With little in the way of fanfare, Element 5 has become a significant regional success story less than four years after constructing its $50 million plant on 40 acres of land on Dennis Road in the city’s north end.
Even more impressive is the fact the company itself has been in existence for less than a decade.
It was founded in 2015 when it purchased a small cross-laminated timber (CLT)manufacturing company in Ripon, Quebec and began production.
Its St. Thomas facility, completed in 2020, is the most highly automated, state-of-the-art mass timber plant in North America.
It can annually produce 45,000 cubic metres of CLT and 5,000 cubic metres of glulam (glued-laminated timber).
A second shift was added in 2021 and last year, expansion of the existing plant began.
An impressive jump out of the gate for Element 5.
However, with an announcement midway through last month, all of that is about to shift into overdrive.
The Hasslacher Group, based in Austria, announced it is acquiring a stake in Element 5.
Hasslacher is one of Europe’s largest and most prominent timber companies and is a global innovator.
The family-run enterprise has a workforce of 2,000 and its stake in Element 5 will result in what is being billed as a ‘mass timber powerhouse in North America.”
Several days after the Hasslacher announcement, we were afforded a tour of the facility, led by Patrick Poulin, Element 5 president and CEO.
He agreed the announcement was a game-changer.
“We’re incredibly excited about this next phase of Element 5’s journey. Hasslacher’s strength in the global marketplace, its technology and its experienced team – together with Element 5 – will drive a significant acceleration of our business.”
We asked Poulin to take us back a year and outline plans for the facility pre-Hasslacher.
“Getting this plant up and running, getting to two shifts, getting all of our products certified, with a reasonable baseline of revenue, in 2023 we did around $30 million in revenue.
“We had big aspirations and so one way to grow would be to take on a strategic investor.
“We could have tried it on our own, but honestly you need to raise some money to do that.”
As noted, Element 5 already had an expansion plan in the works and developed.
“And, had already pressed the start button on that. But, in the midst of that, still talking about taking on new investors to raise more money and see ourselves into the future.
“There are plants in Europe, we’ll have a world-class facility in St. Thomas and so North American demand is going to be quite wide-reaching when it comes to product lines, the majority of which we will be able make in St. Thomas, but there is a lot of opportunity, probably outside of the capacity or capability of what this plant will ultimately have.”
Poulin stressed, “When you’re building a building like this you have finite resources and you work with what you have.
“Even at $30 million, we were getting tight with space. So we needed more space to flow more efficiently and adding some equipment to break bottlenecks was part of the original expansion plan.”
“Conversations with Hasslacher really warmed up in the middle of 2023.”
The investment coming from Hasslacher provides additional funding for the St. Thomas expansion and the introduction of new products.
“Hasslacher is known for its glulam, so they have plants in Austria and Germany and this is a pretty big step for them.
“For any European mass timber producer to actually set up shop and establish a production footprint, you know Europeans are selling into the North American market now, but everything is still produced in Europe when it comes to mass timber.
“But this will be one of the first Europeans actually producing and having a manufacturing footprint in North America.”
Remember, this is right here in the north end of St. Thomas.
In addition to the existing timeline, the expanded Element 5 plant (see photo below) will produce large, fully machined glulam beams, columns and assemblies.
Poulin continues, “Out of the gate, Hasslacher wants to learn about the North American market and they have some faith that even in a relatively short period of time, Element 5 has learned something about the North American market.
“So, we’re going to kind of take it slow, business as usual, let’s say, but ultimately Element 5 will be a conduit for inbound demand into the Hasslacher Group.
“We see the affordable housing building profile as something we are actually carving out in our sales team and giving it a dedicated focus. Affordable housing is getting a lot of traction. We’ve put up a few already and we’re having a lot of conversations in the pipeline around this design concept.”
“There are plants in Europe, we’ll have a world-class facility in St. Thomas and so North American demand is going to be quite wide-reaching when it comes to product lines, the majority of which we will be able make in St. Thomas, but there is a lot of opportunity, probably outside of the capacity or capability of what this plant will ultimately have.”
The leadership of both operations will remain unchanged and both Element 5 and Hasslacher will continue under their current names and brands.
Element 5’s distinctive line of building products is visible in the new Central Elgin Fire and Emergency Services Port Stanley station, one of several undertaken by the firm.
But what Element 5 is undertaking in affordable housing is an area to watch.
“We have an affordable housing cookie-cutter, Lego block kind of design profile, a repeatable design.
“Structural components which are standardized but which can be somewhat customized in terms of shape. The components in that building are all made up of repeatable items.
“We see the affordable housing building profile as something we are actually carving out in our sales team and giving it a dedicated focus.
“Affordable housing is getting a lot of traction. We’ve put up a few already and we’re having a lot of conversations in the pipeline around this design concept.
“The cost per square foot is quite good and you can see that really maturing. It was an idea two years ago and now it’s up and running.”
As for the expansion, the new glulam plant is expected to begin production likely in the second half of 2025, with a production capacity of 100,000 cubic metres of mass timber.
Right now the labour force is around 130 and with the expansion that could push employment “north of 200.”
Poulin admitted, “It’s a great news story from our standpoint.”
We closed out the conversation by looking at Element 5’s 2030 plan.
“We think we can get to north of $100 million in revenue by 2030 and that would be north of probably 300 jobs here.
“We have a pretty aggressive growth plan.
“It’s a great news story, lots of great careers here that we’re supporting today and we hope to support into the future.
“Having world-class, fully automated glulam production at that scale in Ontario will have a significant impact on the North American market.”
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THE START OF THE JOURNEY DOWNTOWN
As seen by the feedback, the sale of railway lands and, in particular, a portion of Jonas Park is a hot-button issue at this time.
St. Thomas homebuilder Doug Tarry envisions a community springing up on the property that would not only provide much-needed housing but lead to the revitalization of a significant portion of the downtown.
A couple of days after city council approved the Jonas Park land transfer, we sat down with Tarry for his reaction to a key step in the process of re-purposing some of the downtown railway lands and protecting the future of the Elgin County Railway Museum.
“Well, this first step was roughly about three year’s worth of work to get to that point. Of course, we still have to finalize things.
“We’ve agreed there is a base, overall plan here. Folks are concerned. They don’t want to see that happen because there is change.
“I don’t want to see that beautiful, Edwardian-era building fall down because there is no money to fix it. So, we are committed to doing what we can on our part to revitalize the downtown core and part of that is trying to see if we can’t move forward with helping with the building.
“Certainly we can’t cover the entire cost of that, it’s fairly significant, but don’t we have an obligation as a community to try?”
A building that Tarry’s father played a key role in many years ago and you can read about that here.
“We recognize all the different things Dad did, but I think he would be pretty proud of this. That we’ve actually stepped up and said we want to see our downtown be vibrant.
“We want to create an urban park which is highly walkable, is very desirable to live in but recognizes our railway heritage and looks at both the past and where we want to be for the next 100 years.
“We recognize Volkswagen’s PowerCo battery plant coming to town. It’s an enormous opportunity for our community but they need housing.
“Where are we going to put housing?
“We need to have a structure to engage with stakeholders and the people who are living there and working there to see what is the best overall use for this land so that it is vibrant and people want to spend time there.”
“Well, wouldn’t it be wonderful if we could say we’ve got a railway line that goes all the way out to the work corridor, why can’t we have that as living downtown and being able to ride our bikes out to the Volkswagen plant?
“We want to see the trails expanded. We have done so much work on the trails.”
I can personally attest to that, having cycled a good portion of the trail network in the city’s south end one summer morning with Tarry.
“We’ve got this once-in-a-century opportunity to really revitalize our community.
“We started with a trail network before the city was even on board with it. They were doing studies and we supported that.
“A couple of years ago, during COVID, we had a million users of the trails in a summer.
“It’s unbelievable, going from 10 years ago when they didn’t exist to now. And, it’s not just about benefitting the south end of the community, this would be the potential for an east-west link that goes all the way out to the elevated park and connects into our future lands that are going to be developed for industrial.
“But, there is also the need for a northern link. I’ve talked to the mayor about that and he’s got some thoughts on where that might need to go.
“You look at that piece of land specifically and there is no urban plan for it and that’s why we’ve been very supportive and vocal, quite frankly, about the need for a Secondary Plan.
“We need to have a structure to engage with stakeholders and the people who are living there and working there to see what is the best overall use for this land so that it is vibrant and people want to spend time there.
“And not just that people go home and live there but we have an opportunity for people to engage there.
“And that, to me, is what is so exciting about this project.
“That land is underutilized to the point the city agreed to declare it surplus so something could be done with it.
“And our intent is not to be using all of that land for housing. We see a road corridor in the continuation of Centre Street as being vitally important.
“The railway corridor so that we’ve got a permanent right-of-way for the railway museum.
“When we look at the CASO station, they’ve got a sliver of land where their south platform should be. Wouldn’t it make sense if we can expand what is available to them so they actually own the land and can do the south platform?
“That would be taking it back to its original purpose and being able to have events there.
“We have to have control over these parcels of land and then the Secondary Plan will enable us to help create this vision of what it could be.”
There are a lot of conditions Tarry has to meet as we outlined last week and a three-year timeline on meeting those conditions.
“And, quite honestly, there are conditions in there that we really need to be in there for the protection of the community.
“We recognize this is a community-based project. We have to deliver housing, that’s the mandate of our company.
“We also understand this is a once-in-a-century opportunity to really change how the downtown functions.
“And, we’ve got to get it right or at least look at as many different components that will help to make it functional.”
So what is the next step?
“We are excited about the opportunity for stakeholder engagement in advance of the Secondary Plan and get out and see what people are thinking.
“And, make sure they understand where we are coming from. I think that is part of the challenge.
“We had to do this pretty quietly for an extended period of time and now the opportunity is there to come and say this is who we are.
“I think sometimes people don’t recognize or realize all the different work we do with our community and it is not just about building houses.
“It’s really about, as my dad used to say, how do we keep the campsite cleaner than we found it.
“That’s the mantra within our company and that is what we want to see happen here.
“And we’re at the start of the journey.”
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THE ECHO CHAMBER
Plenty of activity in the mailbag this week, much of it to do with the Jonas Park land transfer to Doug Tarry Homes.
Earl Taylor kicked things off with this comment on our Facebook page.
“Since this ‘sale’ or more diplomatically described in the report as ‘sole source the disposition of the indicated parcels’ as well as the statement, “There are no financial considerations associated with this report,” means that this city-owned land was given to Doug Tarry Ltd free of charge?”
That prompted this response from Melissa Schneider.
“Of course, it’s with the option to buy it back if it does not get developed. So given for nothing, bought back for how much? And by whom?”
Serge Lavoie responded with the following.
“In fairness Earl, the deal is not so simple. In return, DTL (Doug Tarry Limited) undertakes to build out Centre St. and the Trans-Canada Trail from Ross to CASO Crossing and deed it back to the city.
“DTL will also deed back the portion of the land on which the CASO south platform sits. They will also make whole the rail connection to the transfer table at the east side of the railway museum.
“Along with other provisions, it’s a package of undertakings that seems to fully justify the sole source transfer of the land for one dollar.”
Ed van der Maarel jumped in with this.
“I am not sure we want Centre Street to continue through. The Secondary Plan will iron that out, but we shouldn’t be handing out property until the plan is completed.
As well, MHC (the Municipal Heritage Committee) voted not in favour to the consent to sever ECRM for the same reason . . . for now.”
Carrie Smith checked with a different point of view.
“The old boys club needs some induction of women in it!
“Tired of the ‘spin’ St.Thomas mayor puts on everything while not caring about the important things like accessibility downtown and at public buildings as well as accessibility parking in front of the library and stopping the decimation of the courthouse area heritage landscape.
Sad indeed.”
Valerie Young forwarded a few questions she would like answered.
“I’ve always wondered why we can’t have a small subdivision with mobile homes similar to Lyons trailer park.
“Does the city own Dalewood camp area? Could portions of it not be allocated to year-round mobile homes?”
And, on a different note, Dave Mathers had this observation on last week’s item dealing with the mayor’s luncheon last month.
“Mayor Jones (Southwold Mayor Grant Jones) nailed it with his comment, ‘Amalgamation doesn’t save money.’
“One only has to think back to the amalgamation that created Central Elgin from Yarmouth Township, Belmont and Port Stanley. ALL three Chief Administrative Officers were retained within the new organization with those costs borne by the taxpayers.
“Having said that I’m sure that some serious cost savings could be achieved with a well-thought-out amalgamation project.”
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