The Beginning and the End: Cozier Housing for Migrant Frackers

In the world of residential real estate, highway frontage is an uncommon selling point. Fumes, spraying gravel, the scream of

Egan Crest (Egan Crest, LLC)
Egan Crest (Egan Crest, LLC)

In the world of residential real estate, highway frontage is an uncommon selling point. Fumes, spraying gravel, the scream of air horns: no great friends, these, to man at his leisure. But to the thousands lately migrating for oil-industry jobs to the Bakken Formation—a sprawling rock unit of shale and dolomite that underlies portions of Montana, North Dakota and Canada—views of the freeway might, in some cases, prove enviable. The New York-based auctioneer Sheldon Good & Company (SGC), at any rate, has been counting on it.

In July, the company, which since its 1965 founding has moved billions of dollars’ worth of property, fetched a $9 million bid for a 30.9 acre site containing 91 employee-housing cabins in Watford City, North Dakota. The settlement, known as Bakken Residence Suites, is located at 2345 Highway 85 N—an address that emphasizes both the utilitarian priorities of its tenants, and the exigencies of commuting life in a place that has until recently consisted mostly of prairie and farmland.

A sleepy town of 1,744 at the time of the 2010 census, Watford’s population has since grown to perhaps six or eight times that size. Armed with the latest in hydrofracking—the sand and water-blasting technology that allow energy companies to extract untapped reserves from beneath rock formations—North Dakota surpassed California in 2011 as the country’s largest oil producer. The state currently has between 8,000 and 10,000 profitable wells. Fully developed, the journalist Richard Manning wrote in the March issue of Harper’s, the Bakken will support 35,000-45,000.

Drilling has so far created some 17,000 surplus jobs in the Bakken region, a figure which, SGC COO Stephanie Wilkinson recently told The Observer, will likely grow by 7,000-10,000 new jobs every year for the next 10 to 12 years. Those that travel to fill them will, of course, need shelter.          

An acute housing shortage has accompanied the boom, often relegating workers to shoddy accommodations that do little to discourage employee turnover. Barracks-like facilities with group mess halls, which Ms. Wilkinson called “man camps,” are common, while less lucky migrants bunk down in makeshift assemblages of trailers and RVs; many, Harper’s reported, sleep in cars on the outskirts of towns, or on plots leased from farmers at less-than-neighborly prices. That locals with no direct stake in oil aim to profit from the boom is unsurprising, particularly in light of the unsightly accoutrement of resource extractions: increased traffic, drug use, prostitution and elevated rates of sexual assault, to name a few.

In December, SGC will commence an auction on a second North Dakota tract. At more than 70 acres, Egan Crest will eventually have capacity for 160-190 housing units; the 30 that have been built so far are entirely filled. Two-bedroom houses rent for $150 a night, and are equipped with modern kitchens, flat-screen televisions and comfortable appointments: hardwood floors, colorful bedroom sets. Most residents, both in the Residence Suites and at Egan Crest, Ms. Wilkinson said, are men living alone.

Ms. Wilkinson declined to speculate about the future of properties like Egan Crest: “It’s such a fractured industry and this is still very much a new frontier,” she said. “This phenomenon really hasn’t had enough time to gestate and there’s no sense of how many more of these employee housing facilities will be coming on the market.” (It stands to reason that drill sites in states like Michigan, Illinois and Ohio will produce similar demand for worker housing.) But she did say that they represented early steps in the local development of more expansive permanent infrastructure: schools, transportation, retail options. “Considering the amount of work that’s out there, that development is needed in order for employees to make the commitment to planting their flags in the ground, to bringing their families there, bringing their kids,” she said.   

SGC has marketed its worker housing auctions to local property management and operating companies, as well as to distant investors from states like New York and Texas, with energy industry experience. The company is understandably bullish: “Our last North Dakota auction was a huge success,” SGC CEO John Cuticelli said in a release. “This area is ripe for development thanks to the ongoing oil and natural gas boom in the region.” The U.S. Geological Survey estimates that some 7.4 billion barrels of oil and 6.7 trillion cubic feet of natural gas remain in the Bakken area.  

But these projections, however large, concern finite quantities, and their computation constitutes a kind of haunted arithmetic. More so, perhaps, than in the case of the one-time industrial giants that today make up the Rust Belt, the end, in the area of Watford City, North Dakota, is very much palpable in the beginning—it is simply a matter of counting down. The homes at Egan Crest and at the Bakken Residence suites are simple structures set on dusty lots, surrounded by vast flat, empty spaces. It is possible to imagine prospectors rinsing pick-axes in their backyards. Practically brand new, the settlements have about them already something of the ghost town.

The Beginning and the End: Cozier Housing for Migrant Frackers