They're easy to manufacture and move into place and remove if theres problems(pests, fire, etc). Depending on how he selects people a lot of the unhoused population are not mentally well and/or have substance abuse problems. This means if someone is a hoarder or sets their own place on fire it is not as consequential to their neighbors. It also is less likely to cause problems with neighbors if you have just a little bit of room. I would imagine for something like this to thrive you would want to build community and if people are annoyed with their neighbors because they are sharing a wall it would cause problems. I don't know the real reason just throwing out ideas.