When Ryan Grey Smith and wife Ahna Holder built a shed for storage, it wasn't just any shed. Their compact space turned into a profitable business model and an idea that would resonate with people. Modern-Shed, their do-it-yourself-esque shed business, has become popular for its useful and affordable living spaces.

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When Ryan Grey Smith and his wife, Ahna Holder, bought their Seattle home in 1998, it didn’t have a garage, a basement or an attic.

The 1940s-era house was advertised as a “teardown,” a candidate for demolition. The two architects renovated the home themselves.

Their solution for the lack of storage space? Simple enough: they built a shed.

But it wasn’t just any shed. Their shed was less like a typical garden shed, and more like a chic outdoor room of the house, a hideaway chamber for storage, working and relaxing.

Little did they know that the compact space would turn into a profitable business model and an idea that would resonate. Now, Modern-Shed, their do-it-yourself-esque shed business, has become popular for its useful and attractive living spaces.

The prefabricated sheds come in a variety of shapes and sizes and are modern in design. The sloping metal roof lets in light at the interior wood ceiling, and the four-wall design gives the sheds a simple elegance.

“It’s that whole thing of having a small space,” Smith said. “Maybe that’s why people gravitate toward this.”

A company is born

The first person to do so was a client in 2003 who stopped by to discuss a basement renovation. When he saw the shed in Smith’s backyard, however, he thought the space was perfect and cheaper than adding another room to his home, Smith said. He ordered his own shed, in a similar style as Smith’s.

Smith and Holder saw the potential in modern sheds then, and in 2005, formally launched their business.

How it works

Modern-Shed offers various options for clients, from a simple 6-by-8-foot garden shed to a more elaborate 12-by-18-foot studio. They offer larger dwelling sheds, too, with plumbing and space for kitchen amenities, although the bathroom and kitchen fixtures themselves are not included.

Most clients custom-design their sheds, and have the option of paying extra for alternative eco-friendly options, such as denim wall insulation, cork floor tiles and a GreenGrid roof. These roofs can be planted with vegetation to lower energy costs.

Although the sheds come in all shapes and sizes, the basics are the same: four walls and a sloped roof.

“It really is about finding some alternative ways to build something and building something that will last,” Smith said. “Tearing down a wall is a big deal. Why not do something simple?”

Working from home

Nancy Moscatiello and her husband, Derek Dryman, were considering adding another room to their 1930s-era home in Los Angeles, when they saw Modern-Shed on “Visiting … With Huell Howser,” a television program that aired on KCET-TV, a PBS affiliate.

“We said wait a minute — that would be so much easier,” Moscatiello said. “Having this studio done was easily a quarter of what it would have cost to add onto the house.”

Moscatiello and her husband bought a 10-by-14-foot studio shed, where her husband does animation work.

“It’s away from the kids and the house and dogs and stuff,” she said. “He can leave [his work] in the middle of a project and he doesn’t worry about people messing it up.”

As more people work from home, Smith said, an option like Modern-Shed makes sense. It’s about more than utility — people want a space away from their hectic home lives.

“If you just add on an addition to the house, it’s still your house. It’s too tempting to be like ‘oh, crying baby, oh, the dishes,’ ” said Kate Ostergard, who works at home for gorptravel.com. Her husband, Warren Ostergard, works at home, too, as a film producer. “When you actually leave the main house and go outside, you are actually going to work.”

The Ostergard’s shed is “technologically decked out,” she said, with a 12-foot custom desk, surround sound in-wall speakers, a flat panel TV, wireless Internet, air conditioning, heating and a custom dog door.

Their shed, with all the additional amenities they requested, was still significantly less than what it would have cost to add another room to the home, she said.

Cheaper and prebuilt

Modern-Shed prices range from $6,000 to $23,000, depending on the shed’s size and amenities.

The sheds are prebuilt, pre-drilled and shipped flat from Sedro-Wooley, complete with a tool kit. In a matter of days, clients can install the shed themselves, or pay a bit extra for the delivery people to erect it.

Smith and Holder, who stay busy with Modern-Shed as well as another business called Grey Design Studio and their 3-year-old daughter, Della, can’t really “escape it all” in their own shed. Their work tends to follow them whether they’re in the studio shed or home office.

“We’re constantly thinking up stuff,” he said. “It’s just the way it goes.”