2019 | BUSINESS AND INVESTMENT
BC INVESTMENT LNG: THIS CHANGES EVERYTHING SUSANNAH PIERCE ON B.C.'S $40 BILLION BONANZA
TECH: GAME ON NO. 1 IN TOURISM MINING STIMULUS BEST REAL ESTATE TO BUY INTO NOW
KEY SECTORS ALIGNING FOR BRITISH COLUMBIA INVESTORS
PRINCE OF PORTS
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TIMBER TO CHINA
MINING INCENTIVES TOP FOR TOURISTS KABAM KABOOM
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opportunity is calling
Kitimat will soon have thousands of career opportunities sparked by the construction of Canada’s ďŹ rst LNG export facility. We also have thousands of reasons to make our community your new home. Kitimat is a community of about 8,000 people located on the north coast of B.C. The community sits at the head of Douglas Channel next to Kitimat River. Indoor and outdoor recreation facilities and surrounding wilderness provide plenty of opportunity for an active, outdoor, coastal lifestyle.
District of Kitimat - www.kitimat.ca @KitimatDistrict
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District of Kitimat Kitimat Leisure Services
District of Kitimat
@DistrictOfKitimat
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CONTENTS
FEATURES AND COLUMNS
2019 | BUSINESS AND INVESTMENT
BC INVESTMENT
6 LNG: BILLION-DOLLAR JOB BONANZA LNG Canada has already awarded nearly $1 billion in contracts as it builds the largest private-sector project in Canadian history
LNG: THIS CHANGES EVERYTHING SUSANNAH PIERCE ON B.C.'S $40 BILLION BONANZA
9 PORT POWERHOUSE With record tonnage and huge expansion, Port of Prince Rupert tacks into the big leagues
TECH: GAME ON NO. 1 IN TOURISM MINING STIMULUS BEST REAL ESTATE TO BUY INTO NOW
12 TAKING A 2X4 TO CHINA Persuading China to use more structural lumber would be a major breakthrough for B.C.’s No. 1 industry
KEY SECTORS ALIGNING FOR BRITISH COLUMBIA INVESTORS
12
16 MINING INCENTIVES ETCHED IN STONE Extending flow-through shares and exploration tax credits adds certainty to B.C. mining investments 19 VANCOUVER: NO. 1 FOR TOURISTS AND CONVENTIONS IN CANADA Vancouver’s increase in traveller visits is set to outpace the entire country during 2019 23 INDUSTRIAL STRENGTH Warehouses and light industrial space have overtaken residential as Metro Vancouver’s No. 1 real estate investment 24 TOWERING OFFICE MARKET Unprecedented demand is driving the Metro Vancouver office vacancy rate to the lowest level in at least 20 years
28 TOP 5 B.C. TOWNS FOR INVESTORS The site of Canada’s biggest resource play, Metro Vancouver’s safety valve and one of B.C.’s fastest-growing towns share the spotlight COLUMN
MINING INCENTIVES TOP FOR TOURISTS KABAM KABOOM
PRESIDENT: Alvin Brouwer EDITOR-IN-CHIEF, BUSINESS IN VANCOUVER; VICE-PRESIDENT, GLACIER MEDIA: Kirk LaPointe EDITOR: Frank O’Brien DESIGN: Randy Pearsall PRODUCTION: Rob Benac CONTRIBUTORS: Nelson Bennett, Robin Buntain, Chuck Chiang, Glen Korstrom, Chris MacCauley, Frank O’Brien, Tyler Orton, Jill Tipping PROOFREADER: Meg Yamamoto DIRECTOR, SALES AND MARKETING : Pia Huynh SALES MANAGER: Laura Torrance ADVERTISING SALES: Benita Bajwa, Blair Johnston, Corinne Tkachuk, Chris Wilson OPERATIONS MANAGER: Michelle Myers ADMINISTRATOR: Katherine Butler RESEARCH: Anna Liczmanska, Carrie Schmidt
Copyright 2019 Business in Vancouver Magazines. All rights reserved. No part of this book may be reproduced in any form or incorporated into any information retrieval system without permission of BIV Magazines. The publishers are not responsible in whole or in part for any errors or omissions in this publication. ISSN 1205-5662
27 TECH TAKES THE LEAD B.C. technology scores ‘A’ in economic comparison with other provinces – but more work is still needed
COLUMN
TIMBER TO CHINA
BC Investment 2019 is published by BIV Magazines, a division of BIV Media Group, 303 Fifth Avenue West, Vancouver, B.C. V5Y 1J6, 604-688-2398, fax 604-688-1963, biv.com.
25 KABAM REFLECTS TECH KABOOM Explosive success of B.C.’s digital gaming industry has taken place despite the province offering the lowest tax credits in the country
COLUMN
PRINCE OF PORTS
Publications Mail Agreement No.: 40069240. Registration No.: 8876. Return undeliverable Canadian addresses to Circulation Department: 303 Fifth Avenue West, Vancouver, B.C. V5Y 1J6 Email: subscribe@biv.com
6
Cover photo: Susannah Pierce, LNG Canada’s director of external relations, photographed in Vancouver.- CHUNG CHIOW
MacCauley—23
Buntain—24
Tipping—27
16
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Produced by
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
ENERGY
LNG:
BILLION-DOLLAR BONANZA LNG Canada has already awarded nearly $1 billion in contracts as it builds the largest private-sector project in Canadian history
NELSON BENNETT
B
ritish Columbia businesses and contractors are sharing in nearly $1 billion worth of contracts associated with the $40 billion LNG Canada project, according to LNG Canada. That includes $175 million for First Nations businesses and contractors. This is in addition to the roughly $100 million for First Nations that had been previously spent getting the project to the final investment decision stage. As of January 21, LNG Canada confirmed it had signed $937 million worth of contracts and subcontracts with various businesses and contractors. Susannah Pierce, LNG Canada’s director of external relations, says more contracts would be awarded as the project progresses.
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First Nations have also benefited from about $620 million in contracts awarded on the associated Coastal GasLink pipeline project. “What these contracts and subcontracts represent is tremendous opportunity for individuals to find employment on the LNG Canada project,” Pierce says.
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“For First Nations communities, it is delivering on the opportunities that will assist the Nations to address issues of poverty, unemployment and skills development. For local communities, it is the opportunity for young people to find employment that allows them to remain living in the North.” LNG Canada and the BC Construction Association have trained more than 1,000 apprentices under LNG Canada’s trades training fund, with has so far involved 500 employers. To date, the fund has allocated $1.5 million to cover the cost of training in high-demand trades associated with the largest private resource project in Canada. Site preparation work began in the fall of 2018, with 249 local workers from the Kitimat area employed on the project by LNG Canada and its contractors. The number of jobs to be created this year is estimated
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Susannah Pierce, LNG Canada’s director of external relations: “tremendous opportunity for individuals to find employment on the LNG Canada project” • CHUNG CHOW
to be in the high hundreds, ramping up to about 4,500 at peak construction in 2020 and 2021. That’s just for the LNG Canada project. Coastal GasLink will also employ up to 2,500 workers on pipeline construction from the northeastern gas fields. LNG Canada is a joint venture composed of Royal Dutch Shell PLC, through its affiliate Shell Canada Energy, which holds a 40 per cent share; Malaysia-based Petronas, through its wholly owned entity, North Montney LNG Limited Partnership, 25 per cent; PetroChina Co. Ltd., through its subsidiary PetroChina Canada Ltd,, with a 15 per cent stake; Mitsubishi Corp., through its subsidiary Diamond LNG Canada Ltd. also a 15 per cent share; and Korea Gas Corp., through its subsidiary Kogas Canada LNG Ltd., with a 5 per cent share in LNG Canada Development Inc. É
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
ENERGY
GAS PRODUCERS FORM LNG ALLIANCE Ten western Canadian producers have joined together to find a path to send Canadian liquefied natural gas (LNG) to new markets. Alan Boras, director of communications and stakeholder relations for Seven Generations Energy Ltd., says the group of producers, predominantly Montney producers, are coming together to see where they have common interest around new markets for their natural gas. Montney is among the giant gas fields of B.C.’s northeast that will supply LNG Canada’s Kitimat export terminal. The group – made of up Seven Generations Energy, Peyto Exploration and Development Corp., Advantage Oil & Gas Ltd. and others – has been exploring various opportunities for supplying LNG
projects that would export Canadian natural gas. “LNG Canada is going ahead. There are others that still have opportunities on the horizon. It’s really a matter of trying to see where there could be a confluence of all the component pieces that are required to have a project come together,” Boras explains. A committee, along with consultant Greg Kist, former president of Pacific NorthWest LNG, is looking at opportunities, which may include new or cancelled projects, says Boras. Canada has a tremendous opportunity to supply large populations with cleaner-burning natural gas. Natural gas use in the Asian market would be a benefit in many ways, says Boras. “First of all, it would help us develop our resources,” he says. “It has the potential to close the gap on prices between the oversupplied Canadian market, where prices are relatively low, and the world market. There is an opportunity to develop some of that value for Canada in the economic development in the jobs, in the taxes, in the royalties.” There’s also the opportunity for Canada to help Asian countries end energy poverty and advance societies, he adds. “From the wellhead in Alberta to the potential burner tip in Asia, there is value and benefit to be gained all along the way,” Boras says. CRYSTAL RHYNO, DAILY OIL BULLETIN
BRIEF
NEB: ‘TRANS MOUNTAIN SHOULD PROCEED’ The National Energy Board (NEB) has recommended that the controversial Trans Mountain pipeline expansion project is in the national interest and should proceed. The pipeline, which would run from the Alberta oilsands to Burnaby on the southern B.C. coast, was stopped in August 2018 when the Federal Court of Appeal quashed approval. The court ordered a reconsideration of the project by the NEB. On February 22, the NEB delivered its reconsideration report with an overall recommendation that the Trans Mountain project should be approved. The NEB will impose 156 conditions on the project if it proceeds, and has made 16 new recommendations. These relate to matters that fall outside of the NEB’s regulatory mandate, but within the authority of the federal government.
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The reconsideration report concludes that project-related marine shipping is “likely to cause significant adverse environmental effects on the southern resident killer whale and on Indigenous cultural use associated with the southern resident killer whale,” the NEB said in a release. While these effects weighed heavily in its consideration of project-related marine shipping, the NEB says they can be justified in the circumstances, in light of the considerable benefits of the project and measures to minimize the effects. The NEB said considerable benefits of the project include increased access to diverse markets for Canadian oil; jobs created across Canada; the development of capacity of local and Indigenous individuals, communities and businesses; and direct spending on pipeline materials in Canada.
The NEB report is one of the factors that the federal government will consider when making the final decision on whether or not the project should proceed. The federal government purchased Trans Mountain from Kinder Morgan last year for $4.5 billion following sustained resistance to the project from within B.C. PIPELINE NEWS
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PRINCE RUPERT PORT
PORT
POWERHOUSE With record tonnage and huge expansion, Port of Prince Rupert tacks into the big leagues
FRANK O’BRIEN
T
he decision by LNG Canada to proceed with its $14 billion export terminal at Kitimat will add to the record-breaking tonnage now handled at the Prince Rupert docks, says Brian Friesen, vice-president of trade development and communications at the Port of Prince Rupert.
“The project will create natural gas liquids such as propane that will need market access, which is where it will have a positive effect on Prince Rupert,” he says. AltaGas of Calgary and Netherlands-based tank storage company Royal Vopak are nearing completion of a new Ridley Island propane export facility, Friesen notes, that will be ready this spring as the first propane export
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facility on the west coast of Canada. AltaGas expects the facility will offload 50 to 60 Canadian National rail cars of propane per day to export into Asia. The Ridley terminal is already undergoing a $280 million expansion as it moves to meet global demand for metallurgical coal used in steelmaking. Last year the Ridley port saw a 40 per cent increase in shipments of
THE PORT OF PRINCE RUPERT GENERATES 3,100 DIRECT JOBS AND 5,000 INDIRECT JOBS, ACCORDING TO THE PRINCE RUPERT PORT AUTHORITY
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
PRINCE RUPERT PORT
FOREIGN CARGO TRAFFIC AT PORT OF PRINCE RUPERT In millions of metric tonnes 30 25 20 15 10
2017
Gr
(a an ll d te to rm ta in l al s)
n ai Gr
nt Co
Co
al
ai
/c
ne
ok
rs
e
5
2018
SOURCE: PORT OF PRINCE RUPERT
TOP:
Port of Prince Rupert:
record-setting container traffic for two years straight • PORT OF PRINCE RUPERT
ABOVE:
Brian Friesen,
vice-president of trade development and communications at the Port of Prince Rupert, expects the port to share in gas exports • PORT OF PRINCE RUPERT
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metallurgical coal, to 5.6 million tonnes, while exports of thermal coal, used for electrical production, were up six per cent from 2017 to 2.1 million tonnes. Thermal coal shipments have been dampened at the Fraser Surrey Docks after the Port of Vancouver cancelled a permit for a $15 million thermal coal terminal this year. The controversial project would have had a capacity of shipping four million tonnes of U.S. coal annually to markets in Asia. The plan had drawn fire from environmentalists and municipal governments in Metro Vancouver. Marc Dulude, president and CEO of Ridley Terminals Inc., doubts the thermal coal shipments could transition north to Prince Rupert. “We are not really equipped to serve the U.S. coal market,” he says. A sa le of R id ley Ter m i n a l s, t he on ly gover nment-owned terminal at Prince Rupert, is in the works and that could delay any such decisions, Dulude notes. In November 2018, the Canada Development Investment Corp. (CDEV) announced it was calling for private bids for 90 per cent of Ridley Terminals. The remaining 10 per cent of the shares would be transferred to the Lax
Kw’alaams Band and the Metlakatla First Nation at the close of the sale, according to a government release. Dulude referred all requests for information on the potential sale to CDEV.“I can’t really comment,” he says. CDEV referred questions to adviser Macquarie Capital, which also declined comment. Ridley’s expansion shares in the next phase of growth by the Port of Prince Rupert and stevedore DP World that will increase annual throughput capacity at Canada’s second-largest container terminal to 1.8 million 20-foot-equivalent units (TEUs) when complete in 2022. The expansion comes as the port set back-to-back record years in 2017-18, with 26.7 million metric tonnes handled last year, up 10 per cent from a year earlier. Container shipments increased nine per cent yearover-year to a record of 1.03 million TEU containers passing through its Fairview facility, Friesen notes. As a comparison, the Port of Vancouver handles 3.3 million TEUs annually, and the southern B.C. port has an annual tonnage throughput of around 141 million tonnes. Still, the Port of Prince Rupert is a thriving concern in an area of B.C. that has seen other major projects
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Ridley Island: 90 per cent of the only Prince Rupert terminal owned by the federal government is up for sale, with 10 per cent to be awarded to two local First Nations • PORT OF PRINCE RUPERT
stopped or stalled in the past few years. The port generates 3,100 direct jobs and 5,000 indirect jobs in the Prince Rupert area, according to the Prince Rupert Port Authority.
Friesen says the port, which is aimed at serving Asian markets, has not seen a slowdown in traffic due to the ongoing U.S.-China trade war, but adds, “it is something we are keeping a close eye on.” É
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
FORESTRY
TAKING A
2X4 TO CHINA
Persuading China to use more structural lumber would be a major breakthrough for B.C.’s No. 1 industry
CHUCK CHIANG
I
n the past year, the B.C. government has led two forestry-sector delegations to Asia, both with the same mission: persuade China to build more homes with wood. Shipments of B.C. lumber have increased to Asian countries, but in China the wood is usually used to frame concrete, not houses.
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Opening China as a major softwood destination is a long-term aim of B.C.’s forestry industry but it has taken on a fresh urgency. B.C. enjoyed a lumber-export bull market until last summer, when a sudden drop in U.S. lumber prices removed the insulation between the province’s forestry industry and the softwood lumber duties imposed by the United States. Lumber prices in the U.S. market fell to US$300 per 1,000 board feet from US$600 and this February were still at US$380. The U.S. accounted for 61 per cent of B.C. softwood lumber exports in 2018, China for 15 per cent. T here a re add itiona l factors contributi ng to a
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slowdown, including a shrinking timber supply in B.C. due partially to two years of wildfires and a slowdown in Canadian housing starts. The downturn has resulted in some B.C. sawmills cutting production and laying off staff. “There are certain things that government can do to ensure we have jobs in rural communities that depend on forestry, and there are areas where it’s difficult to exert influence as a government – global markets on lumber prices, for instance,” says Doug Donaldson, B.C.’s forests and natural resource minister, who led the trade delegations to Asia. China, Japan and South Korea are B.C.’s second-,
Total B.C. wood-product shipments to China increased eight per cent from 2017 to 2018 to $3.8 billion, while total U.S. exports were down one per cent to $6.3 billion • RALF GOSCH/SHUTTERSTOCK
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
FORESTRY
AT A TIME WHERE U.S. PROTECTIONISM IS RISING, IT’S IMPORTANT WE TAKE THE OPPORTUNITIES WHERE WE CAN FIND THEM j BRUCE RALSTON B.C. minister of jobs, trade and technology
B.C. SOFTWOOD LUMBER EXPORT VALUE In millions of dollars $7,000
6,000
5,000
4,000 2014
2015
2016
2017
2018
SOURCE: ECONOMIC STATE OF B.C.’S FOREST SECTOR, BC STATS
third- and fifth-largest wood-product export markets, respectively. The three markets combine to make up about 29 per cent of B.C.’s current wood-product exports, although each presents a distinct opportunity. Japan, for example, has a rich tradition of wood-built homes and a savvy consumer base willing to pay for B.C. lumber’s higher prices, says BC Wood’s Asia-Pacific region director, Jim Ivanoff.
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Japan builds 500,000 wood homes every year, and Ivanoff says South Korea has a similar demographic and market profile – although the market itself remains much smaller. China, meanwhile, is a more price-sensitive market where wood-frame construction is relatively rare in the housing industry, Ivanoff says. He notes the Chinese market uses some lower-grade B.C. wood for concrete forming, and the government discourages single-family detached houses to limit urban sprawl. But Ivanoff notes there is increasing Chinese interest in mid-rise wood buildings for applications like resorts and apartment buildings, and that will need to be the direction B.C. lumber takes in marketing itself to China. The lumber-sector trade missions are part of a larger strategy being put in place by the provincial government. In addition to a joint federal-provincial program that will see B.C. representatives attend 15 trade shows in Asia in the next year, B.C. just concluded its participation in the massive China International Import Expo, which included 18 B.C. companies. B.C. Minister of Jobs, Trade and Technology Bruce Ralston says that, although there is rising protectionism south of the border, markets like China are motivated to develop trade relationships outside of the United States, which may present B.C. with an opening. “At a time where U.S. protectionism is rising, it’s important we take the opportunities where we can find them,” Ralston says. É
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Forestry Innovation & Opportunity in the Northern Rockies! The Northern Rockies Regional Municipality (NRRM), with Fort Nelson as its service centre is located in British Columbia’s far northeast corner of BC with the world famous Alaska Highway as its main street. At approximately 86,000 square kilometres, it covers almost 10% of the province - larger than Austria ‌ and is home to 5,500 “can-doâ€? people to ZKRP KDUG ZRUN VHOI VXႈFLHQF\ DQG innovation are second nature.
/LNH 8V 2XU )RUHVW LV 'L௺HUHQW Our forest is atypical in BC. Where coniferous species dominate in the rest of the province, the NRRM’s forest is one made up of mixed-wood, primarily sprinkled with pine. Our diverse ecosystems, wildlife habitat and vegetation also set us apart and have spawned a variety of cultural and recreational values worthy of celebration. These factors combine to provide a range of economic opportunity GLႈFXOW WR PDWFK 7KH DVSHQ UHVRXUFH alone, for example, has been deemed “...a high quality resource, considerably higher than the aspen in other areas of Canada,â€?š by the widely-recognized industry authority FP Innovations.
A Regional Municipality Rooted in Resource Development The economy of the Regional Municipality has historically been driven by the resource sectors of forestry and QDWXUDO JDV 7KH JOREDO ÂżQDQFLDO FULVLV of 2007-2008 and the subsequent decline in global pricing and demand for Canadian natural gas (2014) have UHVXOWHG LQ D VLJQLÂżFDQW FXUWDLOPHQW LQ natural resource based activity and resulted in the closure of Canfor’s OSB, lumber and plywood mills. The resources on which previous industry thrived remain however, poised for renewal. 1. FP Innovations. “Aspen Utilization in the Northern Rockies...â€? (2017) https://nr.civicweb.net/document/147550
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Taking Initiative Is What We Do!
We are Ready to Grow
Never one to await others to address our needs, the NRRM initiated the Forestry Rejuvenation Project in 2013, and has pursued a partnership with the province and First Nations, to VHFXUH JUHDWHU LQÀXHQFH RYHU LWV RZQ economic destiny. This initiative is about to bear fruit in the form of the largest Community Forest license yet granted in the province – one based on a partnership between the Regional Municipality and Fort Nelson First Nation.
The NRRM has planned ahead for growth; a Regional Economic Strategy (RES) is in the latter stages of development, with implementation to begin in Q2 this year. With the assistance of the province in the form of a 20-year, $200 million shared-cost agreement, and using an awardwinning asset management program, we have maintained and upgraded key components of our infrastructure LQFOXGLQJ ¿UVW UDWH UHFUHDWLRQ IDFLOLWLHV The government of BC’s investment in the Northern Rockies attests to their assessment of our future potential. The NRRM is strategically positioned as the service centre for resourcebased activity in the region. Key transportation assets include the Alaska Highway (97 – north/south), Highway 77 (East – NWT/Alberta), CN Rail railhead access, and the recently upgraded Northern Rockies Regional Airport, hosting regular scheduled and charter air service. Our transportation capacity, complemented by a full suite RI DPHQLWLHV DQG DႇRUGDEOH KRXVLQJ render the Regional Municipality capable of meeting the needs of residents, business and industry.
%DVHG RQ WKH SRVLWLYH ÂżQGLQJV RI WKH initial Aspen Study, the NRRM has forged ahead with a second, more comprehensive study considering a range of uses for our aspen from panel products through lumber. As word about Northern Rockies Aspen travels, investors have shown interest in both traditional uses and other more innovative ones. The release of an Investor Package Overview Report on Northern Rockies Aspen/Hardwood Resources due in April 2019, is expected to further heighten interest.
The Fort Nelson Timber Supply: Healthy, Sustainable & Increasing The Annual Allowable Cut (AAC) for the Fort Nelson Timber Sales Area (currently 1,625,000 m3) is undergoing review. While harvest levels elsewhere LQ %& KDYH VHHQ VLJQLÂżFDQW UHGXFWLRQV in AAC levels, it is expected that the cut level in the Northern Rockies will increase when set in Q2, 2019. This expectation is based in part on ongoing engagement between the NRRM and government, aiming to strike a balance between socio-economic and conservation values related to Caribou Restoration.
Northern Rockies Aspen is â€œâ€Śa high quality resource, considerably higher than the aspen in other areas of Canada...â€? FP Innovations (2017)
What’s Missing? :H OLNH WR WKLQN WKDW ZH RႇHU WKH complete package‌ resources, amenities, infrastructure, energy and determined, capable people. We are the Northern Rockies, and we have a vision for a prosperous sustainable future! We want to talk to you about ZKHUH \RX ¿W LQWR WKH SLFWXUH
Call or email em our Regional 'HYHO 'HYHORSPHQW 2ႈFHUV Jack Stevenson or Mike Gilbert invest@northernrockies.ca 250.774.2541 www.northernrockies.ca >Business>Economic Development
2019-03-14 10:34 AM
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
MINING
MINING INCENTIVES
ETCHEDIN STONE
Extending flow-through shares and exploration tax credits adds certainty to B.C. mining investments
00_BC Investment 2019_32p_0.indd 16
2019-03-14 10:34 AM
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NELSON BENNETT
V
ancouver is a global mining hub, with 1,200 mining and exploration companies headquartered in the city, representing mining plays that are studded across the province. Mining plays a vital role in B.C.’s economy, Premier John Horgan confirmed at the opening of the Association for Mineral Exploration (AME) Roundup conference in January. At times, copper and metallurgical coal exports have rivalled lumber as B.C.’s largest export commodities, he told delegates.
But B.C.’s exploration sector has struggled in recent years to attract the investment needed to makes the discoveries that can lead to new mines being built. To address this, Horgan told the AME meeting, two tax credits that have in the past been renewed on an annual basis would now become permanent. Both mining flow-through shares and the B.C. mining exploration tax credit are intended to provide investors with incentives to invest in exploration and mining. But the industry could never count on those incentives, because they have, for years, been renewed on an annual basis. The B.C. government is now making them permanent, and the federal government has also announced that federal mining and exploration tax credits will be extended for five years. Making the tax credits permanent was one of the recommendations of the NDP government’s Mining Jobs Task Force. Horgan says his government will also hire more staff for the mines ministry to help speed up permitting. “We’re going to dedicate new resources so we can make our processes faster and more efficient,” Horgan says. The government will also earmark $1 million for the Regional Mining Alliance, which promotes mining and Indigenous partnerships, especially in the Golden Triangle in northwest B.C. Horgan notes $330 million was invested in exploration in B.C. in 2018, which is up from the $250 million spent
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in 2017. That is still low compared with what was being spent on mineral exploration in B.C. prior to a commodity price crash that started around 2011. While B.C. is blessed with an abundance of minerals, it is also seen as a problematic jurisdiction to do business in, in part due to unsettled land claims and lengthy and costly environmental review processes. Horgan, however, points to the $40 billion LNG Canada project as evidence that his government supports resource development. “It’s the largest private-sector investment in Canadian history,” he notes. But even that project – which secured benefits agreements with every First Nation along a natural gas pipeline corridor – has run into problems with First Nations. Some members of the Wet’suwet’en First Nation had been blocking a road near Houston, B.C.. and preventing Coastal GasLink pipeline workers from accessing the area. The elected members of the Wet’suwet’en support the LNG Canada project and associated pipeline, as do a number of hereditary chiefs. But some hereditary chiefs oppose the project. Horgan says many First Nations welcome resource development, because it provides their people with jobs and other community benefits. “Every Indigenous community that you work in wants to see benefits for their community,” Horgan says. But he adds, “Certainty on the land base is absolutely critical for investment.” É
Geoscience BC helicopters mapped more than 10,000 square kilometres in a recent mission to gather mineral deposit information in northern B.C. In 2018, $330 million was invested in exploration in the province, up from the $250 million a year earlier • GEOSCIENCE BC
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
MINING
A gold boom started B.C.'s mining industry but today nickel is shining, driven partly by demand for electric vehicle batteries • SUBMITTED
MINING OUTLOOK BRIGHTENS IN 2019 B.C. miners faced headwinds in 2018 due to weak commodity prices and a slowdown in demand from China, but this year is flashing signs of confidence. “Although some commodities saw considerable volatility in 2018, we remain optimistic for the year ahead,” says Jeff Swinoga, EY Canada mining and metals leader. “Strategic transactions, refocusing on
quality deposits and, of course, digital transformation are top of mind as the mining and metals industry continues to work toward reinventing itself this year.” Industrial and precious commodities fell by about 12 per cent by mid-December 2018. In stark contrast, cobalt prices declined by 24 per cent in the same period as compared with outstanding growth of 127 per cent in 2017. Copper and zinc prices both decreased by five per cent as of the fourth-quarter 2018. Prices for gold went the opposite way, gaining eight per cent in the last three months of the year. Looking ahead, industry experts predict better metal prices driven by growing demand for nickel from the stainless steel sector and the electric vehicle battery market. They also see the copper and zinc market gaining momentum on supply constraints and tight market conditions. CECILIA JAMASMIE, MINING.COM
BRIEF Copper a comer in low-carbon future B.C. is Canada’s largest copper producer, with six operating mines, including the Copper Mountain mine near Princeton and Teck Resources’ Highland Valley Copper mine near Logan Lake, the largest open-pit copper mine in Canada. About 25 junior projects are at the early or late exploration stage that could become new mines one day. Craig Hart, director of the mineral deposit research unit at the University of British Columbia, points to the demand for copper that will result from the low-carbon economy – more electric cars, wind turbines and generally more electrification. “All of that is going to require a lot more copper, and our feeling is that British Columbia is probably as well poised as any jurisdiction on the planet to take advantage of and exploit the opportunity,” Hart says. But Michael Doggett, mining consultant and adjunct professor
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at Queen’s University’s geological sciences and geological engineering department, says a historical review of exploration and mining for copper in B.C. over the past 45 years suggests the sector in B.C. is a mature industry that seems poised for steady-state maintenance, not bonanza-style growth. “Whatever the reasons, it seems like we get ups and downs in this business, but we seem to hit a ceiling here of about 350,000 tonnes,” Doggett says. “The business of B.C. copper, I think, is going to continue to make a significant contribution to the economy in the province.” Copper is B.C.’s second most valuable export from mining – metallurgical coal being the most valuable commodity. B.C. exported $205 million worth of copper in 2017, according to BC Stats. Spending on exploration for copper in B.C. peaked at $200 million in
2012 – around the time copper prices began a downward slide. In total, about $2.6 billion was spent on prospecting and exploration for copper in B.C. since the 1970s. While copper is widely distributed in B.C., much of the exploration focus in recent years has been in the northwest corner of the province in an area known as the Golden Triangle. Junior exploration companies have carried out most of the work.
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TOURISM
VANCOUVER: NO. 1 FOR TOURISTS AND CONVENTIONS Vancouver’s increase in traveller visits is set to outpace the entire country during 2019
LIJUAN GUO/SHUTTERSTOCK
GLEN KORSTROM
T
he latest Travel Markets Outlook from the Conference Board of Canada paints a rosy outlook for tourism in Vancouver, which is also setting new standards for conferences. It projects that Canada will welcome two per cent more overnight international visitors in 2019. The think tank projected an even higher increase for Vancouver in 2019 – a 3.3 per cent jump in overnight visitors, from within Canada and international markets.
B.C.’S TOP TOURISM CITIES 1 – Vancouver 2 – Victoria 3 – Richmond 4 – Whistler 5 – Kelowna 6 – Surrey 7 – Burnaby 8 – Nanaimo 9 – North Vancouver 10 – Kamloops SOURCE: 2018 TOP SEARCHED DESTINATIONS, COMPILED BY TRIPADVISOR
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TOURISM
The report did not mention ratcheted-up tensions between Canada and China, which have prompted both countries to release travel advisories, warning citizens against travelling to the other country. Nor did the report touch on the political and economic uncertainty in the United Kingdom related to the March 29 deadline when the U.K. could exit the European Union. Outside of visitors from the U.S., China and the U.K. were the second- and third-biggest sources of international visitors to B.C. in 2018, with 285,521 visitors and 157,369 visitors, respectively. Part of the Conference Board’s optimism stems from what it called its “travel intentions survey.” That survey found that “a growing share of Canadian households plan to take a winter vacation, and among those, a slightly higher share plan to stay in Canada for their longest-duration trip.” The Conference Board added that growth from the
The stunning Vancouver Convention Centre has become a tourist destination in itself and the key venue for another record-setting year for conferences in the city • SUBMITTED
U.S. and overseas markets is expected to strengthen in 2019, as travel price inflation eases and “a favourable exchange rate for many international markets remains.” Analysts at Toronto-based CIBC Capital Markets back up the prediction that the Canadian dollar will not rise in 2019. “Tourism activity in 2018 was weighed down by a number of factors, including rising travel prices, the weaker economic environment and lack of major events like those that happened in 2017,” says Greg Hermus, associate director for the Conference Board’s Canadian Tourism Research Institute. Vancouver is expected to have a better 2019 for visitor growth than the country as a whole because of what the Conference Board’s report called “the projected robust economic growth in the province and strong influx of tourists from overseas markets.” Va ncouver’s natu a l beauty a nd reputation for
VANCOUVER LEADS IN TOURIST GROWTH BECAUSE OF WHAT THE CONFERENCE BOARD CALLED “THE PROJECTED ROBUST ECONOMIC GROWTH IN THE PROVINCE AND STRONG INFLUX OF TOURISTS FROM OVERSEAS MARKETS”
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nisg- a’a nation
’ / We Welcome You Aam wil bakwsim
come visit us and explore! + Drive the brand new Nisga’a self-guided Auto Tour. + Nisga’a Museum — one of the finest collections of Northwest Coast aboriginal art in existence. + Guided tours of the lava fields, lava cone: Nass Valley Tours 1250 855641 5684400 8687 + Visitor Centre exhibit. + Hlgu Isgwit, our hotsprings — water heated by nature. + Vetter Falls Lodge — pristine wilderness experience.
sustainability helped the city attract a record 33 citywide conventions and events in 2018 – and this year’s pace is on track to exceed it. Vancouver Convention Centre vice-president of sales and marketing Claire Smith has noticed a rise in the number of citywide conventions that are related to nature or sustainability. “It has taken awhile for Vancouver to be recognized for this,” Smith says. “We certainly have put our stake in the ground as a city with regard to sustainability and sustainable practices, and it is nice to start to see that recognition and have groups coming as a result of that.” The March 2018 convention of global organization Sustainable Brands, which drew about 3,900 delegates, is an example. Vancouver’s meetings and conventions industry supports more than 6,000 jobs and generates more than $300 million annually in direct visitor spending and $500 million in economic impact for Vancouver, according to the convention centre. É
+ Tour K-’alii-Aksim Lisims (the Nass River) and see our famous Fish Wheels: 250 633 2617
nisgaatourism.ca ’ / We Welcome You Aam wil bakwsim
Bert Mercer Economic & Business Development betramm@nisgaa.net 250 641 1644
TO BOOK YOUR 2019 BOOK OF LISTS AD Call 604-688-2398 or email ads@biv.com Space Close: July 30, 2019
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
TOURISM
HOTEL ROOM REVENUES IN B.C.
Tofino ranks No. 4 for hotel
2017 (thousands of dollars)
room revenues • SUBMITTED
$2,500,000 2,000,000 1,500,000 1,000,000
Va nc ou W ver hi st Vi ler ct or i T a Ka ofin m o Ko loop ot s e P na Pr en ys in tic ce to Ge n o O rge so yo B. C. os to ta l
500,000
SOURCE: DESTINATION BC/BC STATS, BASED ON MUNICIPAL AND REGIONAL DISTRICT TAX DATA
BRIEF
10 TOP BREWERIES OPENING IN 2019 British Columbia has a staggering number of craft breweries, but more are always welcome. Here are 10 of the top breweries opening this year. Ace Brewing Co. Courtenay (summer 2019) The Comox Valley's new craft brewery pays homage to the history of the Royal Canadian Air Force. Another Beer Co. New Westminster (early 2019) The ABC is creeping closer to reality with a facility on Capilano Way in Sapperton. The Bakery Brewing Co. Port Moody (summer 2019) Can Murray Street handle another brewery? Moody Ales’ Adam Crandall thinks so. Barnside Brewing Delta (summer 2019) A true on-farm brewery started by farm families, Barnside will be growing all of its malting barley on-site in Ladner. Container Brewing Vancouver (summer 2019) This new craft brewery will be just blocks away from Powell and Callister on Franklin Street.
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Copper Brewing Kelowna (Summer 2019) Kelowna’s exploding beer scene is shaping up to be the biggest story in craft beer for 2019. Copper Brewing is one of four new breweries planned. Dog Mountain Brewing Port Alberni (summer 2019) The city’s second craft brewery is looking to open shop in the historic downtown at Third and Argyle. Farm Country Brewing Langley (summer 2019) The first craft brewery in the City of Langley, Farm Country opens next to the Cascades Casino. Fraser Mills Fermentation Co. Coquitlam (late 2019) This brewery will be the centrepiece for the new waterfront Fraser Mills development.
Ken Beattie of the BC Craft Brewers Guild enjoys a brew • CHUNG CHOW
The Herald Street Brewery Victoria (summer 2019) The good folks at The Drake Eatery and Steel & Oak Brewing teamed up in a new brewery just north of downtown. Ucluelet Brewing Co. Ucluelet (summer 2019) Located in a former church, Ukee’s first craft brewery will be ready to go for the tourist season.
ROBERT MANGELSDORF, THE GROWLER
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REAL ESTATE
INDUSTRIAL STRENGTH Warehouses and light industrial space have overtaken residential as Metro Vancouver’s No. 1 real estate investment
CHRIS MACCAULEY
In Vancouver’s increasingly tight industrial market, vacancy rates have hit new historic lows. The city’s industrial vacancy rate has now dropped to 1.4 per cent from 1.7 per cent last year. Things should start to stabilize through 2019, with more than five million square feet now under construction. But with upward pressure on demand, tight supply and increasing industrial lease rates for tenants across the board, Vancouver industrial continues to be a leading asset class for investors. In 2018, rental rates increased 16 per cent to $11.86 per square foot. This is the highest market average rate on record and is indicative of the market’s prolonged low vacancy rate environment. This rise has been unprecedented but will likely be absorbed by multinational tenants. When we compare Metro Vancouver with other industrial markets on the West Coast like San Francisco, Seattle, Portland and Oakland, there is significantly more potential for industrial lease rates to grow here. While tenant demand is expected to remain strong in 2019, lack of available product moving forward will put continued pressure on prices. CBRE projects positive absorption of an estimated 4.5 million square feet in 2019. Of all construction completing this year, 65 per cent of the space was pre-committed in just the first quarter. Leasing availabilities for space over 100,000 square feet are few and far between, with only four existing options on the market. Of these four, three are tailored to distribution uses. An additional four large-scale spaces are under construction. With these strong fundamentals, we are seeing an influx of global institutional investors into the industrial asset class. Industrial was the most sought after asset class in 2018, and we see that trend continuing, with upward values and appetite into 2019. We started to see more core assets trade in 2018, and we expect more to come this year. Local private investors used to be the most aggressive in our marketplace, but international buyers are now coming in and outbidding them for local trophy assets. Nevertheless, we expect to see an increase in local investors in the small- to-mid-size value properties, but large-scale, Class A trophy assets will continue to garner
institutional attention. Given the outlook for continued lease rate increases, the going return rate is less of an issue for both institutional and local investors. We do anticipate cap rates stabilizing in 2019. BEST INVESTOR OPPORTUNITIES
Existing buildings: With Metro Vancouver’s severe shortage of land and historically low vacancy rates, investors are looking to buy existing assets because it’s extremely difficult to find land of scale to build an industrial portfolio. Investors are buying existing inventory at low cap rates with the foresight that lease rates will continue to improve. Redevelopment sites: Investors are aggressively looking at redevelopment sites with existing income for future redevelopment. Investors are willing to accept a lower yield for a few years, until redevelopment is financially viable. Another trend is investors taking underutilized sites where there’s a possibility for redevelopment and densification. Global investors who have done this in other parts of the world are more bullish in this sector. Industrial strata market: The industrial strata market in Vancouver is one of the strongest for investors in North America. In 2017 and 2018, strata sales accounted for 70 per cent of all industrial transactions by either investors or owner users. This shows the strength of the strata market, which gives smaller investors and owner-users a rare opportunity to take advantage of Vancouver’s hot commercial real estate market. It remains the best vehicle for owner-users and small investors who need to control costs and want to offset lease increases now and into the future. With rising lease rates, this asset class will remain strong through 2019. Overall, Vancouver’s industrial market is seen as the safest and strongest for commercial real estate potential. Industrial used to be boring: now it is the most exciting and evolving asset class. É Chris MacCauley is senior vice-president at CBRE Canada and national director for NAIOP Vancouver.
Light industrial space is attracting investors and tech companies as the industrial market evolves. In 2018, strata sales accounted for 70 per cent of all industrial transactions by either investors or owner-users in Metro Vancouver • SUBMITTED
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
REAL ESTATE
TOWERING OFFICE MARKET Unprecedented demand is driving the Metro Vancouver office vacancy rate to the lowest level in at least 20 years
ROBIN BUNTAIN
Metro Vancouver’s current office market environment can be summed up as: very landlord-friendly with extremely tight vacancy characterized by future uncertainty associated with several new downtown office developments scheduled to come online in the next 24 to 48 months. Metro Vancouver’s office market is currently sitting at a near-record-low vacancy rate of 5.1 per cent, down from eight per cent a year earlier and nearly 10 per cent 24 months ago, thanks in part to a significant leasing push from the technology and co-working sectors. Vacancy in Metro Vancouver is forecast to fall to 3.9 per cent by year-end 2019 while the downtown office market vacancy rate is projected to fall to one per cent by year-end 2019 – the lowest-ever recorded downtown vacancy rate since Avison Young started tracking in 1996. A significant chunk of this demand has come from just three users located overwhelmingly in downtown Vancouver: Amazon leasing/pre-leasing approximately 820,000 square feet, WeWork securing approximately 337,000 square feet and Regus/Spaces taking up approximately 388,540 square feet. Over the next 12 to 24 months, the Metro Vancouver office market is expected to enter into a period of demand far outpacing the available supply, which will very likely continue to drive rental rates up to new heights. Strong demand and limited availability in downtown Vancouver have had a ripple effect on vacancy and rates in surrounding submarkets such as Yaletown, Gastown, False Creek Flats, Mount Pleasant and Burnaby, all of which have seen record-breaking rental rates as vacancy tightens throughout Metro Vancouver. Companies that do not need to be in the downtown core have relocated to these submarkets as they often offer a reduction in operating costs, while providing employees with a unique
culture outside of the traditional corporate highrise office tower. In the competitive labour market seen today, it is imperative for growing organizations to ensure that their office space caters to their workforce, whether that be proximity to employee residences, rapid transit, amenities or other like-minded organizations. This can drive organizations to consider relocating into other areas of Vancouver or to suburban markets and represents an opportunity for investors to acquire office properties or potential development sites in neighbourhoods that may not have been as attractive when there were more options available in key markets. For office tenants seeking to relocate into this marketplace, there are very few options available. Avison Young highlighted this challenge in its Q3 2018 Downtown Office Tenant Profile Report, which revealed that a tenant seeking more than 30,000 square feet of contiguous office space in a Class AAA building had no options in downtown Vancouver. Similarly, a tenant seeking 10,000 square feet to 15,000 square feet of downtown office space on a single floor had only five available alternatives. With these supply constraints, many existing tenants, renewing their leases are seeing 25 per cent to 50 per cent increases in their net rental rate For risk-averse office landlords/investors who currently own an asset in this marketplace, there is a real opportunity to approach existing tenants in their portfolio to renegotiate longer-term leases well in advance of lease expiries in order to benefit from current market conditions and avoid the risk of losing out later to newer product and different lease terms. Alternatively, an owner could wait it out as the market continues to tighten over the next 12 to 24 months; however, there is a lot of uncertainty on whether the market will continue on this trend with an additional 4.4 million square feet coming to the downtown market alone between 2020 and 2023 (only 28.4 per cent of that is pre-leased). Vancouver’s office market will have to continue to attract large international users along with continued organic growth to avoid a significant increase in vacancy, and downward pressure on rental rates. This uncertainty is leading several institutions/private investors to explore selling off existing assets while the market has momentum. É Robin Buntain is a principal at Avison Young, Vancouver, where he specializes in assisting tenants in the acquisition of office space, developing strategic solutions for expansions, consolidations, dispositions, relocations and lease negotiations.
The Post, by QuadReal, will redevelop the old Vancouver post office: much of its one million square feet of new office space has already been claimed • QUADREAL
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TECHNOLOGY
KABAM REFLECTS TECH KABOOM Explosive success of B.C.’s digital gaming industry is taking place despite the province offering the lowest tax credits in the country
TYLER ORTON
W
hen Tim Fields first arrived at Kabam Inc.’s Vancouver headquarters five years ago, the gaming studio seemed as compact as the mobile devices its games are featured on. “We were in a tiny office, more or less sitting on each other’s laps even though there were only 35 of us,” recalls the CEO, who originally hails from Austin, Texas.
The mobile gaming developer has more breathing room now since expanding into new offices and hiring another 200 workers (even more employees are based at Kabam studios in San Francisco and Austin). But even the new facilities on Alberni and Georgia streets aren’t enough for the company that broke onto the scene with the Kingdoms of Camelot mobile game. “We want to bring everybody back together,” Fields says. Kabam announced in November it would lease 105,000 square feet of office space across seven storeys at the under-construction Vancouver Centre 2 tower on
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Seymour Street. That’s nearly one-third of the 345,000 square feet available at the 33-storey building. “As we look over the next couple of years and start to look at our workforce planning, we know that we’re going to be continuing to grow and we want to do that in Vancouver,” Fields says. “We believe in this region, we believe in British Columbia and we believe in the talent base here.” He says he anticipates the 200-plus head count “doubling in size over the next few years” – one of the other major driving factors behind the upcoming move into new facilities.
B.C.’S TECHNOLOGY SECTOR EMPLOYS APPROXIMATELY FIVE PER CENT OF B.C.’S WORKFORCE, MORE THAN THE MINING, OIL AND GAS, AND FORESTRY SECTORS COMBINED
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TECHNOLOGY
Tim Fields, CEO of Kabam Inc.: “we believe in British Columbia and we believe in the talent base here” • KABAM INC
Over the past few years, the studio has built its mobile gaming reputation around partnering with big-name pop culture franchises such as Marvel, Transformers and The Hobbit. “Kabam has become a tent-pole studio in Vancouver over the past decade. They have six titles that have grossed more than $100 million, which is a huge accomplishment,” notes Brenda Bailey, executive director of
the DigiBC industry group representing the province’s gaming sector. “Their singular focus on mobile and their alliance with top franchises like Marvel and Transformers has allowed them to connect with a truly global market.” Meanwhile, last year’s departure of two Japanese gaming companies, Bandai Namco Studios Vancouver Inc. and Capcom Game Studio Vancouver Inc., has raised concerns over investment leaving the city, according to Bailey. This is on top of changes to corporate taxes in the U.S. and the introduction last year of Alberta’s 25 per cent incentive for the gaming industry, the province’s interactive digital media tax credit. B.C.’s interactive digital media tax credit comes in at 17.5 per cent – the lowest among all jurisdictions in the country, according to DigiBC data provided to Business in Vancouver. “It’s ever more important that we have studios such as Kabam and Electronic Arts continuing to expand here,” Bailey says. With that the company began 2019 with a rebranding, eschewing its previous bomb-motif logo for a more streamlined version of the letter K. A key reason for the rebrand, according to Fields, is to make Kabam as attractive as possible to potential new hires. While the city’s beauty is a pull for talent, Vancouver’s high cost of living has made it more difficult for young workers to make a go of it, he says. And in recent months officials from the City of Calgary have been visiting Vancouver, trying to recruit talent to work in Alberta’s fledgling tech industry. “There are places busy attempting to make it more attractive to staff up in significant ways,” Fields says. “Sometimes it’s a little bit harder to convince [workers] that they want to come [to Vancouver]. That forces me to pay higher wages. Higher wages suggest that there are things the provincial government can do with regards to tax incentives to make that more palatable.” Still, B.C.’s game producers are sharing in an industry that is usurping the province’s traditional breadwinners. “B.C.’s technology sector employs approximately five per cent of B.C.’s workforce,” notes BC Stats in its most recent industry report, “more than the mining, oil and gas, and forestry sectors combined, including manufacturing activities related to those resources.” É
B.C. TECHNOLOGY BY THE NUMBERS $29 billion
Annual revenues
$17 billion
Contribution to B.C. GDP
$6 billion
Annual exports
$3 billion
Research and development investment
$343 million $45 million 106,340 $1,690
Venture capital investments Angel investment Direct jobs Average weekly earnings
SOURCE: BC STATS REPORT: PROFILE OF THE BRITISH COLUMBIA TECHNOLOGY SECTOR, 2017 EDITION (RELEASED JANUARY 2019)
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TECH TAKES THE LEAD B.C. technology scores an A in economic comparison with other provinces – but more work is still needed
JILL TIPPING
The story of British Columbia’s tech industry continues to be a story of success and sky-high opportunity. It’s no surprise that B.C.’s fast-growing tech sector is a leading economic driver of growth in our province; technology is a tool empowering businesses, people and governments to tackle important problems and improve lives. Our ecosystem has matured and flourished in the last two years, building ever-closer connections and meaningful partnerships through initiatives like the Digital Technology Supercluster and the Cascadia Innovation Corridor. Since 2012, the BC Tech Association has teamed with KPMG in Canada to assess the impact of the technology sector in B.C., and the latest report shows B.C.’s tech economy takes its place as a clear Canadian leader. In 2018’s report card, the B.C. technology sector’s economic performance received an A compared with other B.C. industries and – for the first time – an A compared with other Canadian provinces. This is a tremendous achievement. There is much to be proud of: B.C. is one of the fastest growing startup ecosystems in Canada. Our research universities are world-class, and our ecosystem now consists of over 10,000 tech companies employing 106,000 people, with 50,000 more working in tech jobs across other sectors. By some estimates up to 40 per cent of the commercial real estate in downtown Vancouver is occupied by high-tech businesses and workers. But the true impact on the economy is in fact far greater. Today, technology is more than an industry; it is an engine that fuels the development and growth of all industries and a key source of innovation, GDP, job growth and economic diversity. Yet B.C. cannot afford to be satisfied with our current prosperity – we are determined to reach our full potential.
The 2018 B.C. Technology Report Card delivers a clear call to action in two key areas: (1) scaling company growth and (2) educating, attracting and retaining the best talent in the world. These challenges are not unique to B.C., but the solutions must be crafted here. Access to talent continues to be the biggest constraint B.C. tech companies of all sizes face when expanding their businesses. Every year, firms create many more job openings than they are able to fill. B.C.’s university graduates are second to none, but we must invest more in people and grow B.C.’s skilled workforce through educational opportunities in K-12, post-secondary and lifelong learning. But the potential does not end with talent. Our analysis shows there is a tremendous opportunity for B.C. to grow more anchor technology companies that have achieved scale. Return on investment will only increase as anchor firms create spinoffs, attract top talent and accelerate the innovation cycle. At BC Tech we have made it our priority to take determined action to build the B.C. tech industry through our venture programs, our ecosystem collaboration and our 2019 public policy recommendations. The most recent BC Tech report card reminds us how critical that mission is and how essential it is that we succeed. For the future to look different than the past requires more than audacious ambition. Success will demand stronger partnerships and collaboration among tech companies, business leaders, post-secondary institutions,and ecosystem and government partners. And as always, visionary change will require a willingness to depart from the safe path of the status quo and take bold first steps in a new direction. The history of technology shows that time and time again, everything is difficult until it is easy, unthinkable until it is commonplace. The real heroes are those who decide, together, to act. É Jill Tipping is president and CEO of the BC Tech Association, headquartered in Vancouver.
VISIONARY CHANGE WILL REQUIRE A WILLINGNESS TO DEPART FROM THE SAFE PATH OF THE STATUS QUO AND TAKE BOLD FIRST STEPS IN A NEW DIRECTION
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5
TOP B.C.
TOWNS
Kitimat Terrace Abbotsford-Mission
Nanaimo
Cranbrook
FOR INVESTORS
The site of Canada’s biggest investment, Metro Vancouver’s safety valve and one of B.C.’s fastest-growing cities share the spotlight
Kitimat has been chosen for the $40 billion LNG Canada terminus and pipeline project, the biggest private development investment in Canadian history • LNG CANADA
KITIMAT
BC Investment’s No. 1 pick of B.C. cities for investors is the northwest British Columbia centre that is ground zero for the biggest private investment in Canadian
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history. In October, LNG Canada confirmed it would proceed with the $40 million liquefied natural gas (LNG) terminus and pipeline network that will change Kitimat forever. It will also likely change the fortunes of those investors quick enough to get into town. Despite work camps springing up to house the estimated 6,000 construction workers, the real estate play in Kitimat is residential rentals. A lot of management types, consultants, government officials and other professionals will be seeking two-to-three-year rentals in Kitimat, figures Jason Pender of JV Development Group. His company is rushing to complete a 27-acre project with 94 townhomes, 30 detached-house lots and a 12-acre modular home site. Kitimat is also on the radar of blue-chip international investors. Royal Dutch Shell PLC is the lead partner in LNG Canada, with a 40 per cent stake. The project is rounded out by Petronas of Malaysia, PetroChina, Japan-based Mitsubishi, and Korea Gas Corp.
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LEFT:
Terrace is so hot
it’s burning. A Chinabased developer is rapidly clearing 700
BELOW:
acres of forested land
Vancouver Island hub city
in preparation for the
is a magnet for Lower
LNG-linked boom • CITY
Mainland investors and
OF TERRACE ECONOMIC
retirees from across
DEVELOPMENT
Canada • SUBMITTED
Nanaimo: the
TERRACE
Kitimat has the LNG plant, but neighbouring Terrace makes the list at No. 2 because it has the infrastructure, including shopping malls and an airport, and the land. Danielle Myles, economic development manager for the City of Terrace, points to a 700-acre industrial site now being transformed from a forest to a job-generating industrial park. Myles expects Terrace will be the staging site for much of the work for the LNG plant in Kitimat, which is a halfan-a-hour drive away. You can still buy a detached house in town for less than $400,000 but prices are up about 20 per cent from a year ago.
NANAIMO
LEFT:
Abbotsford’s regional
hospital and neighbouring Mission’s affordable real estate are helping to attract and retain investors
K nown as the Hub City or the Harbour City, the second-largest urban centre on Vancouver Island is also among the fastest-growing in B.C. Population growth rates approach eight per cent annually, compared with a provincial average of 5.6 per cent. With the expanding Vancouver Island University there has been significant commercial and residential development, says Jay Deleskie, a commercial counsellor with the Vancouver Island Real Estate Board. An expanded airport with direct flights to Calgary and Toronto is reflective of the growth.
from across the Lower Mainland • SUBMITTED
ABBOTSFORD-MISSION
Two neighbouring centres, Abbotsford and Mission, come in at No. 3 for the best investment opportunities in 2019. Abby-Mission is on the eastern edge of the Lower Mainland and is a pressure valve for both residential and industrial plays. The area is feeling its own population pressure as more people from Metro Vancouver move in seeking work and affordable housing. Abbotsford’s industrial vacancy rate has plunged to 1.8 per cent this year, among the lowest in the Lower Mainland. The city has a robust infrastructure, with an award-winning
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cancer hospital and the fourth-busiest airport in Canada. Abbotsford is also the agriculture capital of Canada, with gross farm receipts three times those of Ontario’s Niagara region, in second place. The district of Mission has easy freeway access, is just 15 minutes from the U.S. border and is seen as ideal for distribution facilities. But rental residential investors will also be attracted by a one per cent rental vacancy rate and rent increases that averaged more than seven per cent in the past year across the region.
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BC INVESTMENT 2019 PUBLISHED BY BUSINESS IN VANCOUVER
TOP 5 B.C. TOWNS FOR INVESTORS
CRANBROOK
City building permits in the largest city in the East Kootenays increased by $10 million last year to top $44.2 million. And more are to come with development of the Wildstone Golf Course where 94 homes are planned. A key regional service centre, Cranbook has also seen a spike in industrial development, which doubled from 2017 to 2018 with 21 building permits issued last year worth $7.6 million. Housing remains among the most affordable in B.C.: the average resale home price in January was less than $300,000, according to the Kootenay Real Estate Board. É Cranbrook: a new development around the Wildstone Golf Course is part of a surge in building permits in the Kootenay community • SUBMITTED
Cranbrook redefines the essence of work, life, learning and play. We are an active, youthful community deeply connected to an extraordinary landscape and all the adventures it provides. Our focus is on economic growth locally, and excelling our operations to enhance the quality of life for our residents and business community. Life here offers the balance and richness of life you’ve been looking for.
2019 | BUSINESS AND INVESTMENT
BC INVESTMENT LNG: THIS CHANGES EVERYTHING SUSANNAH PIERCE ON B.C.'S $40 BILLION BONANZA
TECH: GAME ON NO. 1 IN TOURISM MINING STIMULUS BEST REAL ESTATE TO BUY INTO NOW
KEY SECTORS ALIGNING FOR BRITISH COLUMBIA INVESTORS
PRINCE OF PORTS
TIMBER TO CHINA
MINING INCENTIVES TOP FOR TOURISTS KABAM KABOOM
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Space Close: February 13, 2020
2019-03-14 10:35 AM
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