll go into the factory and I'm
feeding off of it.
As the architect, I'm seeingthe way they're doing things in
(18:16):
that that palette that I have isnow getting bolstered right
because I can see how thesethings are put together in a
more efficient manner.
So I think that's pretty muchhow I've seen development on it
and, diego, what do you think inthat regard?
Diego Rivera (18:34):
I think, just to add to this yes, repetitious is
the secret, correct, that'swhere you make the money.
But if you try to use an 80-20rule, 20% of the cost of those
modulars is the bathroom, thekitchen and all the MEPs.
So we have to standardize theMEPs and give the ability to the
bedrooms the world where I dopanels the size of the bedroom,
(18:56):
the size of anything that isoutside that 20% control be
flexible.
So we standardize our bathrooms, we standardize our kitchens,
our connections, our MEPs, rightwhere the money is, and then we
let the architecture fly on theboundaries of the site, the
boundaries of the building, theneeds of the customers.
But the core budget or the corecost of the modular unit which,
(19:20):
in my understanding, by doingnumbers and looking at it, it's
the bathroom, the kitchen andall that area with all the
connections are we standardizeand we create a palette for
those.
So we're trying to be flexibleon the rest of the building and
the standardized bathroom andthere's only so much you can do
with them.
You know an ADA bathroom, aregular bathroom, and then all
you do is you change colors,sizes, but then you keep the
(19:42):
main core of the building andyou use that 80-20 rule.
Peter DeMaria (19:46):
You know along those same lines.
I'm going to add to that.
Very often when I speak tofellow architects, you know, if
you're doing these modularbuildings of any large scale,
they usually end up looking likeminimum security prisons.
You said there's no flexibilityin the design or the aesthetics
.
In the design or the aestheticsand what we've done is part of
(20:07):
our entire approach we integratea unitized facade into our
modules.
That unitized facade enables usto swap out materials, the
thickness of material, the color, all of that.
They give the building reallyits own identity.
Things don't have to look likethe building next door.
That we did two years ago.
So we think we've achieved alevel of variety that's kind of
(20:32):
veiling all of that repetitionwhere we leverage all the
efficiency from.
We're working on a project nowhere in South Los Angeles with a
developer and it's Anthony Gude, it's Gude Capital, and it's
Anthony Goudet, it's GoudetCapital.
And it's interesting because weput together this entire
building and then our modularelevator, which is typically
(20:54):
just a shaft, has become thispoint where we have these
shifting marquee shapes goingaround all the way up this
eight-story building and itbecomes the iconic image of the
building and it kind of stealsthe show, and all of a sudden,
the rest of the building is fine, it's perfect, it's not boring,
but you have this one aestheticfeature that really sets it off
(21:16):
, and I think that's up to thearchitect.
The architects have to takeleadership on it to show what
those possibilities are.
Things do not have to be boringby any means, and you'll see
that project eventually it'squite nice.
So I think, though, we would belying if we told you
repetition's not so important.
We can do whatever you like.
It's part and parcel to what wedo.
John McMullen (21:39):
With all the experience that you both have
acquired, would either of youconsider yourselves a specialist
in modular design?
I ask because it seems likemany designers include modular
in their skill sets.
They'll do traditional, they'lldo modular, but there are few,
at least in my experience, whoare truly specialists in the
(21:59):
field.
What are your thoughts on that?
Do people need to specialize?
Peter DeMaria (22:03):
I'm gonna answer that first, diego.
Diego is a specialist.
I don't know anyone in thisfield in that 2D panel world
that knows that industry andexecutes like he does.
There's so many who've writtenbooks, white papers, giving
(22:27):
lectures, and I've seen them all.
But at some point the rubberhits the road.
And Diego this is why Iconnected with him when I went
to the shop.
They were doing it and he'sbeen doing it for 12 years.
He's not been doing this forjust last week because it became
a cool, hip thing to do.
Diego, explain how you got tothis point, or maybe help John
out with that, because I dobelieve you're the specialist.
I know you're humble not toooften, but I think you'll be
(22:48):
humble this time.
So give them a general idea howyou got to where you are and
what it takes, so that the otherfolks out there who want to
follow in your footsteps havesome general path or some
guideline on how to achieve that.
Diego Rivera (23:03):
I think being humble is the secret of being a
specialist.
Correct, because we learn onthe nose All the mistakes we
make.
You have to add it up.
I think a specialist is just anaccumulation of mistakes.
Who's brave enough to admit itand be able to pass it on to the
next generation or the nextpeople?
So we have different rules inthe shop.
We have a pool schedule.
(23:23):
We do a lot of jobs with DPR,with the big GCs, that they have
different concepts, leanconstruction, pool schedules and
try to implement that.
There's certain rules that wehave in the shop.
Who's at fault, the onereceiving or the one giving?
And our shop is the onereceiving, because if you're
receiving something that is notwhere it needs to be, don't move
(23:44):
forward.
Stop the line.
We believe in drawings, simplethings.
The only way you move up in ourshop is if you bring me
somebody better than you to takeyour job.
So, john, if you come to me andsay, diego, hey, I'm tired of
sweeping floors, I want to putsome screws, you better bring me
a guy that sweeps floors betterthan you in order for you to
move up.
So that has created a level ofdependency on the team and also
(24:08):
trust.
I always say that there's a bigdifference between respect and
admiration.
Everybody respects the guy thatwrites the check, but if you
start admiring your team andyour team admires you, and you
create this camaraderie, thisgroup, where the mistakes are
just the result of our growth,it is where things happen.
I think that's what a lot ofother things in the industry
(24:32):
happen, and a lot of leaderswill.
You know.
I read something on LinkedInthis weekend and I put a little
comment where nowadays, the bestadvisors are everybody else who
has failures in the industrybecause they weren't able to be
smart enough to survive, becausethey bought their souls to
capital, because they neededmore money.
They buy all this equipmenteven though they were smart guys
(24:52):
.
Here they are going out ofbusiness because you had to keep
feeding the bees, so you haveto see what your abilities are.
So we're very cautious on thejobs we take.
We're growing very steady butslow.
Everything we owe is paid off.
We don't owe money to anybodybesides the rent and the
electricity.
So being debt-free and havingthe ability to dream and being
(25:15):
challenged is what is allowingus to grow.
Are we making millions ofdollars?
No, but we're paying our bills.
Our people is paid and it givesus the ability to think, which
a lot of these new modularcompanies, by taking capital and
money and raising funds, theydon't have the ability to slow
down and think.
John McMullen (25:33):
Follow-up question for you, Diego.
What education and developmentdo young architects need in
order to really get skilled withmodular design?
What paths should they followto get their education?
Diego Rivera (25:46):
You know there's a saying that the professor shows
up when the student is ready,correct?
There's so much learning in thestreets that are you really
willing to pay the price?
Are you willing to take thatyear's sabbatical and go mop
roofs, put screws, before yourego of being an architect walks
away?
Or you're ready to pay?
You know, go do red lines for afirm and all you do is you do
(26:07):
red lines for a firm and all youdo is you do red lines and you
dream and you copy paste.
So I think architects shouldhave the ability to go to school
.
They should have the abilitythen to go to the job site.
If you look how architects areraised in the rest of the
countries besides united states,they actually get to build as
soon as they're out, they go tothe job sites.
An architect here here, becauseof legal circumstances, because
(26:29):
I think construction is beingruled by lawyers more than
architects and builders youdon't have that ability to spend
that many hours because you'reprotecting yourself.
You know you don't want torelease your Revit model because
it's not a constructiondocument and we're doing all
these documents, documents andit's.
(27:00):
I understand it's a hugeeconomy.
John McMullen (27:01):
It's a huge industry that everybody needs to
protect themselves.
But within the school, withinthe process of going to school,
they should go to the job sitesand learn.
I'm sure I just butchered it,but I think I paraphrased it
well enough.
How can architects who areexperienced in modular design
best share their knowledge withyounger designers?
Are there best practices?
Are there methods that you'veeither done yourself or
(27:21):
witnessed that you think workparticularly well?
Diego Rivera (27:25):
You know, like I told you, experiences and making
mistakes.
I also say that there's adifference between sweat and
saliva.
A lot of people have a lot ofsaliva, a lot of pictures.
You know, architects have kindof two things.
You know, and I'll probably beoffending architects, but they
have the projects that pay thebills and they have the projects
that raises their ego becausethey get published in a magazine
.
But if you can find that middlepoint where you can teach the
(27:47):
next generation of the mistakesand what you've done and share
that and walk away from that egothat you're the architect, but
assume the responsibility thatit's okay to make a mistake,
that it's okay to repeat itself,the problem is not to make the
same mistake twice, hopefully,and then just lead.
You have to lead Leaders arethere to lead people and you
(28:09):
need to walk away from your ownpersona and build teams.
John McMullen (28:14):
Peter, I want to follow up on something you said
earlier about wanting to workwith other teams.
Are there any best practicesyou've discovered to help with
that communication and ideasharing within a team of
designers?
Peter DeMaria (28:30):
communication and idea sharing within a team of
designers.
Sure, I mean, the communicationchannel is probably the
linchpin in all of it.
We're set up on teams.
We actually work with aninternational team.
We've got folks in Europe,engineers in Europe, we have
architects in South America thatare all part of our team, and
when you have that type ofdistance and it's purely digital
, that has to be really tight.
(28:50):
In addition to that, you havestandards with all of your
drawings, standards that can beshared, libraries and I think
that's where most of the workgoes into on creating the
modular company.
You have to create a library,you have to create an ordering
system, you have to create thesestandards by which everyone's
moving in the same direction,utilizing the same tools, same
(29:13):
details.
It's a language, it's likelearning a new language.
So that's one thing.
The rest of it, I think rightnow, those folks that I told you
, the project managers that wehave on our Revit stations we
need to pull them in and makeeach one of them an expert in a
different facet of building.
(29:33):
So we have one person now who'sreally specializing in just
mechanical, another who's justelectrical, plumbing facades.
So we're empowering them withthis knowledge.
So they're starting to see thathow this all ties together, you
know, to a greater whole.
And that has to happen at thesame level.
When we work with fellowarchitects, we have to give them
(29:54):
all that information, we haveto give them the drawings, we
have to share just abouteverything that we've created If
we hope to be on the same page.
We have to share the playbookif we're going to move that
offense down the field, right?
So I think in many instancesit's just a matter of everyone
(30:15):
getting on the same page sothere's no miscommunication.
And, quite frankly, across theboard, I don't know what the
huge percentage is, buteverything we are doing when it
comes to the planning and thearchitecture and the engineering
is to reduce the amount oferrors in the field and to
create some level ofpredictability in all of this.
(30:36):
And the only way to do that isto share the information so that
we're all on the same page.
We do not have the luxury ofputting that note at the top of
our drawings.
This contractor shall verifyall prior to construction and
notify the architect if thereare any problems, right?
That doesn't exist in our world.
So we're circumventing all ofthat because it has to happen
before we even we pass it off toany other team.
(30:58):
So we've had success with this.
We work with a few differentcompanies already that have
embraced it, and now they've youknow, they've become modular.
You know I don't want to callit specialists yet, but they're
they're very friendly to itbecause they see those benefits
that come with it.
Diego Rivera (31:13):
And something that we've done is, you know, walk
away from the project managersand create product managers.
So we have the product managerfor MEP, for everything else,
and we also have a theory herein the shop that the more we
teach, the more you need us.
So the more we share, the moreyou're going to need us, because
we want to be a source ofinformation, we want to be the
ones doing the research, we wantto be the ones hopefully
(31:34):
helping architects so they canhave their steady building, and
let us take care of whateverhappens inside the walls.
Let us pay attention to the MEP, the outlets, the ROF openings,
the locations of your ADAbathrooms.
Let us help you.
Just redline everything elsethat has to do to make a more
efficient and cost-efficientbuilding, while you keep the
integrity of your design.
So that's what we think we wantto be that resource for
(31:58):
architects, engineering firms oranyone who wants to get into
the modular world.
Peter DeMaria (32:02):
And John, you know you asked that question
earlier about the students andthere's a few programs out there
.
I used to teach University ofTexas, right, and University of
Texas has a like a design-buildprogram there and I can't
remember the exact name, butit's run by a gentleman named
Coleman Coker.
There's another program atUniversity of Kansas.
It's run by Dan Rockhill.
They have design-build programswhere the students are spending
(32:26):
a semester building a residenceor building some building and
the rubber hits the road there.
These folks show up and they'renot in you know the cool
architectural block turtleneck.
They're in work boots andthey've got tool bags and
they're making it happen.
And those folks, I've got tobelieve, have a huge advantage
(32:46):
over the folks who are purely inthe studio, right, because they
understand how critical it is.
Actually, they probably learnmore.
So what you don't want to doout in the construction site,
right, and that feeds them tosay you know we need to resolve
this problem before we get tothe construction site and how
can we do that in the factory?
So I would recommend anystudent who's really interested
(33:08):
in modular that and you're inarchitecture school, that's a
place where you would start.
John McMullen (33:13):
Well, speaking of where students are learning and
how they're learning, are thereany new tools AI, for example
that you feel have the potentialto change how designers deliver
their projects that maybe thesestudents are being introduced
to now?
Peter DeMaria (33:27):
I think a couple things are happening.
It's obvious that the AI isenabling us to do the macro work
much easier.
In other words, I can start toreconfigure buildings very, very
quickly, right?
Simple little modules can begrouped into taking into
consideration the sun, the angleof the sun, solar penetration,
the neighbor's views, your viewsaway from the building.
(33:47):
All those things enable you upfront to configure your
buildings more efficiently.
But what I get a little nervousabout, a little scared about, is
that so many people are justgoing to rely on that machine to
configure their building andthey're going to say, okay, my
job is done now and it's reallyeasy to get wrapped up and be
enamored with what's happeningin the world of modular and
(34:10):
modular construction.
People are fascinated by it,but at the end of the day, it's
a means to an end.
It's really serving a largerpurpose, because we're creating
spaces for human beings, and ifthat gets left out of the
equation, I'm not sure howsuccessful those buildings are
going to be.
And I've seen plenty ofexamples in the past where, yes,
it's a shelter, You've got aroof over your head, it doesn't
(34:30):
leak, but I don't want to be inthat space for longer than 20
minutes.
Right, this gets back to theminimum security prison phrase
that I've heard over and overagain.
But AI is able to take intoconsideration the cultural
elements, how people live inthat neighborhood and all the
other things that impact thequality of life there.
At that point, I think it'sgreat.
(34:51):
In the meantime, we're going tohave to settle with the
architects to see the world alittle bit differently and make
some observations, say you knowwhat?
I've created an incrediblecontribution to this context, to
this neighborhood, to thispiece of property.
So we are not againsttechnology, I can tell you that
much.
We are deeply embedded in itand I see it as a tool, just
like just like everything elsewe have here.
(35:12):
We're embracing it.
Diego Rivera (35:15):
Yeah, you know, to add to what Peter's saying, I
think the best tools.
You know, there was a fellowthat actually Peter introduced
me to.
I never knew about him, EdwardDeming.
You know he was the gentlemanwho helped the Japanese
reconstruct Japan after WorldWar Two.
John McMullen (35:27):
And he had a couple of good quotes.
Diego Rivera (35:29):
He said that without data, you're just
another person with an opinion.
So for AI to work, you needdata.
So, like in our shop, we'vebeen collecting data for the
past 10 years 12 years.
So I know what Jose in the backnumbers are when he's putting a
number 10 screw on a 16 gaugeto a 12 gauge piece of track.
(35:50):
And now we're taking it to thenext generation.
We're trying to write analgorithm where you have three
variables that you have to takeinto account when you do modular
.
One is your schedule thatyou're going to deliver.
The other one is the resourcesyou have that day in the shop,
and the other one is theprocurement of the materials.
The other one is the resourcesyou have that day in the shop,
and the other one is theprocurement of the materials.
So how do you know what panel,what stage to do next week and
(36:12):
everything else based on theteam, based on the people you
have, and be able to leveragethose resources to be productive
and make money?
So I think data is the secretfor AI.
Ai would not work without anyresources.
He also had another good quotethat he said in God, we trust
(36:33):
all others bring the data.
So a lot of the new shops aretrusting in God or whatever your
God is, but they're nottrusting on resources and data
and experience.
And that's where the professorand the student and all this
thing comes in, when there'sknowledge and there's mistakes
being made and all that mistakes.
All those information has beenaccumulated for the benefit of
all and you have to share thatwith everybody and be
accountable for it.
Peter DeMaria (36:52):
There's a quote I use that the Stone Age didn't
end because they ran out ofrocks.
Right, this is coming.
Ai is going to play a more andmore dominant role in what's
taking place in our industry,and we're embracing it.
I'm curious where it's going tobe in a year from now, even
five years from now, and I can'tget my arms around it, but I'm
(37:13):
genuinely excited about it.
John McMullen (37:15):
Well, it seems like a good time.
Conversation seems to havecrescendoed in a couple of
different ways.
Tell me about the formation ofMidRise Modular and all the
experience that you've broughtto it, all the excitement, all
the technology.
What led the two of you tocreate MidRise Modular and
what's your goal with thecompany?
Peter DeMaria (37:37):
A few things have happened here.
I've been in that modular spacealmost for two decades, on and
off, and then about five, sixyears ago I was fortunate to get
aligned with a company calledHBG Modular which we created
with the late Max Azria and afew folks here in Los Angeles,
(38:01):
took my knowledge in thecontainer world and sent me off
to China and worked with a greatteam of people from the US, was
able to get our China factoryapproved by HCD here in
Sacramento, state certified andwe created a bunch of prototypes
and ultimately a five storyapartment building here in Los
Angeles.
We did a homeless project herein Los Angeles and really took
(38:22):
that portion of Modsler to ascalable level.
Now I have been involvedprimarily with boutique type
projects one-off houses, adus,things like that but never
something where it would haveimpact on the masses and then
really help the people who needit most.
So that company resulted inthree or four buildings here in
Los Angeles but then went toanother company hoping to work
(38:48):
on the multi-family project.
That didn't work out and I wasin a spot where I said, gosh,
I'd really love to get back tothis.
And I ran into Diego.
We were getting awards for theprojects that I mentioned
earlier at the world of modularand just hit it off with him and
spend a whole bunch of timewith him, and he explained
(39:09):
everything that he was workingon the 2d panel world and I said
this is exactly what we need inthe 3d panel and he's a
production partner.
I also spoke about that earlierand once I got back to a shop
and saw the culture that wasthere and the work that they
were producing, I realized thatthis guy had solved the problem
in the volumetric world that hewasn't even working on.
He solved the problem in the 2Dworld.
(39:30):
It was easily readapted intothe 3D world and in our
discussions Diego was telling melisten, we want to make the
jump in the 3D world, but we'renot sure, we don't know what you
know, okay, and it was kind ofvice versa.
I didn't have the skillset, Ididn't have the resource to do
what he was doing.
So it kind of fit like a handin a glove quite nicely.
(39:52):
And then, once we got together,I think that we realized that we
had to continue on the pathwith the 2D panel world because
he had a level of expertisethere.
But we slowly started infusingthe volumetric vocabulary into
everything and started to goafter those types of projects.
We did not expect to have a 3Dbiometric project, likely for
(40:12):
another six months or so, butwe're working on a nice size, 88
unit, eight story biometricproject.
Now that's in combination withthe panelized projects that
we're currently working on aswell.
We find ourselves not justdeveloping or building projects
for our clients, but we're thewhite label to other fabricators
, much in a way that we would bethe modular architect, the
(40:35):
specialist in architecture forthe traditional architect.
We are now the intel inside forother fabricators and that's a
result of those folks seeing thesame thing that I saw and what
Diego had created in the 2Dpanel world.
So I think we have a prettydiverse company and I think that
, regardless of what's takingplace, there seems to be always
a demand for the panels, and nowit's starting to take place,
(40:58):
obviously with the volumetric.
Diego Rivera (41:00):
Yeah, and in my side, you know I got enchanted
by all these ideas that Peterhad as an architect.
You know I still dream as anarchitect, even though we build
things day to day.
And then when we talk and we seewhat was coming, especially
living in the world of panels,living in the type one
construction assistant living,nothing in wood, everything
above five stories we're likethere's a big challenge here.
(41:23):
The city of LA, in myprediction, is when the next
five years is going to gonon-combustible.
So I don't think nothing withinthe metro area of LA is going
to be able to be done in woodbecause the density is not going
to allow that Density wouldallow for non-combustible
buildings.
I've been living in thenon-combustible buildings.
I've been living in thenon-combustible buildings for
the past 10 years.
So when I saw that level ofprecision that we do on the
(41:43):
panels, what the industry isdoing in the future, where the
market is going, the knowledgethat Peter brings on the
volumetric side, but, mostimportant thing, have already
established business that paysthe bills.
So we don't have to go get aloan and get in debt to try to
create a volumetric business, itwas a no-brainer.
So we create a subdivision tothe existing operation.
(42:07):
The existing operation isrunning on its own, paying the
bills While we're dreaming onthe side building this
volumetric.
Peter and I were going to take ayear sabbatical just to learn
and go across the world and seewho's doing what.
But we just got pulled in andwe got a project already and the
level of coordination anddigital twins that we run in the
other industry.
(42:27):
It was secure enough for us totake this new challenge and
we're looking forward.
I think it's going to be agreat experience.
We're crawling.
Hopefully, you know, by the endof the year we'll be walking.
I don't know if we're going tobe running, but we'll be enough
to survive while the panelbusiness keeps growing.
John McMullen (42:46):
Have there been any potholes or hurdles that
you've had to navigate in thepast year and a half?
With the beginning of mid-rise,modular Anything.
You didn't expect.
Peter DeMaria (42:55):
Well, they say it's a cliche, right?
All these hurdles or all theseproblems prompt you to come up
with other solutions.
Right, and the worst day canalso be the best day, and that's
happened in some regards.
I'll let Diego talk to youabout our current facility and
how we have shifted gears andnow have taken on a new facility
(43:16):
.
I'm sitting in our new officetoday, and a year ago we were
not even thinking about this atall, but there's some challenges
that did pop up in that regard.
Other things that are happeningis there's some really pleasant
things happening.
You would think that the changein the code and the policymakers
are getting far more friendlyto what we're doing as modular
builders, and we realized a verylong time ago that you can be
(43:39):
the most visionary architect inthe world and have everything
resolved, but the policymakersare so tied to what we're doing
and the ADU laws in California,the SB9 laws, what Diego was
talking about earlier with thenon-combustible.
It's all an attempt by thepolicymakers to have more
density in existing cities.
(43:59):
Instead of promoting sprawl andpeople moving further and
further out into the suburbs,they're bringing people back to
the inner city and what thatmeans is raising in tax dollars,
right.
And when all that happens, thebuildings start changing.
We're doing an eight-storybuilding, 88 units.
There's no parking becausewe're within a half mile of a
(44:21):
parking transit hub.
That's major.
Do you know what that does tothe impact of the budget for the
developer?
They're putting up 88 units nowinstead of 30.
And I'm not saying that densityis the answer to everything,
but I'm telling you that we haveto team and collaborate with
these other players in order tomake an impact, to make that
(44:41):
positive impact.
Diego Rivera (44:42):
Besides that, I think one of the biggest
challenges, too, is having thebanks and the financial world
understand the cash flow of abuilding like this, and that's
what we're trying to stillconvince lenders and even though
the customer, the architect, ison road, it's just the lender
how do you end up paying allthis money up front and you're
(45:02):
acquiring all these materialsand schedules, but they still
want to run it as a traditionalconstruction?
So there's a difference rightthere between still having the
mentality of traditionalconstruction but being able to
have a cash flow, and adifferent phase, which is
manufacturing.
So the line betweenmanufacturing and traditional
construction, I think, is wherethe biggest challenge is that we
(45:24):
see, but once you get the rightlender, once you get the right
customer and everything else isflowing, it's just a matter of
cash flow.
So what Peter is saying back inNovember we were challenged by
the landlord where we're stayinghere in LA.
We've been here for close to 14years paying very significant
amount of money compared to whatthe neighborhood does.
(45:48):
So, he came back in November andsaid hey, diego, it's time to
raise the rent.
I said, well, I've been gettingmonth increases for the past
decade.
He goes no, no, no, no.
Market rate is four times whatyou're paying.
I was paying, I'll give you thenumber.
I was four times what you'repaying.
I was paying.
I'll give you the number.
I was paying 54 cents a squarefoot.
He came back and said a marketrate is two dollars.
I'm like what?
Two dollars?
That's two hundred thousanddollars a month for rent.
(46:10):
Multiply that times a year,that's 2.4 million dollars.
So I was like I said okay, what?
Who in the constructionindustry makes 20% profit or
maybe 10% profit needs to sell$10 million just to pay the rent
.
So we're like Peter, we're introuble.
What are we going to do?
So, within people that we knowwe're in the industry, we start
(46:32):
looking south and went intoMexico, went into the Tijuana
area.
I know a couple of red ironmanufacturers there who do
chassis and structure steel, whodelivered to california, worked
the deal within, did a jointventure and we're actually in
the process of opening our shopin mexico where we keep a small
operation in la to manage theinstallation and the work of the
(46:55):
2d panel where we develop thevolumetric.
But you know, I keep thinking.
I mean, you come to our shop.
I have an american flag made inamerica, very proud of building
everything, but california ispushing us away, you know.
And as we go to nevada and thenkeep going east, but the market
is here and um all these newlaws between mexico and and
(47:18):
united states, where you stilluse 100% American products, you
go across the border and you use, you know, near-shoring and
you're able to use some of theirlabor and bring back the
quality of the products,complying with the same code,
complying with everything else.
It makes sense, I mean.
John McMullen (47:35):
So, in terms of projects, what's and you alluded
to a couple before, peter, butwhat's on the horizon for
Mid-Rise Modular over the nextyear or two?
You mentioned an eight-story,another project.
Do you have anything else inthe pipeline, something you can
talk about?
Peter DeMaria (47:53):
Sure, I mean the panelized projects that we're
working on to support the otherfabricators are a big part of
what we do and we really excelat that.
At the moment we're doing somework in Hawaii.
We're on short list to dostudent housing projects here
with UC system.
(48:13):
We also have a series of folkswho've come to us with SB9 lots
who are really dividingsingle-family residential zone
property into four units now andthat's becoming almost like a
repetitive cookie-cutter type ofsolution that can apply across
the state of California.
So we're creating that menuthat we spoke about earlier,
(48:37):
right where we have a solutionwhere someone can come to us and
get something right off theshelf and they're ready to go.
The other developers that we'reworking with they don't just
kind of go in and do one projectwith us.
They're now presenting all theseother projects because they see
those benefits and I don't wantto say we're early stage, but
(48:57):
we're doing some projects thatare pretty big out of the gate
and we also don't want to runinto a spot where we just take
all the work we possibly can westart compromising the quality
or don't have a way to fabricateit, and we don't want to go the
route of some of the othermodular companies that have
simply failed.
Just kind of business could notkeep up either with that
(49:19):
workload could not produce.
Just kind of business could notkeep up either with that
(49:44):
workload could not quality.
It seems to be at the core ofeverything that we're doing.
So it would not surprise me ifwe grow slowly and steadily and
continue to do excellent qualitywork, and I actually prefer it
that way.
So I think that's probably thevision for the next year or two,
maybe even two or three years,where we'll work out every
(50:05):
little detail we have so thatwhen we deliver something it's
highly predictable, no changeorders and it's just a beautiful
quality project.
Diego Rivera (50:16):
You know, and to add to that to Peter.
You know, going back to what Iwas telling you, being able to
be debt-free.
It's allowing us to dream likethis, correct?
So what's in the pipeline?
In the panel business, weprobably have a couple of
assistant living projects,probably in the range of 250,000
, 300,000 square feet ofbuildings where it's just panels
, that's probably 15,000 panelsbetween walls and floors, 15,000
(50:43):
panels between walls and floors.
We're also becoming this widelabel for existing modular
companies in the city who arechoosing to become an assembler.
You know they all think, hey,we're going to be Tesla, we're
going to be Boeing, we're goingto build modulars and we're
going to sell.
You know we're going to.
So we bought, you know we drinktheir Kool-Aid.
We'll make them the best panelthey need and we supply with
them.
And now, with the operationthat we have in Mexico, we're
also integrating all thestructures, steel and chassis.
(51:06):
So we supply the chassis, wesupply the walls, we supply the
floors.
They put it together, they dothe MEP, they do everything else
and for us, all we want to dois give them the best panel they
can have.
So so far we deliver 88 unitsfor this customer.
We just signed a contract for188, maybe 500 by the end of the
(51:28):
year and they're projecting1,500 units by next year.
So this is just building parts.
You know kits of parts walls,floors and metal chassis and
what they value and what we dois our level of precision.
So if you don't know how to dothe structural part, precise the
box, the chassis, meps and allthat, it doesn't really matter
(51:51):
if the building is not going tocome together once you build it.
So our level of precision onthe 2D panel and being able to
accommodate this other modularcompanies who require,
especially on the chassis, Ithink out of the LA shop, out of
the LA modular companies wesupply to four of them as a
white label.
You know I won't give you namesor nothing like that, but it's
(52:12):
an honor for us for them torespect our level of quality.
We don't compete against thembecause we're actually we're a
small modular company doing ourown buildings, but we can be a
great complement to theirexisting operation.
So that's allowing us to learnto be humble enough to pay the
bills and we have our firstproject of our own that
(52:32):
hopefully will be done by 2025.
And then we'll see what happensfrom there.
John McMullen (52:37):
Peter Diego, thank you so much.
Just clearly a wealth ofknowledge and experience that
both of you bring to MidRise andto the industry.
Really Thank you so much foryour time today.
I really appreciate it.
Peter Diego, if people areinterested in getting in touch
with you, what's the best wayfor them to do that?
Peter DeMaria (53:04):
go at midrisemodularcom or demaria.
At midrisemodularcom we're veryactive.
You won't get passed off to asalesperson.
We prescreen.
We say no to a whole bunch ofprojects that we know are just
not conducive to what Modularbrings to the table.
And, john, I just want to thankyou because you're a great
conduit to the entire industrynot the Modular industry alone,
but to the construction industry, and just modular industry
alone, but to the constructionindustry and just to give us a
forum to discuss and share.
(53:24):
What we're doing right now isimportant.
We'll be talking about someother things we have on the
burner with Team Prefab Centerfor Modular Architecture.
That's part of our whole visionand that's for another
conversation.
But we really do appreciatewhat you're doing and all the
folks there at MBI.
It's a great asset to ourindustry.
Thank you.
John McMullen (53:45):
Well, I appreciate it.
I'm glad to have you guys asmembers and I hope to see you at
the next World of Modular.
I guess we'll be in Vegas nextyear, so hope to see you there.
Diego Rivera (53:54):
Yeah, we should go to the one in Europe.
John McMullen (53:56):
Oh, the one in Europe, absolutely Brussels.
I'll be there.
Diego Rivera (54:01):
There you go, we may see you there.
John McMullen (54:03):
All right, thanks again, thank you.
Peter DeMaria (54:03):
John, my name is John.
John McMullen (54:05):
McMullen, and this has been another episode of
Inside Modular, the podcast ofcommercial modular construction.
Until next time.
Hello and welcome to Inside Modular, the podcast
of commercial modularconstruction brought to you by
the Modular Building Institute.
Welcome everyone.
My name is John McMullen.
I'm the Marketing Director hereat MBI.
Today I'm joined by PeterDiMaria and Diego Rivera of
Mid-Rise Modular.
Among other things, Peter andDiego are here to talk about the
(00:22):
modular building design processand what younger designers
should know about being part ofa modular project team.
Peter and Diego, welcome.
Peter DeMaria (00:30):
Morning, john, good morning.
John McMullen (00:32):
Tell me about yourself, Peter.
We'll start with you.
What's your background and howdid you get started in modular
architecture?
Peter DeMaria (00:38):
Thanks, John.
I started out in architectureschool.
If I really want to go back far, I was able to meet Buckminster
Fuller when I was a young fella.
John McMullen (00:48):
Oh wow.
Peter DeMaria (00:49):
And I was in undergraduate school, was in art
school, where I'd never be anarchitect because my brother was
in architecture school workinghis tail off every night and I
was out having fun at artistparties in New York, right.
But it all changed when I had agreat professor, and I think
that's happened often for manypeople.
There's always a mentor orprofessor out there that really
(01:09):
changes the way you view theworld and at that point I was
able to meet Bucky Fuller and itwas quite inspirational.
It put me on a different path.
I went off to architectureschool at the University of
Texas in Austin and thenmigrated west to Los Angeles,
opened my own architecturalpractice and did primarily
traditional work.
Got to about 2003, 2004, gotfrustrated with the cost of
(01:35):
things and started to explore.
I was teaching at that time,took a year sabbatical and
clearly went around the world tosee what was an alternative way
of building.
That wasn't stopping me much ofthe way the traditional wood
frame construction was doing andI unveiled, you know, the cargo
container at having the mostpotential but the least amount
of research had been done on it.
(01:56):
So I was really fortunate, hadsome great clients in 2005 and
built what I believe is thefirst legal cargo
container-based building in theUnited States.
It was a two-story residencedown in Redondo Beach and that
kind of set me off on analternative path, the
traditional architecturalpractice that I had, and I
really leveraged out what youcould do with that container and
(02:18):
the next logical jump was tomove into the world of modular.
And once I got into steelmodular I understood all the
benefits of it and I've notlooked back.
And right now Diego and I havecome together and I think we're
creating something that's reallygoing to serve the masses.
We think we've come uponsomething that's really valuable
and we want to share it.
(02:39):
We want to bring it out thereto the world and have the most
amount of impact on the peoplewho need housing and a great
housing solution most.
So that was like 30 years in anutshell, right.
So now I find myself here inLos Angeles and travel back and
forth from Austin, texas, to LA,and Diego and I have been
(03:00):
actually working parallel toeach other for the last almost
two decades, but we didn't knowthat we were in each other's
backyards until we met thanks tothe Modular Building Institute
at the World of Modular about ayear and a half or so ago, and
we've been doing fantastic eversince.
John McMullen (03:17):
Well, that's an amazing background.
Thank you, peter Diego.
Tell me about yourself and yourbackground.
Diego Rivera (03:23):
Oh my God, that's interesting when you go after
Peter.
So let's see if I can do betterthan that.
You know I'm going to give it atry.
Same thing, you know learn onthe hard way.
Went to architecture school,became an architect, went to
school here in LA called SCI-Arc.
After I graduate I realizedthat after one hundred and fifty
two hundred thousand dollars indebt, there was nothing in my
brain besides a big ego of abunch of architects who teach me
(03:46):
how to do things.
So I took a year sabbatical andwent through all the trades as
a Latino living in California,took advantage of the color of
my skin and got jobs moppingroofs, installing drywall, doing
ligage.
Now I go to every job.
Hey, I'm un trabajo, so I'llget a trabajo.
I get a job, work my way in.
After a week especially moppingroofs I was like, hey, I know
(04:09):
how to read plans, okay, come tothe office.
So then you're becoming anestimator A couple of weeks in,
a month on, it was like, hey,listen, I actually went to
architecture school, I'm justlearning the trades, thank you
for the opportunity and workedmy way out about a year through
all the trades until I learnedabout ligage.
So within that process, thatjourney, I got hired by a fiber
(04:31):
cement manufacturer in LatinAmerica to go preach fiber
cement with ligage across theworld.
So I was like the youngarchitect who graduated in the
United States, going to thirdworld countries utilizing
framing systems with a substratewhich was a fiber cement.
So that took me to a journey ofabout 10, 15 years where I got
(04:52):
to learn a lot about manufacture, iso 9000, iso 14000, and all
the qualifications that thosebig manufacturers have.
10 years into that, got married, got kids, decided to come back
to the States Mom and dad andeverybody was here.
So I came back to the States,kept working for the fiber
cement manufacturer, working onICC, doing architecture
(05:13):
inspections, writing the code,everything that has to do with
fiber cement and ligage.
And then about 14 years agosomebody told me that there was
an industry, there was a guy inSouthgate putting a panel shop
that he may need help.
So I step in, start working,got into the 2D world that we
call it, you know, panel worldand been doing light gauge
(05:35):
panels, low bearing type oneconstruction in the California
market for over 14 years.
But, like Peter said about ayear ago, I said you know what?
This is easy.
You know because we're buildingfor DPR, for all the general
contractors, the big guys, thebillion-dollar GCs.
And then I said you know what Iwant to see, what happens when
you put this together and you doa volumetric thing.
(05:56):
So I went to the World ofManager, met Peter right there
and we took on the challenge ofgenerating mid-rise.
I've been a steel guy all mylife I have never built a house
in wood.
That's why we choose mid-rise,complying with codes and
everything else.
We want to go about fivestories where we're not
competing against wood.
It's impossible to competeprice-wise.
You know they're two differentproducts.
(06:17):
I think every system has itsplace in this industry and, as
an industry, we should behelping each other and this
industry and as an industry, weshould be helping each other.
And that's the journey thatwe're on right now Create two
lines of divisions.
We still have a ligage panelswhere we're very successful here
in California and that pays thebills, and now we're taking a
couple of modular jobs where nowwe're grabbing those 2D panels
and building them into a 3D unit.
John McMullen (06:40):
Very good.
Both of you have, it soundslike, extensive backgrounds in
traditional construction,traditional design.
What challenges did you bothface when you first started
tackling modular projects?
What was your biggest?
Peter DeMaria (06:54):
hurdle.
I connected with Diego a yearand a half or so ago.
It didn't matter how well Icould draw, how well I could
design, how detailed my drawingswere.
At the end of the day, someonehad to fabricate this and, as an
(07:20):
architect, the architect now isworking with a client and
convinces the client, say, hey,let's go into the modular space.
So at that point you have to beable to deliver a modular
fabricator or a team that isgoing to execute.
Okay, in the traditional worldI can go out there and get three
or four bids right andinterview everybody, but at the
end of the day, there's some youknow strong predictability.
Diego Rivera (07:36):
You're going to find a reputable builder who's
going to do a decent job youknow, the beautiful thing about
what we're doing with peter is Itelling Peter you dream I'll
build it.
You dream where those walls go,you dream the architecture.
Let me take care of whathappens inside those walls.
So building what's inside thewalls is the secret.
And coming from the 2D world,the panels and the connections
(07:58):
and the different inspectionsthat you have on a load-bearing
job you know nine stories, sixstories incorporating that into
your MEP pads, your mechanicalsand everything else.
It is challenging to understandhow boxes are.
But when we come from the panelworld, when we pre-manufactured
panels before foundations arealready been poured, it's been a
game changer of meunderstanding the needs that a
(08:20):
volumetric architect needs.
And also for Peter to emerge,the pre-construction, where
basically construction is aboutlogistics, correct, so we're
playing a logistics game againsta financial outcome.
So we both believe asarchitects that the secret is in
the drawings and that'ssomething that this industry
locks.
(08:40):
The ratio of people that wehave in our team is, for every
one brain thinking and drawing,we have four hands working.
So if you don't have that ratioin your company of brains
against hands and you're notbelieving in digital twin, it's
very challenging to spend moneyon robotics role formings and
equipment, and try to get thereturn on investment when the
(09:00):
brain is not there.
Peter DeMaria (09:02):
Part of what we're doing at Midrise where
Diego's team and in our shopthey're working down a tolerance
level of a 16th of an inch,role-forming our own studs and
joists.
We have all the equipment100,000 square foot factory
inside, 100,000 outside so wehave the capability of doing all
these things.
What we're doing now is alsoworking with fellow architects.
(09:24):
Typically, architects do notbring in another architect to
work with them unless there's asmall boutique firm and they
need an associate architect.
But in our case we share ourtechnology, we share our details
, we share our fabricationcapability, right with the hope
that these other folks will wantto adopt it.
We have no worries about beingthe so-called white label okay,
(09:45):
of what's being fabricated.
We're behind the scenes.
We're kind of almost hired as aconsultant to the primary
architect, much the way astructural engineer would be
hired and we sign all the NDAsand the non-competes.
We're not interested in takingany clients from the other
architects.
We simply want to work withthem and kind of float the
industry boat together.
We have plenty of work on ourown I can design.
(10:07):
There's only so many buildingsI can design right.
But the opportunities arebrimming.
There's so much going on rightnow and that's where our efforts
are focused, and we've beenreally fortunate in the last
year and a half to do somethings that I didn't think were
possible.
But what has unlocked it isexactly that first point that
(10:28):
the ability to fabricate and tofabricate not just put it
together but to do it with alevel of efficiency that does
translate into all those greatthings in the world of modular
being.
You know speed, speed, speedand quality and things are
getting very, very competitivein terms of pricing, but that
speed and quality give you areturn speed, speed, speed and
quality and things are gettingvery, very competitive in terms
of pricing, but that speed andquality give you a return on
(10:48):
your investment I think isunmatched by the other
technology.
So I think that's been thebiggest hurdle.
I know that was a long answerto a short question, but that is
what's been the hurdle for thelast, over almost two decades,
to find that.
But now I believe we, I thinkwe have it.
John McMullen (11:06):
So tell me about your modular design process now.
How does it start and how hasthat process sort of evolved
over time since you started?
Peter DeMaria (11:15):
Right now it's happening.
It's a little bit differentthan it was originally.
Originally, we'll work with aclient who comes to us.
We'll show them traditional wayto put the buildings together
and then we show them thebuildings together and then we
show them the modular benefits,and those clients will work with
us directly.
We will design that building.
But my design work does notstart in the traditional manner.
Just about everything that'sfeeding my design palette has
(11:39):
almost nothing to do with thedesign of the building per se.
I'm worried about logistics.
I'm worried about logistics.
I'm worried about shipping.
I'm worrying about the buildingrattling as it's being moved to
the job site.
And I have modules.
How large of a module can Imove down the street and how big
of a module can I pick up?
How far can my crane boom out?
(12:00):
I haven't spoken aboutaesthetics, creating a positive
environment where people's livesare going to thrive.
That didn't come into thepicture yet.
So what happens is I'm almostlike a chef who's in the kitchen
and I have to figure out howall these appliances and all
this equipment works before Ican really start mixing things.
And that's also a hurdle forarchitects who are not in the
(12:21):
modular world.
They're not used to doing that.
So there's a kind of relearningof the parameters by which you
design.
So that's part of our DNA now.
That's something that's anatural extension of us.
So when we're working on aproject it's rather easy for us
to sit down with the client, hitthe ground running and really
move forward.
(12:41):
When it's another architect whocomes to us, I think in general
architects are trained.
They're problem solvers acrossthe board.
They're trained, they'reeducated to be problem solvers
and whenever someone comes tothem with a project, yes, we do
those projects.
Can you do a gas station?
Yes, you do single family homes?
Yes, you do nuclear powerplants?
(13:03):
Yes, because they know theyhave to solve challenges and
they're not scared to go afterthose projects.
So when they come to us andthey've designed a building and
say, okay, we've designed ourbuilding in a traditional manner
, can you make it modular for us?
And I think, okay, if there wasany level of discipline there
and order and how the buildingis organized, it works.
(13:25):
And other times you have toreconfigure things and you kind
of have to fit it into the icecube tray per se.
So the design phase can dragout a little bit, but typically
the client is the one who willdrive that.
The clients are the one who goto the architects.
Listen, I want to dabble inthis world of modular.
Can we do it and how do we doit?
(13:46):
Those are the people we reachout to, those architects who
have those clients and say youknow, let, let us help you, let
us make that part of your, yourarsenal, your palette and your
creative outlet.
So the process once thosearchitects get uh up to speed on
the um, the know they'll get iteasily.
Diego Rivera (14:06):
And then to add to that, the next step what are we
doing?
Our end is what?
Well, peter is dreaming.
We're telling him hey, peter,this is just a cookie, you can
use the oven or the toaster,Don't be using that big oven
because you're going to kill thecost.
So what we do for that is webelieve in parametric models.
So we'll take the architecturallevel even from the bidding
(14:26):
stage.
I usually tell people when theyuse Bluebeam or any of those
softwares to do estimating, Icall it finger painting.
We don't finger paint here.
We grab the house or the modelor the building that we're doing
it.
We do a parametric Revit modeland out of that parametric model
we get all the data that isneeded to be able to be
efficient on the price.
So that's how we price ourbuildings and as we move forward
(14:49):
on the contracts and on thedeals that we're working with
our owners, we have the abilityto this parametric models to
make decisions on equipment, onsize of the electrical panels
and everything else, and have animmediate impact in the budget
before we make any decisions andbefore we even buy an outlet.
So I think that's where wecomplement each other, where
(15:10):
Peter has the ability to dreamwithin the needs of the budget.
And then we come behind almostas an inspector, just making
sure that at the end of the dayis feasible for the price based
on what the project and the siteis needed.
John McMullen (15:24):
From an architectural point of view and
you both have brought up greatpoints that go outside of the
bounds of just pure architecture.
But from an architectural pointof view, are most modular
projects similar, or the onesthat you do?
Are they similar or does eachproject sort of have a unique
module design that requiresstarting from scratch?
Peter DeMaria (15:45):
Well, you can look at it both ways.
I think if you're going to bemore efficient in this space,
you're going to want to come upwith some standardization,
because I think that's where thelevel of efficiency comes from.
Can you do custom projects?
Sure, but when that happens,most of the folks who are
attracted to modular want to getthings done quickly.
They want to do things ofexcellent quality and they're
(16:08):
trying to do things of greatvalue, a decent value prop in it
all.
Once you go custom, it fallsback into the traditional world
of doing things.
Now we have created a littlepalette.
You know we would love to belike In-N-Out burgers, right
where they've got three or fouroptions on the menu and that's
it.
But the intense amount ofresearch and development has
(16:29):
gone into creating that module,creating that standardized
module, because you have to makesome assumptions about how the
masses of society want to livein a one-bedroom or a
two-bedroom or a three-bedroomapartment or something along
those lines, and you make someblanket statements, but very
often it's not about how we havelived in the past.
When we're designing, it's howdo we want to live, and that
(16:50):
becomes the drawing inspirationbehind what we do right?
And then you combine that withall those technical things we
were talking about before, itbecomes this mix, heavily mixed
level of aesthetics andtechnical prowess and you cannot
leave the technical out andvery often you say, listen,
we'll design it and someone elsewill figure out how to build it
(17:11):
right.
That never happens with us andit's interesting that Diego
mentioned, you know, aparametric model, one of the
benefits we have in our shop.
If we have this shop with rollforming machines and you know 30
, 40 guys putting thingstogether there, we have six or
seven project managers who areworking exclusively in Revit,
(17:32):
autocad and they put thesemodels together.
But they all started out on thefloor of the factory.
They all started out runningthe roll-forming machine,
fastening everything together,and they've all been with us at
least eight years.
So that means that when they'reat that Revit table and they're
inputting information, theyknow firsthand how it comes
(17:55):
together.
There's no disconnect betweenthe people drawing and the
people who are fabricating.
That's massive, that's huge.
That's why Diego and I gottogether.
I said, diego, you've gotsomething going on that I
haven't seen, that I know isrequired and and I see it
firsthand and it's wild becauseI'll go into the factory and I'm
feeding off of it.
As the architect, I'm seeingthe way they're doing things in
(18:16):
that that palette that I have isnow getting bolstered right
because I can see how thesethings are put together in a
more efficient manner.
So I think that's pretty muchhow I've seen development on it
and, diego, what do you think inthat regard?
Diego Rivera (18:34):
I think, just to add to this yes, repetitious is
the secret, correct, that'swhere you make the money.
But if you try to use an 80-20rule, 20% of the cost of those
modulars is the bathroom, thekitchen and all the MEPs.
So we have to standardize theMEPs and give the ability to the
bedrooms the world where I dopanels the size of the bedroom,
(18:56):
the size of anything that isoutside that 20% control be
flexible.
So we standardize our bathrooms, we standardize our kitchens,
our connections, our MEPs, rightwhere the money is, and then we
let the architecture fly on theboundaries of the site, the
boundaries of the building, theneeds of the customers.
But the core budget or the corecost of the modular unit which,
(19:20):
in my understanding, by doingnumbers and looking at it, it's
the bathroom, the kitchen andall that area with all the
connections are we standardizeand we create a palette for
those.
So we're trying to be flexibleon the rest of the building and
the standardized bathroom andthere's only so much you can do
with them.
You know an ADA bathroom, aregular bathroom, and then all
you do is you change colors,sizes, but then you keep the
(19:42):
main core of the building andyou use that 80-20 rule.
Peter DeMaria (19:46):
You know along those same lines.
I'm going to add to that.
Very often when I speak tofellow architects, you know, if
you're doing these modularbuildings of any large scale,
they usually end up looking likeminimum security prisons.
You said there's no flexibilityin the design or the aesthetics
.
In the design or the aestheticsand what we've done is part of
(20:07):
our entire approach we integratea unitized facade into our
modules.
That unitized facade enables usto swap out materials, the
thickness of material, the color, all of that.
They give the building reallyits own identity.
Things don't have to look likethe building next door.
That we did two years ago.
So we think we've achieved alevel of variety that's kind of
(20:32):
veiling all of that repetitionwhere we leverage all the
efficiency from.
We're working on a project nowhere in South Los Angeles with a
developer and it's Anthony Gude, it's Gude Capital, and it's
Anthony Goudet, it's GoudetCapital.
And it's interesting because weput together this entire
building and then our modularelevator, which is typically
(20:54):
just a shaft, has become thispoint where we have these
shifting marquee shapes goingaround all the way up this
eight-story building and itbecomes the iconic image of the
building and it kind of stealsthe show, and all of a sudden,
the rest of the building is fine, it's perfect, it's not boring,
but you have this one aestheticfeature that really sets it off
(21:16):
, and I think that's up to thearchitect.
The architects have to takeleadership on it to show what
those possibilities are.
Things do not have to be boringby any means, and you'll see
that project eventually it'squite nice.
So I think, though, we would belying if we told you
repetition's not so important.
We can do whatever you like.
It's part and parcel to what wedo.
John McMullen (21:39):
With all the experience that you both have
acquired, would either of youconsider yourselves a specialist
in modular design?
I ask because it seems likemany designers include modular
in their skill sets.
They'll do traditional, they'lldo modular, but there are few,
at least in my experience, whoare truly specialists in the
(21:59):
field.
What are your thoughts on that?
Do people need to specialize?
Peter DeMaria (22:03):
I'm gonna answer that first, diego.
Diego is a specialist.
I don't know anyone in thisfield in that 2D panel world
that knows that industry andexecutes like he does.
There's so many who've writtenbooks, white papers, giving
(22:27):
lectures, and I've seen them all.
But at some point the rubberhits the road.
And Diego this is why Iconnected with him when I went
to the shop.
They were doing it and he'sbeen doing it for 12 years.
He's not been doing this forjust last week because it became
a cool, hip thing to do.
Diego, explain how you got tothis point, or maybe help John
out with that, because I dobelieve you're the specialist.
I know you're humble not toooften, but I think you'll be
(22:48):
humble this time.
So give them a general idea howyou got to where you are and
what it takes, so that the otherfolks out there who want to
follow in your footsteps havesome general path or some
guideline on how to achieve that.
Diego Rivera (23:03):
I think being humble is the secret of being a
specialist.
Correct, because we learn onthe nose All the mistakes we
make.
You have to add it up.
I think a specialist is just anaccumulation of mistakes.
Who's brave enough to admit itand be able to pass it on to the
next generation or the nextpeople?
So we have different rules inthe shop.
We have a pool schedule.
(23:23):
We do a lot of jobs with DPR,with the big GCs, that they have
different concepts, leanconstruction, pool schedules and
try to implement that.
There's certain rules that wehave in the shop.
Who's at fault, the onereceiving or the one giving?
And our shop is the onereceiving, because if you're
receiving something that is notwhere it needs to be, don't move
(23:44):
forward.
Stop the line.
We believe in drawings, simplethings.
The only way you move up in ourshop is if you bring me
somebody better than you to takeyour job.
So, john, if you come to me andsay, diego, hey, I'm tired of
sweeping floors, I want to putsome screws, you better bring me
a guy that sweeps floors betterthan you in order for you to
move up.
So that has created a level ofdependency on the team and also
(24:08):
trust.
I always say that there's a bigdifference between respect and
admiration.
Everybody respects the guy thatwrites the check, but if you
start admiring your team andyour team admires you, and you
create this camaraderie, thisgroup, where the mistakes are
just the result of our growth,it is where things happen.
I think that's what a lot ofother things in the industry
(24:32):
happen, and a lot of leaderswill.
You know.
I read something on LinkedInthis weekend and I put a little
comment where nowadays, the bestadvisors are everybody else who
has failures in the industrybecause they weren't able to be
smart enough to survive, becausethey bought their souls to
capital, because they neededmore money.
They buy all this equipmenteven though they were smart guys
(24:52):
.
Here they are going out ofbusiness because you had to keep
feeding the bees, so you haveto see what your abilities are.
So we're very cautious on thejobs we take.
We're growing very steady butslow.
Everything we owe is paid off.
We don't owe money to anybodybesides the rent and the
electricity.
So being debt-free and havingthe ability to dream and being
(25:15):
challenged is what is allowingus to grow.
Are we making millions ofdollars?
No, but we're paying our bills.
Our people is paid and it givesus the ability to think, which
a lot of these new modularcompanies, by taking capital and
money and raising funds, theydon't have the ability to slow
down and think.
John McMullen (25:33):
Follow-up question for you, Diego.
What education and developmentdo young architects need in
order to really get skilled withmodular design?
What paths should they followto get their education?
Diego Rivera (25:46):
You know there's a saying that the professor shows
up when the student is ready,correct?
There's so much learning in thestreets that are you really
willing to pay the price?
Are you willing to take thatyear's sabbatical and go mop
roofs, put screws, before yourego of being an architect walks
away?
Or you're ready to pay?
You know, go do red lines for afirm and all you do is you do
(26:07):
red lines for a firm and all youdo is you do red lines and you
dream and you copy paste.
So I think architects shouldhave the ability to go to school
.
They should have the abilitythen to go to the job site.
If you look how architects areraised in the rest of the
countries besides united states,they actually get to build as
soon as they're out, they go tothe job sites.
An architect here here, becauseof legal circumstances, because
(26:29):
I think construction is beingruled by lawyers more than
architects and builders youdon't have that ability to spend
that many hours because you'reprotecting yourself.
You know you don't want torelease your Revit model because
it's not a constructiondocument and we're doing all
these documents, documents andit's.
(27:00):
I understand it's a hugeeconomy.
John McMullen (27:01):
It's a huge industry that everybody needs to
protect themselves.
But within the school, withinthe process of going to school,
they should go to the job sitesand learn.
I'm sure I just butchered it,but I think I paraphrased it
well enough.
How can architects who areexperienced in modular design
best share their knowledge withyounger designers?
Are there best practices?
Are there methods that you'veeither done yourself or
(27:21):
witnessed that you think workparticularly well?
Diego Rivera (27:25):
You know, like I told you, experiences and making
mistakes.
I also say that there's adifference between sweat and
saliva.
A lot of people have a lot ofsaliva, a lot of pictures.
You know, architects have kindof two things.
You know, and I'll probably beoffending architects, but they
have the projects that pay thebills and they have the projects
that raises their ego becausethey get published in a magazine
.
But if you can find that middlepoint where you can teach the
(27:47):
next generation of the mistakesand what you've done and share
that and walk away from that egothat you're the architect, but
assume the responsibility thatit's okay to make a mistake,
that it's okay to repeat itself,the problem is not to make the
same mistake twice, hopefully,and then just lead.
You have to lead Leaders arethere to lead people and you
(28:09):
need to walk away from your ownpersona and build teams.
John McMullen (28:14):
Peter, I want to follow up on something you said
earlier about wanting to workwith other teams.
Are there any best practicesyou've discovered to help with
that communication and ideasharing within a team of
designers?
Peter DeMaria (28:30):
communication and idea sharing within a team of
designers.
Sure, I mean, the communicationchannel is probably the
linchpin in all of it.
We're set up on teams.
We actually work with aninternational team.
We've got folks in Europe,engineers in Europe, we have
architects in South America thatare all part of our team, and
when you have that type ofdistance and it's purely digital
, that has to be really tight.
(28:50):
In addition to that, you havestandards with all of your
drawings, standards that can beshared, libraries and I think
that's where most of the workgoes into on creating the
modular company.
You have to create a library,you have to create an ordering
system, you have to create thesestandards by which everyone's
moving in the same direction,utilizing the same tools, same
(29:13):
details.
It's a language, it's likelearning a new language.
So that's one thing.
The rest of it, I think rightnow, those folks that I told you
, the project managers that wehave on our Revit stations we
need to pull them in and makeeach one of them an expert in a
different facet of building.
(29:33):
So we have one person now who'sreally specializing in just
mechanical, another who's justelectrical, plumbing facades.
So we're empowering them withthis knowledge.
So they're starting to see thathow this all ties together, you
know, to a greater whole.
And that has to happen at thesame level.
When we work with fellowarchitects, we have to give them
(29:54):
all that information, we haveto give them the drawings, we
have to share just abouteverything that we've created If
we hope to be on the same page.
We have to share the playbookif we're going to move that
offense down the field, right?
So I think in many instancesit's just a matter of everyone
(30:15):
getting on the same page sothere's no miscommunication.
And, quite frankly, across theboard, I don't know what the
huge percentage is, buteverything we are doing when it
comes to the planning and thearchitecture and the engineering
is to reduce the amount oferrors in the field and to
create some level ofpredictability in all of this.
(30:36):
And the only way to do that isto share the information so that
we're all on the same page.
We do not have the luxury ofputting that note at the top of
our drawings.
This contractor shall verifyall prior to construction and
notify the architect if thereare any problems, right?
That doesn't exist in our world.
So we're circumventing all ofthat because it has to happen
before we even we pass it off toany other team.
(30:58):
So we've had success with this.
We work with a few differentcompanies already that have
embraced it, and now they've youknow, they've become modular.
You know I don't want to callit specialists yet, but they're
they're very friendly to itbecause they see those benefits
that come with it.
Diego Rivera (31:13):
And something that we've done is, you know, walk
away from the project managersand create product managers.
So we have the product managerfor MEP, for everything else,
and we also have a theory herein the shop that the more we
teach, the more you need us.
So the more we share, the moreyou're going to need us, because
we want to be a source ofinformation, we want to be the
ones doing the research, we wantto be the ones hopefully
(31:34):
helping architects so they canhave their steady building, and
let us take care of whateverhappens inside the walls.
Let us pay attention to the MEP, the outlets, the ROF openings,
the locations of your ADAbathrooms.
Let us help you.
Just redline everything elsethat has to do to make a more
efficient and cost-efficientbuilding, while you keep the
integrity of your design.
So that's what we think we wantto be that resource for
(31:58):
architects, engineering firms oranyone who wants to get into
the modular world.
Peter DeMaria (32:02):
And John, you know you asked that question
earlier about the students andthere's a few programs out there
.
I used to teach University ofTexas, right, and University of
Texas has a like a design-buildprogram there and I can't
remember the exact name, butit's run by a gentleman named
Coleman Coker.
There's another program atUniversity of Kansas.
It's run by Dan Rockhill.
They have design-build programswhere the students are spending
(32:26):
a semester building a residenceor building some building and
the rubber hits the road there.
These folks show up and they'renot in you know the cool
architectural block turtleneck.
They're in work boots andthey've got tool bags and
they're making it happen.
And those folks, I've got tobelieve, have a huge advantage
(32:46):
over the folks who are purely inthe studio, right, because they
understand how critical it is.
Actually, they probably learnmore.
So what you don't want to doout in the construction site,
right, and that feeds them tosay you know we need to resolve
this problem before we get tothe construction site and how
can we do that in the factory?
So I would recommend anystudent who's really interested
(33:08):
in modular that and you're inarchitecture school, that's a
place where you would start.
John McMullen (33:13):
Well, speaking of where students are learning and
how they're learning, are thereany new tools AI, for example
that you feel have the potentialto change how designers deliver
their projects that maybe thesestudents are being introduced
to now?
Peter DeMaria (33:27):
I think a couple things are happening.
It's obvious that the AI isenabling us to do the macro work
much easier.
In other words, I can start toreconfigure buildings very, very
quickly, right?
Simple little modules can begrouped into taking into
consideration the sun, the angleof the sun, solar penetration,
the neighbor's views, your viewsaway from the building.
(33:47):
All those things enable you upfront to configure your
buildings more efficiently.
But what I get a little nervousabout, a little scared about, is
that so many people are justgoing to rely on that machine to
configure their building andthey're going to say, okay, my
job is done now and it's reallyeasy to get wrapped up and be
enamored with what's happeningin the world of modular and
(34:10):
modular construction.
People are fascinated by it,but at the end of the day, it's
a means to an end.
It's really serving a largerpurpose, because we're creating
spaces for human beings, and ifthat gets left out of the
equation, I'm not sure howsuccessful those buildings are
going to be.
And I've seen plenty ofexamples in the past where, yes,
it's a shelter, You've got aroof over your head, it doesn't
(34:30):
leak, but I don't want to be inthat space for longer than 20
minutes.
Right, this gets back to theminimum security prison phrase
that I've heard over and overagain.
But AI is able to take intoconsideration the cultural
elements, how people live inthat neighborhood and all the
other things that impact thequality of life there.
At that point, I think it'sgreat.
(34:51):
In the meantime, we're going tohave to settle with the
architects to see the world alittle bit differently and make
some observations, say you knowwhat?
I've created an incrediblecontribution to this context, to
this neighborhood, to thispiece of property.
So we are not againsttechnology, I can tell you that
much.
We are deeply embedded in itand I see it as a tool, just
like just like everything elsewe have here.
(35:12):
We're embracing it.
Diego Rivera (35:15):
Yeah, you know, to add to what Peter's saying, I
think the best tools.
You know, there was a fellowthat actually Peter introduced
me to.
I never knew about him, EdwardDeming.
You know he was the gentlemanwho helped the Japanese
reconstruct Japan after WorldWar Two.
John McMullen (35:27):
And he had a couple of good quotes.
Diego Rivera (35:29):
He said that without data, you're just
another person with an opinion.
So for AI to work, you needdata.
So, like in our shop, we'vebeen collecting data for the
past 10 years 12 years.
So I know what Jose in the backnumbers are when he's putting a
number 10 screw on a 16 gaugeto a 12 gauge piece of track.
(35:50):
And now we're taking it to thenext generation.
We're trying to write analgorithm where you have three
variables that you have to takeinto account when you do modular
.
One is your schedule thatyou're going to deliver.
The other one is the resourcesyou have that day in the shop,
and the other one is theprocurement of the materials.
The other one is the resourcesyou have that day in the shop,
and the other one is theprocurement of the materials.
So how do you know what panel,what stage to do next week and
(36:12):
everything else based on theteam, based on the people you
have, and be able to leveragethose resources to be productive
and make money?
So I think data is the secretfor AI.
Ai would not work without anyresources.
He also had another good quotethat he said in God, we trust
(36:33):
all others bring the data.
So a lot of the new shops aretrusting in God or whatever your
God is, but they're nottrusting on resources and data
and experience.
And that's where the professorand the student and all this
thing comes in, when there'sknowledge and there's mistakes
being made and all that mistakes.
All those information has beenaccumulated for the benefit of
all and you have to share thatwith everybody and be
accountable for it.
Peter DeMaria (36:52):
There's a quote I use that the Stone Age didn't
end because they ran out ofrocks.
Right, this is coming.
Ai is going to play a more andmore dominant role in what's
taking place in our industry,and we're embracing it.
I'm curious where it's going tobe in a year from now, even
five years from now, and I can'tget my arms around it, but I'm
(37:13):
genuinely excited about it.
John McMullen (37:15):
Well, it seems like a good time.
Conversation seems to havecrescendoed in a couple of
different ways.
Tell me about the formation ofMidRise Modular and all the
experience that you've broughtto it, all the excitement, all
the technology.
What led the two of you tocreate MidRise Modular and
what's your goal with thecompany?
Peter DeMaria (37:37):
A few things have happened here.
I've been in that modular spacealmost for two decades, on and
off, and then about five, sixyears ago I was fortunate to get
aligned with a company calledHBG Modular which we created
with the late Max Azria and afew folks here in Los Angeles,
(38:01):
took my knowledge in thecontainer world and sent me off
to China and worked with a greatteam of people from the US, was
able to get our China factoryapproved by HCD here in
Sacramento, state certified andwe created a bunch of prototypes
and ultimately a five storyapartment building here in Los
Angeles.
We did a homeless project herein Los Angeles and really took
(38:22):
that portion of Modsler to ascalable level.
Now I have been involvedprimarily with boutique type
projects one-off houses, adus,things like that but never
something where it would haveimpact on the masses and then
really help the people who needit most.
So that company resulted inthree or four buildings here in
Los Angeles but then went toanother company hoping to work
(38:48):
on the multi-family project.
That didn't work out and I wasin a spot where I said, gosh,
I'd really love to get back tothis.
And I ran into Diego.
We were getting awards for theprojects that I mentioned
earlier at the world of modularand just hit it off with him and
spend a whole bunch of timewith him, and he explained
(39:09):
everything that he was workingon the 2d panel world and I said
this is exactly what we need inthe 3d panel and he's a
production partner.
I also spoke about that earlierand once I got back to a shop
and saw the culture that wasthere and the work that they
were producing, I realized thatthis guy had solved the problem
in the volumetric world that hewasn't even working on.
He solved the problem in the 2Dworld.
(39:30):
It was easily readapted intothe 3D world and in our
discussions Diego was telling melisten, we want to make the
jump in the 3D world, but we'renot sure, we don't know what you
know, okay, and it was kind ofvice versa.
I didn't have the skillset, Ididn't have the resource to do
what he was doing.
So it kind of fit like a handin a glove quite nicely.
(39:52):
And then, once we got together,I think that we realized that we
had to continue on the pathwith the 2D panel world because
he had a level of expertisethere.
But we slowly started infusingthe volumetric vocabulary into
everything and started to goafter those types of projects.
We did not expect to have a 3Dbiometric project, likely for
(40:12):
another six months or so, butwe're working on a nice size, 88
unit, eight story biometricproject.
Now that's in combination withthe panelized projects that
we're currently working on aswell.
We find ourselves not justdeveloping or building projects
for our clients, but we're thewhite label to other fabricators
, much in a way that we would bethe modular architect, the
(40:35):
specialist in architecture forthe traditional architect.
We are now the intel inside forother fabricators and that's a
result of those folks seeing thesame thing that I saw and what
Diego had created in the 2Dpanel world.
So I think we have a prettydiverse company and I think that
, regardless of what's takingplace, there seems to be always
a demand for the panels, and nowit's starting to take place,
(40:58):
obviously with the volumetric.
Diego Rivera (41:00):
Yeah, and in my side, you know I got enchanted
by all these ideas that Peterhad as an architect.
You know I still dream as anarchitect, even though we build
things day to day.
And then when we talk and we seewhat was coming, especially
living in the world of panels,living in the type one
construction assistant living,nothing in wood, everything
above five stories we're likethere's a big challenge here.
(41:23):
The city of LA, in myprediction, is when the next
five years is going to gonon-combustible.
So I don't think nothing withinthe metro area of LA is going
to be able to be done in woodbecause the density is not going
to allow that Density wouldallow for non-combustible
buildings.
I've been living in thenon-combustible buildings.
I've been living in thenon-combustible buildings for
the past 10 years.
So when I saw that level ofprecision that we do on the
(41:43):
panels, what the industry isdoing in the future, where the
market is going, the knowledgethat Peter brings on the
volumetric side, but, mostimportant thing, have already
established business that paysthe bills.
So we don't have to go get aloan and get in debt to try to
create a volumetric business, itwas a no-brainer.
So we create a subdivision tothe existing operation.
(42:07):
The existing operation isrunning on its own, paying the
bills While we're dreaming onthe side building this
volumetric.
Peter and I were going to take ayear sabbatical just to learn
and go across the world and seewho's doing what.
But we just got pulled in andwe got a project already and the
level of coordination anddigital twins that we run in the
other industry.
(42:27):
It was secure enough for us totake this new challenge and
we're looking forward.
I think it's going to be agreat experience.
We're crawling.
Hopefully, you know, by the endof the year we'll be walking.
I don't know if we're going tobe running, but we'll be enough
to survive while the panelbusiness keeps growing.
John McMullen (42:46):
Have there been any potholes or hurdles that
you've had to navigate in thepast year and a half?
With the beginning of mid-rise,modular Anything.
You didn't expect.
Peter DeMaria (42:55):
Well, they say it's a cliche, right?
All these hurdles or all theseproblems prompt you to come up
with other solutions.
Right, and the worst day canalso be the best day, and that's
happened in some regards.
I'll let Diego talk to youabout our current facility and
how we have shifted gears andnow have taken on a new facility
(43:16):
.
I'm sitting in our new officetoday, and a year ago we were
not even thinking about this atall, but there's some challenges
that did pop up in that regard.
Other things that are happeningis there's some really pleasant
things happening.
You would think that the changein the code and the policymakers
are getting far more friendlyto what we're doing as modular
builders, and we realized a verylong time ago that you can be
(43:39):
the most visionary architect inthe world and have everything
resolved, but the policymakersare so tied to what we're doing
and the ADU laws in California,the SB9 laws, what Diego was
talking about earlier with thenon-combustible.
It's all an attempt by thepolicymakers to have more
density in existing cities.
(43:59):
Instead of promoting sprawl andpeople moving further and
further out into the suburbs,they're bringing people back to
the inner city and what thatmeans is raising in tax dollars,
right.
And when all that happens, thebuildings start changing.
We're doing an eight-storybuilding, 88 units.
There's no parking becausewe're within a half mile of a
(44:21):
parking transit hub.
That's major.
Do you know what that does tothe impact of the budget for the
developer?
They're putting up 88 units nowinstead of 30.
And I'm not saying that densityis the answer to everything,
but I'm telling you that we haveto team and collaborate with
these other players in order tomake an impact, to make that
(44:41):
positive impact.
Diego Rivera (44:42):
Besides that, I think one of the biggest
challenges, too, is having thebanks and the financial world
understand the cash flow of abuilding like this, and that's
what we're trying to stillconvince lenders and even though
the customer, the architect, ison road, it's just the lender
how do you end up paying allthis money up front and you're
(45:02):
acquiring all these materialsand schedules, but they still
want to run it as a traditionalconstruction?
So there's a difference rightthere between still having the
mentality of traditionalconstruction but being able to
have a cash flow, and adifferent phase, which is
manufacturing.
So the line betweenmanufacturing and traditional
construction, I think, is wherethe biggest challenge is that we
(45:24):
see, but once you get the rightlender, once you get the right
customer and everything else isflowing, it's just a matter of
cash flow.
So what Peter is saying back inNovember we were challenged by
the landlord where we're stayinghere in LA.
We've been here for close to 14years paying very significant
amount of money compared to whatthe neighborhood does.
(45:48):
So, he came back in November andsaid hey, diego, it's time to
raise the rent.
I said, well, I've been gettingmonth increases for the past
decade.
He goes no, no, no, no.
Market rate is four times whatyou're paying.
I was paying, I'll give you thenumber.
I was four times what you'repaying.
I was paying.
I'll give you the number.
I was paying 54 cents a squarefoot.
He came back and said a marketrate is two dollars.
I'm like what?
Two dollars?
That's two hundred thousanddollars a month for rent.
(46:10):
Multiply that times a year,that's 2.4 million dollars.
So I was like I said okay, what?
Who in the constructionindustry makes 20% profit or
maybe 10% profit needs to sell$10 million just to pay the rent
.
So we're like Peter, we're introuble.
What are we going to do?
So, within people that we knowwe're in the industry, we start
(46:32):
looking south and went intoMexico, went into the Tijuana
area.
I know a couple of red ironmanufacturers there who do
chassis and structure steel, whodelivered to california, worked
the deal within, did a jointventure and we're actually in
the process of opening our shopin mexico where we keep a small
operation in la to manage theinstallation and the work of the
(46:55):
2d panel where we develop thevolumetric.
But you know, I keep thinking.
I mean, you come to our shop.
I have an american flag made inamerica, very proud of building
everything, but california ispushing us away, you know.
And as we go to nevada and thenkeep going east, but the market
is here and um all these newlaws between mexico and and
(47:18):
united states, where you stilluse 100% American products, you
go across the border and you use, you know, near-shoring and
you're able to use some of theirlabor and bring back the
quality of the products,complying with the same code,
complying with everything else.
It makes sense, I mean.
John McMullen (47:35):
So, in terms of projects, what's and you alluded
to a couple before, peter, butwhat's on the horizon for
Mid-Rise Modular over the nextyear or two?
You mentioned an eight-story,another project.
Do you have anything else inthe pipeline, something you can
talk about?
Peter DeMaria (47:53):
Sure, I mean the panelized projects that we're
working on to support the otherfabricators are a big part of
what we do and we really excelat that.
At the moment we're doing somework in Hawaii.
We're on short list to dostudent housing projects here
with UC system.
(48:13):
We also have a series of folkswho've come to us with SB9 lots
who are really dividingsingle-family residential zone
property into four units now andthat's becoming almost like a
repetitive cookie-cutter type ofsolution that can apply across
the state of California.
So we're creating that menuthat we spoke about earlier,
(48:37):
right where we have a solutionwhere someone can come to us and
get something right off theshelf and they're ready to go.
The other developers that we'reworking with they don't just
kind of go in and do one projectwith us.
They're now presenting all theseother projects because they see
those benefits and I don't wantto say we're early stage, but
(48:57):
we're doing some projects thatare pretty big out of the gate
and we also don't want to runinto a spot where we just take
all the work we possibly can westart compromising the quality
or don't have a way to fabricateit, and we don't want to go the
route of some of the othermodular companies that have
simply failed.
Just kind of business could notkeep up either with that
(49:19):
workload could not produce.
Just kind of business could notkeep up either with that
(49:44):
workload could not quality.
It seems to be at the core ofeverything that we're doing.
So it would not surprise me ifwe grow slowly and steadily and
continue to do excellent qualitywork, and I actually prefer it
that way.
So I think that's probably thevision for the next year or two,
maybe even two or three years,where we'll work out every
(50:05):
little detail we have so thatwhen we deliver something it's
highly predictable, no changeorders and it's just a beautiful
quality project.
Diego Rivera (50:16):
You know, and to add to that to Peter.
You know, going back to what Iwas telling you, being able to
be debt-free.
It's allowing us to dream likethis, correct?
So what's in the pipeline?
In the panel business, weprobably have a couple of
assistant living projects,probably in the range of 250,000
, 300,000 square feet ofbuildings where it's just panels
, that's probably 15,000 panelsbetween walls and floors, 15,000
(50:43):
panels between walls and floors.
We're also becoming this widelabel for existing modular
companies in the city who arechoosing to become an assembler.
You know they all think, hey,we're going to be Tesla, we're
going to be Boeing, we're goingto build modulars and we're
going to sell.
You know we're going to.
So we bought, you know we drinktheir Kool-Aid.
We'll make them the best panelthey need and we supply with
them.
And now, with the operationthat we have in Mexico, we're
also integrating all thestructures, steel and chassis.
(51:06):
So we supply the chassis, wesupply the walls, we supply the
floors.
They put it together, they dothe MEP, they do everything else
and for us, all we want to dois give them the best panel they
can have.
So so far we deliver 88 unitsfor this customer.
We just signed a contract for188, maybe 500 by the end of the
(51:28):
year and they're projecting1,500 units by next year.
So this is just building parts.
You know kits of parts walls,floors and metal chassis and
what they value and what we dois our level of precision.
So if you don't know how to dothe structural part, precise the
box, the chassis, meps and allthat, it doesn't really matter
(51:51):
if the building is not going tocome together once you build it.
So our level of precision onthe 2D panel and being able to
accommodate this other modularcompanies who require,
especially on the chassis, Ithink out of the LA shop, out of
the LA modular companies wesupply to four of them as a
white label.
You know I won't give you namesor nothing like that, but it's
(52:12):
an honor for us for them torespect our level of quality.
We don't compete against thembecause we're actually we're a
small modular company doing ourown buildings, but we can be a
great complement to theirexisting operation.
So that's allowing us to learnto be humble enough to pay the
bills and we have our firstproject of our own that
(52:32):
hopefully will be done by 2025.
And then we'll see what happensfrom there.
John McMullen (52:37):
Peter Diego, thank you so much.
Just clearly a wealth ofknowledge and experience that
both of you bring to MidRise andto the industry.
Really Thank you so much foryour time today.
I really appreciate it.
Peter Diego, if people areinterested in getting in touch
with you, what's the best wayfor them to do that?
Peter DeMaria (53:04):
go at midrisemodularcom or demaria.
At midrisemodularcom we're veryactive.
You won't get passed off to asalesperson.
We prescreen.
We say no to a whole bunch ofprojects that we know are just
not conducive to what Modularbrings to the table.
And, john, I just want to thankyou because you're a great
conduit to the entire industrynot the Modular industry alone,
but to the construction industry, and just modular industry
alone, but to the constructionindustry and just to give us a
forum to discuss and share.
(53:24):
What we're doing right now isimportant.
We'll be talking about someother things we have on the
burner with Team Prefab Centerfor Modular Architecture.
That's part of our whole visionand that's for another
conversation.
But we really do appreciatewhat you're doing and all the
folks there at MBI.
It's a great asset to ourindustry.
Thank you.
John McMullen (53:45):
Well, I appreciate it.
I'm glad to have you guys asmembers and I hope to see you at
the next World of Modular.
I guess we'll be in Vegas nextyear, so hope to see you there.
Diego Rivera (53:54):
Yeah, we should go to the one in Europe.
John McMullen (53:56):
Oh, the one in Europe, absolutely Brussels.
I'll be there.
Diego Rivera (54:01):
There you go, we may see you there.
John McMullen (54:03):
All right, thanks again, thank you.
Peter DeMaria (54:03):
John, my name is John.
John McMullen (54:05):
McMullen, and this has been another episode of
Inside Modular, the podcast ofcommercial modular construction.
Until next time.
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