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Toronto-area interior building trades likely to weather economic storm

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by Don Procter

Some sectors of the building industry are in for a rough economic ride in 2009, but many wall and ceiling contractors in the GTA expect to hold their own — and even do well. That is partly because the highrise condo market — a bread and butter business for some drywall contractors — remains robust.

Some sectors of the building industry are in for a rough economic ride in 2009, but many wall and ceiling contractors in the GTA expect to hold their own — and even do well. That is partly because the highrise condo market — a bread and butter business for some drywall contractors — remains robust.

Residential tower cranes are ubiquitous in Toronto’s inner city and in pockets throughout the GTA. While single family housing starts were down 17 percent in the first three quarters of 2008 from the same period in 2007, multiple-family starts were up 70 percent over 2007, says Alex Carrick, chief economist, CanaData.

Toronto seems to have a patent on the highrise condo boom. “You’re not seeing this kind of thing happening anywhere else in Canada,” says the economist. The condo craze is partly fuelled by foreign investors (think China and the Middle East) and downsizing empty nesters in the city.

Activity in the ICI sector won’t be brisk, but the wall and ceiling industry expects work there.

Hospital projects coming on stream in 2009 are an example, says Ron Johnson, deputy director of the Interior Systems Contractors Association (ISCA) of Ontario.

That may happen, but Carrick says the global problem could make it increasingly difficult for the federal and provincial governments to secure financing for such big institutional projects.

There are methods of financing such for governments to finance projects that the private sector can’t, however. Private sector bridge financing is one means of delivery. Still, once these projects are completed, governments must write cheques to cover construction costs. Coming up with that money will be more difficult for governments as tax revenues slide and unemployment rises.

Another building sector that seems as confidently prepared as any for the economic downturn is Canada’s Exterior Insulation Finish Systems (EIFS) industry.

The EIFS Council of Canada expects a year of “flat growth” but its president, John Garbin, doesn’t see a significant slide in business for his members.

“We think that whatever downturn occurs will be more than met by our ability to grow market share.”

The Council president and others at the organization are optimistic largely because of how neatly EIFS fits into the green building movement: it is energy efficient and it sheds moisture.

Good times or not ahead, the EIFS Council won’t be sitting on its collective duff in 2009 waiting for business to roll in. The group has big plans, including three major initiatives to strengthen its position in the building industry. One of those is a five-year strategic plan, expected to be in place in early spring.

The Council has never done more than a two-year plan until now.

The idea is to examine the way the Council operates from the inside out. “There are no Sacred Cows,” says Garbin, noting that everything about the Council will be gone over with a fine tooth comb.

In 2009 the EIFS Council also expects to finally roll out its Quality Assurance Program, an initiative that’s been on the books for years. The group is currently tweaking the QAP through a “Beta-project” (trial job) that will be completed soon.

Garbin says the EIFS Council has been slow to bring the QAP to market for a number of reasons. There’s a lot at stake, including making sure that all the groups with a vested interest are on board. That includes insurers and architects’ associations. “We want full endorsement from all of those organizations and others so we don’t receive a negative backlash.”

A third initiative from the council is the development of a broad range of national standards for EIFS, including an “industry-driven” best practices guide and the insertion of EIFS standards in the National Building Code of Canada.

The group is finalizing the NBC S-716 standard for EIFS with hopes it will be published (at least in part) in the National Building Code’s 2010 edition or the amended version in 2011. The standard will be broken down into three parts: installation, materials and design.

Garbin adds that 2009 will also be an important year in training and education because the Interior Systems Contractors Association of Ontario’s newly expanded training centre in suburban Toronto has made class space for EIFS trainees. ISCA’s new 27,000 square foot facility, adjacent to the association’s three-year-old, 56,000 square foot training centre, has the capacity to train several hundred students annually.

Along with emphasis on EIFS training, it offers hazardous materials training, such as asbestos and mould abatement.

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