Village life tastes sweet

Village life tastes sweet

Ed Monaghan has overseen the rapid diversification of Mactaggart & Mickel from house-builder to a firm with a foothold in a range of new lucrative markets.

Ed Monaghan, chief executive of Mactaggart & Mickel, positively buzzes as he talks about building the Athlete’s Village for the 2014 Commonwealth Games in Glasgow.

A sports fan – and keen athlete himself – he is thrilled to be responsible for getting the accommodation ready for the Games. The whole company has been caught up in the excitement, he says.

“I had been involved for about a year and a half before it started to feature for other people in the organisation – and I was really surprised and pleased at how excited they were to be part of it.

And that is replicated around our sites, I know a lot of employees want to go there and be part of it,” he says.

The Athlete’s Village and other contract building projects represent a shift in focus for the 85-year-old company.

Until recently, Mactaggart & Mickel was a house-builder, with very little other work.

But the recent downturn in the housing market has seen the company look at what else it can do – and brought in interesting new projects, like the Commonwealth Games and a veterans’ housing project in Renfrewshire for the charity Erskine.

“If you track back a few years to when the downturn really hit the property market, the house-building market pretty much dried up overnight.

And we had to ask ourselves, as anyone would do – what can we do now? It was really just about looking round the business and trying to identify people with key skills that maybe came from different sectors.

The contracting side was the most obvious because, in effect, we’re still building houses, we’re just not building them for sale,” he says.

Getting a toe in this new market was a challenge, because it wasn’t something Mactaggart & Mickel was known for, and “some of the housing associations have peculiar rules, whereby if you haven’t traded in that discipline for three years they won’t entertain you! “The fact we’d been building houses for 85 years seemed to be lost… But in fairness we got talking to good partners, won our first contracts, and it’s just moved on from there,” he says.

This diversification drive has also seen Mactaggart & Mickel increase its interest in timber systems, commercial property, rental properties – and a drive south of the border to buy up some land.

When every other builder was backing off from buying ‘strategic land’, Mactaggart & Mickel has bought up 800 acres and is currently working on planning applications for this, with more purchases in the pipeline.

“When others pulled out, we moved in – and we expect to see a return on that investment in 2014,” Monaghan says.

All of these new markets have helped balance the books, but Monaghan stresses that Mactaggart & Mickel’s focus remains strongly on housing.

That’s where the most revenue is still to be made, and where the company’s heart lies.

“We take a lot of pride in building someone a home, for their family to grow,” Monaghan says.

In recent years, that focus on ‘homes’ got a little lost, he says, as people bought just to immediately resell, seeing houses as investment vehicles rather than places to live.

“That didn’t help the sector focus on the core value, which is building a home.

People buying a house just to sell it takes a little bit out of the relationship.” Not that Mactaggart & Mickel didn't play its part in, and benefit from, the boom in the housing market, he stresses.

“We were caught up on the same treadmill as everyone else – it’s difficult to stop.

And we weren’t in the business of turning sales away! But we could tell things weren’t sustainable.” The million dollar question is, when will that market recover? “We’ll always need homes.

We offer a product that is still invaluable – you can’t really do without it.

But will we go back to that environment? Not for some considerable time.

The environment’s not there, the funding streams aren’t there, mortgages are still pretty scarce.

I don’t see anything changing in the foreseeable future.” Monaghan would, perhaps naturally in his position, ask both the Holyrood and Westminster governments to reconsider their views on investment to stimulate the economy.

“I think the construction sector can be a stimulus for growth.

Building our way out of recession is, in my view, a better way than cutting our way out of it – which at the moment I don’t think is working.” Monaghan has worked for Mactaggart & Mickel since he joined as a 16-year-old apprentice.

Glasgow born and bred, he started work early because his father had died when he was 14, and “it just seemed the right thing to do”.

He quickly realised, however, that working as a painter and decorator was not what he wanted to do for the rest of his life, and set about studying for an HNC in Building Management in his spare time.

By the age of 24, after six years of studying (“It was a long slog!”) he applied for a role in Edinburgh as a junior buyer in Mactaggart & Mickel’s procurement office.

“I wasn’t actively encouraged to go into construction management, because that tended to be something joiners and builders did.

They see more of the construction process, you see, whereas I’d come in at the end.

But the opportunity came up – and I grasped it with both hands.” Monaghan was appointed to the Mactaggart & Mickel board in 2002, promoted to managing director in 2005, and chief executive in 2007.

“I’ve been very fortunate.

They are a very good company.

I’d like to think that in my short tenure as chief executive I’ve added to that, but they were always a good employer and I’ve had lots of opportunities,” he says.

Mactaggart & Mickel is very supportive of growing people within the company, and still runs an apprentice programme for young people aged 16 to 18.

“Fewer companies do it now, but we see the apprentice programme as our future. We map the intake against our future needs – though that’s been challenging, given the uncertainty in the market! But we still take apprentices every year and in the main they stay with us.

"They go on to do all sorts of things – we have lots of former apprentices in management roles.”

Monaghan himself takes a keen interest in training young people, chairing the Scottish Skills Group within C Skills – the skills council and industry training board for the construction sector – and sitting on the board of his old college, the City of Glasgow College.

“It’s nice to be there, and hearing all the students do presentations on their projects – because that’s the future.” Monaghan recognises the importance of constantly learning at management level, too.

“There’s a lot of learning as you go, of course, but I did a senior management development course at Cranfield Business School two years ago – and I also really enjoy going to seminars to find out what other people are doing.

I’ll come back with a list of 20 ideas, good ideas that someone in a different sector is doing, and ask my team “why can’t we do that?” Employee forums across the company ensure that everyone’s voice can be heard, and initiatives like flexi time, working-at-home policies, and other initiatives to help people manage their lives have made Mactaggart & Mickel a popular place to work, at a time when financial rewards are increasingly difficult to offer.

Monaghan is clearly a busy man, but looks after himself with regular running – the morning we met he had run his regular 10km route before work, and he runs the Glasgow half marathon every year.

“This will be my 22nd in a row!” Living in Newton Mearns on the south side of Glasgow with his wife Jill, sons Fraser and Duncan and daughter Morven, “in a Mactaggart & Mickel house, of course”, Monaghan says the whole family is sports mad.

A trip to London is planned for this summer for the Olympic Games, and flights to Paris will be booked if Bradley Wiggins looks like taking yellow in the Tour de France.

As well as running, Monaghan has competed in triathlons, and has a “long list of things that I’m trying to get through,” including cycling up the Alpe d’Huez in France.

Last year’s New York marathon saw another item ticked off that list – this is a man who makes things happen.

And it’s just as well. With “700 houses to build in about, oh, 700 days!” for the Commonwealth Games Athlete’s Village, along with myriad other projects, Monaghan has plenty to keep him busy. He finishes his coffee and heads back to work.