PropTech: Prescient Leverages Replicability of Hospitality and Multifamily Development to Create Efficiencies in Construction

By Meghan Hall

As construction costs continue to rise, new tech is evolving in an effort to streamline processes and budgets. At Prescient, a hospitality- and multifamily-focused company, the goal has been to use tech to create repeatable processes to ensure efficient project delivery. The Registry recently spoke with Presicent’s CEO Magued Eldaief, as well as Dan Rogers, CEO of Blach Construction and Republic Urban Properties’ COO Reyad Katwan and President Michael Van Every, the project team behind Gateway Millbrae Station, Millbrae Calif. The project is expected to be one of the largest transit-oriented developments in the Western United States, and thanks to Prescient’s help, has been able to significantly reduce various costs.

Please tell The Registry about the founding of Prescient Co. What prompted the development of a digital design build system?

Eldaief: Prescient was founded to directly address the fragmentation and inherent inefficiencies that plague the construction of multi family construction today. AEC companies tend to use a wide range of hardware platforms and software applications for their own operations, leading to the technical challenges in integrating industry supply chains with every job being custom and unique in how it gets delivered. And while the industry is using modern systems (elevators, HVAC systems, better materials, etc.) and software technologies to help manage planning and design, scheduling, bidding, accounting etc., the industry does not have an underlying integrated hardware and software platform that drives a repeatable and efficient process to deliver multifamily housing that can be scaled and industrialized to drive faster and cheaper delivery of attainable housing.

Why is Prescient Co. designed specifically for multifamily and hospitality? What are the biggest challenges that these two asset classes face when it comes to construction? 

Eldaief: The Prescient system was specifically designed for multifamily construction where we can drive repeatability and standardization with an industrial mind-set that allows us to scale and drive productivity similar to what has been achieved in other industries that have adopted the same approach like the car industry. Any multifamily/hospitality building includes a number of similar units that can be replicated leveraging our platform to gain efficiencies in cost and schedule. The key is driving a standardized process leveraging digital technology and standard hardware kit to deliver it.  We are brick and mortar meets cloud. Think of a software app that allows you to design, engineer, manufacture and assemble any multi-unit bespoke building in a matter of minutes and hours using a standard kit of light gauge steel parts. This standard kit of parts is manufactured at scale leveraging industrial automation and a continuous digital thread that leverages BIM to inform and align all project stakeholders and is assembled efficiently with a lean process. This approach and technology platform is ideally suited for large multifamily construction.

What are some of the challenges to developing a platform such as Prescient? How has the company worked to overcome these challenges?

Eldaief: The first challenge in the early days was coming up with a hardware system and methodology akin to an erector set that would work for multifamily construction and then building the software applications that would allow us to design with that kit of parts leveraging a set of defined algorithms allowing us to optimize around a multitude of variables to come up with a bespoke and efficient structural solution. The second biggest challenge was driving adoption and convincing owners that we have a viable product that works! Gaining acceptance of a different approach to design and build in construction is tough especially as it requires early decision making and taking a bet on an unknown system. From a business standpoint, we continue to spend a lot on R&D to  refine our Hardware and software platform to make it even more compelling and appealing to our adopters. A lot of our innovative ideas come from our customers where we hold over 100 patents today with a healthy pipeline of new ones pending! 

Prescient is being used in the construction of Gateway at Millbrae Station, a TOD mixed-use complex set to be delivered next year. Can you explain, specifically, how Prescient was used in this project? What prompted you to choose Prescient for this project?

Katwan and Van Every: Wildfires, natural disasters, insurance and tariffs on Canadian wood has driven the cost of wood through the roof. These conditions made it necessary to find alternate construction materials to wood framing.

Rogers: Yes, that is correct. We took several factors into consideration when considering a partnership with Prescient for the extensive Gateway at Millbrae Station project, which is located along the San Francisco Bay Area Peninsula. The double-threat of potential fires and seismic activities, magnified by building code-related issues and skyrocketing costs, spurred us to source an alternative to wood framing. Specifically, we desired a non-combustible metal framing system and were successful in finding several that would have worked. After much deliberation, we landed on Prescient, as it became exceedingly clear that not only did they have the optimal solution, they would be a like-minded partner and great addition to bringing this long-awaited project to fruition. 

Did Prescient cut down on time or cost? If so, by how much? 

Rogers: Our partnership has been fortuitous. Using Prescient has had a significantly positive impact, reducing both our installation time and overall project costs. While the cost of construction is typically identical for wood and metal framing, substantial savings have come by way of insurance and labor. Over the course of construction, we anticipate our insurance savings to exceed $3.5 million, which is in addition to our ongoing operational insurance savings of roughly $250,000 per year – an approximate value of $6.25 million (based on a 4 percent CAP rate) to the project. From a schedule perspective, it is difficult to analyze exactly how much time we have saved with Prescient, especially given the effects of the global pandemic and subsequent, and varied, supply chain disruptions.

What other projects is the company currently tackling? 

Eldaief: In California we are currently building the 600,000 square foot extension to the UC Davis 1.3 million square foot student housing project we completed last year. Outside of California we have ten active projects being built in seven states. By the end of 2021, we would have completed 72 buildings and close to 12 million square feet across 20 states.  

What is Prescient’s strategy for future growth?

Eldaief: Our focus is around clients, market segments and geographies that value the benefits of off-site construction. We are specifically focused on multifamily for geographies like California where there is high demand for housing and relatively high costs of skilled construction labor to deliver it.  Separately we focus on the student housing segment as it values the predictability of outcomes we deliver regarding schedule and cost. We are fortunate to have a number of repeat clients and relationships that have propelled our growth and platform adoption.   

Where do you see the construction industry heading in terms of technology? What are you most excited about and why? 

Eldaief: From a Prescient Standpoint BIM or Model centric design is the future of our industry, enabling better integration and coordination for architects, engineers, contractors, manufacturers, vendors, suppliers, service providers, developers, owners and occupants. What excites us the most is leveraging the true power of BIM and digitalization with our hardware platform to link-up and integrate supply chains to drive a revolution in how we design, engineer, procure, manufacture and build. The concept of a digital thread that not only links those in the supply chain to deliver a project but also enables those that operate it to look at building life cycle costs is achievable today!

Katwan and Van Every: Our industry has not had many technological advances in the past, with new technologies such as Prescient we see a bright future ahead and look forward to new advances. 

Rogers: While Blach has embraced innovation since its earliest days, the construction industry as a whole has been slower to incorporate technology into the overall building process. However, this is changing rapidly and dramatically. Much to our delight, the increased availability of more robust and reliable technological tools, especially relative to prefabrication, is having a profoundly positive effect on efficiency gains, as well as safety – which is incredibly critical in the dangerous world of construction. We are excited to continue embracing opportunities that enable ongoing advancements in building.

 Is there anything you would like to add? Anything we should be asking?

Eldaief: The only thing I would add is there is not enough emphasis on sustainability in the US with regards to the construction industry as there are no meaningful financial incentives to promote reducing the carbon footprint of all industry participants. This topic is gaining more traction in Europe but cannot be ignored when discussing global warming and making the construction industry greener and more sustainable. Eliminating waste and using recycled materials therefore has to be valued and looked at differently.

Rogers: Prescient is an ideally suited solution that complements our ongoing commitment to innovation. The Prescient platform, including both the actual structure and the application of technology to construct it, allows for heightened collaboration and coordination among our trade partners during the design process. Resulting benefits include field labor efficiency gains that ultimately reduce overall project costs and enable us to deliver increased value to our clients.