by Vanguard Staff
LOS ALTOS, Calif. — Construction cranes will lift modular housing units into place Monday at the Distel Circle affordable housing project, as developers and public officials gather to highlight modular construction as a strategy to reduce the cost and time required to build new homes amid the Bay Area’s persistent housing shortage.
The Housing Accelerator Fund invited media to witness the installation of modular units at the Distel Circle development, an affordable housing project built by EAH Housing. The demonstration is scheduled for Monday afternoon. San Jose Mayor Matt Mahan and members of the Los Altos City Council are expected to attend and will be available to speak with reporters.
“To meet our crisis of housing affordability, we must reduce the time and cost it takes to build new homes,” said Rebecca Foster, CEO of the Housing Accelerator Fund. “Modular homes are an innovative way to meet this moment. They enable housing to be built faster and at a fraction of the cost.”
Modular construction involves building housing units off-site in a factory setting and then transporting them to the project location for installation. Supporters say the approach can significantly shorten construction timelines, reduce labor and financing costs, and limit exposure to delays caused by weather, supply chain disruptions and regulatory hurdles that often affect traditional construction.
The Distel Circle demonstration comes as cities across the region face mounting pressure to address housing affordability and comply with state housing mandates.
Earlier this month, San Francisco adopted Mayor Daniel Lurie’s family zoning plan, a sweeping policy change intended to allow more housing to be built in neighborhoods that have historically restricted development.
Following that vote, the Housing Accelerator Fund sent a letter to San Francisco officials outlining steps cities can take to accelerate affordable housing production, including incentivizing the use of industrialized and modular construction to shorten timelines and lower development costs.
Housing affordability remains one of the region’s most pressing challenges. Rising rents and home prices have pushed many residents out of the communities where they work, contributing to longer commutes, increased traffic and growing homelessness. At the same time, affordable housing developers continue to face significant barriers to financing new projects.
Traditionally, building affordable housing requires developers to piece together multiple competitive public funding sources, a process that can stretch on for years. Those delays often increase costs and create uncertainty that can stall or derail projects altogether. In the Bay Area, affordable housing developments can take close to a decade from conception to completion and cost nearly $1 million per unit, according to housing advocates.
The Housing Accelerator Fund aims to address those challenges by providing private capital earlier in the development process, allowing projects to move forward more quickly and reducing reliance on lengthy funding cycles. The fund, a community development financial institution, has developed financing tools intended to help nonprofit affordable housing developers compete in the Bay Area’s high-cost real estate market and better manage construction risks.
Last week, the Housing Accelerator Fund announced it had doubled the size of its Bay Area Housing Innovation Fund to $100 million. The expanded fund is intended to provide long-term, low-cost capital to housing projects that commit to aggressive cost containment and accelerated construction schedules, with the goal of delivering more affordable homes in less time.
Distel Circle is the first project to receive financing from the fund’s Industrialized Construction Catalyst Fund, which focuses specifically on supporting modular and other industrialized construction methods. The fund provides financing for early-stage costs that are often ineligible for traditional loans, such as factory fabrication and off-site construction expenses.
Construction on the Distel Circle project began in July 2025. Developers expect the project to be completed on an accelerated timeline, with lease-up anticipated in January 2027. Once finished, Distel Circle will become the first affordable rental housing community in the city of Los Altos, offering income-restricted housing to residents of Santa Clara County.
Other modular housing projects have demonstrated the potential benefits of industrialized construction. Tahanan at 833 Bryant in San Francisco, another modular development, was completed three years after the site was acquired and built at a reported cost of $385,000 per unit, significantly below typical Bay Area affordable housing costs. The Industrialized Construction Catalyst Fund was named a finalist for the Ivory Prize in 2025, an award that recognizes innovative and scalable solutions to housing affordability challenges.
Organizers of Monday’s event said the crane installation is intended to provide a visible example of how modular construction can accelerate housing delivery at a time when cities are under increasing pressure to produce affordable homes more quickly. Housing advocates argue that without meaningful changes to construction methods, financing structures and regulatory processes, many jurisdictions will continue to fall short of their housing goals.
The Housing Accelerator Fund said it expects to announce additional modular housing projects in the pipeline that will benefit from similar financing tools. Representatives of the fund and its development partners said the Los Altos demonstration is part of a broader effort to encourage cities and policymakers to embrace construction innovation as a central component of addressing the region’s housing crisis.
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A buddy of mine has a small home building business that specializes in shotcrete. It’s basically walls made of metal wire mesh and a sprayed concrete like substance to form walls that are prefabricated in a factory to be shipped out to builder project site locations. As the article mentions that there are significant time advantages that can be gained through a prefabricated/modular method to construction. The cost savings should be pretty good but it’s still a specialized niche market so the cost savings significantly diminish the larger the scale of the project….usually do to production limitations compared to the traditional sticks and bricks onsite construction conventional method that most builders already have the infrastructure in place to scale for larger projects.