On today’s episode of Power House, Diego chats with Vikas Enti, the CEO of Reframe Systems, about how micro factories can reshape the future of home building in America.
After a decade at Amazon Robotics, where he helped deploy over half a million robots, Vikas is now using his engineering background to create climate-resilient, affordable housing with Reframe’s localized micro-factories.
Vikas talks about how local-focused construction and zoning reform can make homebuilding faster and cheaper. He also discusses how Reframe plans to partner with developers and what the next 12 months have in store for the company’s growth.
Here’s what you’ll learn:
Reframe aims to build climate-resilient homes efficiently. The home building industry has not significantly changed in 100 years. Construction is fundamentally a logistics problem.Reframe is developing micro factories to reduce costs and improve efficiency.Local customization is key to meeting regional housing needs. Affordable housing is a critical issue in the current market.
Related to this episode:
Vikas Enti | Linked
https://www.linkedin.com/in/vikasenti
InReframe Systems
https://www.reframe.systems/
Enjoy the episode!
The Power House podcast brings the biggest names in housing to answer hard-hitting questions about industry trends, operational and growth strategy, and leadership. Join HousingWire president Diego Sanchez every Thursday morning for candid conversations with industry leaders to learn how they’re differentiating themselves from the competition. Hosted and produced by the HousingWire Content Studio.
After a decade at Amazon Robotics, where he helped deploy over half a million robots, Vikas is now using his engineering background to create climate-resilient, affordable housing with Reframe’s localized micro-factories.
Vikas talks about how local-focused construction and zoning reform can make homebuilding faster and cheaper. He also discusses how Reframe plans to partner with developers and what the next 12 months have in store for the company’s growth.
Here’s what you’ll learn:
Reframe aims to build climate-resilient homes efficiently. The home building industry has not significantly changed in 100 years. Construction is fundamentally a logistics problem.Reframe is developing micro factories to reduce costs and improve efficiency.Local customization is key to meeting regional housing needs. Affordable housing is a critical issue in the current market.
Related to this episode:
Vikas Enti | Linked
https://www.linkedin.com/in/vikasenti
InReframe Systems
https://www.reframe.systems/
Enjoy the episode!
The Power House podcast brings the biggest names in housing to answer hard-hitting questions about industry trends, operational and growth strategy, and leadership. Join HousingWire president Diego Sanchez every Thursday morning for candid conversations with industry leaders to learn how they’re differentiating themselves from the competition. Hosted and produced by the HousingWire Content Studio.
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NewsTranscript
00:00This episode of Powerhouse is brought to you today by Polly.
00:05That's the question of the hour in terms of how do you design a product that's highly desirable,
00:13or at the same time doesn't break the bank on the cost segment, but also doesn't hurt the planet.
00:17And I think that's been the problem we're trying to solve here.
00:20Welcome to Powerhouse, where we interview the biggest names in housing and ask them about their strategy for growth.
00:35I'm Diego Sanchez, president of HousingWire, and my guest today is Vikas Enti, CEO of Reframe Systems.
00:43Vikas, it's so great to have you on the show.
00:46It's wonderful to be here, Diego. Thank you so much for having us.
00:48Before we dive in, could you briefly introduce yourself and Reframe Systems?
00:56Yes, so I'm the CEO, co-founder of Reframe Systems, started the company about two and a half years ago.
01:01Prior to starting Reframe, I spent over a decade at Amazon Robotics, helping make same-day shipping a reality for all.
01:09I have deployed over half a million robots across 70-plus fulfillment centers.
01:13If I go way back, I trained as a mechanical engineer, but did most of my work in systems engineering and product development.
01:20I'm a dad of two beautiful twin daughters. They're the reason Reframe exists today.
01:25And I'm happy to dive into any of those things, but happy to be here.
01:29Yeah, that's really interesting. Eleven years with Amazon Robotics must have been really fascinating.
01:35How do you feel like that experience prepares you for what you're trying to build at Reframe?
01:43I feel like a lot of the confidence in wanting to start Reframe and knowing that we could be part of the solution came from the realization that all the work that I got did alongside with my team at Amazon Robotics.
01:56I was a startup called Kiva Systems first that Amazon then bought, and we became Amazon Robotics, and we went from deploying 300 robots in our very first fulfillment center to eventually ending my career that were half a million robots built.
02:10That was the kind of scale that really allowed us to get, at least personally taught me how do you think about systems from the standpoint of how do you design systems that are built for scale, where software actually drives the scalability and flexibility,
02:25but also systems where software enables you to make the underlying cost lower for the hardware of the systems that go in, but also allows you to take overall process costs out of the equation.
02:36And I think there's a lot of my career was kind of built around how do you apply technology to lower costs and increase speed.
02:42And that kind of has become the ethos that was built up.
02:46Very click for me in terms of, okay, how does this experience actually relevant for home building?
02:50It was a more convoluted path, became a dad.
02:54That was a moment of introspection for me to say, where else could I be applying my skills in a new industry?
02:59Climate change was already top of mind, but I was reading the book Speed and Scale when my daughters were born.
03:06Speed by John Doerr, and that really laid out the recipe for how you avoid the climate disaster.
03:12But it kind of laid the premise that all the technologies and materials we need to reduce carbon emissions already exist today.
03:19The only challenge is that they don't have an engine to propagate those changes quickly, at scale, and efficiently from a cost standpoint.
03:29And so to me, it was great.
03:31The skills I bring to the table are how do you actually scale things and bring them to market quickly.
03:35So it said, okay, how at least a piece of the solution, or what is the problem we need to go after?
03:40And it really shone light on housing and the built environment.
03:4440% of our emissions come from our homes.
03:47So it's a clear place to stick as an opportunity for us to go after the space to reduce emissions.
03:53But it was a long path from that realization to eventually arriving at a solution that we frame this building today
03:59to make sure we can build climate resilient homes extremely efficiently, extremely quickly, and predictably.
04:04Really interesting origin story.
04:08But you picked an industry that is maybe one of the most antiquated in the U.S. and globally.
04:17Homebuilding primarily has the same technologies that were in use 100 years ago.
04:24How can your experience in really ramping up robotics at Amazon be applied to an industry that is still, you know, working with technologies that are from a century ago?
04:36I think it's a common saying that if you were to bring a carpenter from the 1800s, they would be very comfortable on a job site today because the process hasn't changed.
04:45While the overall process architecture hasn't changed in how homes get built, there has actually been a lot of technology progress in individual levels, right?
04:53Like, if you think about all the work that's happened on the software side of the world of BIM for architects,
04:59how you actually get to interface in pretty high resolution in 3D to make sure you're actually building your entire building in 3D before you build up a job site.
05:06But that's actually unlocked a lot of efficiencies over time to allow better collaboration between different technology players.
05:15Like, to us, we feel like there's been pockets of technology adoption across the homebuilding stack, but just the fundamental process of homebuilding hasn't changed.
05:22And that's why we're trying to change because we believe that that's where we're leaving significant opportunity for driving costs down and increasing efficiency.
05:30So, at least the good news is, right, we're entering a market where there's only been technology adoption in different segments of the stakeholders we're working with.
05:39If we're working with code submission authorities or code review authorities, if we're working with, we do work with external MEP engineers to actually get a lot of engineering work done.
05:49We're all working on similar technology stacks to make sure that all of our information comes together, right?
05:53So, we're in the world of, at least in the AEC stack, we're glad there's technology adoption.
05:57So, at least the first piece, we're not having to climb a pretty big hurdle.
06:00But we've had to invent a whole bunch of things after that fact.
06:03Like, today, all the work that happens in the BIM stack, super useful to allow architects and engineers to communicate with each other, allow GCs to be part of the same conversation.
06:13Also makes it easy to then generate all the artifacts you need for code submissions to get permit approvals.
06:18And also, obviously, generate really pretty pictures for marketing and sales.
06:22But the place where all the value ends, unfortunately, is when you try to convert that information into instructions that you could use to build on a job site or build in a factory.
06:32That is where we believe there's been a massive divide in the industry and a poor realization that construction, in fact, is a logistics and information problem.
06:40And all the effort we're putting in technology today only solves for the information layer on the design side, but almost none of the information cascades down to how you would use those design information to manufacture or to construct.
06:54So, Reframe, we've had to kind of take the stance to say, construction is a logistics problem first.
07:01So, how do you make sure you're designing a system that embraces that construction is always local?
07:05You have to interface with a job site.
07:07How do you design?
07:08In our case, we believe manufacturing is the way to solve this problem.
07:11We've invented a micro factory.
07:13And the whole goal of the micro factory is that how do you make sure it's roughly the size of the garden center at Home Depot?
07:18How can we locate micro factories that are at similar distances of Home Depot or some job sites?
07:24How do you actually deploy them where they're right within an hour of major metropolitan areas?
07:29You're actually close to the job site.
07:30You're close to your customers.
07:32You don't make logistics a barrier from a cost standpoint, but also by being close to customers, you also take this whole stigma.
07:39And the off-site construction isn't very approachable for a lot of developers today because you're having to find factories that are two or three states away.
07:47It's a remote concept.
07:49But the moment you say, hey, it's no different than you're going to a Home Depot, it's right there.
07:52I think we've already been able to break a lot of the mental stigma and barriers to adoption.
07:55So, that's one piece on logistics.
07:58Could we pause there just for a moment?
08:00Because I think what that means is that there's a reframe systems factory.
08:08There's a lot of them eventually, right?
08:11Like, if you want to have a factory within an hour of, you know, every potential home building site, that means you're going to have to scale up to a lot of factories.
08:21Is that accurate?
08:23Absolutely.
08:24There's about 2,000 Home Depots across the country.
08:27I expect that for every three or four Home Depot, there's a microfactory in that same vicinity.
08:31So, we expect needing at least 200 to 300 microfactories across the U.S. to continue attacking the problem.
08:38And there's a lot more of that needed around the world.
08:41And how many are – is there just one microfactory now or do you have a couple that have rolled out?
08:48So, we have one microfactory today.
08:51We're about 20 miles north of Boston.
08:53And our roadmap is to get a second microfactory up in California.
08:56So, we're focused on L.A.
08:58We're looking at helping with the fire rebuild with Altadena first.
09:02So, we'll be setting up manufacturing capacity there.
09:05And the goal is to be in five markets over the next five years.
09:08So, at the very least, we'll have five microfactories across the country.
09:11But looking at the traction we're seeing with customers, I wouldn't be surprised at the number is twice that by 2030.
09:16And could you tell me more about what a reframe systems home looks and feels like?
09:26I've been to builder trade shows and, you know, seen some of the innovation in modular housing and in 3D printing.
09:36But just to be candid, a lot of them are ugly.
09:40So, how are you thinking about aesthetic as you think about, you know, the really important issue of climate change and, obviously, costs?
09:51No, that's the question of the hour in terms of how do you design a product that's highly desirable, but at the same time doesn't break the bank on the cost segment, but also doesn't hurt the planet.
10:05And I think that's been the problem we're trying to solve here.
10:08Kind of think about your comment on, really, like, a lot of factory built housing historically has been very constrained by starting with the box.
10:17Like, the whole industry evolved from the manufactured housing industry where you're constrained by the trailer size.
10:23And the whole industry kind of said you're building homes as either a single-wide or double-wide.
10:26You put one trailer or two trailers.
10:28That's where the industry kind of took part.
10:29And over time they said, hey, we can actually also do site-built construction, but let's build to local codes but build them in a factory.
10:36But all of traditional modular construction is constrained by the box size.
10:39They started the box, and then they try to fill out the actual floor plan for the home, and that also constrains your actual user experience inside.
10:47But even the way your whole floor plan stacks up and you have the massing for a building, not always does it represent the look and feel of the neighborhood.
10:56Where we've had enough advances over time is, especially with the advent of BIM and the advent of digital modeling, we're able to break this mold to say,
11:04we can actually start with the floor plan and then find the right box dimensions to make sure we're modularizing the structure appropriately.
11:11For Reframe, we have an advantage in that we treat this as a logistics problem.
11:14We're having factories that are close by.
11:17I don't have to index on building the largest box that can be built in a factory.
11:21I can actually build the smallest box that encapsulates the floor plan that I need and get to that experience.
11:27And there's a thing we lean on very heavily, and this is where there's been a fundamental shift in the rest of the industry.
11:31The whole industry has been very focused on standardization so they can get to mass production.
11:36How do you get to a low mix, high volume operation?
11:39We've really been indexing on what we call mass customization.
11:41How do we make sure that we have a bunch of reference product designs?
11:45And if you look at our website, you'll find that a lot of these are look and feel.
11:49Matches or mirrors what you would find, both stick built.
11:51For New England today, there's a huge appeal for building homes that have a standard gable roof.
11:58The facade treatments, the window fenestration details, all of this is a very New England-esque look and feel.
12:04And we've been catering to that with our product line.
12:07But we're also trying to modify the same product for how we meet the look and feel for what we look like in Southern California.
12:12So the roof lines look different.
12:13The window proportions look different.
12:15So these are all things that we get to parameterize as part of our building platform.
12:18All the invention we have on the manufacturing side and how we can go, what we call pixels to parts.
12:23How do you go from the CAD model that we have into manufacturing instructions that go to the robot, that go to our apprentices on their iPads.
12:30We've built a system that allows us, no matter what the design actually looks like, it breaks down pretty nicely to a set of repeatable actions that we can perform across our manual operations, automated operations.
12:42So we've built a system that allows us to do mass customization at scale.
12:46What this means for the customer is that we're able to make sure that we can both react to the differences of the site, right?
12:52Like the huge challenge of construction and the reason we haven't had enough adoption of manufacturing techniques is all of manufacturing has been built for, right?
13:01You do low mix, you build a standard product and find a way to repeat and scale it.
13:05But for construction, given the variability of site conditions, all your different state building codes and the 30, excuse me, and the 30,000 zoning jurisdictions, you very quickly find that you almost always have to site customize a design to maximize the value for the customer to make it legally compliant.
13:23And today has been a pretty high cost to do that because you're having to make it highly manual in the whole design process, but also the manufacturing process.
13:29In our case, software takes over there, it gives us a little marginal cost to make this customizations.
13:34But what this also means for us is we get to embrace the local design language that's needed.
13:38So I also would argue that design is highly subjective and how the aesthetic appeal is highly subjective.
13:46We still index more on having designs that are not necessarily boxy, but designs that have envelopes that are extremely optimized for insulation.
13:59Air tightness for fire resiliency and these tend to be facades and fenestrations are fairly flat because that's the best way for you to make sure you have minimal hover angst, minimal opportunities for air leakage, minimal opportunities for any wildfire intrusions.
14:17So there are certain trade-offs we have to make, which allows us to maximize energy performance and resiliency.
14:23And that's the place where I think we probably won't win every single customer out there, but there's some trade-offs we've had to make.
14:30So you talk about regional and even local customization.
14:36So let's say you have 200 to 300 factories across the country.
14:41Does each one of those factory have a team of designers and architects who are thinking about that local flavor when you build homes?
14:56Yeah, our expectation is that we're able to localize the designs and localize the supply chain with every micro factory that we launch.
15:05It's not clear to me if every micro factory will need to have its own design team.
15:09I expect that we will sell centralized.
15:10We'll have pockets of design teams across the country that have local context.
15:16Maybe they're sitting in the design office versus the factory.
15:18But the other piece we also get to do is we get to train up the factory team to be able to build local context a lot more deeply.
15:26So as an example, a micro factory that's based in Massachusetts will have to carry, will have to know how to deal with gable roof design details, how to deal with cedar shingle facades, how to deal with a lot more exterior insulation to deal with the weather, the climates that we're here in.
15:43But a factory that's built in California will have to know how to deal with different types of facade options that are not cedar shingle, not shiplap, might have to get better at doing details that are relevant for seismic loading, less details right here.
15:57So there's a lot of localized, like construction is local.
16:01So two as a micro factory approach allows us to break the need that one factory has to learn how to build for five different climate zones, which is the case today for most of the players in the industry.
16:09Yeah, this is really interesting. And so if you think about Home Depot or Lowe's, they are B2C, they're not B2B, they're not working with home builders to work with homeowners.
16:24So how do you think about reframe systems as you scale? Are you going to go direct to the consumer or are you going to work through the 40,000 plus custom home builders that are across the country?
16:37Yeah, so today we've actually gone one step further in that we're working with developers, right?
16:43So the segment of the market we're focused on is missing middle housing.
16:47So for the next five years, we want to get really good at and become the best infill builder.
16:51And the way we use the word builder here is how we become the best infill design build GC that can partner with smaller scale developers who are doing infill housing.
17:01They're adding density in existing neighborhoods with duplexes, triplexes, small multifamily.
17:06We want to be their go-to-market partner where they find the land and the financing.
17:10And we basically go into the turnkey solution where a home magically appears.
17:14And the reason we pick developers as our first ideal customer is we believe that the best customer is a repeat customer.
17:22And to us, developers have a long-term pipeline.
17:24And the more we can get ourselves plugged into their pipeline, the higher odds we have to make sure that every factory we build,
17:31we're able to continue to keep its pipeline fully utilized and make sure the factory is fully fed.
17:37This also allows us to do something which is interesting where every micro factory that we set up, our goal is to set that up as a joint venture entity.
17:45And by partnering with developers, we can actually have them come in as capital partners at every factory.
17:50So that allows us to make sure that we have local partners, local context, local capital, and local demand that makes sure that we're de-risking every factory that goes out there.
17:59And we will sell to retail customers, but the experience is going to be a little different.
18:03I think today, for a retail consumer, usually when they're going through the process of building a home, it's a very personal experience.
18:12The industry has kind of created this expectation that you can customize every single aspect of the home to get your dream home.
18:19And we're able to do that, but it comes with significant trade-offs of capital efficiency and time efficiency.
18:24So we want to learn a lot through developers to understand, like, what does the ideal home actually look like?
18:31Like, get through enough design cycles to say, we believe this is the perfect bathroom.
18:34We've spent X hundred hours, right, researching the bathroom, testing it out, building enough prototypes to know that it meets all the aesthetic requirements.
18:42And we run user group studies around it.
18:44It meets all the functional requirements, meets all the code requirements.
18:46So we want to bring, like, a true product development approach.
18:49And we believe the best way for us to do that is to learn through developers who've built incredibly good instincts on what their customers would want for either rental properties or for sale properties.
18:59And the goal for us is to be able to learn this over the next couple of years so that we build enough conviction to say, the designs we have, we can actually recommend that to a retail customer to say, you should pick our design.
19:08This is actually as good as it gets.
19:11And to us, like, today, I think it's a much harder behavior change to go through.
19:15We're going to be learning some of this as we go through the process in rebuilding in Altadena.
19:20Because in Altadena, most of the properties have to be rebuilt.
19:25We're working with retail homeowners who are rebuilding properties that they lost through the fire damage.
19:29We're having to deal with the trauma of it, plus also how do you rebuild something that's better and has more value.
19:36So we'll have to learn a bunch there.
19:38That makes a lot of sense to me.
19:39I'm familiar with the new home process, and there's almost too much choice in that current process, right?
19:49I would guess that most consumers would be okay with some choice restriction if it could impact the final cost.
19:59Absolutely.
20:01So we kind of fell into one project we're working on today.
20:05It's a multi-generational.
20:06It's a triple-decker.
20:07It's a New England building type.
20:09It's three apartments stacked on top of each other.
20:11Very familiar.
20:12I grew up in the Boston area.
20:14Amazing.
20:15So it's as New England of a triple-decker as it gets.
20:18It's a multi-generational living situation.
20:21It's a retail customer.
20:22We weren't seeking them out.
20:23We were trying to sell to their employer, and then it somehow cast it into becoming a personal project.
20:30But at least what we learned through this is giving them choices on the finishes for cabinets, colors for walls, some finish choices for flooring and facade.
20:40These four things have been like the big drivers of decision.
20:44We initially were concerned that they would be driving a lot more changes to the floor plan and the overall look and feel for the building.
20:52But we're learning that there's actually a way to nudge customer behavior where it actually is constrained to finishes that are easy to change.
21:00But we've been lucky with this first customer.
21:02I don't expect that it's going to be the same.
21:04If someone is building a single-family home with us, I expect that they might want more.
21:07So this is an area that we're going to keep learning by partnering with developers first and build a good library of options and what's the app conviction in.
21:14So on a recent HousingWire virtual panel, Ivy Zellman, the very well-known housing market analyst and just analyst period, said that we don't have a home supply issue.
21:31We have an affordable home supply issue.
21:35Do you agree with that statement?
21:37Absolutely.
21:39And I also feel like there's a lot more nuance to that statement.
21:43Again, not an expert in the overall macro environment and how we think about housing supply.
21:49But at least the way we see it and the way we feel like it's, again, construction is very local.
21:55A lot of local implications here.
21:57If I look around, so we're getting more familiar with the New England market.
22:00The observations point on, I think they're most, given the inflation and construction costs and just some of the overall inflation and cost of land in infill markets, the only way that developers can make sense of projects is to build homes that are retailing for like $1.52 million.
22:20That's what you kind of see in a lot of the retail segment.
22:22Right.
22:23Not affordable.
22:23They're not affordable.
22:25But the, I think it was John Burns, who was the other housing data analyst, they had made an observation.
22:37You have to fact check me with the same or someone else, but they said that supply is supply because the moment you create supply, even at that price point, it means that someone who was living in a million dollar home is upgrading their lifestyle to get to the bigger home.
22:51And then they're opening up space in the market for upwards mobility for everyone else.
22:55So they were arguing that supply is supply.
22:59We just need more of it.
23:00I think the challenge here is you need supply in the right places at the right time and obviously the right price.
23:07And so to us, we've been sort of focused on the piece of the question for supply, which is how do we make sure we can drive down the cost of supply, drive down the speed so you're actually able to react to market cycles more quickly and get more predictability so that we're not having to hedge.
23:23Like to do the whole industry hedges on everyone's schedules to everyone's costs.
23:27So the final project costs is all they seem they're on a hair's edge of actually being viable.
23:32If they can bring predictability to the industry where you can say, your home, your developer is going to cost you $320,000 a unit.
23:41We can guarantee you that price plus minus X percent based on some things we haven't fully bottomed out on yet.
23:47But it's going to take exactly three months to get it from the moment you allow us to take site control and start.
23:51Like they can start making higher quality decisions and how they think about the overall project viability.
23:56So we feel like there's just a little bit of this unpredictable in the market that then has a developer hedging significant of what they think that actual costs will be.
24:04And by the time they're trying to get their LPs on board, like every project always seems like it barely, it either did not pencil because everyone hedged so much that the cost didn't make sense.
24:13Or the costs were really that high, that didn't make sense.
24:17So in our case, we believe that you have to be predictable.
24:19The more the industry can become predictable across the supply chain and across the construction value chain, I think we unlock better quality decisions.
24:27And the place where we're hoping to move the needle on is on the speed and the cost of the process we're going through, where we're just fundamentally changing the developer perspective on, like, hey, we can actually make the math pencil to build homes that are $750,000 each instead.
24:40Because we, like, we're still able to get the returns we need for the timescale that we need.
24:45And so we're going through this exercise right now.
24:47We're building, we're co-developing a 12-unit project up in Devons, Mass.
24:50It's an existing, it was an old army base.
24:56We're partnering with Mass Development.
24:57We're currently in the exploration stage today.
25:00But as we go through our site evaluations, et cetera, like this project, most homes there will retail for about $750,000 a unit.
25:07And these are some extremely high-performance homes where normally you're getting them at a fairly lower purchase price point, but your actual operating costs are also going to be over 80% lower than if you're buying a home that was not built to the energy standards we're building them to.
25:23So we think there's a, there's a real pathway here where technology allows you to unlock those economics and get that predictability and speed.
25:30And we're hoping that that kind of supply allows developers to make other choices.
25:34Obviously, the place where I think we, and this is a forum to call for action, I think there's a place where zoning gets to play a big role, which is if zoning makes it easier to reduce minimum lot sizes,
25:47allows developers to subdivide lots pretty quickly to actually build more housing density on existing lots and sort of kind of reduce the cost spaces you're carrying for land as part of a project.
25:57I think we could actually build a lot more starter homes, build a lot more homes that are reasonably priced for the markets they're in, but also create a lot more supply on this instantaneous.
26:06Today, I think we're all fighting an uphill battle on just getting, meeting with zoning regulations that are pretty archaic, that just don't make the economic map pencil to get homes at the price points that people are looking for.
26:20Really interesting.
26:21So last question, could you walk me through your next 12 months as CEO and co-founder of Reframe Systems?
26:31How are you thinking about scaling up the company and starting to roll out this mini factory concept?
26:40Absolutely.
26:41So today, as we look at 2025, we're already building about 30 times more this year than we built last year.
26:48So we're obviously kind of going through that curve as a startup.
26:51We'll end this year with between 18 to 25 homes that are built across a mix of triple deckers, duplexes and bungalows.
26:58And we're also taking on two projects out in Altadena that we'll actually be shipping from Massachusetts initially.
27:04The cost differential is high enough that it surprisingly makes sense today, but that's a way for us to start getting a foothold in the market to eventually then make the case for a local micro factory we will deploy in 2026 in the Altadena, LA County region, as an example.
27:18So on the Massachusetts, New England side, we're already seeing a spike in pipeline for multifamily.
27:25So for listeners who are not from here, there was a pretty heavy legislation that was passed.
27:31One of the biggest things was called the MBTA Housing Choice Law, which allows communities to build housing by right.
27:37So multifamily housing by right across communities.
27:39And that took effect on Jan 1st, 2025, and we've seen a pretty good spike in developers looking at parcels that they already own that allows them to build three-story multifamily by right.
27:51And that's been driving a lot of demand.
27:53We've seen similar upzoning in the city of Cambridge, where now you can build up to six-story structures by right in all single-family lots.
27:59So needless to say, like our pipelines doubled in the last three months, and most of the entries have been for projects that are small multifamily to large multifamily.
28:09So if these start continuing and we kind of see where we're still trying to learn what the timeline's going to look like, if they'll start construction in 2026 or 2027, depending on that timeline, we will very quickly be out of capacity in our current micro factory here, which means we'll have to set up micro factory number two when in Massachusetts.
28:25So if the current momentum continues, we expect that we're launching two micro factories next year, one in California and one in Massachusetts, and just continue to kind of build out housing on both costs.
28:39Fascinating.
28:40I think this has been a really interesting conversation, and I would love to bookmark 12 months from now, maybe we can have you back on and talk through your progress and what you're learning from having multiple micro factories.
28:54Absolutely.
28:55We would love to do that, share our lessons, and invite people to come obviously visit the micro factory we have here and the future micro factories that we open up.
29:04Amazing.
29:05Vikas, thank you so much.
29:06Thank you so much, Diego.