It’s a Utah housing project made of boxes, welcomed for its “outside the box” design.

A Salt Lake City company called Eco Box Fabricators broke ground Jan. 31 on what will be the state’s first multi-story apartment complex made of steel shipping containers.

Backers of the Box 500 Apartments project, at 543 South 500 West, say it will stand six stories tall and offer 83 new studio, one- and two-bedroom apartments accessible to renters earning below the area’s median wages.

Company officials and the city’s building inspectors have worked for more than a year on the structural, safety and engineering challenges of stacking disused steel containers into a residential building. Last week, City Hall issued a series of permits to greenlight the project.

“This design is different than any design in the world,” Eco Box Fabricators owner Rod Newman said. “To my knowledge, it’s never been done.”

If all goes as planned, he said, tenants could start moving in as soon as August.

Thousands of steel shipping containers arrive at Western ports yearly from China and are then discarded. The resulting surplus has spurred a growing international movement known as “cargotecture,” or fashioning the rectangular containers into office, retail and residential spaces.

Utah has seen containers used in building single-family homes and accessory-dwelling units, known as mother-in-law apartments. A small Salt Lake City firm called Little City offers refurbished shipping containers for office spaces. But stacking them this many stories high for residential purposes is new.

Newman and his crew were joined at the groundbreaking by Mayor Erin Mendenhall, Councilwoman Ana Valdemoros, housing advocates, real estate executives and others — reflecting the promise that Eco Box’s pioneering approach could help with Utah’s current lack of affordable homes.

“This is a crisis,” Mendenhall said of the housing gap. “And this new project helps us address it in a new way. By breaking this mold, we can now replicate in other ways across the city.”

In a time-consuming and costly back-and-forth with building officials since mid-2017, Eco Box has tackled a range of concerns on earthquake and fire safety, parking and how the uniquely boxy structure will tie into sewer and power utilities.

One city building official said the review for Box 500 was unique.

“It was a ton of work, but it’s necessary for us to be vigilant," said Orion Goff, director of the city’s building services and civil enforcement. "We’re going to be scrutinized on this.”

Goff said his staff plans to inspect large pieces of the apartment complex as they are completed off-site at Eco Box Fabricators factory, at 534 West 800 South.

Crews will then move those pieces to the building site and stack them, Newman said. “By the time we finish building the foundations,” he said, “I’ll have two floors ready to be put up.”

Eco Box spent at least $650,000 on research and development, computer modeling and other measures, Newman said, to prove the container-stacking concepts behind Box 500 Apartments would meet city building codes.

“Now that the engineering is done,” he said, “we can build a lot more of them and provide a lot of housing for a lot of people.”

Newman said he was inspired to pursue the project by a 14-dwelling complex made of shipping containers in California, which housed homeless veterans. “I thought, ‘We could do it better — and Salt Lake is in need,’” he said.

The city says the units will go to residents making 60% of Salt Lake City’s median incomes — as set by federal numbers — with added guarantees that Box 500 rents also won’t take more than 30% of each renter’s total budget.

The high numbers of Utahns spending a third to 50% or more on housing costs are considered “cost burdened” under city policy.

Mendenhall said the city had waived impact fees typically charged to developers on such projects, in exchange for 15 years of those rent subsidies. Newman is otherwise refusing tax incentives for affordable housing with Box 500, as part of proving the concept, he said.

The mayor, a former city councilwoman who took office in January, said the city’s permit approval showed a commitment to recycling and sustainability, as well as a willingness to get creative in bringing more affordable units to Utah’s capital.

She praised Newman and Eco Box for collaborating with the city and issued a call to Utah’s housing developers:

“Work with us,” Mendenhall said. “Work with us to find new ways and to figure out how to get to ‘yes’ on processes that are instilled with the values of Salt Lake City being a place where all can afford to live.”

Clarification: 12:48 p.m., Feb. 2, 2020 — Details were added on the affordability of homes in the Box 500 Apartments project.