Development Startup REDTech Is Betting Big On Modular Multifamily - Inman

2022-06-15 13:54:59 By : Mr. Andy Zaoo

REDtech by Madelon Group (REDtech) is software that lets developers, their agents and teams choose commercial land, analyze plots, submit offers and coordinate the construction of modular unit-based multifamily developments.

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Platforms: Browser; iOS app Ideal for: Agents who work with developers; real estate developers; modular home manufacturers

While modular, factory-built homes are increasing in popularity, they remain a niche solution to housing.

REDtech by Madelon Group (REDTech) is software that lets developers, their agents and teams choose commercial land, analyze plots, submit offers and coordinate the construction of modular unit-based multifamily developments. REDtech, short for “real estate development technology,” connects developers with modular home manufacturers to financially map out projects to the penny, create unit renderings and create investor proforma.

Yes, this is a super niche bit of software. However, for those developers and factories in this growing line of construction, it can be a powerful tool for reducing municipal friction, cutting delivery timelines and attracting investors.

Users can start the usage process by searching for appropriately zoned lots. REDtech integrates public data, ownership information and accessible comparables to determine an estimated sale price.

Plugging in a number you may like to offer on the lot triggers the deployment of an algorithm to totally underwrite the project from the ground-up. Price-per-square foot, net operating income and every financial term a developer will need to pass on to investors or a lender comes ready to go in a few minutes.

While it could be said that REDtech makes it easy enough for anyone to be a developer, I wouldn’t recommend — nor would the company — that you quit your day job. The point is, the software does a great job of compressing the process and helping, as they say, “find balance between customization and standardization.”

Keep in mind that modular units are much easier to model financially because of fixed manufacturing costs, consistent size and materials and more predictable rents.

The interface also depicts floorplan renderings, separates leaseable and common areas, facilitates supply purchasing and factors each city’s respective fees. It also provides comparisons to traditional, stick-built multifamily developments.

Once you’re comfortable with your project’s numbers and scope, REDtech will connect you to its growing list of general contractors and modular unit manufacturers. With vendors in place, REDtech serves as the project conduit between GC, factory and all other stakeholders, further expediting the building process.

For now, REDtech has mapped lots in Denver, Los Angeles and New York. I was told it can get a new market coded and ready to move in a couple of weeks, maybe a bit longer.

I live within two miles of two separate, large-scale multifamily developments built using modular construction. I watched six stories of apartments get trucked in, stacked like a Jenga game and become fully leased within a couple of months. It’s impressive stuff and I’m excited to see technology vendors emerging to ensure this innovative way to diversify America’s housing stock isn’t slowed by the financial and political hurdles of traditional multifamily construction.

Have a technology product you would like to discuss? Email Craig Rowe

Craig C. Rowe started in commercial real estate at the dawn of the dot-com boom, helping an array of commercial real estate companies fortify their online presence and analyze internal software decisions. He now helps agents with technology decisions and marketing through reviewing software and tech for Inman.

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