Monday Morning Ingenium 11th May 2015

IN REVIEW

Three Surprises

by: Victor Smith

Last week was full of surprises. As I travelled between Canada and the U.K., there were three major events that I believe will have significant implications for Ingenium this year.

Early in the week, as I was preparing to depart for London, Alberta held a provincial election. The decline in oil prices over the past months has had a dramatic effect on government revenues and has resulted in a new attitude of austerity in response to this new reality. Whereas the ruling party has taken some criticism for their policies,

the outcome of the election was nevertheless unexpected for many people.

After 44 years in power, the Conservatives lost out to the New Democrats (the NDP), traditionally Canada's third party. The province now faces the prospect of a more socialist philosophy that will tend to be less kind to big business and more inclined to tax the wealthy and spend on programs for the less advantaged.

For Westpro and NORR this may mean more investment in schools, hospitals and infrastructure in the near future, but long term it could see the flight of private capital from Alberta to other provinces or other countries.

Hopefully, the NDP will act cautiously and implement new policy slowly as oil prices start to increase. For now, however, we’ll have to read the tea leaves carefully and remain flexible to changes in the market.

I arrived in London Tuesday night, two days before Britain’s election. Everyone had a different possible scenario for the outcome, but almost none included David Cameron’s Conservative Party winning a majority given the number of candidates and the divided sentiment of voters in the pre-election run-up.

Yet that is exactly what happened. A surprise victory by Mr. Cameron at least provides the country with some certainty and a sense of stability for another 5 years, whatever one may think of his policies or personality. For Archial NORR this is a good thing, I believe, as our U.K. group is just finally getting its head above water after several years of struggling through a very difficult economy.

A continuation of the recent Conservative policies will allow Archial NORR to keep building on its new-found success.

The third in the series of surprises was Ingenium’s financial performance in the first quarter (Q1) of 2015. The reason for my visit to the U.K. was to undertake a detailed review of the results for Archial NORR, NGCI and NAEP (our U.K., Middle East and Indian consulting businesses respectively) for the period ending March 31st.

Doug Lang and Yahya Jan were there to present these results to myself, Marc Turcotte, Ken Ting-a-Kee and a number of the U.K. Directors.

You will recall that a week ago, we had undertaken similar reviews with all of the other operating groups in the company. After our meetings in London, we are now able to consolidate our findings for Q1, and the results are indeed a surprise.

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The Consulting Group did not meet our financial targets for this period. The Canadian business did much better than planned but our U.S. and International groups have underperformed, largely as a result of circumstances in Chicago and Dubai. We anticipate that this situation will correct itself as we work our way through the year but as of the end of Q1 our profits are about half of what we had expected.

Our Construction Division, however, has fared much better. Based on weak backlog in British Columbia and the typically slow winter season in Ontario, we had expected to experience losses in Q1. Instead, both groups did far better than plan, as did Westpro’s growing Alberta business.

The end result is that Ingenium overall ended up well ahead of its financial targets for the first three months; a position that we really had not expected just a few weeks ago.

While we were in London, we also had the opportunity to engage some of the senior staff in a lengthy discussion on the merits of employee share ownership. As you may know, Ingenium is owned by about 250 of its current and past employees. One of the original guiding principles of its structure is to allow current employees to invest in the business and benefit from its financial performance over the long run.

As we have expanded to new countries, we have also broadened the base of shareholders to include our staff in the UAE, the United States and the U.K. Yet, as much as we would like to see equal participation from all of our groups, the ownership as it stands today is still very much concentrated within Canada.

In order to attract a more diversified mix of shareholders, we will have to overcome regional tax, currency risk and management control issues. And although I’m confident we can do this if the appetite for participation exists, there are two fundamental questions that we must ultimately address if we are to sustain our existing employee ownership structure:

First, is ownership in the company a good investment for the individual; and

Second, is it appropriate for employees to hold senior management positons if they do not have a financial commitment to the company?

I suspect we will continue to debate this topic for some time. Nevertheless, whether you are a shareholder or not it is important that the company thrives and does well. As a result, we should all consider how the events of last week will impact our business.

Will Alberta continue to be one of the growth engines of our business and a strong contributor to our financial performance, or will the economic cycles turn against us as they have in the past?

Will the U.K. continue to grow in stature and in significance within our company, now that there is certainty and stability in the country’s political agenda, or will larger European struggles cause the British economy to falter?

And finally, will our ability to outperform our financial targets in the first quarter of this year but sustained in the next three quarters as well, or was this just an anomaly?

Nobody knows for sure, but I believe the answer to all three of these questions will be resoundingly positive.

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IN THE FIELD

Boris Family Centre In Human Stem Cell Therapies Carlos Gonsalves – Designer (NORR Toronto)

Previously featured in the June 2, 2014 issue of the MMI, the Boris Family Centre In Human Stem Cell Therapies was constructed in a number of stages to ensure ongoing research activities in the surrounding labs were not disturbed.

NORR provided architectural, interior design, structural, mechanical and electrical consulting services for the 14,000 sf interior alteration/expansion of the existing space to accommodate wet and dry laboratories and associated support space. The project is located within the 275,000 sf $65 million Michael G. DeGroote Centre for Learning and Discovery that NORR completed in 2004/05 (refer to floor plan and exterior images).

The interior alteration/expansion also included the construction of a highly specialized stem cell lab which is encased in a glass walled enclosure allowing visitors to observe the Centre’s medical research processes and technologies. The lab is designed to allow natural light into the collaborative learning environment promoting the institute’s research work as well as accommodating the growth in research staff.

Click on the attached rendering to view site progress photos of the specialized stem cell lab.

A custom boardroom was added to the contract after the project was tendered (see rendering below). This new scope of work will be complete by the end of June.

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Within the overall 14,000 sf interior alteration/expansion, the location of the stem cell lab is highlighted in yellow and the custom boardroom is referenced in fuscia.

The Boris Family Centre In Human Stem Cell Therapies is on the 5th floor of the Michael G. DeGroote Centre for Learning. Click on the exterior images to reference the location. MMI June 2, 2014: http://goo.gl/vMhSro

ATRIUM

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THE INSIDE STORY

FedEx Ground Breaking Ceremony

The official ground breaking ceremony took place on May 6, 2015 for FedEx Ground’s newest 420,000 sf Canadian Distribution Hub in Vaughan, Ontario.

Once the project is complete in August 2016, the design-build distribution centre being delivered by Giffels will be the largest FedEx Ground small-package delivery facility and its first automated facility in Canada. The hub is projected to employ more than 300 people and will process 15,000 packages an hour.

“This is a really big deal for us. This is going to be the centerpiece of our Canadian region,” said Steve Myers, vice-president regional operations Canada for FedEx, during the ground-breaking ceremony. It’s going to replace a facility that we now operate in Mississauga and it’s going to give us about four times the capacity of what we have in that location. So this will really kind of cement our commitment to the Canada market.”

Click to view a 42 second (Drone) aerial video taken by Giffels, Project Manager, William Bowdidge.

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INGENIUM PEOPLE NEWS

New Professional Caroline Belgado – Human Resources Administrator (Ingenium Rexdale)

Adam Sharkawy – a member of our Cion group has recently become Professional Engineer attaining his P.Eng. designation. Congratulations, Adam!

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New Addition Patricia Clark – Executive Assistant, Operations (NORR Toronto)

NORR Toronto would like to congratulate Carmen Tocchini (Architectural Designer NORR) and her husband Andrea on the birth of their son, Thomas Reginald Tocchini. Born 3 weeks early on May 6th at 3.17pm weighing in at 6lb 6oz.

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New Hires Caroline Belgado – Human Resources Administrator (Ingenium Rexdale

We are happy to welcome the following new members to our teams in Toronto, Calgary and Ottawa.

Name, Title: Group: Started:

Lina Ahmadi, Architectural Technologist NORR Toronto, Ontario May 6th

Lina joins NORR as Architectural Technologist. A graduate of the Architectural Technology program at George Brown College and currently enrolled in the Environmental Design program at OCAD, Lina is proficient in BIM Modelling, Revit, AutoCAD, Adobe Design Programs, and 3Ds Max Design. Through her internship and involvement in various projects at school, Lina has gained experience in the design of commercial, office, retail, and spa spaces as well as in the preparation of presentation drawings and working drawings for industrial and mixed use buildings. She has most recently worked at Scott Morris Architects Inc.

Name, Title: Group: Started:

Hanna Deczkowska, Project Manager NORR Toronto, Ontario May 7th

Hanna joins NORR as Project Manager. Possessing extensive experience in the healthcare sector and corporate facilities, some of her responsibilities in her prior roles have included project management, design, contract documents and construction, design research, and space planning. Over the years, Hanna has been involved in such projects as healthcare, laboratories, industrial buildings, and administration facilities. She has most recently worked at The Hospital for Sick Children.

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Name, Title: Group: Started:

Luke Dempsey, Project Coordinator Westpro Calgary, Alberta May 7th

Luke joins Westpro as Project Coordinator. A graduate of the Civil Engineering program at Dalhousie University, he brings to Westpro experience in conducting prejob safety meetings, managing contract documents/project costs, production of construction reports, inspection of job sites, and ensuring that budgets are completed according to cost and budget. Prior to joining Westpro, Luke worked at Harvest Energy Corporation, BC Hydro, and RKO Steel Ltd.

Name, Title: Group: Started:

Melwyn Miranda, Document Controller / Project Coordinator NORR Toronto, Ontario May 7th

Melwyn joins NORR as Document Controller/Project Coordinator. Over the span of his career, Melwyn has provided document management for a number of projects in the Mining/Oil & Ga/Engineering & Construction industries in Canada and in the UAE. He brings to NORR knowledge and experience in design, fabrication, vendor/supplier documentation through all phases of the project, up to and including the final certification and project handover. Some of his systems experience and proficiencies include TIMS, Project Wed for EDMAS, ACONEX, and SharePoint. Melwyn has most recently worked at WorleyParsons.

Name, Title: Group: Started:

Jessica Musialski, Architectural Technologist NORR Ottawa, Ontario May 11th

Jessica joins NORR as Architectural Technologist. A recent graduate of the Architectural Studies-Design program at Carleton University, Jessica is proficient in AutoCAD, Revit, Adobe InDesign, Adobe Illustrator, and Sketchup. In addition to this, she has experience in hand drawn conceptual and technical drawings and model buildings. Prior to joining NORR, she has worked as an Intern at Rickson Outhet Architect, as a 3D Prototype Creator at Natural Resources Canada, and a Visual Analytics Officer in the Security Operations Division of the Privy Council Office.

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IN THE INDUSTRY

Shepcote Lane Prisoner Investigation Centre now under construction Simon Crosby – Director (Archial NORR Birmingham) Designed by Archial NORR, Wilmot Dixon has started construction on the new £12.5 million Shepcote Lane Prisoner Investigation Centre (PIC) for South Yorkshire Police. The 50-cell purpose-built custody suite will also house offices for investigators and other agencies like health and social workers and will replace smaller existing police sites in Ecclesfield, Moss Way, Sheffield and Rotherham providing both operational efficiencies and financial savings.

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The project forms part of a £19m project to improve custody facilities across South Yorkshire. Click on the attached links to view the, site and aerial plans which are featured on the South Yorkshire Police web site as well as the previous article on the PIC that appeared in the September 15, 2014 issue of the MMI. The scheduled completion of the PIC is Spring 2016.

http://www.southyorks.police.uk/contact-us/custody-suite-consultation

http://mmi/DisplayArticle.aspx?SearchData=Sheffield%20Prisoner%20Investigation%20Centre

Archial NORR were also commissioned to design the £6.5 million 20-cell Barnsley Custody Suite for South Yorkshire Police which was recently published in the April 20, 2015 issue of the MMI.

http://mmi/DisplayArticle.aspx?SearchData=barnsley

20-cell Barnsley Custody Suite

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IN THE NEWS

Impressive scale model Burt Meredig – (Ingenium)

When I started in the profession in the early 1980’s I was initially involved in constructing models for NORR in Toronto. They were a physical scaled representation of an architectural design which were used to communicate ideas in three dimension to help understand the complexities of a project as well as to convey our proposed solution to our client. Some of the models that we built were assembled with small lights inside connected to a small train set transformer. The transformer allowed you to adjust the brightness of the lighting to help convey to the client what the project might look light at night.

Today digital modelling has become the standard medium to convey designs in 3D, so it was interesting for me to come across a massive scale model commissioned by New London Architecture (NLA).

NLA is an independent forum for discussion, debate and information about architecture, planning, development and construction in the capital. Their core mission is to bring people together to shape a better city.

The 12.5m long model built to 1:2000 scale boasts an amazing 170,000 buildings spread across 85 sq km and 19 boroughs in London.

Supported by touch screens and five bespoke interactive films, it is easy to understand when NLA chairman Peter Murray said that the new model will be a ‘spectacular tool’ for everyone who wants to know about London’s future, from school groups to international city leaders, when its full functionality complete on May 20, 2015. It is an impressive model – I can appreciate what went into constructing it!

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