Musqueam Band: This Land Is My Land

The Musqueam Indian Band has charted a course for financial self-sufficiency 
that depends on real estate – and lawsuits.

It’s hard to miss the signs of prosperity on the Musqueam Indian Reserve, nestled between UBC and the tony Kerrisdale and Dunbar neighbourhoods in southwest Vancouver. The site on the banks of the Fraser River is abuzz with construction cranes and work crews as ground is cleared for a new community centre and sports field beside the band’s administration offices. Down the street from the offices, workers are putting the finishing touches on a 5,000-square-foot glass extension to a stunning fir and cedar longhouse, the former Four Host Nations Olympics pavilion that is now being repurposed as a Musqueam cultural centre.


It’s been a good couple of years for the Musqueam. In 2009 the band received $16.5 million for agreeing to act as a First Nations host for the Olympics. The previous year, the government of B.C. paid the band $20.3 million and transferred ownership of 88.5 hectares of prime urban real estate as part of a “reconciliation” agreement. That’s on top of the approximately $8 million to $10 million the band receives every year in various government grants and transfer payments.


One-time windfalls and payments tied to shifting political winds in Victoria and Ottawa, however, will not meet the community’s long-term needs. The band currently depends on various levels of government for about 75 per cent of its annual budget of between $10 million and $12 million, and funding often falls short of the band’s needs. Determined to take the reins of their own finances, two years ago the Musqueam band forged an aggressive economic development plan that would see it become financially self-sufficient and would establish its credibility as a legitimate player in the private-sector business world.


It’s a blustery September day when I arrive at the Musqueam band offices to meet with Chief Ernie Campbell, the man charged with guiding that vision. Dust is everywhere as I circle looking for a parking spot; paved roads have been chewed up by heavy equipment, and street parking has been usurped by well-worn pickup trucks weighted down with rebar and bags of cement. Every spot in the parking lot of the band’s administration building is taken, so I drive around back, where I find a spot facing a well-equipped playground.

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Chief Ernie Campbell

Inside the modern, open-design offices, I introduce myself at the reception desk, explaining that I’m here for my appointment with Chief Campbell. “Oh dear,” says the receptionist, her eyes widening. “He’s in a meeting.” The confusion isn’t surprising, given that the chief doesn’t have a computer or a smart phone – or an assistant – which has made arranging this meeting a bit of a challenge.


After a flurry of activity, Campbell is pulled from his meeting and he descends from the upstairs conference rooms to introduce himself. Hardly your typical bureaucrat, he is dressed comfortably in jeans and a plaid shirt, the back of his black leather vest embossed with an aboriginal design.


As we settle in at a table in an upstairs meeting room, the soft-spoken Campbell fills me in on his background. A self-described “survivor,” having lived through six years of residential school in North Vancouver, the 69-year-old has always called the Musqueam reserve, which he prefers to refer to as the original site of the Musqueam village, home. He attended Magee Secondary School and spent a few summers working at a cannery on the central coast, but had to quit school before graduation in order to help support his mother and younger sisters. He was elected to band council in 1964 and was driving the Musqueam school bus when he was first elected chief in 1980. He has remained as chief on and off ever since, and consecutively since 1999.


The antithesis of a slick politician, Campbell speaks in colloquial, everyday language as he gives voice to the community’s frustration with dependence on “government handouts” and a seemingly interminable treaty process. The desire for self-sufficiency goes back decades, he says, when the Musqueam band took over management of all its government-funded programs, including education, health and social assistance. But the funding was never quite adequate, he says: “No matter what, we were always short. We’ve always had to supplement the budget when we had the resources, and a lot of times we didn’t.”


As for treaty negotiations, Campbell’s frustration is palpable. “Everybody was excited,” he says of the six-stage negotiating process that was inaugurated in 1992. “I kept saying the mechanism’s there. The principles were there, the 19 principles that would guide the negotiations. We had the treaty commission, the referee, the monitor . . . everything was there. But we had a rude awakening: it was getting the other two parties to live up to them, and they didn’t because they came with the mandate they had. They kept saying, ‘Oh, we don’t have a mandate.’ . . . The attitude of Canada and B.C. toward this treaty has to change. They’ve gotta do the right thing: just sit down and get a mandate to negotiate the land question.”


While the band’s claim to 150,000 hectares in and around Vancouver is not likely to be resolved at the negotiating table any time soon, that hasn’t prevented the Musqueam from exploiting the real estate they do have access to and expanding their portfolio considerably through litigation, rather than negotiation.


The band has always had a limited capacity to generate revenue by leasing out chunks of its reserve land. The 188-hectare parcel of land in southwest Vancouver is technically owned by the federal government, which holds it in trust for the band and is bound by a fiduciary duty to manage it in the band’s best interests. (Musqueam reserve land also includes a 53-hectare parcel in Delta, near Roberts Bank, and a 6.5-hectare parcel on Sea Island, near the airport.) It’s not an ideal arrangement; the land can’t be sold, and the Musqueam have successfully argued in court more than once that the federal government has not lived up to its duty to manage the land in the band’s best interests.


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The Shaughnessy golf course case

There was the precedent-setting case of the Shaughnessy golf course: in 1958 the federal government leased the 65-hectare parcel of prime waterfront real estate to the Shaughnessy Golf and Country Club for $29,000 a year. The Musqueam weren’t party to the negotiations and weren’t apprised of the details of the lease until 1970. When the band sued the feds for failure to consult with them and to act in their best interests, it was awarded $10 million in compensation in a landmark 1979 decision, which was upheld by the Supreme Court of Canada in 1984. Today the club’s golf course continues to sit on Crown-owned reserve land, with about $1 million a year in rent going to the Musqueam.


Then there was the widely publicized case of the Musqueam Park residential subdivision, which garnered headlines when outraged homeowners protested rent hikes proposed by the Musqueam in 1995. In 1965 the federal government had negotiated a deal with a private developer to subdivide the 16-hectare parcel of reserve land and develop 75 residential lots, with each lot leased for between $300 and $400 a year. When rents came up for reassessment in 1995, the Musqueam raised rates to $38,000 a year and, as could be expected, homeowners cried foul. After a series of suits and countersuits, the Supreme Court of Canada set the rent for each lot at $10,000 a year. The subdivision today generates about $750,000 a year in revenue to the Musqueam. (Another subdivision on the Musqueam reserve, the Shalimar Estates townhouse complex, generates another $1 million in annual rent.)


While these on-reserve leases generate welcome revenue, relying on the federal government to develop the land and lease it on behalf of the band is not a long-term solution. The band’s new economic development plan calls for the Musqueam to become landowners and developers in their own right, and the vehicle for this ambitious plan is Musqueam Capital Corp., an umbrella structure under which individual real estate projects will be housed as subsidiaries.


The first project under the Musqueam Capital banner was Celtic Shores Properties Ltd., a residential subdivision on the Celtic shipyards, a 3.5-hectare piece of waterfront near the reserve that the band had bought in 1988. When the original plan to use the shipyard as a source of jobs and training for band members went nowhere, the band switched gears and decided to develop a chunk of the land. In partnership with Richmond’s Progressive Construction Ltd., the band divided the site into 12 lots, built 12 detached single-family homes and sold the homes and lots outright.


For the Musqueam, the Celtic Shores development was an important testing ground, proving their ability to forge partnerships on an equal footing with private sector developers. For Progressive, it was also a learning experience. While Steve Kurrein, the company’s vice-president of residential development, stops short of describing the experience as problem-free, he acknowledges a happy outcome.


“No, it wasn’t a typical real estate development,” Kurrein says. “It was hard work. The governance of the band necessarily means that there isn’t one person making the decisions, as there might be with a private landowner. So the decision-making process is much longer and some understandings we had at the outset of the project changed during the project.” Nevertheless, all 12 properties were finally sold, and Progressive and the Musqueam both walked away with a profit. “So it wasn’t easy,” Kurrein concludes, “but at the same time the end result was fine.”


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Navigating lawsuits

Real estate holdings owned outright by the Musqueam, such as the Celtic property, are limited, but the portfolio has grown significantly in recent years thanks to a number of successful legal challenges. The most controversial of these saw the band take title to the UBC golf course land, along with two chunks of Pacific Spirit Regional Park as well as the land that Richmond’s River Rock casino sits on. The province granted title for all of those properties to the Musqueam in 2007 as part of its much-vaunted Reconciliation, Settlement and Benefits Agreement, in exchange for the band agreeing to drop three lawsuits against the province.


Another legal challenge resulted in the Musqueam taking ownership of a 100,000-square-foot office building in Burnaby’s Glenlyon Business Park, currently occupied by Nokia Canada. When the Musqueam saw no resolution in the offing to a dispute with the City of Richmond and the federal government over a 55-hectare block of Richmond farmland known as the Garden City Lands, the band chose to swap its interest in the land for clear title to the Nokia building. The building, formerly owned by Canada Lands Co., the Crown agency that handles the federal government’s surplus land, now brings the Musqueam about $1.75 million annually in lease payments.


The Celtic Shores development and the Nokia building are preliminary forays into private real estate holdings as the Musqueam band develops a feel for the business of real estate and tests the waters for potential partners. Much greater opportunities lie on the horizon, the most immediate of which is a retail and hotel complex planned for the 8.5-hectare parcel of land near the UBC golf course.


Chief Campbell reels off possibilities that lie on a more distant horizon: the band could buy out the Shaughnessy golf club’s lease and move the Shaughnessy golf course to the site of the current UBC golf course, freeing up Shaughnessy’s prime waterfront land for development. Then there’s the prospect of negotiating a revenue-sharing agreement with Great Canadian Gaming Corp. when the lease expires on the River Rock site in 2041. The band is also considering developing a marina at an undisclosed location, an industrial park on its Delta reserve and a new hotel at the site of the currently idle Fraser Arms hotel (which it owns). 


But before it can pursue all these blue-sky opportunities, the band has to develop its internal capacity as a real estate powerhouse. The role of economic development officer is currently held by Wade Grant, a 32-year-old UBC grad with an impressive resumé as a political assistant and adviser but no experience in real estate or finance. In reality, the role of economic development has been contracted out to Howie Charters, an expert in commercial real estate who manages the Vancouver office of Colliers International. Charters, who previously consulted for the federal government, is the mastermind behind Musqueam Capital and the real estate deals under that banner to date. However, he hopes to oversee a transition that will see him put out of a job as the corporation hires its own CEO and recruits experts from the private sector to fill out its board.


The Musqueam have taken a bold step toward economic self-sufficiency with the formation of Musqueam Capital and have taken tangible steps to prove their mettle as landowners and developers. But a real estate corporation capable of supporting their community is still a long way down the road. First they need to staff up the corporation with a CEO and a support staff. And maybe get the chief a computer and an assistant to handle his appointments.