After a lifetime in Alberta, Don Evernden sold off his charter aviation business and moved to Saskatchewan, drawn by the kind of economic boom he has witnessed in his home province.
Mr. Evernden, 73, bought a farm last year northwest of Saskatoon, cashing in on the growing agriculture sector, and went looking for another opportunity.
The investment that caught his eye was McNab Park, a rundown former military base bordering the Saskatoon airport where old barracks have been used for decades as low-income housing for about 400 people. Some city officials consider the neighbourhood an "eyesore" at the gateway to the city and have longed to redevelop it. Mr. Evernden had the same idea when he bought the land in January for $17-million.
His plans, however, have pitted him against the area's residents, in a struggle that has become a symbol of the tension created by the rapid growth of the city.
"We believe in this project," Mr. Evernden says. "It just might take longer than we first expected."
The unprecedented boom in the commodities Saskatchewan produces, ranging from oil and gas to uranium, potash and agricultural crops, is forcing local business to adjust.
Michael Grace, the president of Kingsmere Capital Corp., a local investment firm, says Saskatoon has many strengths but has been caught off guard by the pace of growth and is spinning its wheels to catch up. The challenges facing investors are the labour and housing shortages. Major companies have been reticent to relocate to the city because there's a lack of housing for their employees, which has slowed investment, he said.
On the other hand, local businesses find themselves delivering an unfamiliar pitch to potential hires, notes David Williams, a professor at the University of Saskatchewan's Edwards School of Business. No longer do they trumpet the region's cheap housing and cost of living; instead, they are talking up what a great place it is to relocate to and invest in real estate.
"We're a humble people here and we're not used to all this attention. We're all looking at each other and thinking 'how did this happen?' "
It may just be getting started. There's a building boom in houses and condominiums, industrial traffic crowds the streets, old, rundown apartment buildings are being rebuilt into big-city condos, and the population of 208,000 is growing at a rate not seen in a century. Cranes and traffic jams, once rare, are now part of everyday life.
Mr. Evernden plans to turn McNab Park into a high-end business park. He believes the development will attract major hotel chains and some of the country's big resource players who are looking to gain proximity to an expanding airport, he says.
The intense growth, however, is creating many of the problems that still plague Alberta, where the inflow of workers and money sent the housing market climbing to record highs, and made it nearly impossible to find affordable accommodation, even on a good wage.
"The high prices are eating into the working poor," Mr. Williams said. "It's the people who are working two or three part-time jobs who have seen their rents skyrocket that are being hurt."
In Saskatoon, housing prices were up more than 50 per cent last year alone, a leap on top of a market that had already been ticking up. The city's industrial vacancy rate is below 2 per cent for the first time in its history, while construction costs have more than doubled in the past three years. The industrial market continues to grow, with the number of building permits rising 64 per cent last year.
Many of the city's poor are struggling to find housing, and shortages of labour and materials have caused major construction delays and cost overruns. Contractors from as far away as Detroit have had to fly in their own work crews.
"We think we've learned from Alberta's experience before us," said senior city planner Alan Wallace. "But what we've learned is that it's impossible to keep up. You're basically reacting continuously."
For Mr. Evernden's Calgary-based project management team, this has meant a public battle with McNab Park's 400 tenants, many of whom see their neighbourhood disappearing and have nowhere to go in a rental market that still lacks low-income options.
City councillor Pat Lorje says the McNab Park development has become a symbol of the people being left behind as the rest of the city moves forward.
"We are creating the conditions for an incredible amount of social unrest. They're shutting down the equivalent of a small town," she said. "It's going to be difficult for these people to find accommodation let alone afford accommodation."
Mr. Evernden's group has come up with one solution to the housing problems created by his plans for McNab Park. It has teamed up with a local developer, Innovative Assets Inc., that is literally moving many of the neighbourhood's rundown houses and apartment buildings across the city, then refurbishing them in their new locale.
Ms. Lorje said the city is implementing several affordable housing initiatives and working with the province to implement measures to help keep up with the growth. The city has struck what it calls a "future growth team" to come up with a strategy to cope with the boom.
The province, for its part, has moved to ease the labour shortage by beginning to develop programs to encourage aboriginal people to train for the skilled trades, where demand is soaring. It has reached arrangements with countries such as the Philippines to recruit workers for areas of high demand.
It has also invested $400-million more in infrastructure than it did last year, pouring money into roads, schools and hospitals, drawing a lesson from the experience in Alberta, where such facilities were overwhelmed.
