A startup owned by Berkshire Hathaway aims to make the construction industry more like car manufacturing.
2 min
A startup owned by Warren Buffett’s Berkshire Hathaway Inc. aims to shake up the construction industry by making it more like car manufacturing.
MiTek Inc., a Missouri-based construction-technology company, is launching a new modular building venture with New York City-based architect Danny Forster & Architecture. The company plans to build entire rooms for hotels and apartment buildings in factories, and then send them to a construction site to be stacked on top of each other.
MiTek has more than 6,000 employees and sells building components, construction software and services like engineering. The company said it is investing tens of millions of dollars in the modular venture, and plans to start working on its first projects early next year.
Modular construction isn’t new, but companies have struggled to be profitable. Transporting entire rooms to construction sites can be expensive, and some finished buildings have suffered from leaky facades.
Other efforts to streamline the construction process have also had issues. Katerra Inc., a Silicon Valley-based startup, has been looking to move a bigger part of construction work to factories and become a one-stop shop that cuts out middlemen like plumbers and architects. But it has struggled under this model, and its main backer, SoftBank Group Corp., had to bail it out.
MiTek looks to modernize modular construction by requiring assembly by general contractors. Instead of building entire rooms in a factory and driving them to a construction site on a flatbed truck, MiTek wants to ship kits of manufactured building parts along with instructions.
General contractors would then construct rooms from these parts, which would include a steel cage forming the structural support for the room, in a warehouse or other type of industrial building near the construction site.
Shipping the parts, rather than entire rooms, keeps transportation costs low and allows MiTek to supply the country from its factory in Lebanon, Pa., said Todd Ullom, the company’s vice president of modular building solutions.
That companies continue to invest in modular construction despite the challenges speaks to the business model’s promise, proponents say. Construction is a massive industry, plagued by rising costs and inefficiencies. Anyone who manages to automate it the way Henry Ford once changed car manufacturing stands to make a fortune, some industry observers say.
“How come an entire industry is operating on mid-to-late-20th-century mode when we’re a quarter of the way, almost, into the 21st century?” said Barry LePatner, a New York-based construction attorney. “It drives me crazy.”
MiTek’s approach brings its own challenges. Relying on customers to assemble rooms based on written instructions can be tricky. Many general contractors are resistant to change, which could lead to friction and mistakes.
Mr. Ullom, who worked as a general contractor for more than 30 years, said relying on a single supplier instead of numerous subcontractors reduces risk, and the instructions are simple to follow. He said MiTek would offer on-site training.
MiTek also plans to automate much of its 225,000-square-foot factory, for example by using robotic welders, not unlike how auto makers assemble cars. Architect Danny Forster’s firm has designed what could become the world’s tallest modular hotel, a planned 26-story building for Manhattan. He said other modular-construction companies moved work from building sites into factories but failed to make it faster or more efficient.
“A lot of times it has been bringing the chaos of the construction site and just putting a roof over it,” he said.
Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: May 18, 2021.
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The U.S. now has more billionaires than China for the first time in a decade, driven by AI and a booming stock market.
3 min
The number of U.S. billionaires in the world reached 870 in mid-January, outpacing the number in China for the first time in 10 years, according to a snapshot of the wealthiest in the world by the Hurun Report.
The U.S. gained 70 billionaires since last year, powered by a rising stock market, a strong dollar, and the insatiable appetite for all things AI, according to the 14th annual Hurun Global Rich List . China gained nine billionaires overall for a total of 823. Hurun is a China-based research, media, and investment group.
“It’s been a good year for AI, money managers, entertainment, and crypto,” Rupert Hoogewerf, chairman and chief researcher of the Hurun Report, said in a news release. “It’s been a tough year for luxury, telecommunications, and real estate in China.”
Overall, the Hurun list—which reflects a snapshot of global wealth based on calculations made Jan. 15—counted 3,442 billionaires in the world, up 5%, or 163, from a year ago. Their total wealth rose 13% to just under $17 trillion.
In November, New York research firm Altrata reported that the billionaire population rose 4% in 2023 to 3,323 individuals and their wealth rose 9% to $12.1 trillion.
Elon Musk, CEO of electric-car maker Tesla and right-hand advisor to President Donald Trump, topped the list for the fourth time in five years, with recorded wealth of $420 billion as of mid-January as Tesla stock soared in the aftermath of the U.S. election, according to Hurun’s calculations.
The firm noted that Musk’s wealth has since nosedived about $100 billion, falling along with shares of Tesla although the EV car maker is benefiting on Thursday from Trump’s 25% tariff on cars made outside the U.S.
According to the Bloomberg Billionaires Index, Musk’s wealth stood at about $336 billion as of the market’s close on Wednesday, although measuring his exact wealth —including stakes in his privately held companies and the undiscounted value of his Tesla shares—is difficult to precisely determine.
The overall list this year contained 387 new billionaires, while 177 dropped off the list—more than 80 of which were from China, Hurun said. “China’s economy is continuing to restructure, with the drop-offs coming from a weeding out of healthcare and new energy and traditional manufacturing, as well as real estate,” Hoogewerf said in the release.
Among those who wealth sank was Colin Huang, the founder of PDD Holdings —the parent company of e-commerce platforms Temu and Pinduoduo—who lost $17 billion.
Also, Zhong Shanshan, the founder and chair of the Nongfu Spring beverage company and the majority owner of Beijing Wantai Biological Pharmacy Enterprise , lost $8 billion from “intensifying competition” in the market for bottled water. The loss knocked Zhong from his top rank in China, which is now held by Zhang Yiming founder of Tik-Tok owner Bytedance. Zhang is ranked No. 22 overall.
Hurun’s top 10 billionaires is a familiar group of largely U.S. individuals including Jeff Bezos, Mark Zuckerberg, and Larry Ellison. The list has France’s LVMH CEO Bernard Arnault in seventh place, three notches down from his fourth ranked spot on the Bloomberg list, reflecting a slump in luxury products last year.
Nvidia CEO Jensen Huang is ranked No. 11 on Hurun’s list as his wealth nearly tripled to $128 billion through Jan. 15. Other AI billionaires found lower down on the list include Liang Wenfeng, 40, founder and CEO of DeepSeek, with wealth of $4.5 billion and Sam Altman, CEO of OpenAI, with $1.8 billion.
Also making the list were musicians Jay-Z ($2.7 billion), Rihanna ($1.7 billion), Taylor Swift ($1.6 billion), and Paul McCartney ($1 billion). Sports stars included Michael Jordan ($3.3 billion), Tiger Woods ($1.7 billion), Floyd Mayweather ($1.3 billion), and LeBron James ($1.3 billion).
Wealth continues to surge across the globe, but Hoogewerf noted those amassing it aren’t overly generous.
“We only managed to find three individuals in the past year who donated more than $1 billion,” he said. Warren Buffet gave $5.3 billion, mainly to the Bill and Melinda Gates Foundation, while Michael Bloomberg —ranked No. 19 with wealth of $92 billion—gave $3.7 billion to various causes. Netflix founder Reed Hastings, ranked No. 474 with wealth of $6.2 billion, donated $1.1 billion.
