Why Invest In Northeastern B.C.?

Northeastern B.C. will be one of the top investment markets in Canada with both Fort St. John and Dawson Creek seeing massive capital investments.  Investments like these lead to job creation. Job creation leads to a population boom and, in turn, raise demand for housing.

People will move to northeastern B.C. to fill jobs

In 2014, the population of Fort St. John grew by 4.5%. According to the North Peace Economic Development Office, the population is set to double over the next 6 years. Fort St. John was recently ranked #1 by B.C. business as best city to work for in in B.C. There are over 2000 people employed in the forestry industry and thousands of additional jobs being created with the Site C Dam and the natural gas industry. The employment base is heavily diversified and ripe to expand. The number of jobs created in Fort St. John will likely grow exponentially over the next 10 years.

The projects driving growth in the region right now

  • In 2012, a new $350,000 hospital opened in Fort St. John, population 25,000. The government believes there is a major population boom on the horizon.
  • Plans are in place to twin the highway from Fort St. John to Grand Prairie. Another major capital project.
  • Fort St. John has the second largest OSV plant in the world, operating with 400 employees per 8 hour shift running 3 shifts per day.
  • The Horn River and Montney natural gas fields are the third largest hydrocarbon fields in North America.
  • enCana is spending $600,000 on drilling in the area in 2015.
  • BC Hydro has announced the Site C Dam for the region, a $9 billion project, the largest infrastructure project in Canada 7 km away from Fort St. John.
  • Petronas announced their decision to proceed with a $36 billion natural gas project, the largest capital investment project in B.C. history.
  • In 2015, Shell’s BC LNG received approval from the provincial and federal governments for their $40 billion liquefied gas project.

There has never been a better time to acquire brand-new cash flowing properties in what is becoming one of the top real estate investment markets in the country.


The Hudson: Opportunity In Northeast B.C.

There has never been a better time to acquire brand-new cash flowing properties in what is becoming one of the top real estate investment markets in the country. Introducing The Hudson Condominiums, located in the heart of Fort St. John, one of the fastest growing communities in Northeast B.C.

Maximize Your Investment Return

There are several reasons to buy new in order to maximize your return on your property investment by buying new.

Here’s a rundown of the benefits:

·        A Quality building with modern finishes means durability and energy efficiency

·        A 2 – 5 – 10 new home warranty means there is no further cash to increase the revenue

·        It generates more rent per dollar investment and attracts a better tenant profile

·        It secures today’s prices with only a small deposit; a rising market gives instant equity upon closing

It gives investors a professionally-managed, predictable revenue stream – a complete Turn-key solution

Hudson Interior1 Hudson Interior2

 

 

 

 

 

Why I Believe This Is A Good Investment

As there are only 10 units left available, the developer is prepaying the interested costs for the next 5 years in order to meet their pre-construction threshold. This would effectively give investors a Net Effective rate of 1.49%* on their mortage.

A High Growth Market For A High Return

In 2014, more than $10 billion in projects was invested into the region giving Fort St. John the highest investment per capita in the country for that year. In 2014, the population of Fort St. John grew by 4.5%. According to the North Peace Economic Development Office, the population is set to double over the next 6 years. Fort St. John was recently ranked #1 by B.C. business as best city to work for in in B.C.

The facts are clear. Capital investments lead to job creation. People move to these areas to fill the jobs, driving rents higher and increasing the price of real estate. The region is set for maximum capital appreciation on your investment.

*For more details on this offer, download our brochure.

 


Fort St. John City Council preparing for ‘exponential growth,’ according to Annual Report

Lori Ackerman PhotoFort St. John’s city council is preparing for a continuation and acceleration of unprecedented growth in the area. “With over $68 Billion in recent investments, the lowest unemployment in the province, and anticipated exponential growth, we are firing on all cylinders economically,” writes Mayor Lori Ackerman in the city’s 2014 Annual Report.

The dollar value of projects inside the city limits grew more than 14 percent year-over-year, to a total of $154.9 million, and an application to expand the city boundary limits was approved in September.

Fort St. John has enjoyed Provincial support of the burgeoning Liquefied Natural Gas industry. In addition to planned pipeline construction, it stands to benefit from the impending construction of the Site C Dam, which is currently Canada’s largest infrastructure project by dollar value.

City Manager Dianne Hunter notes that “growth is expected to continue at a faster pace in the decades to come due to these major projects.”

Fort St. John’s Population has increased 15 percent since 2010, with a jump of 4.7 percent from 2013 to 2014 alone. In order to welcome and accommodate this influx of residents, City Council has worked to develop recreation centres and parks, improve road infrastructure, and prioritize the revitalization of the downtown core.

2014 Fast Facts

  • Total number of dwellings permitted: 531 permits – Increase over 2013 from 339 permits
  • Total construction value: $154,983,081 – Increase over 2013 from $135,654,000
  • 556 Development permits issued
  • 2082 Formal building inspections performed
  • 95 Single Family homes were approved, 71 duplexes and 22 Multifamily units

 

Sources

Alaska Highway News
http://www.alaskahighwaynews.ca/fort-st-john/fort-st-john-poised-for-exponential-growth-according-to-annual-report-1.1976644
Population Growth
http://fortstjohn.com/blog/fort-st-john-population-growth-spike
Boundary Extension
http://www.northeastnews.ca/fsj-boundary-extension-gets-final-approval-from-province/
Annual Report
http://www.fortstjohn.ca/sites/default/files/report/2014-Annual-Report.pdf

 


Job Growth in BCs North expect to explode

Discoverytrip-bctakesnorthamerica

Join Us for this exciting event.  Great way to see first hand what’s happening in the north!

Register http://irrealty.ca/field-trip-discovery-june13-14-2015/


Bank of Canada's Rate Cut is it Good For Canada?

Peter Hall, chief economist at Export Development Canada, said  the rate cut comes at a time a number of high-profile deal and job announcements have been made by manufacturers, even as layoffs in the energy sector have overshadowed those announcements.

A weakening Canadian dollar is a windfall for Canadian exporters paid in $US dollars.  West Fraser, North America’s largest lumber producer, sees a $21 million increase in earnings before interest, taxes, depreciation and amortization for every 1-cent weakening in the exchange rate, Rodger Hutchinson, the company’s vice president and corporate controller, said in telephone interview with Financial Post reporter.  Sectors of the Canadian economy will actually benefit by the weak dollar as a result of the unexpected interest rate cut this week.

In light of recent financial market volatility, declining oil prices and the return of instability in Europe, the outlook for the BC economy is decidedly positive. Stronger economic conditions are emerging, with more robust demand from the US economy boosting provincial export volumes. In addition, employment growth is trending higher while the provincial population is expanding as a result of increased net international migration and the first net inflow of individuals from other provinces in a number of years. After expanding by just 1.9 per cent in 2013 and 2.8 per cent in 2014, real gross domestic product (GDP) growth is on track to accelerate to 2.9 per cent in 2015 surpassing Alberta for the first time in two decades. (British Columbia Real Estate Association, 2014)

 


The Ups and Downs of Oil Prices

Compliments of Danny Nasser of First Energy Capital

I try to remind my clients (and myself) regularly that I am confident of two things during a commodity pull back.

  1.  The price will come back.
  2. There will be people who say it’s different this time and it won’t.

Some interesting numbers on previous oil price meltdowns that would seem to support those thoughts:

 

Reduction in Price

Duration of Decline

Increase in Price 1 Year After Low

1986

67%

82 days

79%

1988

44%

295 days

58%

1991

57%

90 days

5%

1998

60%

484 days

135%

2001

53%

290 days

46%

2008

60%

227 days

76%

Current

57%

141 days

 

 

 

 


What does the recent Petronas announcement mean for Real Estate in NE BC?

Written by Chris Biasutti, Director of Sales & Marketing Western Canadian Properties Group Ltd. Dec 10 2014

  1.  Progress Energy (petronas’s wholly owned subsidiary in NE BC spent $2.5 billion on drilling north of FSJ in 2014. They announced they plan to spend the same amount in the same region on drilling in 2015 and are continuing to develop infrastructure in the region. The continued spending to drill new wells and develop infrastructure will continue to create jobs in a region that is already at full employment. I believe rents and values will continue to rise as Progress moves forward with its 2015 drilling program.
  2. Petronas has cost certainty from the Provincial government on their Tax Regime and they have environmental approval from the provincial government
  3. Petronas does not yet have the CCA adjustment they would like to see from the Federal Government and they are still waiting on a few Federal environmental approvals. Petronas is unable to make any investment decision until they have certainty around these costs and approvals.
  4. Though Petronas claims their decision is due to the correction in the oil price, we believe this is primarily a negotiation tactic as Petronas’s pricing model is not highly sensitive to the Oil price because they own their own production already through Progress Energy and they are their own purchaser of the Gas downstream
  5.  Unlike Fort Mcmurray, NE BC has a diversified economy and is not totally reliant on the oil and gas business to support to growth in the real estate market.
  6. The real estate market in NE BC has experienced steady, stable growth over the past 10 years and, as a result of its stable economic base, was able to avoid the significant market corrections other markets experienced in 2008-2009. I believe we will see the same resilience from the NE BC real estate market today as the effects of the volatility in the oil price are felt stronger in other markets.
  7. The Forestry industry continues to recover in Northeast BC employing approximately 2000 people in the region today. Agriculture also continues to play a role in the stability of the NE BC real estate market. NE BC currently produces 90% of the province’s grain.
  8. At the center of our decision to invest in Fort St. John and Dawson Creek is the fact that over 50% of the rental housing in those 2 markets was built in the mid-1980s or earlier. New rental accommodations are badly needed. With a population having an average age of 30 years and an average income over $100,000 per year, the current rental stock is simply inadequate to meet the needs of this demographic. There are 18 LNG projects proposed for British Columbia. Petronas is certainly one of the more important ones as many believe that it will be the 1st domino to fall. In a recent article in the Vancouver Sun, it was pointed out that Petronas which is a company with over $100,000,000,000 in annual revenues, has already invested up to $8,000,000,000 and made significant commitments to the federal government as part of the federal governments conditions to allow them to buy progress energy.
  9. Research shows the gas fields outside of Dawson Creek and Fort St. John are the 3rd largest hydrocarbon play in North America behind only Texas and Fort McMurray. Only 2% of the population of BC lives in the north yet today it generates 9% of the GDP. This population base is expected to grow to 4 to 5% of the population of BC and some economists believe that over time it will generate 25-30% of the GDP of the province. If any significant portion of this growth takes place, the potential real estate appreciation in the north could be staggering.

Questions an investor should ask….

  1. Is there a risk that projects of this size that could ultimately run into the hundreds of billions of dollars could take longer?
  2. Is there a risk that these natural gas reserves will not be developed?

Each individual investor needs to understand and get comfortable with. We believe that there is no question that many of these projects will ultimately take longer and not all 18 of them will go ahead. We are extremely active building duplexes, townhomes, condominiums and single-family homes in Dawson Creek and Fort St. John. The rental market is very strong and most of the properties that we complete have a tenant in them within 3 or 4 days of receiving an occupancy permit.

Western Canadian Properties Group Ltd. is the largest developer in the BC’s northeast region with over 194 completed since 2012 and another 294 planned or under construction for 2015 or 2016. WCPG is heavily vested in the area  with 50 acres in Dawson Creek and 27 acres in Fort St. John they are the largest land owner within the city boundaries.


Cold Lake heating up as oil boom accelerates

Interesting article published by Financial Post July 25th.

Cold Lake’s population has grown 9% in the past two years to just under 16,000, and non-residents would probably take the population closer to 18,000.

Read more…


The race for LNG profits!

New York-based Oregon LNG applies to export Canadian natural gas

A New York-based holding company applied to regulators to use Canadian natural gas to feed a proposed export terminal in Oregon, putting a cross-border twist on Canada’s plans to lng_10 Jan 16create a brand new liquefied natural gas industry.

Fluor and JGC Awarded EPC Contract for Kitimat LNG Project

Fluor Corporation (NYSE: FLR) announced today that its joint venture with JGC was awarded an engineering, procurement and construction (EPC) contract by Chevron Canada Limited

Petroleum Brunei joins Petronas’s B.C. natural-gas project

(Chevron) for the proposed Kitimat Liquefied Natural Gas (LNG) project in Bish Cove, British Columbia, Canada.  Petroleum Brunei has signed on as a new partner in Malaysian energy giant Petronas’s fledgling B.C. LNG project.

For more details on LNG development and production in BC, visit Government of British Columbia LNG in BC


Here's Where Canada's Biggest Job Growth will be in 2014

Looking for Work?

oil-sands1-Jan 15

According to Workopolis there were more than half a million job openings in Canada in November, a 22% jump over the same period last year.   Over 40% of all the job openings in the country were in the western provinces.  Although December job losses were significant, overall 2013 gained over 100,000 jobs.

A very busy year: oil patch hiring activity expected to rise in 2014 – Alberta saw employment surge by 78,000 till November 2013, which kept jobless rates at 4.7% — second lowest in the country after Saskatchewan.

UnEmployment Rate Jan 2014

Near term job prospects up for Calgary and Edmonton – Conference Board of Canada Help Wanted Index led the way in October with a gain of 7.5 points, which was the third consecutive increase for the province.

The western provinces boast the lowest unemployment rates in the country and this trend is poised to continue as Canada emerges as an energy super power.  Not hard to see why of Canada’s top 10 jobs three are in the energy sector.

Be prepared to re-locate to areas that have low unemployment and strong economic growth.