Rising from the streets of Denver is an innovative six-floor, soon-to-be-completed timber office building that at first glance is an achievement for developers Hines, Ivanhoé Cambridge, McCaffery and the Nordic Structures/Chantier Chibougamau lumber firm.

The building is made entirely of specially-engineered lumber, save for some metal screws, fasteners and connectors.

But the real source of the anticipated construction success of the new 235,000-square-foot building at 3500 Blake St. — and perhaps more timber buildings popping up across North America — might be a feisty breed of tree found in the far north of Canada.

The black spruce grows in abundance around the headquarters of Chantier Chibougamau, a company named after the remote town of 7,500 residents that's a seven-hour drive north of Montreal. The black spruce endures in a severe microclimate in low-nutrient soil of boggy peat moss and it grows in tiny 50-day growth seasons while surviving long, cold winters in crowds of trees competing for sunlight.

The black spruce grows only to a mere average of 4.5 inches in diameter and lives for 80 to 120 years but it grows up tough, with compact fibers on the 15 million acres of land that Chantier Chibougamau harvests, a land almost the size of Massachusetts, Rhode Island and Connecticut combined. Government authorities permit Nordic to harvest the trees on the condition that it plants 10% more trees than it cuts.

Black spruce thrive throughout the colder Canadian boreal region of North America. The trees also were previously common in a handful of the northernmost states nearest Canada but in recent times other breeds have supplanted them in those southern regions.

Though small, the wood is tough and Jean-Marc Dubois, director of business development for Nordic Structures, compares the spruce trees to David taking on Goliath. “It doesn't grow very large and has a very short growing season but its fiber is dense and small," he told CoStar News in a phone interview.

The case for employing black spruce for more than just Christmas trees has much to do with their life span. The small trees absorb carbon from the atmosphere for about 80 years, after which they start decaying and emit carbon back into the air.

Regularly cutting and replanting black spruce is good for the environment, as it increases carbon capture. In contrast, a large spruce from the West Coast is capable of extracting ever-increasing amounts of carbon from the atmosphere for up to 2,000 years, which makes such trees worth preserving.

Dubois and the Chibougamau/Nordic team of dozens of engineers and technicians have devoted decades to transforming the little logs into large-sized buildings and the effort is paying off. The lumber structures — T3 as the structures have been branded, which stands for timber, transit and technology — are catching on across the continent. 

Nordic Structures said it took part in the concept, not the design, of a seven-floor office building at 323 Washington Ave N in Minneapolis in 2018, which Hines sold to LaSalle Investment Management in 2018 for $112 million. Hines then built eight more, including the T3 Eastside, not far from the new Denver site. 

Chantier Chibougamau and Nordic Structures have also been busy in their home province of Quebec, where they supplied lumber and expertise to build a structure atop an existing building at 620 St. Paul St. in Old Montreal. And they were behind the Arbora at 305 de la Montagne which, at 600,000 square feet, is considered the largest multi-residential mass timber project on earth. Their black spruce lumber was also used to transform the CESM soccer stadium at 9235 Papineau St. 

Dubois notes that building with timber can prove as cost-effective as traditional construction because, though traditional steel and concrete cost less, other calculations, such as time spent waiting for concrete to dry, need to be considered in the overall equation.  “There's a learning curve with lumber. No one anticipates that building with wood is going to be much faster than they're used to,” he said. 

Lumber builds require an entirely different set of calculations, Dubois notes, as the buildings tend to be pre-designed in computer models more than in traditional construction and often attract higher sales prices. "If you consider the holistic costs, typically you'll find that a mass timber structure is going to be as competitive as a concrete and steel building of a similar size. You wouldn't be seeing developers building these projects if they weren't cost-effective."

Chantier Chibougamau started in the 1960s as a modest stud mill that pumped out simple two-by-fours before experimenting with finger jointing in the early 1990s, a process that creates larger pieces of wood by pressing and gluing wedges to create larger units. 

Nordic's team started dreaming of not only producing lumber at its sawmill but also of building houses, an enterprise they believed would be far more environmentally friendly than the typical concrete-and-steel approach due to its use of renewable lumber resources. They worked closely with authorities to build a 24-unit lumber property in 2012 in Chibougamau. The company reported that five workers completed the structure in 22 days. Dubois says that the success went largely unnoticed due to the remote location.

"We weren’t getting any business when we started. We were our own development company because nobody understood our product. That’s how we became fully vertically integrated," said Dubois.

Chantier Chibougamau and Nordic Structures took their next step forward by producing cross-laminated timber in 2010, another process used to make larger-sized wood components out of smaller pieces. “Cross-laminated timber gave us the final piece of the puzzle where we could incorporate an efficient building system and give the ability to build cost-effectively and speedily,” said Dubois. The innovative feat of engineering adds value to an item that would otherwise have little worth.

As well as being environmentally sustainable, the wood structures are also up to 50% lighter and can be built in difficult soil conditions that would otherwise require a massive concrete foundation and substructure. The company was hired to build a structure on the Gulf Coast for the United States Army in 2012 that was designed to protect against explosions. Nordic Structures, meanwhile, worked with Canadian authorities to develop fire-resistant lumber properties up to six floors and passed rigorous burn tests overseen by fire authorities.  

A breakthrough came in 2021 when changes to the International Building Code gave them a stamp of approval to build mass timber structures up to 18 floors high. 

Dubois, whose name is the French word for wood, grew up in Montreal and had dreams of opening a radio station before getting hired in a lumber-related position 43 years ago, in the first job he applied for. He joined Nordic Structures 20 years later and is now based in a suburb near Albany, New York, where his passion for wood has not waned. 

“I’ve been doing missionary work like this for 20 years and the whole reason I'm doing it is because I'm really passionate about trying to mitigate climate change,” he said. “Wood is the only truly sustainable building material out there, totally renewable and grows from sunlight for free. All we have to do is manage it.”

Nordic Structures makes a point of shipping its products in a sustainable manner by rail from Chibougamau, which is the last stop in the Northern Quebec Canadian National Railway Line. Dubois said that the company can move one ton of material for 500 miles on one gallon of diesel gas, a far better rate than being trucked.

Eli Gould, a 15-year veteran of the lumber industry, has watched as Nordic and other wood construction companies have grown in number and size. Gould, who is based in Brattleboro, Vermont, and promotes wood construction builds in the United States as a representative of the non-profit, 125-member Quebec Wood Export Bureau, said the growing popularity of lumber construction has spawned competitors.

Other companies in the field of cross-laminated timber include Kaseltnikoff Lumber based in Castlegar B.C., which comes closest to the vertically integrated Nordic model. Not all such companies have thrived, Seattle-based Mercer has recently taken over the failed operations of Katerra based in Menlo Park, California, and StructureLam of British Columbia. Meanwhile SmartLam, based in Montana, took over the IB X-LAM manufacturing plant in Alabama after it failed as a going concern.

Unlike Nordic, many similar lumber companies purchase their wood from other suppliers, which are not always as environmentally conscious as Nordic.

“Most other manufacturers are buying lumber and trying to make a product out of it, whereas Nordic has gone all the way back to the resource. They know where their wood is coming from and it’s coming from a sustainable source. They have their own sawmills and optimize them to make their end product. That’s unique," said Gould in a phone interview.

The cost of lumber builds can vary with the price of wood, which has seen many recent swings. Wildfires in Canada claimed about 4 million hectares of forest this summer and have led to a recent spike in lumber costs. Lumber futures recently surged above $550 per thousand feet, according to Tradingeconomics.com. The price, however, is still only about a third of the record-high prices seen in May 2021.

Local building codes can also determine the fate of wood builds. Currently, three in four Canadians now live in jurisdictions that allow six-floor wood frame construction, according to the Canadian Wood Council.

Gould also stresses that the folksy image many have of bearded men roaming forests with saws doesn't apply to Nordic’s operations: “It’s important to emphasize it's very much a modern 3D software-driven manufacturing business just like aerospace.”

(This story was updated Aug. 21 to correct that the involvement of Nordic Structures was in the concept, not the design, of a Minneapolis office building; that its forest lands span 15 million acres instead of 10 million; and that the black spruce absorbs carbon from the atmosphere for about 80 years instead of 40.)