Goodbye Lumber

Diane Francis column Wednesday April 27

Vince Mifsud is only 38 years old, but is busy working on his third successful start-up, Genesis Building Innovations.

"I've been able to take two software companies public, Rand Technology which went from C$30 million in sales to C$300 million in five years and Pivotal Technologies," he said. "Both had sales outside Canada equivalent to 90% of the total."

Genesis is revolutionary software and manufacturing company which has developed light-weight galvanized steel framing for buildings that are hurricane-proof, wind-proof and termite-proof.

The steel is not only durable than wood, but, more importantly, can be shipped to a site and assembled like a lego set whether it's a house, hotel, hospital or apartment building.

Software and technology innovations have allowed Genesis to produce materials which match the cost of lumber.
"The cost is the same as wood if you include labor, even at today's high steel prices," he said in a recent interview.

The company designs buildings then makes the components for shipment around the world. The plan is to manufacture but also to license its technology and provide turnkey, automated factories to large contractors or developers.

For instance, Genesis was approached by drywall giant United States Gypsum Corporation in the U.S. and demonstrated its technology in February in housing-starved New Orleans. An event, attended by President George Bush, included the erection by Genesis of a 2,100 square foot, hurricane-proof home in just eight hours.

The federal and state governments are looking at this technology as part of the reconstruction of the region in the wake of Hurricane Katrina. Genesis structures have been tested and can withstand 160 mile per hour wind conditions.
Gypsum hopes to build a factory in Louisiana and build 5,000 houses per year.

"We are also negotiating with a firm in Northern California," he said. "We can engineer our buildings to withstand any kind of weather and build them on fault lines."

The steel meets all building codes worldwide, is environmentally friendly because it is 80% recycled steel and also provides health and conservation benefits.

"The Asthma Society of Canada has deemed steel allergy free and because steel frames don't move there is no insulation leakage which save energy," he said.

Genesis has several factories and produced then shipped one million square feet of buildings last year.

Genesis technology is finding great acceptance in places where termites are a chronic issue in wood houses or in areas with strict building codes due to weather risks.

Another benefit that Genesis boasts is that its easy-to-assemble structural kits work around the increasing shortage, and expense, of skilled framers and other construction workers.

"There are 10 people needed to assemble our houses and 40 people on a wood site," he said. "Windows fit perfectly, there is no warping or settling issues and insurance costs 50% less."

Sales abroad are slowly growing, but word has spread among developers about the benefits of using Genesis steel kits.
"We have just shipped 12 houses to Spain and are doing two huge projects in South Carolina," he said.

In Toronto, Genesis is building 600 stacked townhouses downtown, several hotels, McDonald's and East Side Mario's Restaurants and a golf course club house.

"We can engineer a building six or seven storeys high," he said.

The company has fine-tuned its technology and after a venture capital round raising C$16 million last year is expanding manufacturing as well as marketing its technology to potential licencees or customers around the world.

A number of home builders have adopted Genesis structures such as Remington, Baywood Homes, Aspen Ridge, Grey Rock, IBI Group, Urbancorp, Daniels Corporation and Chamberlin Contractors to name a few.

"We feel really good about our company and its ability to replace wood and concrete construction in many parts of the world," he said.

Vince grew up in the steel industry because his father worked until retirement for Samuel Manutech, a highly successful Ontario company.

Eventually, he and his investors would hope to take the company public but that's down the road.

One of the interesting developments, however, that may spirit the company on its growth path is the fact that J.D. Power is going to rank house builders as it does auto manufacturers.

This will help consumers who often buy shoddy homes, but it promises to help catapult steel-framed housing to the top of lists around North America.

"When it comes to quality we cannot be beaten by wood," he said.