Building your dream home with DEN (a Propcast episode)

• DEN Outdoors offers “productized architecture,” selling digital plans, construction documents, and materials lists, streamlining the building process and reducing guesswork.
• Their designs primarily cater to semi-rural to rural settings, emphasizing adaptability to local conditions and ensuring architectural integrity across diverse locales.
• DEN has expanded its offerings beyond digital plans, with the ‘Built by DEN’ program overseeing entire projects, connecting homeowners with pre-vetted contractors for a seamless building experience.
• Justin recommends property investors to consider DEN houses as an alternative to traditional investments, highlighting the potential for passive income through platforms like Airbnb and VRBO.

In Season 2, Episode 10 of the Poplar Propcast, Justin Lieberknecht, Vice President of Marketing at Poplar Homes, talks with Mike Romanowicz, Founder of DEN Outdoors, about the origins of DEN, its design and compliance, how property investors can benefit from DEN houses, and more. 

Catch the full discussion on Google Podcast, iTunes, and other streaming platforms of your choice.

Getting to know DEN Outdoors

After a short introduction, Justin and Mike discuss what DEN is, its early beginnings, and how they operate at DEN. 

Mike describes their approach as trying to “productize architecture.” On their platform, they sell “digital plans, construction documents, materials lists, and everything you need… specified all the way down to the light switches.”

Navigating construction can be overwhelming. As Mike points out, for anything “larger than a doghouse, there’s just a lot of back and forth on the details.” By eliminating the guesswork, DEN ensures every project detail is accounted for.

Responding to customer feedback, they have evolved into a marketplace connecting homeowners with builders familiar with their designs through their BuiltBy DEN program. Drawing historical parallels, Justin notes the brand’s resemblance to the “Sears Roebuck catalog houses.” Mike envisions DEN as the next iconic brand, delivering thousands of homes with a distinct approach.

Summarizing its unique value, Mike emphasizes: “DEN is not like a custom home construction company… We’ve delivered this incredible housing product with all things predetermined and curated. That’s what you’re essentially buying into.”

Design and Compliance of DEN houses

Having experienced working on a house with his dad, Justin highlights the challenges of floor plan adjustments. In jest, he said these plans often lead to unexpected changes, like turning a “12×12 bedroom into a walk-in closet” due to lot variations. He particularly emphasizes the aesthetic simplicity of DEN’s A-Frame design and its adaptability across building codes.

DEN’s unique approach is in how its designs primarily cater to semi-rural to rural settings. Building on lots ranging from “half an acre to large estate-style properties,” DEN doesn’t face the typical urban design challenges. Instead, its focus is on “tailoring structures to local conditions such as wind, seismic, snow.“

This adaptability is what sets DEN apart. Unlike prefab housing, which often faces geographic restrictions due to retooling, DEN’s designs can seamlessly blend into diverse local conditions without compromising on their architectural integrity.

Building DEN houses with contractors

Curious about DEN’s partnership approach with contractors, Justin asks, “I know you have a partnership with general contractors. Is that where they kind of sign up and go, ‘Yep, do it for me, put it here, and then you guys take over’?” Justin wonders about the versatility of the program, posing an important question, “Can almost any contractor do this?”

Mike’s response underscores the uniqueness of DEN’s process. “Well, I think this is the thing that’s really fascinating about starting with digital plans. We’ve run that program for like two and a half years… with little intervention from the DEN core team, we saw builds and builders succeed across the country.”

But what about challenges along the way? According to Mike, “They [customers] would write in here and there with like a couple of questions to our support email, but we didn’t do any construction management, and people were still succeeding.”

Mike elaborates on the BuiltBy DEN program: “Our customers are getting so much more. We’ve pre-vetted all of the contractors… We have a dedicated DEN project manager that the customer really interacts with.” This systematic approach ensures not just the construction of a DEN house, but a seamless, guided experience for every client.

Overcoming hurdles in the DEN design process

Going back to the design process, Justin points out, “The three big hurdles in the design process are having the code verified by a structural engineer, and then the inspections and the inspection timing.”

“So when you were doing your design process, how do those mesh in and what does that look like for your designers, and how do you find them too?” he added. 

Mike separates it into two approaches. “In the past,” Mike recounts, “customers partnered with a local architect or structural engineer, interpreting our designs and making them code-compliant. We include the CAD files to make that process easier.” The responsibility then rested on local contractors for inspections, while DEN stood by for support. Mike emphasizes, “The customer runs their own process and creates their own path.”

However, the emergence of ‘BuiltBy DEN’ signifies a paradigm shift. “We’ve wrapped our arms around the whole process,” Mike says. Starting locally in the Hudson Valley and the Catskills, the ‘BuiltBy DEN’ approach is about overseeing the entire project. Mike amusingly points out, “If push comes to shove, someone from the DEN core team could just drive to a site.”

DEN’s customer profile

Justin opened with a pointed question, “Who do you see as your current customer base, and then who do you see as your expanding customer base?”

Mike offered a detailed insight, “Right now, most of our customers live in cities and are priced out of urban markets. They want to invest in real estate as an asset class. Even if you’re an executive, it’s impossible to just buy into some of these markets.”

Digging deeper into their persona, Mike paints a vivid picture, “Our customers are taste-driven, design-oriented. These are also people that buy products from really slick direct-to-consumer brands. They live curated lives and do not want to live in vinyl-sided housing from the seventies.”

Justin chimes in with an observation, “A lot of the A-frames are beautifully structured. They look a lot like what you see in featured ads for Airbnb and VRBO, like a Joshua Tree or Catskill retreat. It’s a really nice design.”

Mike gratefully responds, “I appreciate that. Our customers gravitate towards that housing experience. It’s both a lifestyle choice and enabler. They look at real estate as a stable asset class, and they get to use it, rent it, and build equity.”

How Many States has a DEN been built in?

Curious about the expansion of the company in terms of geography, Justin asked: “How many states has a DEN been built in?”

Mike discloses a common curiosity among many, “People ask me this question all the time; they’re curious about how many we’ve built.”

For the initial years, Mike explains, “For the first two and a half years, we just offered the designs. So we don’t have clean data on this.” He paints an anecdotal picture of their data collection method, “What typically happens is we sell the design, time goes by, and then someone messages us on Instagram or email exclaiming, ‘Hey look, it’s done.’ And our reaction is always, ‘Oh, this is amazing’.”

Mike highlights the vast reach of DEN, “We’ve seen DEN projects either commence or finish in almost every single state of the lower 48.” Recalling the brand’s early days, he added, “We also sold a small-scale prefab product, an A-frame of 120 square feet. We shipped that to multiple states.”

However, Mike hints at a change in DEN’s approach, “While we haven’t had a specific geographic concentration until now, that’s about to change. ‘BuiltBy DEN’ will specifically target the Hudson Valley and Catskills region.”

What kinds of infrastructure are needed for a DEN?

When it comes to setting up a DEN, Justin asks, “What kind of infrastructure is necessary to drop one of these down?” He wondered about the feasibility of setting up a DEN without the typical amenities like water and power and inquired about the range of infrastructure options available, specifically plumbing and septic arrangements.

Mike clarifies, “For a long time, we provided the plans, and they were modified by owners based on their individual needs.” He further explained that the specifications often varied based on whether the owners had access to utilities such as power or Wi-Fi.

Yet, the evolution of DEN has seen advancements. Mike details this, “With ‘BuiltBy DEN,’ everything is delivered to code in the Hudson Valley and Catskills region. This includes being on the grid with the possibility of supplemental power through solar or wind, and of course, a septic system.”

Justin visualizes the potential of the A-frames and says, “If you align that East to West… you’ve got a perfect field for a solar array. Imagine batteries on the cooler side, and you’ve got a system where you can simply drop these anywhere.” He conceptualized a straightforward setup where just two holes would suffice—one for water input and another for output.

Mike acknowledges the intricacies of such a setup, especially concerning gray water treatment. But he highlighted DEN’s forward-thinking approach by revealing, “We’re currently building an app that will enable someone to just click to add solar panels to their DEN.”

How property investors can benefit from DEN

As the paradigm of property investments shifts, Justin shares some insightful strategies for listeners to consider, especially when looking at DEN as an innovative solution.

For renters, Justin points out an appealing model: “If you’re a renter listening to this, consider buying land where your budget allows. Then, set up a DEN and list it on platforms like Airbnb and VRBO.” 

Unlike traditional timeshares, which may not offer the best return on investment, a DEN can provide both a vacation spot and a source of passive income. As he succinctly put it, “This approach beats the heck out of a timeshare, promising a much higher return on your investment.”

However, the potential of DEN isn’t limited to just renters. Justin also advises seasoned investors, particularly those who’ve delved into land banking. “If you’re an investor who’s got a bunch of land, it might be worth revisiting that piece of land. Assess its underlying value and see if it’s ripe for setting up a DEN.”

Justin notes, “You’ve got three products, right? The A-frame, the barns, and the backyard offices. Is that accurate?”

Mike clarifies, “We have more than that. We have over 30 designs in our core catalog. A-frames, barn houses, cottages, cabins… We’ve got this series called the Outpost with an offset, a really cool geometric roof. We also have backyard offices, amenity-oriented structures, like a really beautiful garage, a sauna, a washroom.”

Pondering the wide variety, Justin observes, “So you’re basically building up a cabin camping, a glamping spot too.”

Mike hints at their design philosophy, “We’ve got this not-so-secret, kind of Lego land approach to our design catalog where all of these can be built next to each other. They all make sense next to each other from an aesthetic perspective.”

Highlighting their clientele, Mike added, “Today, we definitely service some commercial operators. Like small-scale glamping operators. Small to medium size short-term rentals, like Airbnb portfolio operators as well.”