01/07/09

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A concrete option

Wally Sanger surveys his recently opened operation in Okeechobee.

While many builders are suffering in Florida's residential downturn, one Palm Beach-based company is busily expanding its business, opening new facilities and trying to keep pace with $100 million in work orders.

Royal Concrete Concepts has found a niche at the intersection of low cost and high durability. The company's secret? Modular building, with its own patented process.

The walls have withstood blows at 85 miles per hour from a two-by-four during missile impact testing, and the structures themselves will hold up to the winds of a Category 5 hurricane.

Wally Sanger started out as a builder of conventional homes, using conventional materials. Now, his patented method of manufacturing, known as "concretables," have transformed his company into an in-demand builder of everything from modular classrooms and military barracks to energy efficient and custom homes.

Concretables are modular buildings constructed with steel framing, poured concrete and a polystyrene core. They are used in more than 25,000 structures around the Southeast and Caribbean — especially in Florida schools where pre-configured portable classrooms are in demand. Royal has also begun making inroads into the growing "green" building category.

"The way Wally explains the insulating strength of the concretables' polystyrene core is by thinking about a hot cup of coffee in a [styrofoam] cup. The cup is less than a quarter of an inch thick, but you know what it does," said Anna Niehaus, director of residential sales at Royal Professional Builders. "That insulation goes both ways though. It's good in the winter and good in the summer."

Last spring, a Port St. Lucie home became the first in the state to earn a certification through the U.S. Green Building Council's LEED for Homes pilot program after performance tests were completed by the Florida Solar Energy Center. Built by Royal Professional Builders, which is comprised of five divisions united under the Royal Companies umbrella, the home includes hurricane-resistant, energy-efficient wall panels, Energy Star appliances and a drought-tolerant, low-maintenance landscape.

"When Wally started building in Florida in 1982, he was a conventional builder. But he quickly came to the conclusion that conventional building was not the way to go in Florida. It's not energy efficient, it's not hurricane resistant, it's not termite resistant," Niehaus said. "In Florida, you need to build differently."

By 1989, Sanger had developed the combination of steel, poured concrete and polystyrene and dubbed it "Royal Walls." The Royal Wall system then expanded to integrate floors, walls and roofs into individual units that are manufactured in a factory-style process. The components are then trucked or shipped to the building site.

Developed initially as a way of prefabricating walls, Sanger expanded the process to include a variety of applications.

Recent projects include the development of what the U.S. Navy calls the "Very Low Maintenance Housing Units" at the U.S. Coast Guard Base at Great Inagua, in the Bahamas.

Royal currently employs 350 people. Niehaus was reluctant to share revenue information for the privately held company, although some published reports have estimated its 2006 revenues to range anywhere from $80 million to $167 million.

Niehaus did say, though, that Royal currently has a backlog of $100 million in orders.

"Conventional builders in Florida have done well, even in the past few years, but they're not building as much as they once did, which is when our modular company really started growing," she said. "We think in the near future we will be all across Florida, particularly in areas that are hurricane prone. The biggest attribute these modules have is that they are hurricane resistant, and people are interested in having their homes be sustainable."

As business expands, so too, will Royal's manufacturing capabilities. In 2006, Royal announced plans to build a new $30 million manufacturing plant on 175 acres in Okeechobee, west of the county airport. Royal expects to employ up to 1,300 people at the plant, although the company's headquarters will remain in Palm Beach County.

Niehaus said that while classrooms were not considered ideal candidates for portables, school districts throughout the state have been turning to Royal to meet expansions needs, as well as temporary space while schools are being built or refurbished.

Building a classroom on site using conventional methods can cost $165 per square foot; a Royal portable costs $75 per square foot and can be manufactured at Royal's facility in three weeks. It is also certified to last 100 years.

In a video testimonial provided by the company, Susan Olson, director of facilities, planning and construction for Indian River Public Schools, said several schools in the district were damaged by Hurricanes Frances and Jeanne, with the alternative learning center ending up completely destroyed.

The district was "under the gun to get something done quickly," Olson said. A normal school takes 18 months to build, but the school district didn't have the luxury of time or the budget to build in a timely manner.

"[Royal] is the way to go. You save money — the total cost of the project was about half of what a normal school of this type would cost," Olson explained. "But the most important thing was the swift timeframe. Based not only on my perception, but also on the feedback we've gotten from at least a dozen sources, this is the best thing we've ever done."