“We’re not hoity-toity or high falutin’,” says Peter Naccarato, the down-to-earth Director of Construction at Hady Construction Associates. This is one of the factors that has kept him here. He’s been with the Toronto-based operation, which specializes in industrial and commercial building, for over 40 years and reports that the working atmosphere has remained consistently “low-key” during this time. Staff turnaround is low. He tells me about Ray, a super who has been working on-site for almost 50 years and Angie, the accountant who has been keeping the books for almost as long. People like to stick around and clients tend to become repeat customers. The Hady website is a relatively unpretentious affair, but when it comes down to it, attention is paid to the details that matter. While others may be preoccupied with marketing or chasing sales at any cost, Naccarato’s team are focused on the nitty-gritty of actual construction. This involves identifying all the additional, often overlooked, steps needed to make architectural drawings come to life and being transparent with clients from the get-go. In other words: no hidden extras.
“Bridging the gap between concept and reality” is how Naccarato describes the process, from preparing a bid to the building work that will follow. It’s all based on extensive organizational knowledge of the industry. Founded in the 1960s as the construction wing of the owner-developer Sorbara Group, Hady has since become a full-service general contractor on the competitive market, offering lump-sum, design-build and project management services. The company portfolio encompasses all kinds of industrial buildings, from manufacturing to healthcare, some commercial projects and a few institutional as well. There have been several projects for the Erin Mills Development Corporation, a series of high profile retail centers (such as ten apiece for Home Depot and Canadian Tire), some 50 auto dealerships (including Honda, Hyundai, Toyota, Volkswagen and the Zanchin Auto Group) and a few for the Toronto Catholic School Board.
Paradoxically, the overview and honesty that informs a bid from Hady Construction can be off-putting for some clients initially. The reason for this is that competitors often omit some necessary steps, making their prices appear cheaper at first, but subject to add-ons at extra cost later, once work is in progress. As Naccarato explains, “We include more than what’s on the written paper because we know the reality of the construction industry. Something is shown on a drawing in a certain way—that might be the final product they want—but to get there, there’s a few steps in between that you need to include. A lot of my competitors don’t do that. So my price will appear higher at first, because they didn’t allow for certain things.” He continues, “We’ve had clients, where we’ve bid, we lose the job to our competitor and then they come back and say ‘Okay, I need you guys to do it because the last guy was too cheap.’” In other words there had been arguments over every nut and bolt, or even worse, corners were cut. It often leads to a domino effect, costing the client more in the long run.
“We include more than what’s on the written paper because we know the reality of the construction industry.”
When it comes to the big picture, Naccarato is adamant that honesty is always the best policy, rather than trying to secure a job whatever the cost. The biggest challenge at the moment is fielding the supply chain crisis, attributed to, among other things, the knock-on effects of the pandemic. In 2020, Hady was fortunate to be engaged in construction deemed essential and permitted to continue. Food facilities, auto dealerships and a medical clinic, along with transport and infrastructure projects meant that the team could work through 2020 largely as planned. In 2021, an ongoing supply chain crisis is affecting budgets and schedules in a way that no one was prepared for. The global shortage of materials, coupled with shipping delays makes it difficult to cost and plan anything. Naccarato is not willing to make promises unless he’s certain he can keep them, but there is very little certainty in the air right now. He notes that some competitors are committing anyway and getting the jobs, but he doubts that they’ll be able to deliver on time or within budget. Looking back on the first waves of the pandemic and the initial shutdowns, he recalls that in construction there was never a shortage of labour, if work was permitted, but manufacturing activities were paused. Therefore the construction companies drew on their reserves, which soon became depleted. When things started to move again, supply and demand were out of sync, and the price of structural steel doubled within the space of a year. Meanwhile the delivery times for open web steel joists have stretched from the previous average of approximately two months to eight and sometimes ten. The reasons for this are not entirely clear.
“I don’t know if it’s a false set-up by the manufacturers, so they can increase the price, or if it’s a real thing. But pricing has gone up and it’s everything,” says Naccarato, going on to describe the consequences of just one material being unavailable: “Just a quick example, there was a roofing material that we use, polyiso, and the chemicals that produce that insulation were not available. Therefore, the insulation was not available to us, even though we had ordered it previously, within our scheduled time. An alternate was proposed: polystyrene. It was a bit of a challenge getting our owners and architects to accept it. The main difference is that polyiso is a three-inch board thickness, and polystyrene’s going to go to seven or eight inches to get the equivalent insulating value. Okay, fine, we got over that hump. And then the big challenge was trying to find the fasteners long enough to put that thicker membrane onto the roof. Even as of today, it’s hard to find fasteners.”
Meanwhile a lack of white cement powder led to delays in making precast concrete panels, as new suppliers had to be found. The quest for alternative products and new suppliers, sometimes from new countries, is time consuming and can involve some dead ends, as extensive background checks and quality control measures must be conducted. Substitute materials must be CSA approved and provide the same structural integrity, no matter where they come from. The entire procurement process has become incredibly unpredictable. When steel from China was unavailable, it could be sourced from North America, but from there it was more expensive. At the time of our interview, China had started re-opening but was affected by an energy crisis, forcing factories to go dark. These complicated issues show no sign of being resolved before the end of the current year, but Naccarato remains sanguine about it all. He has recently secured a new supplier for the screws needed and is confident that a new source of white cement powder will be found too. He doesn’t have time to panic anyway, and one senses that he is too pragmatic to waste time on it. Clients will point to contracts and service commitments to be honored, and he respects, even welcomes, this, adding that it gives extra motivation to “push ahead and do the best you can and that’s one of the reasons why we actually will find cement powder somewhere else. It kind of gives you the incentive to think outside the box.” Good work is rewarded, in this case, with more work, as there is certainly no shortage of projects to keep Naccarato and his colleagues occupied. In the coming months, they will be busy with food processing plants, another auto dealership and some transport infrastructure. Looking further ahead, to the end of 2022 and beyond, he is hopeful that by then some of the supply chain issues will be resolved and that everyone can return to “some kind of normal.”