Cleveland eyes modular homes to boost manufacturing jobs

Cleveland is asking the manufacturers of modular homes to consider setting up shop in town and helping to fill in vacant land with new, factory-made housing. 

City Hall is aiming to achieve two goals at once with the plan: creating new jobs on dead industrial land and placing new homes where old houses have since been demolished. Mayor Justin Bibb’s administration on Monday put out a call for modular home builders interested in the work, according to a news release. 

Unlike traditional homes that are built on the lots where they stand, modular homes are constructed off-site and shipped to neighborhoods around the country. City officials believe modular homes offer a cheaper route to homeownership than on-site home construction. 

Through its $50 million fund for redeveloping old industrial sites, the city would offer low-cost or free land for a modular home factory. City Hall would sweeten the deal by offering incentives to build 200 units of housing on lots owned by the city land bank. 

“We want this to be able to benefit current residents in the city who are living in substandard housing as well as to be a tool to attract more residents to the city,” Jeffrey Epstein, the city’s chief of integrated development, said in an interview.

The goal is to build the first homes in 2026, he said. City officials plan to pick a neighborhood for the first 200 units and streamline area zoning code so that the developer won’t need to obtain variances. 

The homes could sell for between $150,000 and $300,000, Epstein said. Because they are new construction, they will qualify for residential tax abatements. The ultimate cost of a new home depends on how much subsidy the city can put in, he said. The city would work to drive down costs as much as it can, including by offering smaller units.

“My gut is that without several hundred thousand dollars in subsidy, you can’t build a new house for $80,000,” Epstein said. 

Bibb sent a letter to modular home manufacturers recently to gauge their openness to  the idea, and more than 10 companies said they were interested, Epstein said. Once applicants submit proposals, City Hall plans to pick three finalists to bring their products to Cleveland. The winning company would receive other incentives to open a factory in the city, including tax-increment financing and a commercial tax abatement. 

Ward 13 Council Member Kris Harsh cosigned the idea in the news release from the mayor’s office.

“We’re not just bringing manufacturing jobs back to our city – we’re addressing our housing needs with an innovative, high-quality and cost-effective solution that will benefit generations of Cleveland residents,” he said.