School Climate & Safety

Builder of Modular Schools Closes; Projects Stalled

By Joetta L. Sack — March 08, 2005 3 min read
  • Save to favorites
  • Print

The recent closure by a Southern California manufacturer of modular buildings has left several districts there stranded with half-completed school projects.

TurnKey Inc., a privately held company in Temecula, Calif., that built modular classrooms and other school facilities, filed for voluntary dissolution, in which directors and most stockholders agree to shut a company down.

It was the second modular-classroom manufacturer in Southern California to shut down in the past half-year. In August, Moreno Valley-based Aurora Modular filed for bankruptcy, also leaving behind several unfinished projects.

See Also

The shutdowns come as the modular industry, by and large, is enjoying a robust period.

Worldwide, the construction and sale of modular, or factory-built, commercial facilities is a $5-billion-a-year industry, said Tom Hardiman, the executive director of the Modular Building Institute, based in Charlottesville, Va. School facilities—mostly in California and Florida—account for about $1.5 billion of that market, he said.

“The advantage we provide is not cost savings … but time,” said Mr. Hardiman. A factory-built facility can be finished in nearly half the time of a school built on site, he said.

Meanwhile, one of the districts most affected by TurnKey’s closure is the 140,000-student San Diego Unified School District, which had contracted with TurnKey to build dozens of classrooms at four schools at a total cost of $34.5 million. One project is nearly complete, and the district was about to begin construction on two others. One was at the beginning of the design phase.

The company’s shutdown in January will translate into delays in the opening of the schools, or portions of the schools, said Bob Kiesling, the district’s chief facilities executive. He said he expected the district to recover all of the money lost by the TurnKey’s closure through the insurance that the state requires on such projects.

“If a construction entity goes out of business, you’re out of luck, and you need to have safeguards in place to complete those programs,” said Tom Kube, the executive director of the Council of Educational Facility Planners International, based in Scottsdale, Ariz.

“It’s bad enough we have to house our kids in modular classrooms,” he said, “but it’s even more dreadful when a company like this goes out of business and leaves districts stranded.”

Several telephone calls and e-mails to two TurnKey officers seeking comment for this story were not returned. A hearing on the company’s dissolution in the Riverside County Superior Court was postponed from last month to early this month.

A June 2004 press release from the company said that TurnKey was founded in 1998 and had grown since 1999 from just 12 employees to 330.

Quick Expansion

That quick expansion could have led to the company’s demise, said three California architects and facility planners familiar with TurnKey, who asked not to be identified.

“They had a reputation for more marketing than substance,” said one architect. “They overexpanded and sold to the moon.”

The company advertised a design process that prevented mold and cut down on maintenance costs. As part of that process, prebuilt construction components would be shipped to a school site and then attached to a concrete foundation. The company said the process cut down on building time and cost about 20 percent less than traditional construction.

But one former employee interviewed for this story, who asked not to be identified, alleged that TurnKey preyed on small districts that were not well versed in construction practices. The company, according to the former employee, had lawyers who wrote stringent contracts that did not allow for any change orders in construction. The company had also offered some districts temporary financing until they could receive state money for their construction projects.

But, according to the former employee, if a district asked for a change or could not secure all the financing within the specified period, TurnKey voided the contract and demanded that the district pay all the costs.

According to news reports, some former TurnKey employees had asked state and federal officials to investigate the company’s labor practices and handling of retirement accounts.

Mr. Kiesling of San Diego said that district officials there had researched the company, including visiting its factory, to determine that TurnKey could handle the district’s volume of the work.

“They gave an excellent product—the school building that they were mostly done with is very good quality, and was a very good price,” Mr. Kiesling said.

Reporter-Researcher Marianne D. Hurst contributed to this report.
A version of this article appeared in the March 09, 2005 edition of Education Week as Builder of Modular Schools Closes; Projects Stalled

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Artificial Intelligence Webinar
Decision Time: The Future of Teaching and Learning in the AI Era
The AI revolution is already here. Will it strengthen instruction or set it back? Join us to explore the future of teaching and learning.
Content provided by HMH
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
School & District Management Webinar
Stop the Drop: Turn Communication Into an Enrollment Booster
Turn everyday communication with families into powerful PR that builds trust, boosts reputation, and drives enrollment.
Content provided by TalkingPoints
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Special Education Webinar
Integrating and Interpreting MTSS Data: How Districts Are Designing Systems That Identify Student Needs
Discover practical ways to organize MTSS data that enable timely, confident MTSS decisions, ensuring every student is seen and supported.
Content provided by Panorama Education

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

School Climate & Safety Heat Illness Is Preventable Even on a Budget, Experts Say
Building awareness of risk is a critically important strategy for under-resourced school districts.
5 min read
Senior Joaquin Garcia takes a drink of water on the sideline during a morning football practice at Westwood High School in Austin, Texas, on Sept. 2, 2025.
Senior Joaquin Garcia takes a drink of water on the sideline during a morning football practice at Westwood High School in Austin, Texas, on Sept. 2, 2025.
Noah Devereaux for Education Week
School Climate & Safety ‘We Can Save Other Athletes’: How One State Is Fighting Heat-Related Deaths
The state has encouraged schools to modify their practices and monitoring during tough conditions.
5 min read
Football players gather around a coach during practice at Heard County High School in Franklin, Ga., on Aug. 27, 2025.
Football players gather around a coach during practice at Heard County High School in Franklin, Ga., on Aug. 27, 2025.
Lynsey Weatherspoon for Education Week
School Climate & Safety Opinion ‘This Kid Scares People’: A Behavior Specialist Shows Her Reality
Real school shooting prevention doesn't come from splashy announcements about a policy change.
Jillian Haring
4 min read
Depressed young male person sitting outdoors alone suffering from problems. Surrounded by a network of teams and individuals looking out for signs and ways to intervene.
Vanessa Solis/Education Week + Getty Images
School Climate & Safety Chicago Schools Prepare Students and Parents as Trump Threatens National Guard
The district is pledging not work with or share student records with ICE officers.
Kate Perez, Chicago Tribune
3 min read
Students file in for the first day of school at Courtenay Language Arts Center in Chicago's Uptown neighborhood, Aug. 18, 2025.
Students file in for the first day of school at Courtenay Language Arts Center in Chicago's Uptown neighborhood, Aug. 18, 2025.
E. Jason Wambsgans/Chicago Tribune/TNS