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Ontario's infrastructure boom comes to Toronto's west end (Alyssa Bistonath)
Ontario's infrastructure boom comes to Toronto's west end (Alyssa Bistonath)

Hard-hat heaven Add to ...

On a flying visit to Ottawa in January, Dalton McGuinty, Ontario's Liberal Premier, had the bearing of a man on a nation-building mission. And for good reason: The day before, he'd startled Ontario from the floor of the Toronto Stock Exchange with news of a $7-billion deal aiming to turn the province into North America's green-energy heartland. Today, speaking to an overflow crowd in the lobby of a brand-new cancer treatment centre, McGuinty happily stole a march on his prorogued federal counterparts. Amidst heartfelt cheering after opening the new facility, he sent a pointed message to his peers studying their budget options elsewhere in the national capital: "It's extraordinary what you can accomplish," the Premier deadpanned, "if you can stop worrying about who's going to take the credit."

But who could blame McGuinty, even if he did want to take some ownership of Canada's infrastructure boom? While Ottawa looks for ways to modestly stimulate spending, Ontario's Liberals are engrossed in perhaps the largest building spree in Canadian history. Undeterred by a $25-billion deficit, Ontario is well into a $90-billion, 15-year mega-scheme aimed at renewing the province's roads, jails, schools and, most urgently of all, hospitals. "We've got to keep the capital-spending dollars flowing," McGuinty pledged while showing off Ottawa's new cancer centre, which was paid for, he noted, with an $82.5-million grant.

That provincial grant-and the cancer centre it created-is best appraised in a wider frame than government leadership: Much of Ontario's building boom is the work of a powerful alliance of builders, bureaucrats and bankers that is quietly sliding an entirely new foundation across some of the Canadian economy's most important terrain. Thanks to this alliance, the money behind McGuinty's smile in Ottawa didn't actually come from his own pockets. It came from a consortium of private lenders in collaboration with a major construction company and a team of government deal makers. Working within the rubric of public-private partnerships-a concept that, when bruited a decade ago, was a red flag to public-interest watchdogs-the emergence of the builder-bureaucrat-banker triumvirate has fudged the lines between government and banking, and transformed the construction

industry along the way. As each new public-private project is unveiled, a set of increasingly competitive builders are making themselves into government partners-specialists in the lucrative niche of soothing politicians' headaches while freeing governments to roll-out politically juicy infrastructure coups without ever directly adding a dime to public debt.

And that debate over the propriety of mixing up the public interest and private profits? That's so 1990s. "There's no magic in it," McGuinty punched home after trumpeting the new public-finance realities manifest within Ontario's massive infrastructure drive. "You just want to do it in a way that doesn't saddle your kids with excessive payments."


Through the ninth-floor window over Brad Nelson's shoulder, a bulldozer about the size of a Tonka toy inches down an embankment toward a miniature dump truck surrounded by tiny workers in hard hats. What looks like a sandbox scene could be part of a Bob the Builder episode but for the fact that Nelson, who is COO and president of Canadian buildings at PCL Constructors Inc., was filling the foreground in his Mississauga office with full-scale business talk of a sort rarely heard these days among upper-echelon Canadian executives. "Last year was our best year ever, for sure," Nelson said proudly. "And we expect we'll do just about the same this year."

Employee-owned PCL, Canada's largest construction company, doesn't disclose a great many numbers, but it currently signs about $6-billion worth of deals annually, Nelson estimated. Its biggest recent coups were the hospital-building jobs it won in 2009: a $759-million facility for the Niagara region and a $622-million project on the site of Toronto's Don Jail. "This is one of the first cycles where governments got it right and spent money when the private sector isn't," Nelson said. "It's a good healthy construction market."

PCL's competitors agree. At EllisDon Corp., Canada's second-largest construction company, senior vice-president John Bisanti describes business conditions as the best he's seen in 25 years. Like PCL, privately held EllisDon doesn't make many numbers public. But Bisanti estimates the Mississauga-based company completed more than $2 billion worth of projects in both 2008 and 2009. "In dollar volume, this is the hottest time I've ever seen," Bisanti said. "It's pretty exciting."

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