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Structures USA’s GigaCrete,
Stuccomax and GigaSiding products are giving builders the opportunity to build homes
safer, much quicker and at a lower cost
Capital Goods
Construction Materials
Structures USA, Inc.
6775 Speedway Boulevard, M105
Las Vegas. Nevada .89115
Phone: 702-651-6161
Andrew Dennis
President and Founder
Interview conducted by:
Lynn Fosse
Senior Editor
CEOCFOinterviews.com
October 2004
BIO:
Andrew C. Dennis
President and Founder
Mr. Dennis was born and educated in England he is a
graduate of The West Nottinghamshire College of Art and Architectural Design and
Kingston-Upon-Hull, College of Architecture and Design. As Britain’s top design
student he was awarded a position with the BBC and worked as a set designer.
Approached by The Hudson’s Bay Company (The Bay,) one of Canada’s retail giants,
he emigrated and became a team member with Corporate Architectural Planning and assisted
in the architectural design, planning and expansion of over 5,000,000 square feet of
retail store growth during the early 70’s throughout Canada.
Emigrating to California Mr. Dennis formed PBE an
innovative Architectural, Industrial and Interior Design firm in Los Angeles, which
operated for many years as a leader in Southern California. After the sale of the 15
year-old business, he devoted several years developing the entire “Structures”
product line. Relocating to Las Vegas he became Vice President and Director of
Design for Paul Steelman Design Group in Las Vegas, a world renowned Architecture and
Hospitality design company. He has taught “ next generation thinking” and
product design at UNLV, invented and patented several products in addition to designing
many buildings and themed interiors. He is now focused totally on the success of
Structures. As Founder and President Mr. Dennis has developed international
relationships with Presidents of countries and Ministers responsible for Housing and
Developments on a large scale. His creative ingenuity and vision as a futurist will
keep Structures at the leading edge of the global marketplace.
Company Profile:
Structures (USA) is a research and development company specializing in new construction
technologies aimed at high speed, low cost global construction. Founder Andrew C. Dennis
has invented GigaCrete, a new form of lightweight concrete that outperforms traditional
concrete utilizing Portland cement as the binder. This new concrete matrix does not use
Portland cement or sand and gravel and therefore does not have the inherent problems
associated with that 2500 year old technology. It is totally fireproof and engineered to
be Hurricane and Earthquake resistant. GigaCrete can be made into building panels to make
floors, walls and roofs, or sheets of cement board siding and roofing and can cure in 8
hours as opposed to concrete that takes up to 28 days to cure.
Structures have designed an advanced manufacturing process and assembly of building
product at the jobsite has been developed and patents applied for. The manufacturing
process is computer controlled, very fast and requires little labor and space to perform
massive quantities of product at low cost and high profit. This highly advanced technology
is aimed at the global markets in housing, commercial, resort, and hospitality, medical,
retail and military structures.
Additional products include:
Stuccomax - a super strength stucco material that requires only one, one-coat application
without shrinking or cracks.
GigaSiding - an alternative to current vinyl or
cement board siding that is fire and insect resistant and very low maintenance.
CEOCFOinterviews: Mr.
Dennis, Structures is a newly public company. Would you please give us a bit of
background?
Mr. Dennis:
“Structures was born out of the need to create affordable housing, which was
fire-resistant and engineered for hurricanes and earthquakes that could be assembled
quickly. Our target market is wood-framed houses, which is the first thing to be damaged
in a hurricane region. The company is a couple of years old, although the research and
development has been going on for about ten years. It is something that I have done while
running an architectural company until two years ago and then I made a decision to pursue
this on a fulltime basis. In the past six months we have moved into a full-scale factory
type industrial park and we are continuing on with code approvals for four different
products. One is the GigaCrete, which is the building system, anther is called Stuccomax,
which is a bullet-proof single-coat, one-application stucco, which has never been done
before; we have literally made history with it. It is applied very quickly and dries
within a few hours. The installer can then move on to the next, which typically they
can’t do; they have to come back two to four times to re-coat the house. The essence
behind the whole business program is to build safer and faster with a superior product and
then extend that from the building side to the actual finishing that goes on in the
structures. Our goal is to go after mass affordable housing on a global basis, not just
here in the U.S.”
CEOCFOinterviews: What
building code standards must you meet?
Mr. Dennis: “We
used to have fragmented code organizations here in the country until the last year or so,
where each of the different sections of the country had their own building codes. Florida
had different building requirements than California obviously, because one has hurricanes
and the other earthquakes. All of these groups came together under a new organization
called ICC/ES (International Conference on Computational & Experimental Engineering
& Sciences), which has replaced ICBO and all of the others. ICC/ES is now the new
governing body for all of the states with two additional Florida and California code
requirements, but they are actually a very small proportion of the approval process. Once
you have ICC/ES approval, you are then able without argument to go into virtually any city
or state. This is a process, which is lengthy and extremely costly. It will be a few more
months before the government system is approved for the U.S. Unfortunately we are held
back by our bureaucracy and we can build in many overseas countries right now. Products
like our Stuccomax are a faster process and a little easier to get through and don’t
have anywhere near the testing criteria to get through.”
CEOCFO interviews: Is
the industry resistant to change or are they welcoming it?
Mr. Dennis: “The
building industry was absolutely looking for the next best thing. Everyone is looking for
speed and something that they don’t get called back with construction defects. There
is an entire litigation industry that has grown around construction defects. Because of
cracking in stucco and movement in walls, construction defects has now become an entire
new “fix it” industry. The wood framing industry would actually be most
impacted; we don’t use any wood at all. In meeting with the builders that use wood
construction, they are very receptive because of the rising cost of wood. They would
negate the litigation that goes with green wood that they buy from the Pacific Northwest.
When you build a few thousand houses out of that, in an environment like Las Vegas, the
fastest growing city in America, as the wood dries everything starts cracking and
shrinking and there are tremendous problems, with Structures products all of that
disappears.
In high fire zones, they are looking for alternates where they don’t want to build
out of wood because the insurance companies either won’t insure you or you pay a
higher premium. The builders are definitely looking for new products and for change and we
can do it so much quicker; we can build a house in three or four days as opposed to three
or .our months. The faster a builder can turn it around, the more profit he makes because
he is spending so much on labor, he can build more in a quicker time frame, which means
his financing costs him less. Initially, we thought we may have problems with the concrete
industry. We made the decisions not to do concrete foundations. The builders will have
their foundations poured before we come along. Very few concrete companies could actually
keep up with our potential output and would have a tough time to keep up with 27 houses a
day which we could actually produce. We are giving the concrete companies phenomenally
more business than they would have had before."
CEOCFOinterviews: When
looking at one of our homes would it be obvious that you use a non-traditional method?
Mr. Dennis: “No!
After the war, panelized building in this country was termed pre-fab, and they got a bad
reputation because they were thrown up rapidly and shoddy. Manufactured housing or
factory-built housing picked up a bad reputation because it was considered low-cost and
low-class. That has probably been the single biggest barrier. When you say to someone that
you have a panelized building system, the first thing they say is “oh you mean it is
a modular or a pre-fab house.” The whole industry has to re-educate everyone on the
fact that it is better to build something in a controlled factory environment than it is
at a job site. The rest of the world has never had a problem with this; in fact in Japan
it is just the opposite, they will consider a factory built product far superior to
something built on a job site.”
CEOCFOinterviews: What
is it that you know that no one else does?
Mr. Dennis: “I
developed a binder. In an effort to build a hurricane resistant house for myself, looking
forward to retiring in the Caribbean, I looked at other people’s panelized building
systems, knowing that it is very costly to build on an island because the raw materials
aren’t there. So I figured if I design something, containerize it and ship it, that I
could actually assemble it very quickly, so I looked into other people’s panel
systems. Ten years ago when it began, and I started to design the house for myself,
everyone was using wood and in doing so you have a termite and a fire problem, as well as
humidity problems and mold problems. I didn’t want to have these problems. I made up
a panel using steel studs instead of wood studs and cement facings instead of wood
facings. I actually came up with the first generation panel back in those days. That
evolved into a building system in as much that it had specific connection details. I did
something quite unique that nobody had done it previously; I created a column out of
panels, the column center could be filled with concrete if needed for extra strength but
it turned out to be so strong, concrete was not needed. More importantly,
esthetically, I didn’t want a wall with a window. When you live in a beautiful place
and want to see the ocean, you want to open all the French doors and enjoy the scenery so
columns made the most sense.
The column became an integral part of the initial concept; don’t build a wall but use
the wall panel to make a column; now I can have big open spaces in between, with large
glass areas. After building the column, I realized it was so strong that it was stackable
up to four stories tall. I took on a project in the Middle East and took my sample panel
with me. They build everything out of concrete in the Middle East. I was talking to a
building inspector in Abu Dhabi of all places and this man lifted up the light-weight
panel up and after rapping on it with his knuckles said, “it doesn’t look or
feel like concrete, and so you can’t use it here. However, you have a brilliant
engineering idea, a brilliant modular concept idea that if you could do this out of
lightweight concrete, you would really have something.” That sent me in a different
direction. It took a year-and-a-half to realize the weak link in concrete is actually
Portland cement, which is the binder. Everybody uses Portland cement, it really began with
the Romans and we still use it all over the world. I was able to find a binder that was
many times stronger than Portland cement and mixed it with fillers such as volcanic ash,
recycled polystyrene, ash from power stations, sawdust, and agricultural waste. I realized
that I could cast a moldable material that could be made into a very strong panel. We have
since refined that to being lightweight and it looks and feels like concrete. It dries
very quickly; poured into a mold in the morning; it is de-molded the following day and
delivered to a job site. Typical concrete takes twenty-eight days, and ours takes eight
hours. At that point, I realized that I had an inexpensive material where I am taking an
environmentally problematic material like waste ash from power stations and instead of it
going to land fills, we turned it into a building product, so it looks and feels just like
concrete.”
CEOCFOinterviews: Will
you tell us about the funding needed to accomplish this?
Mr. Dennis: “We
went public to raise the capital to build nationwide micro-factories; there will be small
factories set up in each of the developing areas. Wherever there is growth, fires, or
hurricanes, we should be there. The growth of the company in the U.S will actually be
through these micro-factories that can be set up relatively inexpensively.”
CEOCFOinterviews: Is
there much equipment involved?
Mr. Dennis: “Yes,
there is quite a lot of equipment involved. In the micro-factory there is about a million
dollars worth of equipment and in the full-size factory, there is about four million
dollars worth of equipment. We are going through the approval process about the same time
that we are getting the machinery all together and actually building the first factories.
The first one will be here in Las Vegas. We are in the space right now, so we are
transitioning from research and development into the commercialization and manufacturing
of the product.”
CEOCFOinterviews: Do you
anticipate that it will be easier to get an audience with the builders to get them
on-board once you are set up or is it going to be missionary work?
Mr. Dennis: “There
is a small circle of people in this very big industry and word has traveled very quickly
that there is a new company on the block. Almost weekly, we have new people coming through
here from all over the world."
CEOCFOinterviews: Will
you tell us about your patenting for this product?
Mr. Dennis: “We,
like Coca Cola, not wanting to patent the secret recipe, have a similar position. We have
patent applications in for the connection systems. Eight additional patents submitted for
the manufacturing and mixing process.
CEOCFOinterviews: What
is it about the management of Structures that gives you the expertise to go from the
development stage to being commercial?
Mr. Dennis: “When
we can save 20% off wood framing costs and at be least 40% below masonry construction,
every major builder is looking at this. The factory process is a cookie-cutter operation.
We mold panels in large mold boxes in multiples of 42 at a time. This is a very simple
process even though the machinery is not. When you can buy six components and build
virtually anything up to four stories with those components, you have a very dynamic
building system. This isn’t rocket science. We are a lean company. As we grow, the
factories can actually remain quite small; we will only have a hand-full of employees
running the facilities and turning out tremendous amounts of product. It is a relatively
easy thing to manage; we are looking for joint-venture partners that come from the
construction or concrete industry.”
CEOCFOinterviews: In
closing, what should potential investors know that they might not realize when they read
your material and look at what you are all about?
Mr. Dennis: “Most
investors are looking for new ideas and next-step products. Because we have multiple
revenue streams from five or six different products, we’ve limited our risk.
Certainly in some areas we will sell more buildings and in other areas we will sell more
stucco and in other areas we will sell the siding. I just came back from Canada and
realized that in Toronto and Vancouver there are tremendous markets for our fire resistant
GigaSiding, what looks like wood siding. Even in Hawaii they have enormous termite
problems and many people won’t even paint the siding they put on the house because a
year downstream they are going to have to replace it again. Those are the micro markets
that are ideal for us and I think that helps investors realize how flexible the company
can be. By placing Micro factories requiring relatively small investment in multiple
global and nationwide locations our risk of failure is really minimized.”
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