On Thursday, inside the Hotel du Pont in downtown Wilmington, a group of economists, investors, and housing experts met to discuss a business venture that would leverage Chinese investment and manufacturing to produce modular housing units at low cost for Delaware customers.
Dennis O'Brien, CEO of InfoVest, a Wilmington-based venture capital firm, spearheaded the meeting. The semi-retired investor and entrepreneur is also a former foreign correspondent for China Daily and a long-time champion of economic ties between the two countries.
"Delaware is in trouble," O'Brien said. "China can be the answer to that trouble."
The working plan is to partner with the Chinese manufacturer Maristar to produce modular homes for about $80,000 each, according to O'Brien. Maristar mainly builds shipping containers, but the company has adapted its facilities to produce modular homes with a similar steel, rectangular structure. The homes would be adapted to fit local building codes and shipped to the U.S.
How will the project help Delaware? The group spent much of the meeting working that out.
For the first half of the meeting, which spanned several hours, O'Brien pressed the idea of using the homes to build affordable communities in low-income parts of Wilmington, such as the area around Governor Printz Boulevard and the Brandywine River.
The group ultimately decided, however, that serving low-income buyers wasn't feasible without collaborating heavily with the local government - a prospect that didn't align with the goal of hitting the ground running.
"It would probably take a lot more groundwork, especially with the social programs, to get lined up," said Christopher Counihan, a professor of international relations at the University of Delaware, who came up with the initial idea to partner with China on this type of project.
O'Brien said that making the deal too risky and complicated for the Chinese investors was also a concern.
Instead, the venture will go after another demographic: foreign-born college students.
Dr. Jianguo Chen, director of the University of Delaware's Confucius Institute, said the number of Chinese students attending the college has increased 200 percent per year. Chen, who attended the meeting, added that the University only plans to attract more of those students, and housing could become an issue.
"We thought the container modules could serve that Chinese population," Counihan said.
The homes would be stacked into vertical apartments, upwards of 10 stories, with common areas and subdivided rooms for multiple students. Both American and Chinese students would be housed in the apartments, ideally encouraging integration among the groups.
InfoVest is seeking at least $100 million to get the project started. Much of that money could come from Chinese investment company Shanghai Yongquan Entrust Investment Development Center LP. Li Kai, chair for the firm, called into the meeting and expressed an interest in the project.
"Delaware is a perfect test case for how the Chinese can help us as a country," O'Brien said.
InfoVest is reaching out to American investors as well.
The goal is for the housing to be available to students in September 2018.
"This is something that could be implemented pretty rapidly," Counihan said.