Canada’s construction sector is bracing for a potential surge in material costs and investment uncertainty as trade tensions with the United States continue to escalate.
To better understand how this could impact builders, we spoke with accomplished economists who are warning that tariffs on steel, aluminum, and other goods could disrupt supply chains, weaken the Canadian dollar, and prompt companies to postpone major projects.
While some argue that government spending could offset a private-sector slowdown, there is widespread concern that ongoing tariff threats—and possible retaliatory measures—could cause long-term harm to both economies, heightening the stakes for Canadian builders and policymakers alike.
Julien Karaguesian: Construction has a huge silver lining
Karaguesian, is a Course Lecturer at McGill’s Department of Economics. He also spent 25 years in the Canadian Ministry of Finance and worked at the Embassy of Canada in Washington D.C as Finance Counsellor.
For Karaguesian, the recent announcements by Trump are a clear escalation of trade tensions between Canada and U.S. But he argued it should not come as a shock, as the U.S. has been moving in this direction for decades. And despite the doom and gloom, he believes the trade war could have a silver lining for the construction sector and be an opportunity to reshape Canada’s economy.
Karaguesian reached all the way back to President George W. Bush’s time as one of the first instances of changing American attitudes toward free trade. Following the 9/11 attacks borders thickened, first for security reasons, and then for economic reasons following the 2008 financial crisis. The American government spent billions bailing out its auto industry, hoping to eat into Canada’s 20% share of the sector. This continued with President Barack Obama, who implemented a Buy American procurement policy.
“Both the left and the right were anti free trade,” said Karaguesian. “You had the rise of the Tea Party movement on the right and the Occupy Wall Street movement on the left. Now Trump has tapped into this.”
He noted that some of this sentiment stems from the early 1980s when the U.S. began deindustrializing their economy and moved that work to other countries.
“We did the same here,” he said. “Economists promoted it, saying people would move to more value-added jobs. But that didn’t happen. We gutted our rust belt. It was the deindustrialization of the English-speaking West. We lost well-paid blue collar jobs.”
And then easy access to credit softened the pain of destroying the manufacturing sector, saddling many with crippling debt. Karaguesian said this caused many to become disillusioned with the country and created ripe conditions for Trump to ascend to the presidency.
“The reaction from voters to traditional Republicans and Democrats was that these people have messed up the economy,” he said. “That’s when Trump enters the scene. He knows Americans in the rust belt and Appalachia have been devastated and then indebted. He ran on an anti-free trade ticket. And then Biden kept most of the initial tariffs he imposed … Trumps actions are an acceleration but shouldn’t come as a surprise.”
More than the tariffs themselves, which change from day to day and have been walked back multiple times, the biggest issue is the uncertainty. Karaguesian explained companies might consider to relocating to the U.S. to avoid it. He cited Barrick Gold’s announcement that it might cross the border as a prime example of this.
But when it comes to Canadian construction, there could be a massive silver lining.
“Any government serious about maintaining Canada’s prosperity is going to have to make up for the shortfall,” he said. “Any government coming to power cannot undertake austerity measures or they will make the economy worse. They will likely run deficits to rebuild the industry.”
Karaguesian predicts federal and provincial money is going to pour into the construction sector, citing Trudeau’s massive high-speed rail announcement as the start of this. There is also talk of expanding pipelines.
He also warned of retaliatory tariffs, which may feel warranted, but could hurt builders.
“The only way our costs go up is if we do dollar-for-dollar retaliation,” he said. “I don’t think we should do that. We have some time to think and sectors like construction should be lobbying against it. Trump tariffs will be recessionary, but retaliatory tariffs will be inflationary, giving us the worst of both worlds. The negative demand shock from Trump’s tariffs will have to be absorbed by government spending. Candidates have to run on a ticket of rebuilding the Canadian economy and I think that’s a good idea.”
Another way to fight without retaliatory tariff is shifting procurement to local suppliers when able.
“If they have torn up our trade agreements that they forced us to negotiate, we are free to take our procurement and only use Canadian suppliers,” said Karaguesian. “That will be good for our side and create less American competition.”
Werner Antweiler: Buying domestic could dampen impacts
Antweiler is an Associate Professor at University of British Columbia’s Sauder School of Business. He serves as Chair, Strategy and Business Economics Division and Chair in International Trade Policy.
Antweiler believes the dispute could drive up material prices and hurt the Canadian dollar. He urged Canadians to stand up to President Donald Trump, who he believes is ignoring negotiated trade agreements.
He explained that the trade war is affecting the input price of construction materials directly and indirectly. Major inputs into construction are steel, cement/concrete, and lumber. Steel and aluminium currently will be subject to U.S. import tariffs starting March 12. This can have an indirect impact as Canadian steel is exported to the U.S. and may in turn end up in steel products that are purchased by Canadian construction firms.
“They in turn will look for cheaper alternatives domestically and from third-country sources, and this may drive up prices,” said Antweiler. “Another indirect effect may come from a depreciation of the Canadian dollar, which makes imports more expensive. A direct effect will also come from Canadian counter-tariffs on U.S. steel and aluminium. So this is very much a repetition of the 2018 trade war that Trump launched against Canada at that time.”
He noted there will be a noticeable effect on steel and aluminium prices, although reshuffling supply chains from imports to domestically-sourced goods may help dampen the impact.
“Construction firms will be well advised to look into their supply chains and identify alternative suppliers in order to circumvent the tariff impact,” he said. “Companies should examine carefully where their inputs are made—in Canada, in the United States, or in third countries. They should then look to identify alternative non-US suppliers and be ready to shift sourcing to more affordable vendors when the need arises. In some instances, this may also require establishing relationships with these suppliers.”
Antweiler added that in the long term, economies will adjust as companies will look for affordable suppliers. But it requires much effort, and certainly some short-term pain as finding alternative suppliers may not be easy, and these alternative suppliers may be constrained in their ability to ramp up output. Businesses must engage in extensive contingency planning and prepare for the different scenarios that may emerge.
He noted that the situation will become much more worrisome should Trump launch into a full-scale trade war with 25% tariffs on everything. Then Canada will be forced to retaliate in kind, and this will further increase the cost of building materials.
Antweiler said Trump is treating close friends and allies as if they were enemies for unclear reasons and in ways that will harm his own country.
“We do not know the true intentions of the US president. One can never take his word at face value, and his utter disregard for CUSMA—a treaty he himself signed—demonstrates that he is not good to his word,” he said. “Canada and the United States have been friends, allies, and good neighbours. This trade war makes no sense and is an affront to our friendship. It is a return to the age of protectionism of the early 20th century, which has caused great economic harm — including the significant contribution to worsening the Great Depression.”
Jock Finlayson: Be wary of retaliatory tariffs
Finlayson is the Independent Contractors and Businesses Association’s Senior Economist and a Senior Fellow at the Fraser Institute.
He believes the simmering trade war could weaken the Canadian economy and feared retaliatory tariffs could compound its impacts.
He explained that we don’t yet know all the details, except that steel and aluminum will face 25% tariffs as of March 12. On the export, this will hit B.C. mainly due to Rio Tinto’s large aluminum manufacturing plant in Kitimat which does ship product to the U.S.
Trump postponed his earlier plan to slap 25% tariffs on all Canadian merchandise exports to the U.S. (except oil and critical minerals, which would face a lower 10% tariff).
“In early March, we should know more about the mercurial, tariff-obsessed U.S. President will do,” said Finlayson. “My best guess is that Canada will face a 10% across-the-board levy on all of our goods exports to the U.S., totalling almost $600 billion per year.”
He noted that this would weaken the B.C. economy, mainly by dampening output and employment in export-focused industries (lumber, energy, minerals/metals, agri-food, and all parts of manufacturing).
“Without Trump’s tariffs, I would have expected the B.C. economy to grow by around 1.5-1.8% in 2025, after inflation,” he said. “With a 10% U.S. tariff in place, growth will be materially lower—less than 1%. The same holds for 2026, assuming the American tariffs remain in place for the next two years.”
In construction, this means reduced levels of non-residential investment across large parts of the private sector economy.
“Trump’s mad-cap tariff policy will cause many B.C./Canadian firms to postpone investment decisions,” he said. “Some may redirect capital spending to the U.S. to get around the tariffs. This is negative for the domestic construction industry, particularly companies active in non-residential segments.
To help offset a fall-off in private sector investment, governments may boost capital spending on infrastructure and other categories of public sector assets.
But Finlayson’s biggest concern was if Canada would retaliate with its own tariffs, a move that he feels could be disastrous.
“Canadian retaliation, while understandable in the circumstances, will magnify the blow to our economy by raising costs/prices for consumer goods and business inputs,” he said. “This is particularly true given that the U.S. is the number one source of Canadian and B.C. imports.”
He called for retaliation to be carefully calibrated so it minimizes harm to Canadians. He said this should include not imposing tariff levies on imports of building materials and other construction inputs.
Finlayson argued that Trump’s broad tariff strategy aims to boost U.S. manufacturing, reduce trade deficits, and strengthen the economy, but it faces significant challenges. The U.S. manufacturing sector already struggles with a skilled labor shortage, making large-scale reshoring difficult.
“There is overwhelming evidence from history—including Trump’s first term as President that the kind of tariff scheme Trump favours will harm the U.S. economy by increasing inflation and raising costs for both households and businesses,” said Finlayson.
Peter Morrow: Stay calm and strategize
Morrow is an Associate Professor of Economics at University of Toronto and is an expert in international economics.
Morrow stressed that President Donald Trump’s tariff threats have already created confusion for industries on both sides of the border, and construction firms should prepare for significant ripple effects.
“Things are chaotic if everything’s sort of lurching from one stated policy to another stated policy; it’s really unclear what’s going to happen,” Morrow said. “I think the uncertainty is the biggest issue. Companies really don’t know what is going to be coming down the pipeline six months from now.”
According to Morrow, the imposition of tariffs could result in unexpected price fluctuations. In some cases, Canadian firms might actually see costs drop if demand for certain goods in the U.S. falls, freeing up supply for Canada.
“Because the other buyers are no longer there. It’s like if there’s a housing boom in the U.S., lumber gets more expensive for Canadian builders; this is just the opposite of that,” he explained. “Those American consumers are disappearing. So Canadian timber manufacturers have to sell to someone, so Canadian builders might actually get a better deal.”
However, other sectors could be hit hard by retaliatory measures.
“If there’s retaliatory tariffs, then anything that gets hit by a Canadian retaliatory tariff that comes from the U.S. will become more expensive,” Morrow said.
Heavy construction equipment or specialized machinery sourced from the U.S., for example, may become costlier if targeted.
Adding to the complexity, Morrow highlighted how tariffs could disrupt long-established supply chains, particularly in major industries like auto manufacturing. He noted that parts often cross the Canada–U.S. border multiple times before becoming a finished product, meaning repeated tariff payments could “have the potential for chaos.”
The impact on the construction sector, Morrow advised, depends on the extent to which local economies rely on tariff-affected industries.
“If you build houses in the Okanogan Valley and you think that Trump is going to slap tariffs on Canadian wine from the Okanogan Valley, all those winemakers are going to have a lot less money in their pocket,” he cautioned. That diminished revenue could slow homebuilding or renovation projects.
As for how Canada should respond, Morrow pointed to strategies used in previous trade spats—focusing retaliatory tariffs on politically sensitive goods in the U.S.
Ultimately, Morrow urged level-headedness and careful planning among Canadian builders. While stocking up on certain materials might make sense if tariffs seem likely, he warned against overreacting.
“This is not smart for any of us. This is just going to cause both sides pain,” Morrow said.
Canada is currently embroiled in a bitter trade war with the United States. Tenions went from a simmer to a boil this month when U.S. President Donald Trump announced he would impose 25% tariffs on steel and aluminium.
“It’s a big deal. This is the beginning of making America rich again,” Trump said as he signed the orders in the Oval Office.
The U.S. accounts for over 90% of Canadian steel and aluminum exports. According to RBC, the renewal of the tariffs from 2018/19 would apply to roughly $24 billion of Canadian exports.
But this runs both ways. Canada is the largest U.S. import market, worth US$ 7.5 billion in steel and $9.4 billion in aluminum products in 2024. Canada accounts for about a fifth of U.S. imports of steel and 50% of aluminum imports.
Trump’s reasons for the tariffs (which he has threatened tariffs on many other things including cars, oil and, well, everything) have been numerous and shifting. He says they are punishment for drugs crossing the Canadian border, the trade deficit the U.S. has with Canada and has even suggested the country should just become the 51st state.
The impact of this trade war could be massive. Steel producers have called this a “doomsday scenario” for their industry. Homebuilders believe it could further hamstring efforts to increase housing supply. Provincial and national leaders are racing to fortify Canada’s trade infrastructure and shore up relationships with other trading partners. In the meantime, they are encouraging Canadians to avoid spending their dollars in the U.S. and instead buy Canadian products and services.
Prime Minister Justin Trudeau stated that picking Canadian products will ensure “Canadians don’t bear undue costs around tariffs.”
If you or your company is looking to buy Canadian, we rounded up a list of some Canada-based companies creating products for the construction sector.
Steel
Solid Rock’s team is all smiles after installing successfully installing some intricate galvanized structural steelwork for a pool enclosure. – Solid Rock Steel
Algoma Steel
Algoma Steel was forged in 1901 with two small blast furnaces, a 60-ton Bessemer furnace, a 23- inch bloom rolling mill and rail mill. It has since grown into a fully integrated steel producer based in Sault Ste. Marie, Ont. The company manufactures and sells hot and cold rolled steel products including sheet and plate. The company is currently constructing two new state-of-the-art electric-arc-furnaces to replace its existing blast furnace and basic oxygen steelmaking operations. It’s the biggest construction project in Sault Ste. Marie history. The change is expected to reduce Algoma’s carbon emissions by 70%.
Canam
Canam Steel Works Inc. was founded in St. Gédéon de Beauce, Que. in 1960. Despite a series of devastating fires, the company persisted. The company says it has been involved in more than 300,000 Construction projects in North America. They are also embracing technology. The group recently won an award for its Building Engineering Platform (BEP) which aims to modernize, update or replace some in-house engineering and detailing applications for Canam’s steel products.
Solid Rock Steel Fabricating Co. Ltd.
Solid Rock is a classic immigrant success story. Berend Steunenberg learned the metal fabricating trade while growing up in Holland and and took his skills to Vancouver in the 1950s. He worked day and night shifts at two jobs to buy an old flat deck truck, a second-hand welding machine and a torch set-up to start Solid Rock Steel. Now the company is helping tackle large, complex projects like The Butterfly, the Surrey Central Library and Microsoft’s Vancouver headquarters.
Wood
Interfor Corporation
Interfor Corporation, founded in 1963 and based in Vancouver, is one of the largest lumber providers globally, with 21 mills across North America. Interfor’s operations span British Columbia, Ontario, Quebec, and the U.S. South, producing a wide array of wood products, including softwood lumber and engineered wood.
West Fraser Timber Co. Ltd.
West Fraser Timber Co. Ltd., founded in 1955 in B.C., has grown to become one of the largest lumber producers in the world. The company operates over 60 mills across Canada, the U.S., and Europe, producing a wide range of wood products, including softwood lumber, plywood, OSB, and engineered wood.
Nordic Structures
The Montreal-based CLT producer has worked on many projects in the U.S. and Canada, including Canadian Nuclear Labratories, Plate 15, Paul Mercier Library and more. Since 1961, Nordic has been using trees to make construction materials at its industrial complex in Chibougamau.
Canfor
Canfor Corporation is a forest products company headquartered in Vancouver, B.C. Founded in 1938, Canfor specializes in producing lumber, pulp, and paper products, serving markets across North America, Asia, and Europe. The company operates numerous sawmills and pulp mills, with a strong presence in B.C., Alberta, and the U.S. South. In 2019, the Jim Pattison Group, one of Canada’s largest private companies, became Canfor’s majority owner, ensuring it remains Canadian-owned.
Machinery
Tigercat
Tigercat is a privately owned, vertically integrated Canadian corporation with deep expertise in engineering, fabrication, manufacturing, and the support of machinery suited to severe duty applications. The off-road industrial product line includes land clearing, silviculture and site preparation equipment as well as other specialized severe duty carriers used in a variety of industries including utilities, oil and gas and construction.
Cement/Concrete
Béton Provincial Ltée
Béton Provincial Ltée, a Quebec-based family-owned company established in 1960, stands out in Eastern Canada for its diverse, high-quality concrete and paving products. They focus on a personalized customer approach and boast a wide distribution network, supplying construction projects across the region. In recent news, Béton Provincial made headlines by acquiring assets from CRH Canada, further solidifying their position in the market.
Federal White Cement
A Canadian manufacturer operating since 1979, Federal White Cement, based in Woodstock, Ontario, specializes in white Portland and masonry cement for the construction industry. This family-owned company prioritizes innovation, offering traditional and eco-friendly white Portland cement options alongside white masonry cement. While specific recent updates aren’t readily available, their website provides details on their commitment to high-quality and sustainable white cement solutions.
Tools/Gear
Gray Tools
Leaving home at 16, Alex Gray traveled the world before settling in Toronto, Canada, where he encountered skilled tradesmen whose livelihoods depended on their hands and tools. He founded Gray Tools in 1912, focusing on manufacturing hand tools for accomplished tradespeople. The company offers over 6,000 hand tools designed for the specific work and needs of the professional user under two brands: Gray and Dynamic Tools. They are Canada’s only broad line manufacturer of hand tools.
Canada West Boots
Based in Winnipeg, this 47-year old boot manufacturer has a variety of styles for steel toe work boots. Canada West states that making Goodyear welted footwear may not be the easiest way to make a boot or shoe, but they still believe it is the best way. Especially for heavy-duty work boots and western boots used throughout Canada.
Big Bill
Big Bill is a fourth-generation family business and a brand of Codet Inc., dedicated to producing high-quality workwear for over 75 years. Founded by Charles E. Audet in Coaticook, Quebec, the company has grown into a North American leader with four specialized divisions: workwear, outdoor clothing, flame-resistant apparel, and safety footwear.
Panels
Cabot Gypsum
Cabot Gypsum has been manufacturing high-quality gypsum products since 2011 from its state-of-the-art 200,000-square-foot facility in Point Tupper, Nova Scotia. Strategically positioned for efficient distribution via rail, ship, and truck, Cabot Gypsum serves both Canadian and U.S. markets with a diverse product line, including regular and fire-rated drywall, mold and moisture-resistant panels, abuse-resistant boards, vinyl ceiling tiles, and exterior sheathing.
Environwall
Envirowall Partition Systems is a leading Canadian manufacturer of high-performance vinyl-covered gypsum panels, serving the construction industry from its 50,000-square-foot facility in Toronto. With a production capacity exceeding 100,000 square feet of panels per shift, Envirowall specializes in durable, easy-to-install partition systems designed for commercial, institutional, and industrial applications. aesthetics in modern building projects.
Willow Lake Métis Group (WLMG) has announced a strategic partnership with Earth & Iron Inc., a leading Alberta-based earthmoving and construction services provider. The collaboration aims to enhance service offerings and foster economic growth within the Métis community.
Established over 25 years ago, Earth & Iron has built a reputation in Alberta’s civil and oilfield sectors, consistently moving millions of cubic meters of earth annually.
“This alliance will enable us to undertake larger projects, create employment opportunities, and contribute to the prosperity of our community,” says Andy Harnett, Willow Lake Métis Group CEO.
Stuart Gray, General Manager of Earth & Iron Inc., added, “We are excited to collaborate with Willow Lake Métis Group. This partnership not only broadens our operational capabilities but also reinforces our dedication to community engagement and sustainable development.”
This new partnership is set to commence immediately, with both organizations working closely to integrate their operations and pursue joint projects across Alberta. Together, the partners will focus on creating long-term value through innovation, integrity, and teamwork in the resource and infrastructure sectors.
They stated that they are committed to empowering the Métis community through supporting cultural preservation, economic development, and sustainability.
Willow Lake Métis Group is the business arm of the Willow Lake Métis Nation, focusing on creating economic opportunities that benefit the Métis community. By partnering with industry leaders, WLMG aims to provide top-tier services while upholding the values and traditions of the Métis people.
Key Takeaways:
Vancouver is piloting a new model for delivering market rental housing on city-owned land, starting with a rezoning proposal for Pacific and Hornby Street.
The Vancouver Housing Development Office (VHDO) will generate non-tax revenue by leveraging city real estate assets for market rental housing while addressing infrastructure funding needs.
The proposed development includes 54- and 40-storey towers, potentially adding 1,136 market rental homes, while the city remains committed to non-market rental housing initiatives.
Led by the Vancouver Housing Development Office (VHDO), this initiative will enable the delivery of market rental housing on city land while piloting a new way to generate non-tax revenue for the city.
“The launch of the VHDO is a big step forward in making sure we have the right homes for the people who need them. By putting our real estate assets to work and thinking outside the box on housing solutions, we’re setting up Vancouver for long-term success – so more families and residents can put down roots and thrive in our city,” says Ken Sim, Mayor of Vancouver.
The VHDO was established at the direction of Council to centralize housing delivery. In addition to non-market rental housing, the VHDO will focus on partnering and investing in the development of market-rental housing on City-owned property. In line with the recommendations in the Mayor’s Budget Task Force Report , this aims to maximize the delivery of market rental housing and generate financial returns and non-tax revenues to address the growing infrastructure deficit and Council priorities.
The proposed 54- and 40-storey buildings at Pacific and Hornby could provide up to 1,136 market rental homes, comprising a mix of studio and one- to three-bedroom units.
While the city is pursuing market rental housing development, it says it remains committed to delivering non-market rental housing through the VHDO as well.
Key Takeaways:
Cooper Equipment Rentals strengthens its presence in both Eastern and Western Canada with the acquisitions of Rent All Centre, Skyhigh Platforms, and Big Stick Rentals, enhancing its service network and coverage.
The acquisitions will improve equipment availability, efficiency, and service flexibility, ensuring better access and faster response times for customers across Ontario and Alberta.
Cooper remains dedicated to being Canada’s leading independent rental company, expanding with a focus on maintaining service quality, operational excellence, and strong company values.
The Whole Story:
Cooper Equipment Rentals Limited has announced the acquisitions of Rent All Centre and Skyhigh Platforms in Ontario, and Big Stick Rentals in Alberta. These strategic additions extend Cooper’s reach in both Eastern and Western Canada.
Rent All Center and Skyhigh Platforms
Founded in 1973, Rent All Centre (RAC) and Skyhigh Platforms have served contractors and businesses with general rental and aerial equipment. Their full-service rental locations across Cobourg, Port Hope, Peterborough (two branches), Belleville, and Trenton, along with Skyhigh’s aerial specialty location in Whitby, will now operate under the Cooper banner.
“It is with great pride that we have now joined another Canadian owned company, to continue the path we’ve been walking. The Cooper family will continually improve on our already excellent service and reputation,” stated Brian Wheatley, President.
This acquisition enhances Cooper’s service footprint in Peterborough and the 401 corridor, complementing its existing network in Toronto, Oshawa, Kingston, and Ottawa. Cooper stated that the integration of RAC and Skyhigh will create seamless equipment sharing and expanded resources, increasing efficiency and availability for customers.
Big Stick
With a modern fleet and a prime location in Grande Prairie, Alberta, Big Stick Rentals has built a reputation for reliability and service excellence since its founding in 2013. Under the leadership of Kevin Bjornson, the company has become a key player in Northern Alberta’s rental market.
“I never expected to find a large partner who shared the same core values and culture as our little company. As I learned more about Cooper, it became evident that the small family who made large contributions to Big Stick Rentals’ success would be well taken care of in the Cooper family,” said Bjornson.
Big Stick’s strategic location in Grande Prairie strengthens Cooper’s coverage in Western Canada, enabling broader geographic reach, equipment availability, and service flexibility across Alberta and beyond.
National vision
For Doug Dougherty, CEO of Cooper, these acquisitions represent more than geographic expansion – they reinforce Cooper’s commitment to being Canada’s only truly national, independent rental company.
“At Cooper, we don’t just grow for the sake of growth – we expand with purpose,” said Dougherty. “Bringing these respected businesses into the Cooper family means we’re strengthening our service, growing our footprint, and staying true to what matters most: delivering the best rental experience in the industry.”
Brian Spilak, COO of Cooper, highlighted the operational advantages of the expansion:
“For our customers, these acquisitions mean more access to the equipment they need, where and when they need it. By expanding our network, we’re not just adding locations – we’re investing in better service, faster response times, and deeper local expertise. Whether it’s a small contractor or a major project, we’re ensuring they have the right equipment and support to keep their jobs moving forward.”
Key Takeaways:
The Manitoba government is investing $36.4 million over two years to support infrastructure upgrades at the Port of Churchill, including wharf repairs and warehouse upgrades, to boost trade and economic growth.
The Arctic Gateway Group, owned by 41 Indigenous and Bayline communities, is leading the development, supporting local jobs, economic reconciliation, and increased shipping of critical minerals.
Churchill is being developed as a key Arctic trade hub, with plans to increase mineral exports, enhance Manitoba’s role in global supply chains, and position the province as a gateway for international trade.
The Whole Story:
The Manitoba government is investing $36.4 million over two years to the Arctic Gateway Group (AGG) for capital infrastructure projects at the Port of Churchill.
“Churchill presents huge opportunities when it comes to mining, agriculture and energy,” said Manitoba Premier Wab Kinew. “Our government’s investments are fueling northern Manitoba’s economy, increasing international trade and unlocking new economic opportunities for all Manitobans. These new investments will build up Manitoba’s economic strength and open our province to new trading opportunities.”
The $36.4-million investment will support the AGG’s port and rail development vision and plan to expand traffic diversification and growth opportunities and attract private investment partners from the agriculture, mining, fertilizer and resupply sectors. Planned works include wharf repairs and freight warehouse upgrades, noted the premier.
“This is about keeping northern communities connected, strengthening Indigenous economic leadership and positioning Manitoba as a key player in the global critical minerals market,” said Sport Minister Terry Duguid, minister responsible for Prairies Economic Development Canada. “Reliable affordable rail service is essential for the North and these investments will ensure it remains a lifeline for communities and businesses. At the same time, we’re creating new opportunities in mining and mineral development – helping Indigenous communities build skills, secure good jobs and drive economic growth. This is a long-term investment in Manitoba’s future and in Canada’s clean energy transition.”
Infrastructure Minister Lisa Naylor explained that as a maritime province located in the heart of North America, Manitoba is strategically positioned to ship commodities, critical minerals and natural resources.
“Developing the Port of Churchill will advance northern Manitoba’s economy, support trade expansion with Europe and strengthen our Arctic sovereignty as we position Manitoba as a gateway to the Arctic and to the world,” she said.
Chris Avery, CEO, Arctic Gateway Group stated that the upcoming shipping season will see double the volume of critical minerals that will be shipped to internationally markets from the Port of Churchill.
“As a locally owned and operated Canadian organization, backed by 41 Indigenous and Bayline communities, Arctic Gateway Group will continue to step up and support working people, creating regional opportunities and diversifying the supply chain networks of this province and country,” he said.
The AGG is a subsidiary company of OneNorth, a partnership of 41 First Nation and Bayline communities in Manitoba. The OneNorth community ownership model of the AGG demonstrates economic reconciliation in action, noted the minister.
In August 2024, AGG and Hudbay Minerals Inc. piloted a successful 10,000-tonne zinc concentrate export shipment through the port, establishing Churchill as a northern trade critical minerals supply route.
After months of threats, U.S. President Donald Trump may (or may not) implement 25% tariffs on all most Canadian goods (oil would recieve a 10% tariff).
First, they were supposed to go into effect on day one of Trump’s presidency. And then they were scheduled for Feb. 1st. Then they were scheduled for Feb. 4. At the time this article is being written, Trump announced the tariffs would be delayed for at least 30 days after speaking with Prime Minister Justin Trudeau.
“The Tariffs announced on Saturday will be paused for a 30 day period to see whether or not a final Economic deal with Canada can be structured,” Trump wrote on Truth Social.
What does he want from Canada?
It’s not totally clear what Trump hopes to accomplish, but the common theme is a feeling of being treated unfairly. Officially, he and his team have claimed that it is in response to lax borders and drug smuggling.
In his executive order to implement the tariffs, Trump said this: “the sustained influx of illicit opioids and other drugs has profound consequences on our Nation, endangering lives and putting a severe strain on our healthcare system, public services, and communities.”
But a day later he posted this on social media: “We pay hundreds of Billions of Dollars to SUBSIDIZE Canada. Why? There is no reason. We don’t need anything they have. We have unlimited Energy, should make our own Cars, and have more Lumber than we can ever use. Without this massive subsidy, Canada ceases to exist as a viable Country. Harsh but true!”
He’s also said many times that Canada should be annexed by the U.S. as its 51st state and called Prime Minister Justin Trudeau its governor. Whether or not this is meant to be taken literally is anyone’s guess.
Despite provincial and national efforts to address some of these concerns or explain the realities of North American trade, Trump has said there is nothing Canada can do right now to avoid tariffs. He also denied using tariffs as a negotiating tactic to secure borders and that they were “purely” economical.
However, based on his decision to delay or halt tariffs in other countries recently, it appears Trump is open to negotiation. What it would take to get him to stop these tariffs in Canada, remains to be seen.
Does he have a point?
When it comes to toxic drugs and immigration, the government of Canada says less than 1% of the fentanyl and illegal crossings into the United States come from Canada. Despite Canada promising more than $1 billion to secure borders, Trump says it’s not enough to avoid the tariffs.
Trade is more complicated, but economists agree that it is not clear what data Trump is referencing and analyzing our trade relationship requires more nuance.
According to TD Canada, Canada is the largest export market for the U.S. and makes up one of the smallest trade deficits, owing largely to U.S. demand for energy-related products.
“With respect to Trump’s assertion that the U.S. subsidizes Canada to the tune of US$200 billion per year, it’s unclear where this number is derived,” said TD economists. “In any event, rather than a subsidy, the U.S. trade deficit is a by-product of U.S. economic outperformance relative to other countries.”
While Canada does have a trade surplus with the United States, it’s due almost entirely to oil and gas purchased by the U.S. Last year, Canadian exports of energy products (oil, natural gas, power) to the U.S amounted to nearly $170 billion, or almost 1/3 of total shipments. In contrast, energy accounted for only 6% of all U.S. imports. Put simply, Canadian sources are critical to U.S. energy security.
Remove Canadian energy exports from the equation and the trade story flips. Ex-energy, the U.S. enjoys a trade surplus with Canada of around C$60 billion (US$45 billion).
What does it mean for builders?
It’s clear that vast chunks of both economies will be impacted, including the construction sector.
“Virtually all economists think that the impact of the tariffs will be very bad for America and for the world,” said Joseph Stiglitz, an economics professor at Columbia University and a winner of the Nobel prize in economic sciences. “They will almost surely be inflationary.”
Homebuilding, one of Canada’s biggest pressing issues, is facing substantial disruption.
“Ontario’s residential construction industry, like many others across the country, are bracing for the impact of the tariffs,” says RESCON president Richard Lyall. “The residential construction industry is already challenged. The move is reckless and will cause economic hardship in both the U.S. and Canada, affecting tens of billions of dollars of trade in construction materials alone. Such levies will only increase costs and lead to a further slowdown in residential construction activity which will exacerbate an already dire housing affordability crisis.”
He explained that the present situation is a much more significant event than the tariffs that were imposed by the previous Trump administration in March 2018 on certain imports of steel and aluminum from Canada. Canada responded by imposing countermeasures against $16.6 billion of steel aluminum and other products from the U.S. Both countries lifted their tariffs in May 2019.
“No one will benefit from an arbitrary increase in material and product prices. Our countries and supply chains are intertwined and dependent on each other, so nobody wins in a tariff war,” says Lyall.
Canada and Mexico account for nearly 25% of building materials imported into the U.S. Roughly 30% of the lumber used in the U.S. is imported and more than 85% of the imports come from Canada, according to the National Association of Home Builders. Canada is also the largest foreign supplier of steel and a major supplier of aluminum to the U.S., both of which are essential for residential construction. Meanwhile, the U.S. also imports other materials from Canada such as cement, cement products and gypsum used for drywall.
Groups like the Calgary Construction Association believe there could serious consequences beyond just homebuilding, including contractors disengaging from projects or choosing not to bid on essential infrastructure like schools and public facilities. It could also result in owners delaying or postponing projects, causing economic momentum to stall. And provincial leaders have said the tariffs will likely result in hundreds of thousands of people losing their jobs.
“Even if projects return post-tariffs, costs could still escalate, making them more expensive and difficult to complete,” said the group.
The Canadian Construction Association (CCA) recommended proactive measures. For existing contracts, businesses should review their agreements for provisions on price adjustments due to changes in taxes and customs duties, noting that contracts without such provisions may leave contractors liable for increased costs.
For new contracts, the association advises raising tariff concerns early, including duty provisions, and referencing standard industry wording. Contractors may have grounds for cost recovery due to unforeseen expenses or project delays, though this can be challenging without clear contractual provisions.
For some specific industries it could all but wipe them out. Steel officials say the the tariffs as well as Canada’s retaliation is a “doomsday scenario” for them as 99% of Canadian steel exports go to the U.S.
What is Canada doing about it?
Trudeau announced he would impose tariffs on $30 billion worth of imported U.S. goods as soon as Trump’s tariffs begin. A list of these goods includes wood products such as engineered structural timber, plywood, veneering sheets, particleboard, fibreboard, panels, shingles, shakes, posts, and beams.
Also listed are plastic floor, wall, and ceiling coverings; carpets and other textile floor coverings; lavatory fittings; doors, thresholds, windows, frames, shutters, and blinds; large reservoirs, tanks, vats, and other builders’ ware; luminaires and lighting fixtures; as well as furniture and its components.
These tariffs apply only to goods originating from the U.S. They do not affect goods already in transit to Canada as of February 4.
He announced the government also intends to impose tariffs on an additional list of imported U.S. goods worth $125 billion, including steel and vehicles. However these would be subject to a public comment period prior to implementation.
But where it gets more interesting is at the provincial level. Ontario Premier Doug Ford plans to ban all American companies from provincial contracts until U.S. tariffs on Canadian goods are removed. He has already shredded a $100-million contract with SpaceX to deliver high speed internet to remote areas.
In Alberta, Premier Danielle smith called on the federal government and other provinces to “immediately commence a national effort to fast track and build oil and gas pipelines to the east and west coasts of Canada, construct multiple LNG terminals on each coast, increase internal refining capacity, unleash the development of critical minerals, lower taxes, reduce red tape, tear down interprovincial trade barriers and re-empower provinces to develop our unique economies without constant federal interference and imposition of anti-resource development laws.”
Premier David Eby announced he is assessing private-sector projects worth $20 billion with the goal of getting them approved as quickly as possible, and issuing their permits faster. These are expected to create 6,000 jobs in remote and rural communities. In addition, the Province has vowed to support and help implement the actions being taken by the federal government.
“We won’t back down or be bullied into becoming another state,” said Premier Eby. “Our province is unified and resolute. We’ll never stop standing up for B.C. and Canada.”
Government leaders also strongly encouraged people to purchase Canadian products when possible.
B.C. Premier David Eby tours the PKM Canada Marine Terminal.
Key Takeaways:
The Canada Infrastructure Bank is providing a $60.7 million loan to support the Metlakatla Development Corporation and Prince Rupert Port Authority in developing the South Kaien Import Logistics Park, aligning with Metlakatla’s long-term vision for regional growth.
The project will expand Prince Rupert’s import and transloading capabilities, with private sector investment expected to build infrastructure for handling up to 100,000 TEUs of cargo, strengthening Canada’s trade gateway to the Asia-Pacific.
The initiative will create direct and indirect job opportunities, particularly for Indigenous communities, while also supporting infrastructure development within the CIB’s Trade & Transportation priority sector.
The Whole Story:
The Canada Infrastructure Bank (CIB) has reached financial close on a $60.7 million loan to help the Metlakatla Development Corporation (MDC) and the Prince Rupert Port Authority develop the Indigenous-led South Kaien Import Logistics Park in B.C.
Funding comes from the CIB’s Indigenous Community Infrastructure Initiative (ICII) and will be used for site infrastructure needed to develop 56 acres of flat, serviced land in proximity to Fairview Terminal, CN Rail and the recently announced CANXPORT facility.
More than half of the logistics park is leased for a logistics and warehousing complex which significantly expands and strengthens import transloading and related capabilities at the Port of Prince Rupert. The remaining 23 acres are available for lease.
Most of the site preparation work is expected to be completed within two years and relates to heavy civil construction, land removal and levelling bedrock.
A subsequent phase will see private sector investment build transloading and warehousing infrastructure. This will create approximately 100,000 twenty-foot-equivalent units of capacity to transload marine containers into domestic 53-foot containers.
Officials stated that this project is part of Metlakatla’s long-term vision for enabling regional growth and benefiting the next generation of its members.
They noted that it also provides the ancillary benefits of creating and sustaining direct and indirect jobs and training opportunities for Metlakatla members and other Indigenous people in the Prince Rupert region – many of whom are already employed within the trade corridor.
The investment is the CIB’s second in a port. In May, CIB announced a $150-million loan to help build the CANXPORT export logistics hub at another site at the Port of Prince Rupert.
Funded through ICII, the project is within CIB’s Trade & Transportation priority sector, which is dedicated to addressing financing gaps in new projects such as ports, freight highways, roads, bridges, tunnels and passenger rail.
The Port of Prince Rupert is a critical Canadian trade gateway that ships a diversified portfolio of cargoes through several intermodal, dry bulk and liquid bulk terminals. The Port is the closest North American west coast port to Asia-Pacific markets. The Port is also the deepest natural harbour in North America, is ice-free year-round, and is able to accommodate the largest vessels in the shipping trade.
Key Takeaways:
B.C. is fast-tracking $20 billion in private-sector projects to boost the economy and counteract the negative impacts of U.S. tariffs, with an expected 6,000 new jobs in rural and remote areas.
The province’s strategy includes retaliatory measures and outreach to U.S. policymakers, economic strengthening through expedited projects, and diversification of trade to reduce reliance on the U.S. market.
A new trade and economic security task force, along with a cabinet-level “war room,” will oversee a unified government approach to protecting B.C.’s economy, businesses, and workers.
The Whole Story:
B.C. and Alberta have announed plans to speed up large private sector projects as part of its response to large U.S. tariffs.
In Alberta, Premier Danielle smith called on the federal government and other provinces to “immediately commence a national effort to fast track and build oil and gas pipelines to the east and west coasts of Canada, construct multiple LNG terminals on each coast, increase internal refining capacity, unleash the development of critical minerals, lower taxes, reduce red tape, tear down interprovincial trade barriers and re-empower provinces to develop our unique economies without constant federal interference and imposition of anti-resource development laws.”
Premier David Eby announced he is assessing private-sector projects worth $20 billion with the goal of getting them approved as quickly as possible, and issuing their permits faster. These are expected to create 6,000 jobs in remote and rural communities. In addition, the Province has vowed to support and help implement the actions being taken by the federal government.
Premier Eby added that additional measures are under consideration by B.C. and could be introduced in the coming days and weeks.
“We won’t back down or be bullied into becoming another state,” said Premier Eby. “Our province is unified and resolute. We’ll never stop standing up for B.C. and Canada.”
In January 2025, B.C. released its preliminary assessment of 25% tariffs. That analysis showed that B.C. could see a cumulative loss of $69 billion in economic activity between 2025 and 2028, along with the loss of more than 120,000 jobs. Estimates also indicated 25% tariffs on Canadian mineral exports alone will cost American companies over US$11 billion and have a profound effect on the U.S. defense industry, energy production, and manufacturing.
The B.C. government says it has a three-point approach to fight back against the tariffs:
respond to U.S. tariffs with tough counter-actions and outreach to American decision-makers;
strengthen B.C.’s economy by expediting projects and supporting industry and workers; and
diversify trade markets for products so British Columbia is less reliant on U.S. markets and customers.
To support B.C.’s strong tariff response and ensure actions are swift, responsive and co-ordinated, Premier Eby has established a trade and economic security task force to bring together business, labour and Indigenous leadership. The task force is co-chaired by Tamara Vrooman from the Vancouver International Airport, Jonathan Price from Teck, Bridgitte Anderson from the Greater Vancouver Board of Trade, and includes B.C.’s largest business organizations.
A new cabinet committee will act as a day-to-day war room, co-ordinating the whole-of-government approach the Province is taking to protect B.C.’s workers, businesses and economy.
According to the province:
54% of BC exports in 2023 were sent to the United States;
Wood, pulp and paper, metallic mineral and energy products combined make up approximately 67% of total goods exports.
The top five states for B.C.’s exports were: Washington ($9.8 billion), California ($3.2 billion), Illinois ($2.1 billion), Texas ($1.5 billion), Oregon ($1.3 billion)
The federal government has announced an investment of more than $663 million in transit funding to improve Metro Vancouver’s public transit infrastructure, providing predictable and long-term funding, tied to greater density near transit.
This funding, which will be delivered to TransLink over 10 years from 2026 until 2036, will help Metro Vancouver advance key improvements to its public transit system and help respond to critical transit needs caused by rapid population growth. Providing long-term, predictable funding will help TransLink plan, upgrade, replace, or modernize existing public transit and active transportation infrastructure.
Officials stated that these investments, beginning in 2026 until 2036, will help increase the housing supply and affordability as part of complete, transit-oriented communities, while helping to reduce greenhouse gas emissions and mitigate the impacts of climate change.
“Through a $663 million injection of reliable, predictable baseline funding for TransLink, this federal government is keeping Metro Vancouver residents connected to their work and communities,” said Jonathan Wilkinson, Minister of Energy and Natural Resources. “The funding, which will focus on expansions, improvements, and repair, is critical to the stability and future of public transit in the region, including along the North Shore. Reliable public transit infrastructure is key to reducing traffic, lowering air pollution, and improving affordability for all communities.”
Baseline funding is conditional on TransLink submitting a capital plan, and the subsequent signing of a funding agreement.
Key Takeaways:
Graham Power Services, in partnership with 42 West Constructors Ltd., plans to acquire the powerline construction and maintenance assets of Rokstad Power Ltd. and affiliates, subject to approval by the British Columbia Supreme Court, with a target close date of February 17, 2025.
Graham intends to maintain existing agreements with First Nations for work with BC Hydro, emphasizing sustainable and community-focused practices. Additionally, 42 West Constructors Ltd. will continue the collective bargaining agreement with Local Union 258 of the International Brotherhood of Electrical Workers.
The acquired team will operate as Graham Power Services, offering overhead and underground powerline construction, maintenance, storm response, and substation services. Bryan Plowe will lead operations in British Columbia, focusing on strengthening customer relationships and creating growth opportunities.
The Whole Story:
Graham Power Services on behalf of its parent, Graham Maintenance Services LP. and its partner, 42 West Constructors Ltd., announced today that Graham intends to acquire the powerline construction and maintenance assets and resources of Rokstad Power Ltd. and affiliates from FTI Consulting Canada Inc, in its capacity as court-appointed receiver of Rokstad.
The transaction remains subject to the approval of the British Columbia Supreme Court, the hearing for which is currently scheduled for January 31, 2025. Once approved, there are certain closing conditions that will need to be met, with an outside close date of February 17, 2025.
Graham is an employee-owned business with over 2,700 staff and the capacity for up to 6,000 craft workers. Established in 1926 and with offices throughout North America, Graham Group generates annual revenues exceeding $4 billion and has delivered over 500 projects annually.
“Graham is very excited for the opportunity to welcome a highly capable team that will now operate as Graham Power Services, delivering maintenance and construction of overhead and underground distribution and transmission systems, as well as emergency response to storms and substation services,” said Thomas Grell, Graham’s Executive Vice President, Services.
As part of the transaction, Graham intends to assume and maintain all existing agreements and relationships between impacted First Nations to perform work designated with BC Hydro.
“It will also be our honor to continue to build and grow these existing relationships with all Indigenous groups that share the same values for territory sustainability, economic stewardship for the land, and to benefit their communities,” said Graham Vice President, Terry Mitchell.
42 West Constructors Ltd. intends to assume and continue the collective bargaining agreement (master line agreement) with Local Union 258 of the International Brotherhood of Electrical Workers.
Graham Power Services operations in BC will continue under the leadership of Bryan Plowe as Vice President, Power Services.
“I am proud of the services our team has been delivering to outstanding Canadian customers like BC Hydro and many others,” said Plowe. “As we join Graham, I am excited by the possibilities for expanding our customer relationships, working with other divisions of Graham, and creating opportunities for our people.”
BBA, based in Mont-Saint-Hilaire, Quebec, has acquired Calgary-based Kilo Power, a consulting engineering firm specializing in utility-scale solar energy projects across North America and New Zealand. Kilo Power provides comprehensive services for photovoltaic (PV) generation, grid interconnections, and high- and medium-voltage AC systems. The acquisition aims to bolster BBA’s renewable energy footprint, particularly in Alberta, and enhance its capabilities in solar PV and battery energy storage solutions.
CPP Investments and Bridge Industrial have committed over $1.13 billion to establish a portfolio of industrial properties in core U.S. markets, with CPP owning 95% and Bridge managing the portfolio. The joint venture will focus on acquisitions and potential new developments to meet growing demand for logistics properties supporting faster shipping times in a market with limited warehouse construction space. This marks the second collaboration between the firms, following a 2021 venture investing $1.4 billion in developments in Miami and Los Angeles.
Rendering of the proposed Ksi Lisims floating LNG project.
Western LNG has secured over $150 million in a private equity placement, led by Blackstone Energy Transition Partners, to advance its Ksi Lisims LNG and Prince Rupert Gas Transmission (PRGT) projects through to a Final Investment Decision (FID) expected in 2025. With cumulative investments now exceeding $265 million, the funding supports environmental permitting, engineering, and engagement with Indigenous and local stakeholders, including the Nisga’a Nation.
United Rentals announced its $4.8 billion acquisition of H&E Equipment Services to expand its presence in the U.S. equipment rental market, driven by strong demand from construction firms amid increased infrastructure spending and reshoring trends. The deal offers H&E shareholders $92 per share, a 109.4% premium, and includes a 35-day “go-shop” period for alternative bids. The merger will add nearly 64,000 units to United Rentals’ fleet and is expected to achieve $130 million in annual cost synergies within two years.
Forest products producer Marwood Ltd. has announced that it has agreed to purchase all of the assets of Fraser Specialty Products Ltd., operating as Fraser Wood Siding. Fredericton, N.B.-based Marwood said in a release that the acquisition will add a ninth manufacturing site to its network. Fraser, headquartered in Edmundston, N.B., manufactures and paints solid wood siding, trims, and shingles.
EllisDon Corporation has partnered with Palantir Technologies to deploy advanced AI and data analytics tools, enhancing its operational capabilities and driving growth in the construction technology sector. This collaboration, which began in summer 2024, leverages EllisDon’s modernized data infrastructure—developed over a decade—to optimize operations and improve efficiency.
GFL Environmental Inc. has agreed to sell its Environmental Services business to Apollo and BC Partners for $8 billion, while retaining a 44% equity stake. The transaction will provide GFL with approximately $6.2 billion in net cash proceeds, enabling it to reduce debt by up to $3.75 billion, allocate up to $2.25 billion for share repurchases, and use the remainder for transaction costs and general corporate purposes.
The sale of our Environmental Services business at an enterprise value of $8 billion is substantially above our initial expectations and is a testament to the quality of the business that we have built. The transaction will allow us to materially delever our balance sheet which will accelerate our path to an investment grade credit rating.
Patrick Dovigi, Founder and Chief Executive Officer of GFL
The First Nations Major Projects Coalition has announced the launch of ‘Nations Forward: First Nations in Major Projects’, a brand-new magazine produced in partnership with MediaEdge Communications. Nations Forward will become the official voice of the FNMPC, delivering knowledge and resources to help advance fully informed decision-making regarding First Nations participation in major projects.
UK-based renewable energy company Low Carbon has signed a 10-year Power Purchase Agreement (PPA) with Quebec-based carbon removal developer Deep Sky to supply 10 GWh of renewable energy annually from its Lethbridge 1 solar project in Canada. This clean energy will power 100% of operations at Deep Sky’s Alberta facility, Deep Sky Alpha. The agreement underscores Low Carbon’s role as a leading independent power producer and aligns with the growing trend of organizations securing renewable energy contracts to meet climate goals. Both companies highlighted the importance of this partnership in supporting decarbonization and innovative carbon removal initiatives.
YRH Inc. and Pinargon Ltd., two Canadian consulting engineering firms specializing in telecommunications infrastructure and wireless communications, announced their merger, effective February 1, 2025, forming a unified entity under the YRH Inc. name. Combining decades of expertise, the merger will enhance their capabilities in wireless communications, telecom structures, fibre optics, and intelligent transportation systems (ITS), enabling them to offer more integrated and innovative services.
China’s Sinopec is in discussions with Pembina Pipeline for a potential liquefied natural gas (LNG) offtake agreement and an equity stake in the Cedar LNG project, a proposed $4 billion LNG export terminal in Canada. The project, a joint venture with the Haisla First Nation, would produce 3 million metric tons of LNG annually, with completion expected by 2028, pending a final investment decision in mid-2024.
A rendering shows the Cedar LNG project in B.C.
Key Takeaways:
Overall, Canada’s construction investment decreased by 0.5% in November 2024, but the non-residential sector reached a record high, offsetting the decline in residential investment.
Ontario’s multi-unit dwelling investments drove the residential sector’s decline, contributing significantly to the $168.1 million drop in overall residential construction.
Quebec experienced growth in residential building investments, while Ontario’s performance in both residential and commercial sectors played a major role in shaping national trends.
The Whole Story:
Canada’s construction investment showed signs of fluctuation in November 2024, with mixed results across various sectors. While some areas of the industry saw growth, others experienced setbacks, reflecting broader trends in the market. The latest report from Statistics Canada reveals key shifts in both residential and non-residential construction, highlighting regional variations and emerging patterns in investment.
Overall, investment in building construction edged down 0.5% (-$96.6 million) to $21.4 billion in November, following a 1.1% decrease in October. Year over year, investment in building construction grew 2.7% in November.
The monthly decline in investment in building construction in November was driven by the residential sector (-$168.1 million to $14.8 billion) but was partially offset by a gain in the non-residential sector (+$71.5 million to $6.6 billion).
On a constant dollar basis (2017=100), investment in building construction decreased 0.5% compared with the previous month to $12.8 billion in November, but it was up 0.1% year over year.
Ontario’s multi-unit component drags down residential
Investment in residential building construction declined 1.1% (-$168.1 million) to $14.8 billion in November, with decreases occurring in four provinces and three territories, led by Ontario (-$227.8 million). Quebec (+$84.1 million) led the gains recorded in the remaining provinces in November.
Investment in multi-unit dwelling construction was down 4.8% (-$374.4 million) to $7.5 billion in November, largely attributable to Ontario (-$317.9 million). Declines were also recorded in five other provinces and two territories.
Single family home construction investment rose 2.9% (+$206.4 million) to $7.3 billion in November. Monthly increases were observed in eight provinces, with Ontario (+$90.0 million) leading the national gains.
Investment in residential building construction, November 2024.
Non-residential construction investment reaches record high
Investment in non-residential building construction increased 1.1% (+$71.5 million) to a record-high $6.6 billion in November. This marked the fourth consecutive monthly increase.
The industrial component increased 2.2% (+$30.7 million) to $1.4 billion in November.
Commercial construction investment edged up 0.4% (+$12.8 million) to $3.3 billion in November. The gain in Ontario (+$25.0 million) offset decreases in Alberta (-$4.4 million) and British Columbia (-$9.5 million).
In November, institutional construction investment rose 1.5% (+$27.9 million) to $1.9 billion, with six provinces and the three territories recording increases. Quebec (-$1.7 million) led the decline in the remaining provinces.
Key Takeaways:
On Nov. 25, 2024, president-elect Trump proposed tariffs of 25% on all Canadian and Mexican imports to the United States, and an additional 10% on imports from China.
Premier David Eby has met with several state governors and impressed upon them the devastating impacts tariffs would bring on both sides of the border. He and other premiers will travel to Washington, D.C., on Feb. 12 to continue to make the case against unjustified tariffs for all Canadians.
The ministry’s preliminary assessment is based on internal planning assumptions, including that a 25% U.S. tariff would remain in place for the duration of the Trump presidency and that Canada retaliates as well as key economic indicators and inputs, including economic activity, trade, the labour market and demographics.
The Whole Story:
How much are 25% tariffs on all Canadian imports going to cost British Columbians?
The province has done a preliminary assessment of potential impacts to the B.C. economy.
In president-elect Donald Trump’s tariffs scenario, B.C. could see a cumulative loss of $69 billion in economic activity between 2025 and 2028. The province’s real GDP is projected to potentially decline by 0.6% year over year in both 2025 and 2026.
Job losses are estimated at 124,000 by 2028 with the largest declines in natural-resource sector export industries and associated manufacturing. Losses would also be felt in the transportation and retail sectors. The unemployment rate could increase to 6.7% in 2025 and 7.1% in 2026, and corporate profits could see an annual decline in the range of $3.6 billion to $6.1 billion.
Tariffs imposed by the United States, along with potential retaliatory measures, could impact many of the p rovince’s key revenue streams, such as personal and corporate income taxes. Preliminary analysis indicates this could reduce annual revenues by between $1.6 billion and $2.5 billion.
Officials noted that the preliminary assessment, done by the Ministry of Finance, is one of many possibilities as there is considerable uncertainty about the exact nature, magnitude and timing of United States policies that may be implemented.
In 2019, the Bank of Canada estimated the impacts of a 25% tariff. National Bank recently reported that the Bank of Canada’s estimate of the Canadian GDP impact “would exceed that of any previous recession, barring the temporary setback at the onset of the COVID-19 pandemic.”
To prepare, the province plans to use a three-part strategy: respond, strengthen and diversify.
To respond to these tariffs, B.C. is engaged in contingency planning across government and will participate in nationally co-ordinated retaliation if and when required. B.C. aims to strengthen its domestic position by growing the economy to create high-paying jobs to generate the wealth needed to support people through strong public services, such as health care and education. This includes fast-tracking permitting in B.C. and reducing trade barriers between provinces. Lastly, B.C. will focus on diversifying its trade relationships, using the Asia-Pacific network to become less reliant on exports to the United States.
Key Takeaways:
GFL Environmental Inc. is selling its Environmental Services business to Apollo Funds and BC Partners for an enterprise value of $8 billion. GFL will retain a 44% equity interest, expecting$6.2 billion in net cash proceeds after equity retention and taxes.
GFL plans to allocate up to $3.75 billion of the proceeds to repay debt, reducing its net leverage to 3.0x.
This will cut annual cash interest expenses by approximately $200 million, enhance free cash flow, and support share repurchases, dividend increases, and growth investments.
The Whole Story:
GFL Environmental Inc. announced that it has entered into a definitive agreement with funds managed by affiliates of Apollo and BC Partners for the sale of its Environmental Services business for an enterprise value of $8 billion.
GFL will retain a $1.7 billion equity interest in the Environmental Services business and expects to realize cash proceeds from the transaction of approximately $6.2 billion net of the retained equity and taxes.
GFL intends to use up to $3.75 billion of the net proceeds from the transaction to repay debt, making available up to $2.25 billion for the repurchase of GFL shares, subject to market conditions, and the balance for transaction fees and general corporate purposes. Net Leverage, pro forma for the planned use of proceeds, is expected to be 3.0x.
“The sale of our Environmental Services business at an enterprise value of $8 billion is substantially above our initial expectations and is a testament to the quality of the business that we have built,” said Patrick Dovigi, Founder and Chief Executive Officer of GFL. “The transaction will allow us to materially delever our balance sheet which will accelerate our path to an investment grade credit rating. A deleveraged balance sheet will provide ultimate financial flexibility to deploy incremental capital into organic growth initiatives and solid waste M&A and allow for a greater return of capital to shareholders through opportunistic share repurchases and dividend increases, while maintaining a targeted Net Leverage in the low 3’s.”
Dovigi continued, “The transaction allows us to monetize the Environmental Services business in a tax efficient manner while retaining an equity interest that will allow us to participate in what we expect to be continued value creation from these high-quality assets. In addition, GFL will maintain an option, not an obligation, to repurchase the Environmental Services business within five years of closing.”
He explained that the repayment of debt is expected to reduce GFL’s annualized cash interest expense by approximately $200 million, resulting in significantly improved free cash flow conversion.
The company plans to provide more details on the financial impact of the transaction when it reports its 2024 full year results in February and hosts its Investor Day on February 27 at the New York Stock Exchange.
“After a long, robust and highly competitive process, we are excited to have selected the Apollo Funds and BC Funds to partner with on this transaction,” Dovigi concluded. “We have a long-standing relationship with BC Partners, to whom we have delivered significant returns on their capital. We also look forward to working with Apollo, a leading alternative asset manager, with deep expertise and a demonstrated track record of value creation for its stakeholders.”
Craig Horton, Partner at Apollo stated that GFL Environmental Services is a leading North American provider of increasingly essential industrial and waste management services, with a broad customer base and exposure to attractive and growing end markets. \
“We believe this transaction will provide the Environmental Services business with greater flexibility to pursue organic and inorganic growth opportunities as an independent business, while also taking advantage of the strategic, value-added resources and structuring capability of the Apollo platform,” said Horton. “This is a great example of partnership capital from the Apollo Funds, including our Hybrid Value and Infrastructure strategies, and we look forward to working with the talented management team as well as GFL and BC Partners to accelerate growth and drive value creation.”
Paolo Notarnicola, Partner and Co-Head of Services at BC Partners noted that their long and successful relationship with Patrick and the GFL team underlines BC Partners’ true partnership approach, supporting entrepreneurial leaders at high-growth businesses in defensive sectors to scale and grow.
“Under Patrick’s leadership we have seen GFL’s Environmental Services business grow from a small franchise in Ontario in 2018 to a leading operator with over $500 million in Adjusted EBITDA,” said Notarnicola. “Going forward, we are excited about the growth potential of this business, which is best placed to capitalize on the significant consolidation opportunity in the environmental services industry, including further expansion in the United States. In addition, we look forward to working with the management team of GFL Environmental Services and our partners at GFL and Apollo to accelerate the delivery of the margin-enhancing and growth opportunities we have identified together.”
Pursuant to the Transaction Agreement, GFL will retain a 44% equity interest in the Environmental Services business and the Apollo Funds and BC Funds will each hold a 28% equity interest. The Transaction is expected to close in the first quarter of 2025 and is subject to certain customary closing conditions. The Transaction is not subject to any financing conditions.
Key Takeaways:
Canada’s construction sector is anticipated to recover from a 3.1% output decline in 2024, growing at an annual average rate of 2.2% from 2025 onward.
This growth will likely be driven by government investments in transport, renewable energy, healthcare, education, and a gradual recovery in the residential market.
Declining interest rates, stabilizing inflation, and increased efforts to recruit younger workers have improved the sector’s outlook. However, uncertainties such as economic volatility, geopolitical tensions, and fluctuating market conditions continue to pose risks, particularly in financing new housing projects and addressing supply chain disruptions.
The return of Donald Trump as U.S. President and related trade policies, such as a threatened 25% tariff on Canadian imports, could severely impact Canada’s economy and the construction sector.
Additionally, geopolitical challenges, including war in Ukraine, tensions in the Middle East, and the renewal of the Canada-U.S.-Mexico trade agreement in 2026, add layers of uncertainty to the industry’s future.
The Whole Story:
Is Canada’s construction sector on track to soar in 2025 or crash and burn?
As we peer into the future, some experts believe a rebound is on the horizon. But others feel the next 12 months will be a mixed bag of growth and risk. However, all agree that our neighbours down south will play a large role.
Here are some of the key themes experts have their eyes on for the coming year:
Donald Trump and the U.S.
Don’t expect to see incoming president Donald Trump disappear from headlines anytime soon. All construction experts we spoke with cited the U.S. as a huge factor for 2025.
“Should he carry forward with the threat to levy a 25% across-the-board tariff on all goods imported from Canada (and Mexico), the Canadian economy will quickly be catapulted into a recession. Looking a little further ahead, the Canada-U.S.-Mexico trade agreement (CUSMA) is up for renegotiation/renewal in 2026. That, too, represents a risk for Canada, as with Trump in the White House there is a chance the agreement itself could be scrapped.”
Canadian Construction Association President Rodrigue Gilbert also expressed concerns about developments in U.S. politics.
“It’s hard to not focus on the American election and the impact this will have on our industry. With just a few weeks before his inauguration, President Trump has been able to create uncertainty, economic disruption and sow division amongst our governments,” he said. “Between tariffs, border management, a nationalistic economic policy, it’s safe to say the Canadian Government was not prepared and it affected our industry. We are hopeful that this will be handled in the new year and that the effect on Canada’s construction industry will be minimal.”
Interest rates
Interest rates have been a ray of sunshine during 2024 and experts believe the warmth could continue into 2025.
“Over the past 18 months, the construction sector has benefited from several positive developments,” said Bill Ferreira, Executive Director of BuildForce Canada. “One of the most significant has been the steady decline in interest rates, which has started to ease financing pressures on new projects and investments.”
Finlayson called it the main reason for optimism about the economic environment in the coming year.
“This should be helpful in setting the stage for increased investment across all segments of the construction business – homebuilding, the industrial sector, engineering infrastructure, etc.,” he said. “The outlook for new office development is less favourable, given the stickiness of the work-from-home phenomenon and significantly higher office vacancy rates in many cities.”
However, Linesight Executive Vice President Patrick Ryan noted that while decreased construction activity in some sectors has alleviated demand temporarily, a potential rise in activity due to falling interest rates could push labor costs back up. Regions with significant high-tech and mission-critical projects still struggle with a lack of skilled labor, particularly in the MEP trades.
Rebounding
Linesight anticipates the residential sector is to rebound in 2025, supported by lower interest rates and government initiatives aimed at reducing the housing deficit. These include affordable housing programs, tax incentives like the removal of the Goods and Services Tax on new rental projects, and significant investments to increase the housing stock.
From 2025 onwards, the construction industry is expected to recover and grow at an annual average rate of 2.2%. This growth will be fueled by substantial government investments in transportation infrastructure, renewable energy projects targeting carbon neutrality by 2050, and the expansion of healthcare and educational facilities. The largest infrastructure project in the pipeline is the US$17bn Alberta to Alaska rail line development project.
Some believe this recovery will be slow to pick up steam.
“It will take time for companies to get settled again, and not only feel more confident in the market – but start executing in a way that reflects that confidence,” shares Raymond Wong, Vice President of Client Delivery at Altus Group. “Canada is facing a significant challenge on the employment side, and I think that will take some time for the labour market – and the economy at large – to reflect the positive impact of the rate-cutting cycle.”
Labour unrest
In 2024, Canada experienced significant labour unrest, with major strikes affecting postal services and ports. The Canada Post strike, which began on November 15 and lasted 32 days, involved approximately 55,000 postal workers demanding better wages and working conditions. It ended on December 17 after government intervention.
Concurrently, port strikes hit Canada’s major maritime hubs, with lockouts at the Ports of Montreal and Vancouver starting in early November. These disputes involved dockworkers, the Maritime Employers’ Association, and the International Longshoremen’s Association, centering on issues of scheduling and wage increases. The strikes at Canada’s two busiest ports, along with actions at East Coast terminals, severely disrupted supply chains. On November 13, Labour Minister Steve MacKinnon ordered the Industrial Relations Board to intervene, citing daily economic impacts of $1.3 billion. These labour disputes significantly disrupted Canada’s postal and port operations.
With the rise of artificial intelligence threatening to shrink some industries and the overall challenging economic climate, it is likely that we could see more labour unrest going into 2025. And depending on which sector its in, major supply chains could be impacted.
Optimism
Despite the challenges and uncertainty ahead, many experts believe builders will rise to meet them.
“2025 is gearing up to be another interesting year,” said Gilbert. “With our neighbours to the south welcoming a new (old) President to the White House and as we prepare for the certainty of a federal election here at home, I’m optimistic because I know that no matter the challenges ahead, our industry is resilient, ready and willing to work.
He also noted that there is significant momentum within the Canadian government to finally tackle real challenges, like workforce and the reduction of red tape, which will allow the industry to build the infrastructure and projects Canadians need.
Key Takeaways:
Tla’amin Nation is set to reacquire nearly half of the former mill site at tiskwat.
The Asset Purchase Agreement (APA) between Tla’amin Nation and Domtar includes provisions for Tla’amin to assume responsibility for maintenance, taxes, and insurance upon ownership. The Nation is prioritizing archaeological and environmental stewardship, with Domtar expressing commitment to collaborative solutions and respect for Tla’amin interests.
Extensive community engagement showed overwhelming support (94%) among Tla’amin citizens for the reacquisition, with youth support even higher at 97%.
The Whole Story:
Following nearly two years of due diligence and negotiations, Tla’amin Nation is set to reacquire close to half of the former mill site at tiskwat.
The Nation stated in a release that the reacquisition will come 146 years after the lands were alienated from the Nation through the illegal sale of Lot 450 in 1878 and one year after the federal government accepted Tla’amin’s specific claim for Lot 450 for negotiation.
Last month, Tla’amin Nation and Domtar initialed an Asset Purchase Agreement (APA). The agreement is subject to approval by Tla’amin Executive Council within 60 days.
Under the terms of the APA, Domtar (formerly Paper Excellence) will return the lands to Tla’amin for the Nation’s use. Tla’amin will assume responsibility for carrying costs such as maintenance, taxes and insurance upon taking ownership.
“This agreement is a step in the right direction for us to regain our rightful place at tiskwat,” said Hegus (Chief) John Hackett. “We will continue to work with Domtar and Brookfield to protect Tla’amin archaeological and stewardship interests across the entire site.”
Sixteen parcels comprise the 120 acres of Tla’amin reacquisition lands. The reacquired lands primarily front the river and ocean and are among the least industrialized areas at tiskwat. Notably, Tla’amin assumes responsibility for most of the riverfront lands. However, the reacquisition does not include the dam, which is encumbered by a bare land trust between Domtar and Brookfield Power.
“We raise our hands in deep respect for the Tla’amin elected council and their staff for their collaboration in our ongoing work together,” says Lana Wilhelm, Director of Indigenous Relations, Domtar. “The entire Domtar team is deeply committed to working with the Tla’amin Nation to do the right thing. We continue to work on solutions for the entirety of the site.”
To build a negotiations mandate, Tla’amin Nation engaged its citizens through a series of six public engagement sessions and a survey conducted between October 2023 and May 2024.
94% of Tla’amin citizens who participated in the engagement process supported the reacquisition of tiskwat, with support among youth even higher at 97%. At the same time, 98% of Citizens were concerned about the environmental legacy at tiskwat following a century of industrial activity. These concerns and risks are addressed in the agreement being presented to the community.
The Nation stated that the reacquisition of tiskwat not only represents a historic step toward rectifying past injustices but also serves as a cornerstone of Tla’amin’s vision for economic prosperity.
Nation representatives explained that reacquisition lands will support Tla’amin Management Services LP’s (TMSLP) current business interests while creating opportunities for future development aligned with Tla’amin goals for employment, revenue generation, and sustainability.
The APA and accompanying business plan will be reviewed for recommendation by the Tla’amin Finance Committee and Tla’amin Economic Development Committee before being approved by Tla’amin Executive Council.
Pomerleau Capital Inc., the financial arm of Pomerleau Inc., has completed the second round of financing for its PCap Real Assets Fund L.P., raising the fund’s total value to over $200 million with support from CDPQ and six new financial partners. The fund, established in 2021, aims to reach $500 million and focuses on long-term investments in infrastructure, energy transition, and building projects across Canada, guided by ESG criteria.
Given the growing needs of communities, private enterprise has a vital role to play in financing the construction of sustainable infrastructure. We would like to thank the CDPQ for their renewed confidence, and the commitments of our six new partners. They are firmly rooted in the Québec business community and undertake major activities reaching right across Canada. Our PCap Fund now exceeds $200 million, strengthening our room for manoeuvre and diversifying our business opportunities.
Philippe Adam, Pomerleau CEO
Procore Technologies announced its acquisition of Edmonton-based Intelliwave Technologies during its Groundbreak 2024 conference, where it also unveiled new innovations, including its Resource Management system. This all-in-one solution integrates labour, equipment, and materials tracking with Procore’s AI Agents for enhanced visibility, forecasting, and risk management to boost productivity and profitability. The acquisition of Intelliwave adds its materials management software, SiteSense, to Procore’s platform, strengthening Resource Management’s capabilities for end-to-end control of project resources.
Procore made multiple big annoucements at its 2024 Groundbreak conference.
Bothwell Accurate Co. Inc. announced the amalgamation of itself and Glastech Glazing Contractors. The company said the move represented two industry leaders coming together to build a stronger future in construction and glazing services.
NuFrame Group has officially opened its NuFrame Panels facility in Chilliwack, B.C. Officials stated that new facility represents a major step forward for NuFrame and its commitment to quality, efficiency, and innovation in construction.
NuFrame’s new facility in Chilliwack, B.C.
Quikrete plans to acquire Summit Materials in a deal valued at $11.5 billion. The transaction combines Summit’s aggregates, cement and ready-mix concrete businesses with Quikrete’s concrete and cement-based products business to create a vertically integrated, North American construction materials solution.
EllisDon Corporation and Impulse Partners have announced a successful second round of its ConTech Accelerator program. From over 165 submissions, 30 were selected as the top contenders. Following a series of interviews, representatives from the eight finalist startups traveled to EllisDon’s Mississauga office to pitch their innovative ideas in person. The ultimate winners were SALUS, EHAB and Specter Automation.
CustomAir, has successfully completed two acquisitions: Power Plus Electric Ltd. and assets of I.C.R. Air Inc. ICR strengthens CustomAir’s presence in the British Columbia interior, where the Company already has a significant foothold. Power Plus’ electrical expertise expands CustomAir’s core HVAC capabilities, positioning the company to address the increasing demand for decarbonization and electrification.
The growing demand for decarbonization and the shift away from fossil fuels for environmental comfort and process efficiency has accelerated the push towards electrification. CustomAir is at the forefront in developing electrically driven solutions as the main option for interconnected systems, making electrical expertise essential to delivering comprehensive services. With Power Plus’ expertise, we are well positioned to meet the evolving needs of our customers.
Peter Harteveld, CustomAir’s founder and CEO
Stack Modular has unveiled its rebranding. The company says its rebranding reflects its commitment to growth and cutting-edge technology. The rebrand features a new logo and updated visuals.
Our new brand is a testament to our unwavering commitment to innovation and excellence in modular construction. It reflects our journey, growth, and vision for the future. We’re excited to keep turning heads and transforming how the world builds.
Jim Dunn, CEO, Stack Modular
Aecon Utilities Group Inc. has announced it has acquired Ainsworth Power Construction (APC), which is an electrical services and power systems business unit of Ainsworth, headquartered in Toronto, from GDI Integrated Facility Services. APC’s management and operational teams are joining Aecon Utilities through the transaction. APC has over 80 employees and 80 years experience as a technical services contractor for electrical utility clients, primarily in Ontario.
CAI Capital Partners announced that its portfolio company, the Universal Group, and its related companies has successfully closed the acquisition of Barricades and Signs Ltd. Barricades, headquartered near Edmonton, Alberta, was founded in 2004 by Robert and Fran van Bruggen and has grown into a leading traffic control company with operations across Alberta, British Columbia, Manitoba, and Saskatchewan.
These awards are a spotlight on the tremendous contributions that construction and maintenance contractors make to life in British Columbia. By supporting our world-class highway system, they keep travellers safe, our communities connected and our economy strong. The stories behind this year’s winners point to the entire sector’s commitment to public service, effective partnerships and excellence in road construction and maintenance.
Mike Farnworth, Minister of Transportation and Transit
CIMA+ has acquired Vancouver-based Recollective Consulting, which specializes in sustainable site management strategies, green building guidelines, Leadership in Energy and Environmental Design (LEED) and zero-carbon building design. The acquisition expands CIMA+’s expertise in sustainable development and presence in British Columbia. Recollective has worked on more than 750 green buildings and completed more than 100 LEED certifications, more than 20 energy models and more than 75 embodied carbon analyses.
Falcon Equipment has partnered with RELAM Inc. as a new strategic equity partner. Officials noted that Falcon’s focus does not change. Its name, people, products and how it does things remains the same. They added that with RELAM as our long-term strategic partner, it is poised to supercharge growth and broaden market presence.”
ConstructionClock announced the successful completion of a $1 million pre-seed raise. ConstructionClock is an app that automatically clocks workers in and out of job sites based on their geo-location without ever taking out a phone or opening the app.
Key Takeaways:
The MOU includes plans for three significant hydroelectric initiatives: the 2,250 MW Gull Island facility, a new 1,100 MW expansion near Churchill Falls, and a 550 MW capacity increase at the existing facility.
The agreement ensures $1 billion annually for Newfoundland and Labrador starting in 2025 through dividends, water rentals, and energy sales.
Construction plans emphasize respect for existing agreements with Indigenous communities and require meaningful consultation throughout the project lifecycle.
The Whole Story:
Newfoundland and Labrador and Quebec have signed a significant Memorandum of Understanding (MOU) to expand hydroelectric generation in Labrador, setting the stage for economic and energy benefits across both provinces. The agreement includes new contracts for the Churchill Falls facility and plans for additional projects that will deliver renewable energy for generations.
“Today represents a significant milestone for every Newfoundlander and Labradorian,” said Dr. Andrew Furey, Premier of Newfoundland and Labrador. “Over the life of the agreement, we will generate dividends to the province of more than $200 billion by 2075, have access to nearly four times the electricity we do today to support industrial growth in Labrador, and realize the development of Gull Island without the financial and construction risks.”
Quebec Premier François Legault praised the MOU as a “win-win” agreement.
“This agreement will generate savings of over $200 billion over 50 years,” he said. “It allows us to secure a major energy block for several generations while ensuring a price far lower than the alternatives. It will help us keep electricity rates as low as possible for Quebecers.”
Agreement Highlights
The MOU outlines two primary components:
New Contracts for Existing Churchill Falls Generation: Hydro-Québec will replace the current contract with payments to Churchill Falls (Labrador) Corporation (CF(L)Co) totaling $33.8 billion in net present value from 2025 to 2075. Energy prices will rise over time, linked to market indices.
New Generation Projects in Labrador: The agreement includes three major initiatives:
Gull Island Facility: A 2,250 MW hydroelectric project on the Churchill River.
Churchill Falls Expansion: A new 1,100 MW facility near the existing site.
Capacity Increase at Churchill Falls: Adding 550 MW to the current facility.
Hydro-Québec will also pay Newfoundland and Labrador Hydro $3.5 billion as an option payment for co-developing these projects. Combined revenues, including dividends and water rentals, are expected to bring $1 billion annually to Newfoundland and Labrador starting in 2025.
Renewable Energy for the Future
“This memorandum secures access for Quebec to a large quantity of renewable energy for 50 years at the lowest price possible,” said Michael Sabia, CEO of Hydro-Québec.
Energy costs from existing Churchill Falls generation will average 6 cents/kWh, with new developments priced at approximately 11 cents/kWh. The collaboration aims to support decarbonization while driving economic growth in both provinces.
Quebec Premier Francois Legault meets with N.L. Premier Andrew Furey.
Indigenous Engagement
The agreement emphasizes respect for existing agreements with Indigenous communities and commits to meaningful consultation throughout project development. Both provinces aim to ensure transparency and collaboration at every stage.
Path Forward
The MOU sets the foundation for detailed planning and project analyses, with construction expected to begin following permitting approvals. The existing Churchill Falls contract remains in force until definitive agreements are finalized.
“This agreement allows us to secure a major energy block for several generations,” said Premier Legault, underscoring the historic nature of the partnership.
Key Takeaways:
The average tax burden on a newly constructed home in Ontario has risen to 36% of the purchase price, up from 31% just three years ago, driven largely by increased development charges. For an average new home costing $1,070,000, this translates to a tax burden of nearly $381,000, a 16% increase since 2021.
The escalating tax burden significantly affects housing affordability, disproportionately impacting first-time buyers and lower-income households. For homes priced at $450,000—aligned with median household incomes—the tax burden rises sharply to 45.2%. RESCON says these high costs deter developers from investing in new projects, exacerbating Ontario’s housing crisis.
RESCON says the data underscores the need for federal and provincial governments to provide more funding for municipal infrastructure to reduce reliance on development charges.
The Whole Story:
The average tax burden on a newly constructed home in Ontario has jumped to almost 36% of the purchase price, up from 31% just three years ago, a report commissioned by the Residential Construction Council of Ontario (RESCON) has revealed.
On the average price of a new home in Ontario, which is about $1,070,000, that means consumers are now paying nearly $381,000 in income taxes, corporate, sales and transfer taxes, and development charges and fees. The new number is a 16% increase over 2021 and highlights a troubling trend.
“These taxes are out of control and pushing the cost of new housing beyond the reach of most working families,” says RESCON president Richard Lyall. “The tax burden is significantly raising the price tag of a new home and directly contributing to the housing crisis we are facing by affecting the ability of developers to invest in new housing projects. This escalation presents substantial challenges to housing affordability and economic stability.
“The situation simply can not be allowed to continue. The huge increases have occurred over the last decade in large part because municipalities have hiked their development charges to pay for municipal infrastructure. The findings of this research indicate a critical need for the federal and provincial governments to get more involved in funding public infrastructure at local levels to support growth and ease the tax burden on housing in Ontario.”
The report, called Increasing Tax Burden on New Ontario Homes: 2024, was done by the Canadian Centre for Economic Analysis. Research revealed that the tax and fee burden on new homes continues to be more than twice that of the rest of the economy and governments now derive nearly four times more revenue from the sale of a new home than builders, further exacerbating the challenges faced by the residential construction sector.
According to the research, the tax and fee burden is significantly higher because of recent surges in development charges and the escalation presents considerable challenges for market stability. Of the total tax and fee burden on new housing, 70% consists of direct fees on the home, such as development charges and other fees, while the remaining 30% arises from indirect taxes paid during the development process, including income and corporate taxes paid during the ordinary course of a residential construction business.
Across the province, the tax burden varies by dwelling type and municipality. Rates in some jurisdictions are higher than the provincial average. In the GTA, excluding Toronto, the average tax and fee burden on a new home is 35.9%, a large apartment is 37%, and a small apartment is 36.9%. In Toronto, the average tax and fee burden on a new home is 35.1%, a large apartment is 34.2%, and a small apartment is 35.3%.
The system disproportionately affects first-time buyers and lower-income households. For homes priced at $450,000, an amount which aligns with what many households could afford based on median pre-tax household incomes, the average tax burden rises sharply to 45.2%.
The report calls for immediate reform of the taxation and fee structures affecting new housing and notes there is a critical need for the federal and provincial governments to take a more active role in funding municipal infrastructure.
“Much of our economic success depends on a robust housing supply so it is critical that we address the tax burden,” says Lyall. “Municipalities lack the revenue streams to fund the infrastructure necessary for new housing and end up loading the cost onto new homeowners via development charges. This must change if we are to incentivize more homebuilding.”
