From: Jody Snider, Daily Press
Published November 15, 2004 12:00 AM

Recycled Shipping Containers Make a Splash in Construction Scene

NEWPORT NEWS, Va. - The steel cargo shipping containers routinely unloaded at ports like the Port of Hampton Roads one day could be used in the construction of homes, businesses and even office buildings.


Although the idea never has been tried in the United States, a New York architectural firm gave the concept some credibility last year when it became the winning proposal in a national competition on solutions to creating affordable housing.


The concept has been tried in several Third World countries. It not only offers a remedy to affordable housing, it also offers a solution for recycling shipping containers, that for whatever reason, sit useless in depots in Hampton Roads and elsewhere across the United States, says Mark Strauss, a principal of Fox & Fowle Architects, the architectural firm that made the proposal.


"These containers can be stacked, and they are designed so that they can be interlocked at the corners," Strauss says. "What we'd like to do is create units that not only recycle containers but offer affordable living and commercial buildings."


As costs for building homes escalate, residential contractors argue they can no longer build homes in the $100,000 range because of the rising cost of land and construction materials. With local ports situated around Hampton Roads, developers for future projects could buy surplus containers at local depots. In 2003, the equivalent of 1.65 million 20-foot container units moved through the three state-owned port terminals in Hampton Roads.


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The proposal to use containers for construction suggests using 3,000 containers to construct 351 housing units, 170,000 square feet of retail, office and hotel space and 27,700 square feet of civic and cultural space around a central green near a rail station in Gloucester, Mass. In the past year, the concept has gained the attention of several national publications like The Wall Street Journal and a magazine for the Urban Land Institute, the national think-tank for developers and architects across the United States.


The idea also caught the eyes of national developers like Alex Conroy of Conroy Development Co. in Fairfield, Conn., the developer and an owner in the MacArthur Center in Norfolk. He says the idea is credible for developers like himself, who always look for ways to cut cost.


"The idea is to create prefabricated units from the containers that would include plumbing and windows. The containers can be stacked and welded together, and floors, ceilings, electricity and water can all be added.


"If you take the metal side off a container, you can replace it with a storefront, which is ideal for retail construction. It works," Conroy said.


Conroy is evaluating where a development could be built using shipping containers.


"The question is where are the most empty shipping containers now," he said. He said the low-cost construction is fast because it can be prefabricated and assembled on site. He said one benefit of using steel containers in the construction of buildings and housing units is that the construction is strong, but less costly than the traditional framing with lumber.


Shipping containers are built in low-wage exporting countries such as China for about $2,000 each. Until this summer, the containers' heavy weight made them expensive to return to China. As a result, containers were sitting empty at depots, where a standard 320-square-foot container could be purchased for as little as $600, or less than $2 per square foot. That's not only cheap for steel, but it's also less than the cost of using lumber.


However, the market changed this summer when steel prices climbed, and China began making fewer containers, creating a tighter market in the United States. The changes have made it cheaper to unload the containers and send them back empty. Although the surplus doesn't exist as it did a few months ago, those in the shipping industry claim the container business is very cyclical and turns easily with a shift in economics.


Shipping officials say the time will come when the trend, or movement of containers, will reverse, and when it does, containers will be plentiful, says David White, administrator for the Hampton Roads Maritime Association.


"Sometimes the containers do tend to have a life that lacks purpose," White says. "From the time a ship line takes them out of service they might sit in someone's container yard for a very long time."


These days, Robert Foley, a vice president at Mid Atlantic Leasing in Chesapeake, says climbing steel prices have driven the demand for the containers so high that he's sending more containers out than he's getting in.


And sometimes, the containers even go back out empty.


"I might get eight in, and 25 containers may go out," Foley says. "Or I might get 15 in and 55 containers could go out."


While developers like Conroy and architects like Strauss are aware of the changing market, they say they're waiting for the cycle to reverse.


"Who knows when that will happen," Strauss says. "Right now it's cheaper to send them back empty, but who knows what it will be like in five years. It changes. What this proposal did for us is open our eyes to prefabricated materials that get stacked as a part of a design idea."


Conroy calls it a market-driven issue based on steel prices.


"Some of the hurdles we're going to have to face include educating the banks that this is a reasonable idea so that they can see the value in it, and that these are not just containers.


"It's like an Erector set. It's the reuse of something to a much higher value, and most things don't end up that way," Conroy says. "They end up as scrap."


Source: Knight Ridder/Tribune Business News


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