How Financing Companies Can Leverage AI to Help Modular Developers Build Faster w/ Park Place Lending Inc.

Financing can kill a great modular project long before the first module is built. That’s exactly where AI is starting to change the game. Jim Park, founder of Park Place Lending, talks about how AI is impacting financing for commercial modular construction, and the real-world bottlenecks that keep good ideas from turning into funded projects.

Jim digs into how AI helps with early feasibility: faster budgets, tighter schedules, cleaner pro formas, and clearer comparisons between modular vs conventional construction. Jim shares how developers can use data to identify true demand pockets, even down to ZIP codes, and why the “obvious” markets are not always the best markets. We also talk about the bigger shift most builders miss: you don’t just need a better build method, you need a scalable system that connects marketing, qualification, financing, and delivery.

Transcript

Welcome To Inside Modular

SPEAKER_01 0:00

Hello and welcome to Inside Modular, the podcast of commercial modular construction, brought to you by the Modular Building Institute. Welcome everyone. My name is John McMullen. I'm the marketing director here at MBI. Today I'm joined by Jim Park, broker and owner at Park Place Lending. Jim is here to talk about the intersection of financing for commercial modular projects and the opportunities that AI can bring to modular building developers. Jim, welcome.

SPEAKER_00 0:28

Thank you, John. Thank you for having me, and I really appreciate it.

Why ADUs Are The Big Bet

SPEAKER_01 0:32

It's my pleasure. Thanks for being here. Tell me about yourself, Jim. What's your career looked like thus far and what got you interested in modular building?

SPEAKER_00 0:40

Yeah, so I've been in real estate and lending for the past 30 years, and I've also been actively building multifamily uh here in Florida. So I understand both the financing side and the development side at a very practical level. What the experience has shown me is one of the biggest challenges in real estate today is not really demand. Like demand is there. The challenge is how do we deliver housing faster, more efficiently, and more affordability. And that's what led me to modular construction. And more specifically, what I'm really focused right now is modular ADUs, accessory dwelling units. In my opinion, honestly, this is one of the biggest opportunities in our entire real estate market for the past 30 years. You know, you have millions of homeowners just sitting on equity, cities pushing more and more housing density, and growing need for flexible living solutions. And modular ADUs literally sit right at the center of that. And when you combine modular ADUs with AI and the right financing strategies, you create a scalable system, not just in one, but also being able to scale.

SPEAKER_01 1:45

So when you are you're looking at the commercial real estate and the construction landscape right now, where do you see the biggest opportunity for AI to really help developers make smarter decisions about modular ADUs and modular construction in general?

SPEAKER_00 2:00

Well, you know, um when you look at the commercial side of the modular side, AI can do, you know, by itself what a whole team um can put together. So for example, the builder, if you think about the capability of analyzing deals and predictability of cost, we have AI programs right now that can literally within minutes you know bring you the right numbers and figures that it would take you know days or weeks to accomplish. So when you incorporate AI with the modular uh industry and the need out there, it's like a perfect storm right now.

SPEAKER_01 2:40

So for a developer comparing uh modular to conventional construction, where can AI really help clarify uh that decision early in the process?

Trust Gaps And Feasibility Accuracy

SPEAKER_00 2:51

So most modular companies are missing one thing: the scalable system that connects marketing, qualification, financing, construction. So, for example, um, if you take a project, you know, there's a lot of moving parts, but with AI, you can generate consistent homeowner leads, work with general contractors, pre-qualify using AI, structure their financing, and turn them into real projects with artificial intelligence right now that really is a game changer, you know, uh, with these type of projects and this type of development.

SPEAKER_01 3:27

One question always pops in my head when we talk about AI, what what are some of the big unknowns or misconceptions that hold uh developers back in this case from from pursuing modular and how can AI sort of help reduce that uncertainty? I know a lot of people sort of get uneasy when we talk about AI, they don't quite trust it yet. What's your opinion on that?

SPEAKER_00 3:47

You know, I totally agree. Uh, our industry, you know, being in it for three decades, it's a very slow adapting industry, even on the lending side. You know, lenders haven't really adapted yet. And the biggest um, you know, fear I would say is that it you have to change the entire paradigm shift. You know, everyone's used to getting information from say title companies or you know, different kinds of sources, and it's just the unknown aspect of it. And with anything else, it's going to be a slow adaptation in our industry. I think, especially in the module industry. But John, I truly believe that whoever uh takes the initiative and starts now, because there's a saying, first the market wins. And once you adapt and you bring, you know, people like myself, who's really versed in this, not only in the construction side, but on the lending and the disposition side, then we can really help the modular companies structure the right marketing and the right end product to hit the masses while everyone else is kind of you know thinking about it or contemplating, hey, is this something that we should do? By that time, you're already way ahead of the game.

SPEAKER_01 4:57

So, given your experience with AI, your excitement about it, what have you seen AI do to improve uh early stage feasibility work? You know, budgeting and scheduling and pro forma development, uh, all these types of things for commercial building projects.

SPEAKER_00 5:15

John, I'll tell you what, the accuracy is mind-blowing. You know, large language model is what you know AI really is. And, you know, it started with Chat GPT, OpenAI, but then you have Google with Gemini, and then you have Clot Anthropic. And it's literally an arms race right now. It's an arms race to the top. And the amount of technology that's changing from just last week till today is mind-blowing. So, for example, when we put a campaign together, we used to have a whole team, a whole staff, and then we'd have meetings and whatnot. Within 30 minutes, if I say, hey, look, we want to, you know, dominate this market, uh, look for properties here, so on and so forth, within 30 minutes, John, with a 99% probability, we'll have everything and more that we need to start, you know, hitting that market full speed ahead.

Finding Winning Markets With Data

SPEAKER_01 6:09

Do you think AI, given this arms race that's going on, you named the big three players, uh, do you think AI can help developers better understand the real cost drivers in modular construction? Because I know they're different uh than traditional, uh, you know, things like production and transportation, installation, project timing, that kind of thing. 100%.

SPEAKER_00 6:28

Like that's where this comes into play. So, for example, you have to really, you know, accurately determine the demand, the data, the financing, and the speed. Things that really you don't really understand going into a project. But with AI, you'll know not only ahead of time, but you'll know three, four months ahead of that. So, for example, let me give an example. So we have this one product going out, and uh, we're looking for areas zip code-wise, in in all you know, 50 states said, hey, provide me the top 10 zip codes where housing actually is short on demand. I mean, a short in supply, I should say, short of supply. Demand is big and supply short. Right now in the US, the housing market's slowing down, right? So, you know, most homes are uh our buyer's market. So I told AI, I said, look, provide me the top 10 zip codes where every house that goes on the market for the most part has multiple offers. Well, in this market, there's not many markets where if you if a house goes on the market, you're gonna have multiple offers, like in 2020, right? Well, AI, through all the data, literally within two minutes, providing me the top 10 zip codes that I would have never thought that I should be targeting. Okay, so like in the past, there's no way, like New Hampshire, Pennsylvania, you know, places like uh Syracuse, New York, that I would have never, I would have focused on what? Southern California, Arizona, Florida. Well, those are the slow markets right now, right? So AI was able to tell me exactly where to target for my exact product that you know I would have never known. Well, I can only imagine for a developer, you know, or people that want to really expand their modular company based on their uh criteria. I would sit down with them because every builder has a different need. I would say, okay, um, you know, Mr. and Mrs. You know, owner of this uh modular company, what is your end goal? Here's my end goal. Great. Then I would structure uh an AI um campaign specifically where they want to go. And within let's say an hour, I can provide a full-on blueprint with a 99% probability that we're gonna hit that goal.

SPEAKER_01 8:48

So from a from a financing perspective, what what information do developers often struggle to present clearly when they when they bring a modular project to a lender? What what do they have trouble with?

SPEAKER_00 9:00

That's the exciting part right now. Financing has always been the slowest moving Titanic. You know, they're not speedboats, they're really, really hard to to you know get technology until this past year. So a lot of these companies that are slow to move, Fannie, Freddie, you know, these big players, they are still using you know tape and and paper and stuff, real slow. But there's a handful of fintech companies that I've specifically worked with, where now we use blockchain for underwriting. What that means is if someone says, Hey, look, um, I want to build this uh modular, I want to build this uh ADU, you know, do I qualify for half a million dollars? Well, before you have to submit it like at a regular loan, application, appraisal, and all that. Now with AI, we use blockchain technology. So if you tell me your name, address, date of birth, location, whatnot, it'll underwrite within two minutes and give us an answer yes or no. That quickly without an appraisal and without a hard pull credit. So the uh funding capability now with AI, with some of these fintech companies that have gone into the game, it's literally a game changer right now.

SPEAKER_01 10:14

You use the term blockchain, and I'm sort of familiar with it, but I'm guessing there are those listening to this who are not entirely familiar with it. Could you give me like a 30-second overview of what you mean and how that applies to financing for commercial projects?

Packaging Deals With Funnels And Renderings

SPEAKER_00 10:28

Sure. So blockchain uses the terminology saying that you know everything is digital on the back end. So, for example, uh, typical person applies for a loan or HELOC, uh, they pull up credit, upload tax returns, bank statements, all that stuff. Your typical way of doing business that usually takes 35 to 45 days on a good day. Okay, and then you have to have the appraiser go out there, you know, you pay them what,$1,000, that takes a week, appraisal comes back, the underwriter doesn't like it, and now you have all these conditions you have to meet. It's a it's a very uh ineffective way of doing business. So, what blockchain does it takes the data, instead of uploading bank statements, tax returns, and all that stuff, they will have you log into your um online bank account and then verify that you make what you say you make. And that takes within less than a minute, and then that blockchain will give us an underwriting approval and say that, yep, John does qualify for$500,000. Um, we we verified his title, and uh based on the appraisal, it looks like it's uh the the equity is there, and then we set up a signing appointment with a digital notary, it's that fast.

SPEAKER_01 11:45

So, how can AI then help uh developers package all this project data, the the assumptions, the risk factors into a stronger, uh more credible financing request?

SPEAKER_00 11:58

So let's say you have a modular company that you know has a certain goal and and they want to uh you know build 50 modulars this year. Okay, so let's say that says the goal. Well, then we will sit down and say, okay, uh, what does your module look like? And um, you know, is are you want to work directly with the consumer, or do you want to mainly go through a general contractor? Because every modular company has a different uh exit strategy. So then we'd put that together and we put a pitch stack together. And then if you're going B2C, meaning if you're going directly to the um, you know, end user, real estate investor, then we'll put together a marketing campaign, get them into the information funnel, we call it, get them on a webinar, educate them on how this works and what the steps are to build this modular, and then while they're on the actual call in the webinar, we get them pre-approved with our blockchain technology for financing. So by the time that uh homeowner or you know, the general contractor who sent the deal, by the time they're done with the webinar, John, we can pretty much give them the green light to get this deal funded so that the modular company can pretty much forecast how much they need to bring to the table.

SPEAKER_01 13:13

Modular projects, they don't always fit the you know the traditional uh assumptions that that lenders often have about when financing needs to uh kick in. Uh, can AI help sort of bridge that gap between how developers describe their projects and how lenders evaluate them?

SPEAKER_00 13:33

It is, I think that's the biggest strength right now is you could have a modular company who's not really technology or marketing savvy. You know, they're they're building uh property, so they're not really in that aspect. But when you look at the AI funnel system that we have, I could have a, you know, someone who's been building modules for 30 years and not tech savvy. I can give them a login to my the membership area. They can say, hey, look, I want my modular to look like this. And then the AI will generate high-resolution rendering of that exact end product that they can send to the end user or use that as a marketing pitch. And at the same time, create a landing page. Look, landing pages and websites, you know, those were kind of like hard to do. Now, when they come on to the members area that I have, they can just put in X tell AI what to do. Hey, I want you to um, you know, create a landing page and a website that has five of these different models from A, B, C, and D. And within minutes, it'll create the most high-resolution landing page with a domain that they can send to whoever they want to send it to.

SPEAKER_01 14:46

Have you had uh more success with one AI vendor than another? I know Chat GPT is good at some things, clawed at others. What are your favorites? And are there particular tactics that you use to get them to generate these results that that really benefit you and your clients?

SPEAKER_00 15:04

Yeah, so uh chat GPT was first out of the gate, you know. So everyone knows that it's kind of like um, you know, right share, you think of uh Uber, right? So Chat GBT is is the main name, but who's making a really, really strong pitch right now is Google. Their Gemini platform, they came out with this thing called Nano Banana. It's kind of funny, but nano banana, if you Google it, you can put any kind of uh query into that nano banana and it'll generate the most phenomenal like image you've ever seen in your life. So you can say, hey, nanobanana, I want you to create a two-bedroom, two-bath, 800 square feet modular that's modern, high ceilings that you would put in Miami within seconds, it'll create the most incredible image you've ever seen for free.

SPEAKER_01 15:57

From your point of view, you've you've had all this experience, you play with the different tools. How can AI improve underwriting uh by helping lenders assess you know modular project risk more accurately? How is it doing that uh today?

SPEAKER_00 16:13

So the beauty of this uh platform AI is you could have a modular uh company owner say, hey, look, this is the product, you know, our cost per square foot. This is how much we spend to build one of these, this is how much it's gonna cost us to ship it from say Tennessee to Florida, right? So it puts all that into a spreadsheet and you tell it to say, hey, I want you to provide me with a step-by-step which uh product I should build at what cost, and then what we're gonna expect to sell this for. So for a modular company owner, now you're not going in the blind, you're not taking a risk. You know ahead of time, pretty much with you know a 90% accuracy, what they need to build, what area they need to send it to, and then how to get the end user to come into your funnel, learn about it, and go, hey, I was gonna go site production, you know, but it looks like if I go modular, um, it's gonna cost me 30% less, and timing-wise, it's gonna call me months faster. Like, for example, um, there's a company in Miami, so Miami Dade County has one of the strictest building codes in the country, obviously, because of hurricanes. Well, it turns out that modulars actually uh withstand hurricanes better than site build. So a lot of the lenders are accepting these modular builds because it's built quality controlled and they can adjust the actual framing and whatnot so that it can withstand a uh Cat 5 hurricane. So this AI will pretty much uh put together a blueprint on what areas you know they're selling this to to design the perfect modular so that they're not overpaying for the cost.

Start With Two Projects

SPEAKER_01 18:01

I imagine there's a lot of listeners now who are first-time developers perhaps new to not only developing modules or projects, but AI and working uh with the two in conjunction. So, from your point of view, what financing mistakes do you think a lot of first-time developers make? And where could AI sort of help them avoid the more those more costly errors?

SPEAKER_00 18:26

That's a great question. I think where most of them uh miss the boat is that they leave too much on the table. In other words, most people are used to getting financing one way, but AI will identify many different options to get a project, whether it's one or two or whether it's a subdivision, to accurately get the funding that you would have never thought is there. So as a developer and a builder and a modular company, you're gonna be able to have you know a behind-the-scene look at, whoa, I didn't know we can get this product out there. Now we can actually hit that market and we're still gonna get a high profit margin. And that's where I'm gonna be able to help anyone that you know needs help, is I can sit down with them, see what their end goal is, and then put this together ready to build financiable, you know, modulars to hit the right audience. Because my specialty is specifically AI. So there's nothing that's gonna like uh hinder us from getting the right project off the ground.

SPEAKER_01 19:27

As you're working with developers, introducing them to how you use AI, what are some of the ways that you help developers turn a modular concept into a financial project uh that that lenders can really understand and support? Is it just a matter of plugging in everything to AI and seeing what pops out? Or what what steps are you going through with them?

SPEAKER_00 19:48

Well, you know, modular is still um kind of a newer product in people's mind. Because when I first heard modular, I always thought like mobile home, you know, manufactured home. Well, we know that's not the case. And even commercial, like pickleball, indoor pickleball is really big right now for a commercial retail space. Well, it's much easier and faster to build a flex space using modular than it is to ground up with concrete, right? So we'll go to a site and say, okay, this uh land is perfect for commercial. You can do a you know a 100,000 square foot uh pickleball gym with all the other stuff. Well, AI is gonna tell us, hey, if we have this lot and we have this zoning and we have this that we need, give me, you know, the return on investment that the end user would have to pay if we build a modular compared to for your site build. Okay, so so the analytics and um things that you wouldn't even know it's there, you'll have all this information ahead of time so that you can make the proper decision.

SPEAKER_01 20:52

So, what advice, given your experience and again your your excitement about AI, what advice would you give to developers who are who are interested in it, but still kind of need that hand holding, that trusted, you know, human guidance to to structure the right deal?

SPEAKER_00 21:09

You know, I always say start with two. Everything's in pairs, right? I always tell everyone just do two projects. Okay. So if you want to eventually do a hundred, just start with two. And then there's a little bit of a learning curve compared to like how we used to do business. And we always start with two. We say, okay, let's have two end users, you know, go from uh A to Z using the AI model. And then what we'll do is we'll help them be the educator. Because right now, John, modular, you and I, you know, we like it, but most people they think the same, oh you know, is this like uh mobile home? They don't understand. So, what I would do in this case is I would do a webinar like this with the owner of the modular company, and I would ask them questions Hey, tell tell me about your company, you know, what is your quality? Build. And then we would get that recorded webinar and we would send that out to the people that have an interest. Because it's better to get that information out one to many than one to one. And AI will help us identify the exact qualified end user to get that information out too. And then, based on you know the product that you're going to sell, customize it according to what they're going to need for that property.

One Stop Financing And Contact Info

SPEAKER_01 22:25

One more question for you. Looking ahead, how do you see AI and specialized financing working together to make modular construction more accessible, more scalable, uh less intimidating for the next generation of commercial developers?

SPEAKER_00 22:42

So I've talked to a lot of modular owners and uh companies, and they said that's the biggest disconnect right now is uh there's a lot of demand for ADUs. You know, like here in Orlando, Florida, even the city is offering a$10,000 grant right now for uh any homeowners wanting to build an ADU. So the government's really pushing this, but they get stuck on the financing part, John. Like, okay, yes, I want one. Okay, how do I how do I fund it? Well, the modular companies don't know. They're like, well, do you have a HELOC company? So it's not really efficient. Okay. Where I come to really bring a package to the table, we call it the one-stop. When the uh homeowner or the business owner wants a project built, we make sure they get financing ahead of time. Okay, so we'll do that ahead of time. So we'll say, hey, a modular owner company, how much is this gonna cost? About uh$550,000. Great. Then let's have use our proprietary blockchain technology, make sure that they can get the funding. Because if they can't get the funding, then we'll make sure that, hey, you know what, we can't do this project, but we can do this a scale-down version. So that way it's gonna make the modular company owner have more credibility. Because the last thing you want to tell someone that really wants something, you tell them you can't get it, they're gonna be very unhappy, right? And most of the time it deals with financing. So that's where I come into play and help out, make sure they're approved for what they can afford to this build, and then we go in and put place the order with the modular company.

SPEAKER_01 24:15

Well, Jim, I I think this is all the fascinating stuff. It's amazing, really, what AI is doing now. Uh, and I never really connected the dots between it and lending and financing for commercial modular projects, but uh it's so cool that you have. I appreciate your time being here today. I think uh you and and your company, Park Place Lending, are going to be at World of Modular next week. Is that right?

SPEAKER_00 24:37

Yes, I am, and I'm looking forward to um meeting meet a lot of people there.

SPEAKER_01 24:41

Excellent. So uh for those uh who will be there, I hope they can connect with you. If they miss you, how should people reach out to you if they're interested in in working with you?

SPEAKER_00 24:50

They can uh either go to LinkedIn and uh search for uh Jim Park, or they could uh email me at gym at parkplacelending.com.

SPEAKER_01 25:04

All right. Well, again, thanks so much, Jim. I very much appreciate your time. I hope to get to see you next week, and I'll talk to you soon. All right, thanks, John. My name is John McMullen. This has been another episode of Inside Modular, the podcast of commercial modular construction. Until next time.