The state’s push for housing density, along with the need for new homes post-wildfires is driving demand for Airbnb spinoff Samara’s prefab homes, which landed a $34 million investment this week.
The company was started by Airbnb co-founder Joe Gebbia and former Flex CEO Mike McNamara in 2016. Factory-made homes, or panelized housing, is taking off in places such as the Palisades and Altadena, as builders and homeowners look to alternative materials that speed up timelines to getting back home.
“We expect LA to pick up quite a bit on the back of the fires and because of the products that we’re deploying there,” McNamara, Samara’s CEO, told The Real Deal this week, after his firm announced the $34 million Series B closing led by Thrive Capital.
Samara turned heads in February when it partnered with Rick Caruso’s nonprofit Steadfast LA to help expedite the recovery timeline. As part of that, Gebbia donated $15 million toward giving homes to fire survivors without the means to rebuild their homes.
At least 100 homes are expected to be built through that partnership, and a separate organization is handling recipient selection. A “handful” of homeowners have so far been identified in Pasadena and Altadena, and Samara is assisting them with permitting, McNamara said.
“It’s a careful process that our partner is going through,” said McNamara, who was unable to provide a figure on how many property owners have been selected. “They do want to make sure that we’re gifting it to people that need it most. So, the process takes a little bit of time.”
The installations take four to six weeks. Factoring in site preparation and utility hookups, the whole process takes two to three months. The first recipients’ homes are expected to be in the ground by the end of the year.
The company’s analysis of homes destroyed found that 600 spanned 1,000 square feet or less in Altadena, McNamara said. That’s the sweet spot for Samara, which has a 950-square-foot model called the XL 10 with two bedrooms and two bathrooms.
Other prefab players in the market include Hapi Homes, which was in the design stage with 30 clients in Altadena and Pasadena as of August. RSG 3-D said 40 to 50 homeowners were working with architects expected to use the company’s panelized materials to rebuild.
ADUs to boost multifamily
Rebuilding is one area of growth for Samara, but multifamily is ramping up the fastest as state and local policies shift in favor of adding density and increasing the housing supply.
“It’s just been a continuous change in regulatory policy in California that they’re allowing more and more of this density,” McNamara said.
A raft of changes this year have carved out exceptions in building codes in efforts to speed rebuilding.
That kicked off with January’s executive order from Gov. Gavin Newsom which allows an ADU to be installed even without the primary home being issued a certificate of occupancy. The point is to make it easier to get impacted residents into housing while they rebuild their primary residences.
Boosting multifamily are laws such as Senate Bill 684, which was effective last July, and Senate Bill 1123, rolled out this July. Both cut the environmental review required under the California Environmental Quality Act for housing projects on qualifying lots in a bid to reduce the red tape around permitting.
As a result, Samara’s seen plenty of work from multifamily owners, ranging from mom-and-pop businesses to large corporations with thousands of units in their portfolio.