Building business booming

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This article was published 20/11/2023 (698 days ago), so information in it may no longer be current.

Shindico Realty’s next development might need to be a bigger office.

The Manitoba-based real estate firm has announced a new construction branch and the acquisition of a local property management firm in the last two weeks.

Shindico officially joined forces with Akman Management on Thursday, adding 1.2 million square feet of property ($320 million of assets) to its portfolio and increasing its staff by 42 per cent.

Earlier this month, Shindico announced the founding of SNR Construction Ltd., a general contracting division that will handle pre-construction, design-build, and construction management services, which is expected to create another 30 jobs over the next couple of years.

“For control of scheduling and pricing,” Shindico president and CEO Sandy Shindleman said of SNR Construction. “All the contractors in Winnipeg are at capacity or beyond capacity and we felt that for our clients and ourselves that we needed to be more hands-on in the construction.

“We’re running the meetings now, we’re doing a lot of the buying now, so it was a natural evolution to do it.”

Shindico has several outstanding projects that it has outsourced, but Shindleman said all future projects will be handled in-house and that it should lead to faster build times.

“We hope so. As I said, the general contractors now are just so busy, so at capacity, that they don’t need the business. Now, we do think that will change. We are expecting that will change — the interest rates, et cetera — one thing that will help with the jobs is if the city goes ahead with the new ‘as-of-right’ zoning. That will pick up a lot of jobs, as well. It’s just a perfect storm if you will.”

Mayor Scott Gillingham proposed a housing regulation reform earlier this month in response to a request by the federal government for the city to change its zoning bylaw before approving its $192-million application to the housing accelerator fund, one that Gillingham expects to fund 15,000 housing units over the next decade.

The as-of-right zoning would allow construction of up to four units per lot across the city, four-storey buildings within 800 metres of “frequent” transit routes and mid-rise rental construction around malls and commercial corridors.

The city’s executive policy committee voted 5-1 in favour of changing the bylaw and it will now go to a full city council vote this week.

A self-performing construction arm isn’t a groundbreaking addition by any stretch, plenty of real estate firms have gone a similar route. But it comes at a time when the labour shortage in the construction sector continues to be a hot topic.

There were 48,700 people employed in Manitoba’s construction sector, as of 2022. A workforce outlook by BuildForce Canada predicts the province will see 7,600 retirements, 500 employment changes and need to recruit 8,700 new entrants over the next 10 years to keep pace.

The report warns that while attracting first-time new entrants from the local population helps to offset expected retirements, replacing the lost skills and experience may create potential skills shortages.

“Probably the No. 1 issue that’s discussed in construction companies across Manitoba is the labour shortage issue and — if things ramp up like we expect them to — where the next group of labourers are going to come from — skill trades, superintendents, construction managers — where that group is going to come from,” said Ron Hambley, president of the Winnipeg Construction Association.

“Certainly, there are streams from universities and colleges and the trades programs in the apprenticeship systems, but those will solve the issue in the short term but likely not in the longer term.”

Of course, some reinforcements could be on the way with the federal government’s new target of 465,000 immigrants by the new year, 485,000 in 2024 and upward of 500,000 in 2025. A little more than 15 per cent of the province’s construction workforce was represented by immigrants in 2021.

Hambley said construction as a whole is on par with 2020, though there have been major shifts in multifamily and institutional builds. In 2022, 17 per cent of the province’s construction employment was dedicated to institutional builds while 21 per cent of workers went to new housing.

“The institutional component of our industry is really really busy,” Hambley said. “It’s probably up 150 per cent over last year and that’s a direct result of the significant investment the province has made in half a dozen new hospitals all over Manitoba.

“The second part of that is the single-family residential side of the market is pretty flat. The multifamily residential construction is hot— just drive down Pembina and you’ll see what I mean. There are projects everywhere.”

The institutional and multi-family sectors are expected to remain strong in 2024 and continue commanding large shares of construction employment. Meanwhile, a spreadsheet from the Winnipeg Construction Association provided to Free Press shows 25 major projects (budgets of at least $50 million and upward of $3 billion) that are set to begin in the province over the next three years.

“I think 2024 is going to be an interesting year. We’re starting to see the reconstruction of The Bay downtown and Portage Place. I mentioned all the hospitals, we’re in the middle of a nine-school procurement for the province,” Hambley said. “There’s lots of different parcels of property like the Kapyong Barracks site, which we expect to see underway.

“So, some really interesting things that we haven’t seen in the past along with a fairly robust list of projects for the new year.”

jfreysam@freepress.mb.ca