📈 Breaking records

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Good morning! ⛸️ East Vancouver locals are making the most of freezing temperatures. Residents were seen lacing up ice skates and practicing their moves at a frozen flooded construction site. 

⏰ Today’s read: 4 ½ minutes

MARKETS

*Stock data as of last market close; currency, oil and crypto data as of 8:15PM ET January 15th, 2024.

Economy:  New data suggests the global construction equipment rental market size is expected to expand at 6% compound annual growth rate (CAGR) from 2023 to 2035. The market is anticipated to garner a revenue of USD $280 billion by the end of 2035, up from a revenue of USD $195 billion in the year 2022. Experts say the growing industrial activities, like agriculture, have led to an increasing need for construction machinery.

THE BIG STORY

Top 100: Massive projects break records in 2024

ReNew has released its Top 100 Projects list for Canada, showcasing how builders are helping address some of the nation’s biggest concerns. According to the report, healthcare work helped push the entire list’s project value to $292 billion, a $20 billion increase from last year. 

Top five projects:

• Site C Clean Energy Project - $16 billion

• GO Expansion – On Corridor Works - $15.7 billion

• Bruce Power Refurbishment - $13 billion

• Darlington Nuclear Refurbishment - $12.8 billion

• Eglinton Crosstown LRT - $12.5 billion

Where the work is:

• Ontario - 42 projects totalling $171 billion (60% of the list) 

• B.C. - 22 projects totalling $63 billion (20% of the list)

• Quebec - 17 projects totalling $35 billion (15% of the list)

Behind the numbers: While it’s exciting to see the size and scope of Canada’s major projects, it’s worth noting where some of these gains are coming from. The list’s top project, Site C Dam, wouldn’t have reached the front of the pack without major cost increases. Original estimates for the project were $6.6 billion, but soil concerns, delays, the COVID-19 pandemic and other construction cost increases pushed it to its current price tag of $16 billion. 

Here are some recent stats on cost:

• Canada’s residential construction price index has soared 51% since the start of the pandemic, putting new pressure on home prices amid a severe housing affordability crisis.

• Recent stats show non-residential building construction costs increased 5.9% year over year last November alone. 

• Data shows that between 2020 and 2023, construction costs for the city of Toronto were the second highest in the entire world, going up 40.5%

Paying the bill: It’s great that we are seeing the amount of construction work grow by billions, but if much of those gains are from escalating construction costs, there should be some serious cause for concern. 

NEED TO KNOW

The week's headlines

💵 The federal government has approved between $1.75 billion and $2 billion in new commercial bank loans for the Trans Mountain Corporation so it will have enough cash to complete its West Coast pipeline expansion. The project also caught a break from regulators. A pipeline design change has been approved which will avoid years of potential delays. 

🏗️ Global engineering firm Stantec has signed an agreement to acquire Morrison Hershfield, a 1,150-person engineering and management firm headquartered in Markham, Ont. With a particularly strong presence in Canada, Morrison Hershfield will increase Stantec’s Canadian workforce by approximately 10%.

⚛️ An Alberta power producer is looking to build the province’s first nuclear power reactor by 2035. Capital Power Corp. announced Monday a new partnership with Ontario Power Generation (OPG) to jointly assess the viability of building small modular reactors. If built, the SMRs might be jointly owned and operated, OPG says.

📈 B.C.-based green building products startup Nexii, which two years ago was valued at more than $1-billion, now under court-ordered protection from creditors. B.C. Supreme Court Justice Michael Stephens appointed KSV Restructuring on Jan. 11 to monitor Nexii Building Solutions Inc., which owes creditors more than $112 million.

PROJECT SPOTLIGHT

Double dipping

Maple House at Canary Landing, a project spearheaded by WDL 8 LP—an alliance featuring Dream, Kilmer Group, and Tricon—boasts an architectural collaboration between Danish firm COBE Architects and Toronto-based architectsAlliance. Situated on Block 8 of the West Don Lands, this development will showcase three towers standing at 16, 16, and 26 stories, collectively offering 756 rental units. The project recently was the first ever to be recognized in two of UrbanToronto.ca's Best of 2023 categories.

PROJECT UPDATES

Gaglardi Tower Project achieves LEED Gold certification 

25-storey hybrid -timber tower proposed for Mount Pleasant

Brampton tower targets net-zero affordability

Toronto announces massive co-op housing project

Inland Hospital asks for $8.6M to cover higher project costs

New children’s treatment centre project announced for Brantford

WHAT WE’RE TALKING ABOUT

LIST: 🦾 10 innovative construction tech startups around the globe

READ: 👀 Construction trends to watch in 2024

PHOTOS: ✈️ How drones are helping PCL deliver St. Paul’s Hospital 

READ: 🚘 It’s official. Toronto has some of the worst traffic on the planet

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Here’s to a great rest of the week!