Started more than 50 years ago as a family business by the three DeGasperis brothers, the ConDrain Group today is one of Canada’s largest water main and sewer contractors. And there are some big changes coming, ones that will make ConDrain an even better option for its clients and that will allow the company to thrive as it enters its next 50 years.
Romeo DeGasperis literally grew up with the company. Now in his early 40s, he is set to take over ConDrain, in partnership with his cousin Jim DeGasperis, and oversee the next phase of its development. Romeo notes that his father and two brothers, who in 1954 founded what was then Con-Drain in Toronto, are ready to pass the reins to the next generation, though this decision was not made brashly. The family meets each Saturday to talk about the past week, says Romeo, so that they can share information about the various divisions and aspects of the business with one another. “Saturdays give us that time to get together and catch up,” he adds. About a year ago they began discussing a succession plan. It was decided that Jim and Romeo would be appointed to head the company, running it jointly, as co-CEOs and President and Vice-President, respectively.
The cousins plan to modernize the company to some degree, says Romeo, by looking at different marketing strategies and designing a new logo. However, they will never set aside the company’s proud history. “We still have the grassroots that we were brought up with,” says Romeo. “Both my cousin and I worked in the field, from the age of 12 or 13 years old.”
Indeed, the cousins spent summers in the shop and out in the field, gaining experience in various positions, from pipe layer, to foreman, to machine operator, eventually working their ways into the office. Romeo was trained as a civil engineer and came into the office full-time when he was 30. Jim jumped right into the business after high school, and worked away from home, in cities such as Hamilton, St. Catherines, and Port Dover for four years, running projects on-site.
Shortly after Jim was married at age 22, the company launched its road construction arm, called Con-Strada, which he ran beginning in 1980. “We felt at the time that we needed to be self-sufficient in roads,” he says. The company started off small, doing a couple million dollars of business in its first year. Con-Strada grew by doing work for municipalities, and other industrial, commercial, and institutional projects. Con-Strada expanded into a group of companies, including Strada Crush, which recycles concrete and asphalt for use in construction projects; Strada Aggregates; and Strada Environmental.
The experience that the cousins gained working in the field is priceless. “If you’ve worked in all those positions, outside, for probably 18 years, the employees or the staff below you can’t pull the wool over your eyes,” Romeo notes. “I can drive by a worksite and basically pick out, from a distance, things that are not right. No school will give you that. That’s just practical experience.”
ConDrain, which does from $350 to 400 million in business each year, is one of many companies under a holding company, explains Romeo. Its sister companies in the industry offer services such as the production of aggregate materials, lighting, valves and fittings; installation of gas and power lines, fibre optic cables, and street lighting; construction of residential, commercial, and industrial buildings; and development of land for entire communities. The relationships with these other companies allow ConDrain to help clients get their projects completed with fewer headaches. “It makes us very vertical and very efficient,” says Romeo. “That was part of the plan over the years from the first generation.” For customers, it’s a one-stop shop, he adds, though it requires a high degree of coordination between ConDrain and its sister companies.
Creating a new, stronger brand: the amalgamation of ConDrain and Con-Strada
Another change that’s been in the works throughout the past year has been the amalgamation of Con-Strada under the ConDrain brand. Romeo says that one of the conditions that his father and uncles put on the transfer of control to him and Jim was that the company’s operations would be streamlined. “It creates more efficiency for our customer,” says Romeo. “It’s one point of contact, versus two points of contact.” Says Jim: “It’s the same people, just a little bit different direction.”
It was a natural move, says Jim. ConDrain would pick up work that included roads, and, acting as a general contractor, would sub-contract out the road work to Con-Strada, and vice versa. “It was sort of a hand-in-hand situation,” he notes. A lot of the work that the two companies did was closely related, more so than with other sister companies. The transition has not been an effortless one, and it has included work on rebranding and more practical concerns, such as moving all of Con-Strada’s and ConDrain’s employees into the same office. Jim says the goal is to get everything in place by this April.
Taking care of business: ConDrain at work
Weather is somewhat of a factor in determining when the company will shut down each year, but this year, says Romeo, the decision was based solely on availability of projects. “The volume is down,” he says. “We’ve had a large number of projects deferred. That, based on talking with our customers and sitting down with our staff and scheduling out the crews, gives us so many weeks of work. That determines when we should start.” He says that ConDrain doesn’t bring people on and off. “We try to keep our people throughout the year. That’s the way you keep good employees as well.”
The availability and diversity of its employees is one thing that allows ConDrain to respond quickly and get to work on projects. “We have a few different work forces and unions within the one company,” Romeo says. “Because of the size of company that we are and the equipment we have, we can mobilize very quickly, within weeks.” Often, delays are due to waiting for clients to get permits or sufficient financing in place to get work started, especially on private sector projects. Besides being of the country’s biggest sewer and water main contractors, ConDrain is also very big on earth moving, having ample equipment to get the job done. Joining forces with Con-Strada, one of Canada’s biggest road-building companies, will allow the new ConDrain to complete work even more efficiently.
On a number of projects, ConDrain has utilized what is called a design-build approach, where the company can deliver turnkey operations to its clients, taking care of an entire project from start to finish. As an example, Romeo cites the work that ConDrain did in Alliston, Ontario, where it built a water main specifically for the nearby Honda plant. The main was 55 kilometres long, running from Alliston to the town of Collingwood, and ConDrain worked on the design with SNC-Lavalin, in addition to arranging financing and, of course, constructing it. “There’s no question that you cut through a lot of red tape and you create a lot of efficiencies through a design-build,” says Romeo.
Jim explains that the company evaluates each job before it makes a bid, in order to see if it’s a good fit for their equipment and people. They know what their strengths are, and if the project involves earth work, pipe work, and gravel work, they pursue it, he says, as opposed to projects that are heavily weighted toward paving or concrete bases. “The good thing for us is that we have a big advantage in that looking at different projects, we look at our own company, ConDrain Group, but also our sister companies.” This means that projects can be picked up for which ConDrain will be the general contractor, but work will then be fed to sister companies.
ConDrain’s employees: the “backbone of the company”
ConDrain’s employees, which at its peak time will number from 600 to 650, are drawn from unions, and due to the seasonal nature of their work, the same employees do not have to return to the company year after year. But they do. This is something that Romeo notes with pride: “Even in these tough times, I’m confident that all our staff will come back and that our turnover rate is probably about 20 to 25 years,” he says. “These are unionized employees, so that’s quite long.”
“The employees are the backbone of the company,” Romeo says. As the owners of the company, he and Jim have a responsibility to make sure that we have work and that things are running efficiently, but the daily grind of business falls on the company’s administrative staff and on-site workers.
Romeo notes that there has been a great deal of internal restructuring, and because of some strategic promotions, he and Jim will have more support in the work they do. Romeo says that increased staff involvement in the company’s planning will ease the process, “from concept to completion.” Many of the staff members who have been promoted have a long history with the company, and their expertise is a valuable asset, especially as the company continues to grow. “When my father and uncles started the business, there were only a few companies,” Romeo says. “My cousin and I are responsible for overseeing about a dozen companies.” He explains that though their priorities lie with ConDrain, keeping tabs on all of the companies and how they work together means that he and Jim need staff to keep ConDrain running smoothly. “We can’t be here every single day, every single hour,” he says.
Jim explains how ConDrain hires and trains employees, noting that there are various ways this happens. There is not a great deal of turnover, but employees do retire and need to be replaced, he says. As a pre-emptive measure, ConDrain arranges what could be seen as casual apprenticeships: “Probably the biggest thing we do here is when we bring in younger people who want to work in the field, we put them with senior people and train them that way,” says Jim. “We find that’s probably the best way, because every company has its own philosophy.” Jim says that this is especially successful when preparing employees for supervisory positions. Young engineers are being brought on board through a relationship that ConDrain has with Seneca College. The unions where ConDrain’s employees come from conduct their own training for on-site workers such as operators and labourers. Jim notes that the company also has an extensive health and safety training program.
Jim says he anticipates there will be a lot of workers available this year, though Romeo notes that the company will start up later, hiring workers back well into February, rather than the usual start-up in mid- to late-January. “Let’s just hope that the government puts a lot of work out and puts people back to work,” says Jim. “We’ll go from there.” For a company that’s been around for as long as ConDrain, there are still some things that are out of their control. And one of these things is the country’s economy and the effects that a downturn can have on their business.
Public versus private: a changing market for ConDrain
ConDrain’s mainstay for past 50 years has been green-field development, but both Jim and Romeo recognize that the company’s focus may have to shift as long as the current economic slowdown keeps private projects on the backburner. The cousins’ experiences in working in the mushrooming suburbs around Toronto building roads and doing sewer and water main work have allowed them to build up a strong portfolio in the private sector; now, though, they are turning to capital projects to fill in the gap as new housing developments are put on hold. “Since the company started, it’s been dabbling in capital work, even though it hasn’t been the core business,” says Jim. But this doesn’t mean that the new ConDrain will be left behind. “Our equipment and our people are very versatile,” he adds.
This versatility is not an accident. Romeo says that the company has continued to occasionally pick up capital projects in order to keep employees proficient in both kinds of projects and to keep administration staff up to speed on working in conjunction with government staff. “By having that benefit, we’re able right now to retool and chase capital work,” says Romeo. According to Jim, the company has already landed some capital projects, and he is confident they will pick up more. If it wasn’t for the government work, Jim says, they’d be pursing projects in other cities, such as Ottawa, far from where the bulk of their work has been done up to now.
Romeo thinks the days of coming across green-field developments with 1000 residential ready-for-service lots are coming to a close. “That’s going to force us to, no question, go into more capital projects,” he says. In Ontario, the government has mandated a drive towards intensification, meaning that green-field work is becoming harder and harder to come by, and instead there is an increased number of non-green-field projects, such as erecting condominiums in suburban areas. “In those kinds of applications, you don’t need a lot of sewers and a lot of roads,” says Romeo. ConDrain, then, has to look to make up the difference elsewhere. “We are definitely going to be focusing on capital projects and reconstruction projects,” he says. “But we’llnever forget that green field is always our mainstay.”
When asked about the recently announced federal budget, and its inclusion of $12 million in infrastructure spending, Romeo is cautiously optimistic. “We’re looking forward to seeing what’s actually going to happen,” he says, but he adds that the stipulation that municipalities will have the match federal funds to a certain degree could prove a sticking point. However, the injection of money into the industry that ConDrain is a step in the right direction, he says, and it will get some people back to work.
And there is a great deal to be done. Romeo notes that it is not just new projects that will be built, but money will also go towards rehabilitation work. “In the city of Toronto you’ve got a lot of old sewer, a lot of old bridges, a lot of old institutions that are failing,” he says. Another positive about this influx of capital work is that, according to Romeo and despite what many in the public might believe, these projects often involve less red tape. “When a government project is ready to go, they’ve got all their T’s crossed and I’s dotted,” Romeo says. When the economy slows down, the government tries to catch up on infrastructure, he notes. Projects that have already been designed and approved and are sitting on the shelf can be put into action quickly. “When it’s time to call the tender and go out for the work, all the red tape’s been dealt with,” he says.
Jim says that when it comes to capital projects ConDrain will evaluate them the same way it does private projects, by ensuring the company’s people and equipment will get the job done better than any other company. “We’re not going to re-build the 401,” he says. Instead, the company will seek out projects that would better be called “semi-green field,” such as extending a highway, or adding to existing roadways with clover-leaf ramp structures. He says that ConDrain’s expertise in water main construction will likely be in high demand, as he estimates there will be many projects to build large feeder mains connecting one community to another. Capital projects can be a little more complicated, but the core characteristics are the same, he says. “Pipes are pipes and roads are roads.” He emphasizes that the company will not have to change direction entirely, nor does it want to, and that perhaps 30 or 40 per cent of the gap left by diminished green-field work will be filled by public sector projects.
Community building, in more ways than one
ConDrain and Con-Strada have left their marks on the communities where they work with more than water mains and roads. Jim and Romeo, and their employees, have been involved in making positive contributions in numerous ways. “Almost every municipality that we’ve worked in, we’ve helped through some form of charity or contribution towards a hospital or a park,” says Romeo. Jim says that their financial donations are most often focused on hospitals and other medical care organizations, but they have also given to churches and schools, in the form of both financial support and by lending their people and equipment to help with infrastructure projects, such as building parking lots. “We try to look at the communities where we’re actually working and give certain people a hand where it’s needed,” says Jim, noting that requests come across his desk nearly every day.
Jim also lends his expertise and industry connections to help with the planning and construction of various community projects. He is currently helping raise money for the Evergreen Brick Works Project in Toronto’s Don Valley, where Evergreen, a national charity, is trying to raise $55 million to transform a historic site that was abandoned for decades into a venue that showcases green design and promotes urban sustainability. His experience working on large-scale projects allows Jim to help work with planners and engineers to find ways to save costs, something that he notes can make all the difference in getting an important project completed. “Sometimes it’s not what you make, it’s what you save.