Making up for lost time in Prince Rupert

We're back on the minds of the central Canada media these days, as the Globe and Mail takes a walk down our third avenue shopping district, chats with a mayor and takes the economic pulse of the city after the glow of the container port opening has faded.

The Globe presents a generally positive overview of where we stand at the moment, a far cry apparently from when Mayor Herb Pond says "People were crying in my office", a reference to the early days of the Skeena shutdown and the economic tsunami it unleashed in the city.

Patrick Brethour recounts the past days of misery for the city and how what he calls the "rising tide" of the port is beginning to change the dynamic of the city.

It will be interesting to see if the residents of the city find his findings accurate or a still a tad optimistic, based mainly on his examination of the rising cost of real estate as the main indicator of better times at hand and the "hundreds of jobs " created by the port .

It's an interesting look at our current situation, presented from someone not quite so close to the trees as it were.


Waiting for the boom on Third Avenue
PATRICK BRETHOUR
pbrethour@globeandmail.com
June 27, 2008

PRINCE RUPERT -- Three decades ago, when forestry was still an industry, and your Grade 10 was all that was needed for a high-paying job, the retail strip on Third Avenue in Prince Rupert was the symbol of local prosperity.

The somewhat jealous phrase "Third Avenue merchants" was synonymous with the wealthy retailers who held sway over a prosperous northern coastal city. But no more: the main retailing strip - like much of Prince Rupert - has been in decline for many years.

In the boom days a furniture store sat across the street from city hall. It's now a low-end dollar store.

Decaying houses, a shrinking population, the end of blue-collar prosperity and double-digit unemployment are all chapters in Prince Rupert's story of economic disaster. Along the way there have been many false starts, too many false hopes: abandoned plans for a pig-iron foundry and an aluminum smelter in the 1990s, failed efforts to save the Skeena pulp plant this decade.

Mortgage foreclosures were rampant as unemployment soared, and incomes dropped.

"People were crying in my office," recalls Mayor Herb Pond, who has been in office since 2002.
Only recently has that story started to shift, with the startup of the container port last November, which gave Prince Rupert not just hundreds of highly paid jobs, but something more. A future. "We are catching up after 20 years, on so many fronts," Mr. Pond says.

For a town that has had precious little to celebrate, it has been difficult not to keep hopes from wildly outpacing reality. On the evening of the official opening in September, Mr. Pond led a crowd - numbering more than half of the town's entire population - in the chant, "Phase II! Phase II!" referring to a hoped-for expansion that will triple the capacity of the container port operation.

Then came the full force of the collapse of the U.S. housing market, and the decline in the U.S. dollar, both of which cut sharply into American demand for imports - and the need for trans-Pacific container shipments. And the November startup of shipments came at the start of winter, hardly the most auspicious weather for a newborn port being scrutinized on reliability, and the turnaround times of freighters.

The cheers have faded, with exuberance giving way to the realization that the container port will not be a cure-all for Prince Rupert. Next week, a second container ship will start docking at Prince Rupert each week, months beyond what even the less giddy experts at the Prince Rupert Port Authority had hoped for.

"We thought we'd be ramping up faster," concedes Don Krusel, chief executive officer of the Prince Rupert Port Authority, adding that it has been tough to meet expectations from locals that the port's expansion "would be a blast, a rocket ship."

Still, there are definite signs that the port expansion is changing the course of Prince Rupert's economy.

Foremost is the performance of the port itself. The expansion to a second weekly shipment, belated as it is, still means that Prince Rupert's bid to win traffic from elsewhere on the West Coast is working. Winning a share of new business would be impressive enough; taking market share away from other ports as container shipment volumes flat-line is doubly so. Twice-weekly shipments will boost employment income from the port, and turn many part-time positions into full-time jobs, many of which pay upward of $85,000 a year. This week's announcement by Canpotex Ltd. that it will build a potash terminal on the southern outskirts of the city will further galvanize the local economy.

Those dollars are starting to show up in the formerly dilapidated streets of Prince Rupert, where the housing stock largely dates from the Second World War. The cracked streets of the city - a stark contrast to the smooth, and provincially funded highways outside of the municipality - are a reminder of the city's own financial travails, when it had to write off an entire year's worth of taxes in the wake of the Skeena bankruptcy.

Today, the rising tide of the port-led economic expansion has both increased incomes and boosted housing prices, leading to a booming home renovation market. Even the city's top hotel, the Crest, is getting in on the action, and building a new floor.

Clint Logan, owner of J&J Construction Ltd., remembers the depths of the 2002 downturn, when he tried to sell his house for $150,000, only to see it malinger on the market after Skeena began its death spiral. It finally sold for $114,000 - after two years.
Earlier this year, the same house sold for $275,000.

Mr. Logan doesn't seem to mind much, though. His construction business is on a hiring spree, now that Prince Rupert residents finally have the money - and a reason - to spruce up their homes. "They're fixing up what they let go for years," he says.

The days of waiting for lone customers to call are long gone. "Now, you hate for the phone to ring," he says.

That is the new story of Prince Rupert: the world has come calling, and the time has come to make up for the lost years.