Seeking space and more moderate costs, people and companies are moving to the Island, bringing opportunity with them
As the base of the provincial government and a desirable destination for retirees from colder parts of Canada, Vancouver Island has long enjoyed a remarkably stable economy, with service industries dominating. In recent years, however, it has seen some of the province’s fastest population and economic growth.
To a large degree, this reflects a spillover from the more populous Lower Mainland, which, hemmed in by the Coast Mountains and the U.S. border, faces constraints on the availability of land. In response, growing numbers of people and companies have been trading the congestion of the mainland for the breathing room, shorter commutes and lower costs available on the Island—and a mostly milder, sunnier climate to boot.
That trend is expected to continue. “The region’s lower housing price point compared to the Mainland/Southwest Development Region and other higher-priced markets will continue to attract retirees as well as younger buyers seeking better affordability and lifestyle,” the Chartered Professional Accountants of B.C. predicted in their Regional Check-Up 2019.
In fact, mainland-based developers have been following the exodus: of the 20 rental apartment buildings under construction in downtown Victoria, nine are being built by Vancouver developers, among them BlueSky Properties, Concert Properties, Reliance Properties and Salient Group. Real estate advisory firm Colliers International reported a surge in rental unit construction and permit applications in 2019 throughout the Capital Regional District.
Building permits soar
Buoyed by in-migration, the Island has been virtually immune from the general pullback in the Canadian real estate market over the past two years. Indeed, residential and mixed-use projects stalled or purchased out of bankruptcy years ago are going ahead, such as Onni Group’s 450-unit Colwood Corners in Victoria’s suburbs and 360-acre Wyndansea project in Ucluelet. The revived Union Bay Estates project promises 2,900 homes on a 349-acre parcel in the Comox Valley.
Powell River’s Resident Attraction Campaign, launched in 2014 in response to downsizing at the town’s paper mill, has been almost too successful. More than half of home sales over the past two years have been to out-of-town buyers, real estate agents in this quieter, ferry-accessed part of the mainland coast say. The value of building permits nearly doubled between 2017 and 2018, and elementary school enrolment is on the rise. Newcomers are behind a slew of funky ventures such as Townsite Brewing and Point Group Hospitality; they are also the primary users of new coworking space the Innovation Hub.
Nanaimo, meanwhile, saw building permits balloon past $300 million in 2019, including three hotels. The city’s airport and marina facilities are undergoing major upgrades. Perhaps not surprisingly, one in 10 workers in the Vancouver Island/Coast region is employed in construction.
Even heavy industry has been moving to the Island. In April 2019, the new B.C. Vehicle Processing Centre in Nanaimo welcomed its first load of Mercedes-Benzes from Europe. The facility enables offshore carmakers to land vehicles destined for the Western Canadian market on the West Coast instead of bringing them overland from Halifax by truck or train. The owners of a 421-acre site adjacent to the Duke Point industrial area are applying for a rezoning that would create one of the largest industrial and office sites on the Island.
The Port Alberni Port Authority, meanwhile, is pursuing an ambitious plan to help alleviate congestion at mainland ports with a new Port Alberni Transshipment Hub (PATH). This $1.7-billion venture would see trans-Pacific shippers unload cargo containers at the mid-Island port for transfer onto barges destined for terminals around B.C.’s South Coast and Washington’s Puget Sound, saving shippers time and money currently spent waiting for a berth at the busier ports.
Businesses have been establishing toeholds the Island from farther afield, too, especially in the technology sector. Victoria, which welcomed Brazilian software firm Daitan Group in 2018, continues to attract tech companies in search of talent. Seattle-based NetMotion, a developer of software enabling remote workforces, decided last fall to expand its presence in the city after opening a 12-person office the previous year. Meanwhile, Swedish electronic gaming studio Stillfront spent a reported $120 million to acquire 10-year-old local game developer Kixeye.
The capital city’s office market has been strong, highlighted by the redevelopment of the Victoria Press Building into 120,000 square feet of office and retail space meant to house the head office of local financial services concern Merchant House Capital.
Island tourism has hit new highs in recent years, at least partly thanks to the favourable exchange rate for American travellers. Arrivals at the region’s two major airports, Victoria International and Comox Valley, were up nine percent in 2018.
Although manufacturing on the Island is dominated by forest products, there are also significant players in food processing, ship and boat building, furniture making and aerospace.
The region also has a robust lineup of post-secondary institutions, including UVic, Royal Roads University, Vancouver Island University, Camosun College and North Island College. Victoria, in fact, has the highest proportion of PhDs per capita in the province.
Campbell River is fast becoming known as an entrepreneurial hub as a result of the world-class economic development efforts. The newly created Campbell River Area Angel Group, in partnership with the city, is achieving significant results in technology sector attraction for new and emerging entrepreneurs. Campbell River is recognized not as a community that puts hurdles in the way, but one that says, “let’s figure out a way to get it done.”