Wooden house manufacturer branches out into local market

Newsroom 01/04/2013 | 10:31

A prefabricated wooden house can be assembled from scratch in a maximum of three days, it is cheaper to build, environmentally friendly and cuts energy costs by up to 75 percent, says HoneyWood, a Romanian manufacturer of such buildings, which, after being active in Western Europe for some 10 years, launched local operations last week.

By  Simona Bazavan

“In Western Europe there is already a market for prefabricated wooden houses. People are familiar with the concept and one can say that about 5 to 10 percent of built volumes are such constructions. In Romania we are in the early, pioneering phase but growth will come,” predicted Razvan Cazacu, founder, owner and manager of HoneyWood, a Romanian manufacturer of timber-framed houses.

The 40-year-old Romanian entrepreneur started business 15 years ago in Bacau, eastern Romania, by processing wood and exporting timber to countries such as Germany and India. He later began manufacturing and exporting solid wooden furniture and shifted to wooden houses after seeing demand in Western Europe and landing a first order in France in 2006.

In 2007 the businessman and his wife invested EUR 500,000 in purchasing a factory in Moinesti, which now includes 2,000 sqm of production lines, 300 sqm of office space, 20,000 sqm of land and has a production capacity of one house per week or approximately 50 units per year.

One year later HoneyWood set up its own engineering office and invested in buying dedicated software for the structural design and manufacture of timber-framed houses, which has enabled it to obtain international quality certifications for its constructions.

So far the company has erected more than 150 such buildings in countries including France, the Netherlands, Italy, Switzerland, Germany and Belgium. In 2012 alone it built 25 houses and had total sales of EUR 1.7 million. This year it should grow to 30 sold units and a total turnover of about EUR 2 million. However, the crisis has made itself felt even on mature Western European markets such as Italy and the Netherlands, leading to slower growth rates for the manufacturer.

“Over the past ten years we have had constant growth and managed to expand from 12 employees in 2006 to 50 at present,” said Cazacu last week, at his firm’s launch event on the Romanian market.

Despite this, HoneyWood wants to further grow and to double its production capacity to 100 units per year by investing approximately EUR 1 million in its factory over the next three years. “This is not much. There are German companies building more than 1,000 per year,” he said. Most of this increase should be supported by the local market, estimates the owner, as it is no longer logistically feasible to build more than 25-30 houses across Europe per year.

He says he chose to launch the HoneyWood brand locally at this particular time because the company has gained experience and expertise in the field, and although he admits Romanians still prefer traditionally brick-built or concrete reinforced houses, he believes that once they understand the concept and its “numerous advantages” they will be more open to the idea.

Cazacu also admits that when it comes to wooden houses, anything goes on the local market as the concept itself is not well understood by Romanians. “In Romania, many manufacturers have done a disservice to the concept of timber-framed houses, by choosing to offer uncertain quality for a very low price (…) as the client may not always be a ‘connoisseur’ and would accept a job half done,” he says.

So far the local market for genuine prefabricated wooden houses is virtually nonexistent, and despite the fact that a simple search for “wooden houses” on the internet reveals dozens of local companies offering to build them, there are fewer than 10 local manufacturers who actually build prefabricated wooden houses, says the company.

“People continue to prefer traditionally-built houses because this is what they trust. As long as we succeed in developing trust I am sure things will change – because there has been a strong ecological trend in Western Europe for many years now. This isn’t something we have invented. Romania will follow the same trend,” he told Business Review.

HoneyWood estimates that it will manage to sell locally some 25-30 percent of the houses it manufactures next year, and once it reaches a production rate of 100 units per year, no more than 30 will be sold outside the country.

At first the company will mainly focus on selling in Bucharest and Bacau where its headquarters are located. People under 45, with an above average education, open to the new and interested in environmental issues are HoneyWood’s client profile.

Greener, faster, cheaper

Leaving aside finishes, a timber-framed house can be 30 percent cheaper than a traditionally built one, says Cazacu. Overall building costs are EUR 450-600 per sqm.

After the buyer receives the house kit, the construction can be raised from the ground in up to three days on average. Within 45 days the house is finished and the owner can move in.

Construction takes so little time because the house is entirely prefabricated, meaning walls, ceilings and floors are built in the factory and later assembled on site. Even finishings such as windows and painting can be added in the factory’s temperature-controlled factory. Most of the materials used to manufacture the house come from Germany, including the wood, as so far no local supplier can meet the technical and quality requirements, said Cazacu.

One of the biggest advantages of prefabricated wooden houses is that timber-framed walls are better thermal insulators than other construction materials, and thus they can be thinner, gaining an additional 10-15 percent of living space compared with a brick or block-built house of the same footprint area.

Also, good insulation means that energy costs can be 75 percent cheaper than with a regular house, added Cazacu. The houses are environmentally-friendly not only because of the materials used but also because of the construction techniques. Another advantage is that they can resist earthquakes of up to 9 degrees on the Richter scale and have an unlimited lifespan, provided regular maintenance is kept up. As for architecture and design, HoneyWood’s owner says there no limitations whatsoever and the traditional, rustic look of log homes is only one of numerous choices.

Niche market still in its infancy

Others before HoneyWood have tested the waters with the prefabricated wooden house concept in Romania but so far there are no official data as to how many such constructions have been built locally.

For example, Finnish log house manufacturer Honka entered the Romanian market last March by appointing Romanian company Finn Land Business as exclusive importer. In its first year of activity the company planned to sell some 10 houses locally, and starting 2013 the figure was intended to reach a level similar to neighboring Bulgaria, Hungary and Slovenia, where 50 to 80 houses are sold each year.

Buyers can choose from over 10,000 existing Honka house designs or come up with their own. The price of a built sqm is between EUR 300 and EUR 1,200 depending on the specifications chosen by the owner – the house can come with built-in electric network, fireplaces, sauna, etc.

Once the order is placed, the house parts are manufactured from massive pieces of wood in the company’s two factories in Finland and later sent to Romania by truck, in about six weeks’ time. The house can be assembled in around three weeks. However, the foundation is not included in the price and it must be previously built by the owner.

Green houses in the spotlight

The concept of environmentally-friendly and energy efficient houses has been getting increasingly more attention in Romania, especially since last autumn, when a Romanian project for such a construction ranked 9th out of 18 at Europe’s Solar Decathlon competition held in Madrid.

The “Prispa” solar house (e.n. Romanian for traditional porch) was created by 45 students from the Ion Mincu University of Architecture and Urban Planning, the Polytechnic University of Bucharest and the TechnicalUniversity of Civil Engineering of Bucharest.

The model house, which was built in Romania, had over 8,000 visitors during July and August last year and received over 20 enquiries from potential owners and a few companies interested in the industrialization of the house. At the competition in Madrid, the project had 25,000 visitors in 15 days, reporting more than 25 interested buyers, and also interested retailers from France, Spain and Africa, Pierre Bortnowski, the coordinator of the team who created Prispa, told BR in an interview last year.

Its creators are confident the project can be industrialized and estimate the energy-independent house could be available for prices starting at EUR 70,000.

simona.bazavan@business-review.ro

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