38 Modular Townhomes, Craned in Like Lego: How Cresco Is Building Through Nova Scotia's Trades Shortage

0:03Welcome back to the Atlantic Construction Podcast. I'm your host Daniel Arsenault. On this episode we have Amanée Mousavi and Farhang Fotovat from Cresco. Amanée is also the president of Family Business Atlantic. Lots of great discussions ahead — hope you enjoy. All right, welcome back to the Atlantic Construction Podcast. Today I have with me Amanée Mousavi, sales and marketing with Cresco and president of Family Business Atlantic, and also Farhang Fotovat, commercial construction development manager with Cresco. Thanks for being here, guys — great to have you.

0:41Thank you for inviting us. Thank you for having us. Yeah, so Amanée, do you want to just jump in and sort of give us a little background — first about Family Business Atlantic? We'll try to tie that in with the family business of Cresco and sort of complement each other with that, but maybe dive into Family Business Atlantic and sort of what it is, and you know, this opportunity to reach contractors through the construction podcast. Absolutely.

1:09Well, as we all know, Atlantic Canada is really rich in family business, and you know, we like to say a family business is anyone who supports their families, employs families, or receives emotional or financial support from their families. And right now, Family Business Atlantic — we are a membership-driven organization. Our main goal is to support the economic prosperity in Atlantic Canada, and we do that through a number of ways. We offer to our members complementary programming, so you know, that's anything — well, right now,

1:48with COVID it's all online webinars, but I think there's hope that we will have some face-to-face programming in 2021. Fingers crossed, for sure. But there's a lot of value to our members, and we offer educational courses for our members — anything from leadership training courses to HR management. And in addition to the programming, I'd like to say one of our main value-adds is our offering of a peer group. Right now Family Business Atlantic we have

2:24seven peer groups, and basically a peer group is like a mini board of directors. It's a confidential space where you and other like-minded individuals who are also involved in family business meet once a month. You have like a three-hour meeting, and it's just such a nice, safe, and confidential platform where you just share all of your family business challenges, you learn from one another, you share your stories and your experiences. And you know, say there's something on your mind — like your son is working in the business,

2:57and your father is the owner, and you know, you're like, "Dad, why are you making it so hard for me?" — and you want to share your challenges. This is a really nice place to go where everybody just talks about family business dynamics. And we know family business is very unique in its challenges. Yeah, I think — and you know, just coming from a family business background personally myself, and of course I've been a member

3:24of Family Business Atlantic — I can speak to just the value of the peer groups. Because like you said, it is a really unique dynamic, and if you're not in one — and I think you know, to define a family business would be, you know, whether or not it's family ownership. Like you said with Family Business Atlantic, it's structured like — it could be family that works in it, it could be emotional support, financial support. There are many different dynamics to it. But just to have that peer group to

3:53talk to people on a monthly basis who have similar experiences, where family dynamics kind of infiltrate your work life — and so then exponentially it can become a certain unique stress. So the peer groups, just from personal experience myself, were very helpful. And that's one of the reasons why I thought, you know, I appreciate you being here, Amanée, and just thinking that more people need to know about Family Business Atlantic — and especially in the construction community.

4:29Because I think, you know, there are so many subcontractors and so many tradespeople, and it seems to be — I know Family Business Atlantic focuses on every industry, right? You guys are not specific to any industry. All your members are from various backgrounds, right? But I think in the trades, there could be way more people benefiting from what you guys offer. Oh yeah, absolutely. I mean, us being involved in a family business, we see who our

5:01sub-trades are, who our partners are, our contractors — and honestly the majority of them are family businesses. And you know, at Family Business Atlantic we like to say: you are a family business if you feel you are a family business. You could be like a young guy, an entrepreneur starting up a siding company, but you are — and you will become — a true family business. You are receiving emotional and financial support from your family. So we don't like to define family business at all, right.

5:28And right now, actually, speaking of — we're really catering to that sector. And I'll let you know that we are working on an entrepreneurial initiative right now which, if it launches, is really going to broaden our scope of membership and be inclusive of small to medium enterprises, families involved in business, entrepreneurs. And I'll also let you guys know a little bit about who our members are who are involved in construction — and maybe some of them are listening right now.

6:04We have Kim Conrad with Conrad Brothers, we have The Hardman Group — I love the Jessem family involved in property, a generational business — the Blunden family, Blunden Construction, Barrett Lumber. We also have Maple Leaf Homes out of New Brunswick, and lots of other trades like windows and home improvements — Leahy's Glass, and Scotia Metals. Of course Cresco — we've been involved since 2010. Nice. Yeah, and so a lot of these members are from Nova Scotia, and you also have some members in New Brunswick and you kind of have an initiative now to

6:46sort of reach some people in PEI, which is kind of a new area that you're trying to get Family Business Atlantic some exposure. Yes, I'm so excited. Our board has taken the initiative to move into PEI, and really this is just going to open up so much opportunity for those families in PEI. I don't really recall the stats — Michael LeBlanc, who's a CFO of Leahy's Glass, he's really spearheading this initiative right now. And I just remember looking at the list,

7:15I was like, oh my god, PEI is just full of family businesses. And if we're able to bring our resources there and collaborate with them, it's just going to be so great for all of us. And our goal right now — we will launch officially in May — and our goal is to get a peer group right off the ground in PEI. That's amazing, that's so exciting. Maybe touch a little bit about the stuff that you offer, like for management

7:46within family businesses, whether it's accounting or HR. Yeah, I know that I've attended a few of those educational offerings that you guys offer, and it's very valuable. Yeah, I believe you were part of the course. Which course? I was trying to remember — leadership and HR? That's right. Yeah, so we are very fortunate to have partnered up with the Department of Labour and Advanced Education, and they really enabled us to offer these educational courses to our members. Right now we have digital marketing,

8:21which is a full class, and pretty soon we're going to be offering some others as well. But leadership has been a course, HR best practices has been a course, and our goal is to really communicate with our members to see what their business needs are. So we're constantly sending out surveys. It's constantly changing too, with the times, right? Exactly. And speaking of that, you know, we have done close to 40 webinars to date, because this time last year we were shut down. So we had to cancel our

8:54programming, and these webinars — I can't tell you how valuable they have been to our members. I feel more connected with people involved in family business now than prior to COVID. Yeah, because we're online once every two weeks, and we're connecting, we're talking about like-minded problems that we're all having — we're all trying to navigate and learn how to be successful through COVID. And what's been really great is also a third of our membership at Family Business Atlantic are advisors. So these are like trusted advisors who

9:28are there to help our members with any issue they have — whether it's legal, succession planning, estate planning, as I mentioned HR, insurance issues, wills — yeah, all that. So they come to our programming sessions, our webinars, and they're subject matter experts. So whatever that topic may be for that week, they're on there talking to the members, providing really great value. And it just ends up being like a nice coffee chat — we're all in the morning drinking our coffee and able to hear what each other are doing and learning from

9:58one another. And I really feel those in the construction industry can benefit from an association like this. You know, we're all one voice at the end of the day. Absolutely. The support is incredible. I know I've even attended a few of the Family Business Atlantic webinars throughout COVID, and I think one was on the CEWS funding and the rent subsidy — you know, just the different things that are out there during COVID for businesses to be aware of. And

10:29I know of a few family businesses — I won't mention them — but because of those, they knew about things they would otherwise not have known about, and they were the perfect candidate for these fundings. So I mean, the support is incredible, and it's so catered to the needs of each member of Family Business Atlantic. So it's not like it's just, "Let's put on this, let's offer this" — it's more like, "What do they need?" Like, everything is so well thought out.

10:57Yeah, and that's — you know, it's funny, during COVID we actually increased our membership. I think we're upward of 110 to 115 members right now, and during COVID we were able to establish our seventh peer group. So that came from people really needing a place to feel supported. Yeah. And each peer group would probably have anywhere between like eight to twelve members, something like that? Exactly. Yeah, yeah. So I really hope that people who are tuning in,

11:27whether they're in the construction industry or not, just to go check out Family Business Atlantic because it's really incredible, the stuff that you guys are doing, and so important. Yeah, the support is so important. It's also really affordable — it's only five hundred dollars for a membership fee, and that membership is not only for you, it's for your entire company. So maybe your CEO wants to join one of the courses, maybe your daughter's thinking of the business, she wants to

11:54maybe get into the accounting side — everybody has access to the programming, the events, and the network. Even the succession things that you guys assist with — it's so important for families to have support with that. There are so many things happening and so many things transitioning, and it's incredible. I think it's just something that more people need to tune into, for sure. Yeah. Farhang — maybe just give us a little bit of

12:30background about Cresco, the company, and sort of the story there and your role with Cresco. Yeah, sure. So Cresco started — it was started by my uncle Hossein Mousavi in 1989. He had some background — I think around the time after the Iranian revolution, 1979–1980, he came to Canada. He studied — he got a bachelor of science at St. Francis Xavier University — and then he got into construction. He got into construction and driving taxi, and then in 1989 he started Cresco with

13:16his other partners. And then in 1994 my father-in-law Taleb Abedali joined, and they started working together. From then it just grew. Both of them, they are just visionary people — they grew the company from home construction into land development. In 2006 they bought thirteen hundred acres of land. It's what's known as the Parks of West Bedford right now — it's the most successful development east of Montreal. And

14:01from then they got to building apartment buildings, commercial buildings. Now we are in any type of real estate business. Is there two, three main communities that you guys have? Yes — Parks of West Bedford being one. Cresco — basically our main office is in, and mostly they started from Clayton Park, right? They built in Clayton Park. But our recent developments — we worked on the Parks of West Bedford, the

14:39Ravines of Bedford South and Russell Lake West. Okay. Tell us a little bit about your journey — moving here in 2005 and attending NSCC with whatever the construction courses were called at that time. Your journey. Yeah. I came to Canada on a student visa. I just wanted to leave Iran and get a student visa. I came here to Canada — my uncle was here, I didn't know anything about Canada, right. Like,

15:11basically I just wanted to leave the country. I came to Canada in 2005 with a student visa and tried to find out what I wanted to do. I started studying business at Saint Mary's, and then I said, no, that's not for me. I went to community college and took the construction administration technology program — it's one of the best programs that I recommend to anyone who wants to get into construction. That's NSCC. Yes. The first year I was at Leeds Street, and the second

15:47year — it's a two-year program — we moved to the waterfront campus. That was the first year that they had the waterfront campus open. And yeah, that was a two-year program. When I finished that, I changed my study permit to a work permit and started working. Working different parts of construction — from just working as a junior site supervisor to doing cost consulting and estimating. And then I moved up. I worked for a while doing some hard labour with a concrete formwork company — I ran a crew of

16:29formwork labourers. And then I moved to Cresco — in 2013 I joined Cresco and joined the family business. Which I'm very happy about right now — I'm really enjoying just being part of the family. It's giving a lot to my life. Yeah, that's an amazing story — just everything from working on the sites and running a formwork crew to NSCC. It's such an amazing background of experience. Maybe during the pandemic, for you and your position at Cresco,

17:09I'm sure there were many challenges. Maybe touch on a few of the toughest ones. Yeah, I'm sure others have talked about this, but you know, like, when they started — we were just like, oh, they're starting to shut down basically every business. And we said, what is going to happen with construction? Actually, I think the construction industry in general was very successful negotiating with the government, with the provincial government — basically having plans and agreeing to

17:48getting an agreement with the government not to shut down construction. But we came up with different plans. Like, at one point I had on my job site like three different shifts, basically to separate people from each other. The idea was that we would only have one crew — and on our homes, I was doing a project of multi-unit — the idea was just to have one crew in each unit at a time. I had like three shifts:

18:16I had people coming from seven to three o'clock, three to nine, and I even had some of the trades — yeah — they agreed. They said, you know, "We don't want to be around people, we don't know what's happening. I just want to work. How about if I come and work overnight?" And that worked. We just tried — of course it wasn't at the same speed as what we were doing before; production wasn't there. Some of the

18:44trades started having their workers staying, but we managed it. Definitely it was challenging, but you know, the good thing with us is that in Nova Scotia we learn and we adapt, right? The changes. Yeah, yeah. So you guys have, like, a portfolio of all the subcontracts that you use for your home builds. And with your company you have site supers and project managers — sort of just run through how things work. Yes, you know, as the company grows we

19:20keep adding more people. It started with one person — Hossein himself running. He always talked about the time that he was building 200 homes basically by himself. But our success at Cresco — it's our trades, our loyal trades that we have, our subcontractors that we're working with. We've made great relationships with them, and we always, when we look at them, we look at them as partners. Yeah, we have very good trades working with us, and we try to build that

19:56long-term relationship with loyalty. We are good to them and they are good to us, and we try to keep working with them as long as there is no reason not to — they're our partners. Right now in our home construction — I'm not doing that much home construction — but in our home construction we have about six employees, and any time around our job sites we have about like

20:34200 to 250 trades sometimes working on our different projects. Yes. And so your position is construction, so that would be apartment buildings and anything outside of home builds? Yeah. In 2013 when I joined Cresco, at the time we had our biggest partnership with Clayton Developments — that was our land development. We also owned some lands; Cresco owned some lands that they started working on as development manager and looking after developing those lands. Some of them

21:09were at different stages — we had some with approvals already in place, others I had to go get approval for. And with that, we developed those lands — basically preparing them: anything from cutting trees, getting approvals, doing the sidewalk, building roads, putting pipes in the ground, curbs and sidewalks — anything before construction — then making the lots ready for homes to be built on them, or apartments or commercial. That's what I did. And then about two years ago,

21:45we decided to also expand and move into multi-unit construction. The first project I'm doing right now is a project we are doing in partnership with The Shaw Group, which is a very interesting project. This is probably the first project at this scale in Nova Scotia — 38 units of townhomes. These are all modular homes. The units are built in manufacturing at Prestige Homes in Sussex, New Brunswick. They ship by trailer to here, and on site — even from the time that we got the

22:26site — we had to put the foundations in, build pony walls. And the units come — the main floor and second floor — almost, I'd say, a hundred percent: kitchens are installed, toilets are installed, flooring is already done, drywall painted, everything. Then we get the crane to put these units together. It's basically five blocks of — two of them actually four — 38 units. They go together like Lego. With just like eight hours — the crane starts at eight

23:04o'clock in the morning and by five o'clock we have five blocks done. Now, because of the type — because these are townhomes — they couldn't finish the exterior in the factory. But we have to finish the exterior and connect the pipes. But it's a very interesting project. I see more of that will happen as we have a shortage of trades — it's happening currently right now. Yes, it's happening right now. I'm working on the last four of these,

23:36and we have plans to start another 20 of them. These ones we're working on are called Brownstone Way Townhomes. They're all rental. These are two floors on top of each other, 16 feet wide — 16 feet is the max that they can carry on the trucks. And they can be anywhere from like 30 to 70 feet deep, because of the size of the truck. But the units that we have right now are about 30 to 40 feet

24:07deep. It was very well accepted — it was amazing how quickly they were accepted by the market. And now in land development there's something that everyone talks about: it's called "missing middle." The missing middle is that part between apartment building and home construction. You know, if somebody wants to rent, they don't want to be in a large house, but they also don't want to be on the second, third, or tenth floor of an

24:39apartment building. This is another option that we're bringing to the market. What's the square footage of these modular units? These are less than 2,000 square feet — very affordable, very very affordable compared to apartment buildings. The rent is more affordable than apartment buildings. Yes. How many can they truck over at one time? One. Where do they come from — they come from New Brunswick? Yes. And I don't think there's a limit on the manufacturer — they're talking about anything they can

25:09produce up to — I think they can produce up to 16 units per week. I'm not sure exactly about that number. But there's no limit as long as you have trucks to bring them, right? I mean, you just have a crane put them together. Yeah. We started this, and it's interesting — as we were going through it we were making changes to the units to make them more efficient. The way that we are doing

25:46it — in the first phase of this, when I started, all the electrical and plumbing were coming to the basement and we had to connect them all together. With the second phase, we started moving the basics: hot water tanks, and putting electrical panels in each unit and each floor, and only having one line coming down to the basement connected to the main panel for electrical. We move the hot water tank to the second floor instead of just having it below, to

26:22reduce a large amount of plumbing pipe that we needed to do. And we also moved the HRVs to the second floor and just bring one supply and one exhaust for the bathroom to the basement. The next phase we are going to — it's a bungalow — bungalows on a crawl space. And this is where I'm very excited about the next phase, which is phase three: these are 20 bungalow townhomes

27:00that just come already ready, and all we need to do is put them on the crawl space. Not much connection of electrical or plumbing in these ones — they're going to be even more efficient. So for this model, what would you say it saves you on the schedule? You know, it's a lot — it's a lot of time. A third of the time. But what this has added for us

27:31is that we're not using our own trades to build these units. These are already built in manufacturing — except for the cladding and the building envelope. We're using only a minimal amount of our trades. These are already built in manufacturing in New Brunswick and we bring them to Nova Scotia. One big topic right now in construction is the shortage of trades — we don't have enough skilled trades to do what we want to do. As population is growing, that means we have more, you know, we all hear about

28:08this — the population of Nova Scotia is growing, especially Halifax. And now what they need: they need homes. How are we going to build them if we have a shortage of trades? If they're doubling the amount of increase in population, that means we need to double the speed of construction. And the units that we are building now — this is something that there's an opportunity to move forward with this type of project. Absolutely, yeah. And the other thing is, you know, we know

28:40they don't lose any time in winter, and everything is built — it sounds like it's close to the space. Yeah, that's amazing. It's so exciting, really interesting. Maybe let's chat about Family Business Atlantic and its role with Cresco, and your current succession planning, and sort of how that looks. Yeah, for sure. So as Farhang alluded to, Cresco is made up of two families — the Mousavi family, which my father started, and then the

29:15Abedali family — Taleb Abedali. And Taleb Abedali's daughter married my cousin Farhang, so now we're actually a really true family business. And obviously the owners are hoping that more and more family gets involved. We've really needed Family Business Atlantic's support to get to where we want to go for the future. So as I mentioned, we joined in 2010, and through the connections that I've made at Family Business Atlantic we were able to hire a family business advisor.

29:57And her name is Dr. Margaret Humphries — she's the owner of Watermark Partners. Through her help, we have now established a family council and a shareholders council. So the joint family council — it's basically the two families, whether you're a shareholder or not, you're still part of this family. We meet on maybe a bi-yearly basis I would say, and we talk about anything from updates on Cresco's future ventures, joint ventures, partnerships — anything that's on the

30:42horizon for Cresco. It's really important to keep the family informed, and that's the main purpose of the joint family council. But the shareholders council — that's where all the ownership decisions are going to be made. And I know that we're in the midst of our succession planning right now. The owners of the company are definitely not going anywhere; what we're really concentrating on right now is grooming the family members who want to be involved in the family business,

31:18so like myself — I've worked in sales and marketing for the past 12 years. I do hold my real estate licence with Royal LePage Atlantic. Specializing in new construction has really allowed me to service my family business. I'm super involved with new home construction right now, and not only doing the sales and marketing, but being part of a family business it's nice to also learn about how the homes are being constructed, be involved

31:50in the construction, the design, the exterior and interior finishes. So I'm definitely learning a lot. Through our family business advisor, I'm sure many of the other children who are thinking of one day being in the family business are really benefiting from everything we're doing right now. So what's really interesting is we believe that in order for Cresco to move to the next generation successfully, there has to be governance in place. And that's what we're very

32:28busy with right now. Everything we learned from successful family businesses is: you should really have policies in place so that when it does go to the next generation, we're all on the same page and following the goals, the values, and the principles that the owners have. So for example, at Cresco we have come up with a shareholders expectations document. We're working on family compensation and trying to understand what the philosophy of family compensation is. We're going to be working on

33:01conflict resolution — we all know that no matter how much you love one another, conflicts do arise. So we're doing everything we can to just be sure that when any challenge comes our way, we've already established where we want to go as a family, and to keep those values really close to our hearts in every future decision we make. And with the market growing right now, we're looking to be a big part of that market growth, so we're working hard right now.

33:38Wow, that's such a unique scenario that you've laid out — your involvement in it, Cresco being your family, Hossein being your father, you being the president of Family Business Atlantic, and sort of how Family Business Atlantic is assisting Cresco with this unique transition. As you talk about it, there are so many elements. It just makes me think — it's so hard for people who are immersed in their businesses with so many different hats that they're wearing, so

34:06many daily tasks, to take on — and it takes years regardless. But to have that third party of Family Business Atlantic providing that support, because really it's impossible to do it on your own. You're so busy, and to do it right — I mean, to do it right with all the different structures in place — yeah, that's just a really unique scenario as you explained it. Yeah, for sure. I mean, you know, there are stories of what

34:35could have been really successful family transitions to the next generation — why they didn't make it, and what their failures were — is something that we're definitely learning from. And we're really lucky at Cresco. We're super fortunate to have really strong management running the company, so that right now as family owners we can concentrate on not really working in the day-to-day business but working on the business. And I like how you put that. Thanks. And that's basically what we're doing right now — working on the future succession.

35:12That's amazing. Yeah, I think it's interesting too that Hossein, your father — was he on a path to become a doctor? Was his bachelor of science kind of pointing that way? Yeah, sort of — the creative juices were flowing. Obviously he's done quite well for himself, but he just couldn't deny that other part of himself. And at the time I'm sure people might have been a little bit critical, maybe, of just taking such a shift into development and whatnot — which I'm sure

35:38he has put those concerns to rest by now. Yeah, it's funny — he came to Canada to be a doctor, going to St. FX, studying science and all. But I'm sure, like all of us early on, we realize that if you're not following your passion, you know, you're going to be best at what you do when you follow your passion. So quickly he shifted to saving up enough money to purchase a few lots, build a few homes. A few homes turned into

36:0550 homes, into 100 homes. At one point — I think it was in Timberlea/Beechville — they were doing close to 200 homes a year. And geez, where the market's going right now, it's just insane. So it's definitely a good time to be in the construction industry. Wow, yeah, it's so exciting. Well, thanks so much guys for being here — really appreciate your time. It's been great to chat with you about all these important topics. Just in closing, I'm just wondering if you want to let our listeners and

36:34our followers know where they can find Cresco and where they can find Family Business Atlantic online. Yeah, sure. So Family Business Atlantic — we have a user-friendly website and I definitely encourage everybody to check it out. It's familybusinessatlantic.ca. Once you're on there you'll be able to see the list of who our members are, the list of who our trusted advisors are. And right now, I know as we're still living with COVID around us, we're all facing different challenges — but those challenges are also very

37:11similar to one another. So I can't stress enough how the trusted advisors at Family Business Atlantic have been there for their members from the beginning of COVID up until now — just there for any support we may need. You know, some businesses are not doing so good financially, and others are having a challenging time managing growth. So whatever it may be, these trusted advisors are there to basically hold their hand — because at the end of the day, we're all about supporting growth within Atlantic Canada.

37:49So definitely check out our advisors. And then you'll also see a list of — just feel free to hop on to one of our webinars. I'm sure it's a topic that you will be interested in. And again, you can find us at familybusinessatlantic.ca. I'd be happy to speak with anybody — if you're working in the construction industry, you're a family business, or you're a young entrepreneur thinking of really expanding your business connections, this is a great place to do so. So you can always

38:19reach out to me and I'd be happy to sit down and have a chat with you. All right. And thanks again for having us — this has really been a great opportunity to learn more about the Atlantic Construction Podcast. I think what you're doing is fabulous — having one voice for everyone in the construction industry, a place where we can just hop on and hear each other's views and really feel connected. I think as we live in these challenging times, the more we feel connected with

38:44one another, the more successful we'll be. So kudos to you for having this. Yeah, thank you so much. Thanks, guys. Thank you, we appreciate it. Thank you. Thanks for tuning in to this episode of the Atlantic Construction Podcast. Be sure to follow us on any podcast platform you use. You can also find us on LinkedIn and Instagram — Atlantic Construction Podcast. Be sure to send us a comment or a review; we'd love to engage with you.