Cleaning up construction "in Concert"

Leaky condos. Sweatshops. Unfulfilled warranties. Numbered companies. Laundered money. Poor workmanship and low quality. Unpaid wages. Injuries and lack of safety. Unaccountable off-shore bosses.

Unfortunately, these horrors often come to mind when construction is mentioned in BC. But not everyone in the business abides by these rules, and some firms are making a real difference in the way the construction industry operates in this province.

One such firm, Concert Properties, not only defies the all-too-familiar trends in the construction business, but also debunks many long established mis-beliefs about union labour, worker-managed money, social responsibility and market competition.

The firm is run by a cooperative of 15 BC-based union pension funds, hires union labour and local contractors, uses union made ethically produced supplies and focuses much of its efforts on building moderately affordable housing for both sale and rent. How can a firm with such a philosophy and practices survive in the cutthroat and turbulent $20 billion a year BC construction business?

“The success of Concert Properties shows that well trained highly productive skilled labour is the real value in the market,” says Wayne Peppard, executive director of the BC and Yukon Territory Building and Construction Trades Council, most of whose 14 affiliated unions are both employees of and investors in Concert. “Union pension funds just aren’t as greedy as private developers, and look to long-term sustainable development and returns, instead of short-term fast money.”

He adds that long-term low growth investment and economic strategies, preferred by union pensions and other socially responsible investment agencies, lead to overall better and more stable rates of return than standard capitalist practices of maximizing profits as quickly as possible at the expense of working conditions, social and community concerns and the environment.

In addition, he says the economic benefits of this are far greater overall, as the dividends for pension-funded ventures go back to worker in the form of retirement benefits, instead of into the pockets of an elite of corporate investors and executives.

Skilled labour and innovative design and construction methods are another factor in Concert’s success, as the firm has won numerous awards from both trade associations and community and consumer groups for some of its projects, according to CEO David Podmore.

“We can compete quite effectively in an open market, including in the residential sector,” he said, adding that one of the firm’s advantages is that it does much of its financing through local credit unions and Mortgage One, a union pension-funded financing agency set up as an alternative to the major chartered banks. “We have a talented team, good design discipline and efficient skilled labour. We invest in moderate risk projects, buying land and building on it. And we’re fairly fiscally conservative in our management. ”

Podmore, a former city planner from Alberta, was asked to spearhead Concert Properties, along with former developer Jack Poole, in 1990, then known as the Vancouver Land Corporation, which was a joint venture between the Telecommunications Workers Union pension fund, looking to invest in ethical real estate development, and the City of Vancouver, suffering from a dearth of affordable rental market housing for middle and low income earners.

Soon after, “guaranteed rental” developments, offering long-term no-increase rental contracts and rebates for long-term tenancy, began appearing around the city. Since then, the firm has grown well beyond Vancouver and into major residential, condominium, commercial and community developments across BC, Alberta and Ontario.

It has become one of the largest residential construction developers in Western Canada. The firm also seems to have weathered the storm of the leaky condo crisis with little trouble. While many sources attribute the crisis to shoddy workmanship and unaccountable contractors and developers, others point to what are often seen as poorly developed, and in many cases poorly enforced, building codes, which do not address the realities of building in a humid west coast climate.

“We have experienced some problems,” Podmore says. “But they are not systemic.”

SO, while many construction lobby groups call for rolling back employment standards and enacting repressive labour laws making it harder for workers to organize into unions or negotiate their working conditions, Concert uses fully union labour and abides by its agreements.

While some corporate lobbies, as a cost-saving measure, are supporting the Liberal government’s replacement of apprenticeships with a “modular skills” development plan, Concert participates in union apprenticeship programs.

And while numbered companies and defaulted warranties for defective construction remains a major problem in the industry, Concert abides by its warranties with few problems.

Finally, while the trend of “fast money and get out” still prevails among many development circles, Concert sticks mainly to buying real estate, developing it over time and, in many cases, managing the projects, especially in residential construction.

SO, does it work? “We started out with $27 million. Now we are a $260 million a year business, with over $600 million in assets,” Podmore says. “We have properties in 17 municipalities. We could have a billion dollars in assets over the next two years.”