1975 – 1985 - Alberta Venture
Transcription
1975 – 1985 - Alberta Venture
Oil rig outside Calgary, 1975 1976 Lougheed establishes the Alberta Heritage Trust Fund, putting a portion of oil revenues into long-term investments. 1978 Syncrude opens its second oilsands project in Fort McMurray, a $2.3 million openpit mine and processing plant. 1978 Edmonton hosts the Commonwealth Games. 1979 Albertan Joe Clark becomes prime minister. His minority government is dissolved by a confidence vote nine months later. 1980 Prime minister Pierre Trudeau announces the National Energy Program, increasing Ottawa’s take of Alberta oil revenues. 1975~1985 Diversity Danger Wildly swinging fortunes emphasized the danger of a single-industry economy. In this context, the 1976 establishment of the Heritage Trust Fund to save energy monies for a “rainy” day was a portent for the future. Prosperity continued into the early 1980s. While agricultural prices rose and coal production increased markedly, oil and gas primed Alberta’s economic pump. Prices skyrocketed in 1981 to nearly $40 a barrel. Construction cranes dominated Calgary’s skyline. In 1978, more than 400 companies were listed on the Alberta Stock Exchange. Public spending increased from $1.1 billion in 1974 to $10.8 billion in 1985. The good times were over by 1982 amid a national recession, a despised National Energy Policy, falling oil and agricultural prices, lagging construction, and diminished investment capital. Unemployment hit double digits and many left the province. Trust and mortgage companies collapsed. This depression, the first since the 1930s, awakened policy makers to the need for a more diverse economy. The new focus was on high technology, forestry and tourism, with the latter two alternating as the third largest industry after oil and gas, and agriculture. 1981 Ghermezian brothers build the first phase of West Edmonton Mall. 1982 Fearing further NEP-style intervention, Alberta leads a lengthy legal battle with Ottawa that results in a constitutional “notwithstanding clause.” 1982 Separatist stirrings increase as Gordon Kesler, a candidate for the factional Western Canada Concept Party, wins a provincial by-election. 1983 Mayor of Eckville and highschool instructor James Keegstra is fired for preaching racism to students. 1984 Captained by Wayne Gretzky and bankrolled by Peter Pocklington, the Edmonton Oilers win the first of four Stanley Cup victories. “We’ve more or less purchased an entire crescent. And yes, the houses are connected.” Ghermezian family T BY NORM SACUTA HE BOARDROOM AT TRIPLE FIVE’S CANADIAN Eaton’s Centre. At one time, Eaton’s Centre was set to offices has windows that look out over the rival WEM, with planned twin 50-storey residential tow- north parking lot of West Edmonton Mall. I’m ers. Those blueprints were shelved during the oil bust and waiting to talk to Don Ghermezian, the current neither of these early developments are in Ghermezian mall president and second son of Eskandar, the eld- hands. “At present, the largest property we hold in Ed- est of the four famous brothers who have changed the monton is the mall,” says Don. “We’ve divested ourselves retail face of Edmonton over the past 25 years. The door of many smaller properties.” to the boardroom opens. Don Ghermezian, 31, is certainly not his father – or 1990s, the Ghermezians re-mortgaged the mall through rather, not the image of his father’s generation, all suits Alberta Treasury Branches to the tune of $350 million and hats splashed across newspapers. Trim and fit, he’s and a secured $60-million credit line. The financial deal dressed entirely in black: a designer T-shirt, dress pants became one of two controversies that dominated head- and shoes. “What can I do for you?” he asks. lines surrounding the family, the other was a protracted “Well, I want to know about your family. I know you’re very private. This city has always been rife with rumours about you all. I’ve got friends who insist the Ghermezians aren’t even living here anymore.” 108 As the real estate market remained soft into the early battle to regain control of their other colossal venture, the Mall of America in Minnesota. But the Ghermezians are nothing if not resilient. Amid claims of bribery and alleged political interference “No,” he says, smiling. “We’re still very much here. to secure the ATB loan, a confidential out-of-court settle- We’ve never left. I’m just building a new house which ment was reached with the bank in 2002 and the family should be ready in a month.” retained control of WEM. Anticipated expansions in the The basic history of the Ghermezians is easily gleaned next decade include an 8,000-seat arena, a third hotel, from magazines. Orthodox Jews from Tehran, they 300,000 square feet of retail and an apartment complex. moved first to New York and then in the 1950s in stages Mall of America also came back into Ghermezian hands to Montreal, where the four boys – Eskander, Nader, Rap- with a court victory in 2004. Billion-dollar expansion hael and Bahman – went to college and made a fortune plans will double its size, making it nearly three million selling Persian rugs. The family came to Edmonton in square feet larger than WEM and the single largest real 1971 and settled into the city’s oldest neighbourhood to estate complex in the world. begin managing and developing the land holdings they If there’s a specific gift the Ghermezians have, it’s for had purchased throughout the 1960s. Don says the Gh- anticipating the value of real estate and potential markets ermezians didn’t experience oppression in Iran. “It was well ahead of their actual emergence. They did it in the entirely a business decision to go. There were just more 1960s, speculating with vigour on the emerging Alberta opportunities elsewhere.” oil boom, and they’re doing it again now in the fastest WEM was preceded by other smaller properties in Ed- growing market in the U.S. – Las Vegas. The “Great Mall monton, including a hotel and downtown’s ambitious of Las Vegas” is already in development in the city’s sub- ALBERTA VENTURE | THE CENTURY The Ghermezians: back row (left to right): Bahman, Raphael, Nader and Eskander, with parents Miriam and Jacob urbs. “The real estate we have in Vegas was purchased over the past 20 years,” says Don, attesting to the family’s foresight. “Are more of the children involved with the business now?” I ask. “How many of you are there?” “Not all of you?” “All of us,” he says. “Of course, with so much business now in the United States, we have our American head office as well. But Edmonton is home. It’s a great place to live in, do business and raise a family.” He laughs and then counts his brothers, sisters and My older brother once worked a summer job in the cousins. “Eskander has 8 ... Nader 10....” He stops after kitchen of the Ghermezians’ Convention Inn South, 20 several rounds of fingers. “33.” years ago. He regularly watched patriarch Jacob Gher- “And you’re all involved in the business?” mezian sample desserts in the kitchen and chat with em- “Just the older ones.” ployees, often with a young grandson in tow. He would I wonder aloud about another rumour – the living take biscuits off trays in the kitchen and feed the boy, arrangement of the extended family. A private Jewish school, tunnels between houses, a self-sustaining town within the upscale Glenora neighbourhood? then walk off to teach him another part of the job. Perhaps Don was that boy. One thing is for certain: with 33 new Ghermezians on the ascendancy, the next “Well,” Don replies, smiling as if a little wary. “We’ve generation must have learned well from someone. The more or less purchased an entire crescent. And yes, the world of investment and real estate in the 21st century houses are connected. We all live there.” best be on its guard. ALBERTA VENTURE | THE CENTURY 109 “Now that I look back, I wonder why on earth I wasn’t more frightened.” Jean Paré C BY JENNIFER COCKRALL-KING OOKBOOKS ARE FUNNY THINGS. THEY’RE NOTORI- by her father that no obstacle is too great to overcome. ously difficult to turn into profitable ventures, Maybe it was having to pick up after a troubled marriage yet for every closet novelist, there must be two closet left her a young, single mother of four with nothing but cookbook authors eager to lose their shirts. The the debts of an alcoholic, compulsive-gambling ex-hus- other odd thing about cookbooks is that successful band. Somehow, Paré’s clear-thinking prairie practicality ones come from very unlikely places. 110 landed her squarely on both feet. A case in point is Jean Paré, a wedding and banquet “My first catering job in 1963 was for over 1,000 peo- caterer who launched Canada’s most popular cookbook ple,” Paré laughs, still able to recount the menu of that series from a spare bedroom in her home in Vermilion, successful first banquet. “Now that I look back, I wonder just west of Lloydminster. With the help of her son, Grant why on earth I wasn’t more frightened of it. I didn’t have Lovig (the co-founder and now CEO of Company’s Com- enough sense to be scared.” ing), she built a publishing powerhouse with $10 million After 16 years of catering, she dove into cookbooks in annual sales that releases eight to 10 new titles and sells just as fearlessly. On her son’s advice, Paré concentrated more than one million cookbooks each year. Oh, and late on one subject, rather than appetizers to desserts and bloomers take note: Paré didn’t publish her first book un- everything in between, like most other cookbooks at that til she was 53 years old. Almost 25 years later, and with as time. Not interested in handing a manuscript over to a much clarity and spring in her step as people half her age, publisher, Paré wanted to write, design, sell and distribute she’s still going strong, arriving at work at 6 a.m., often the book herself. In 1981, she self-published 150 Delicious with baking in hand – because she just can’t wait to get Squares, a book that is still in print and that has sold well going on another day doing the work she loves. over a million copies. “I fixed everything that I didn’t like Maybe it was her depression-era upbringing in Irma, about cookbooks,” explains Paré. A lay-flat book binding, Alberta. Jean Paré (pronounced “Gene Perry”) learned the user-friendly indexes, tried-and-true recipes, full-colour art of putting a solid meal on the table and how to turn photos cross-referenced with recipe names and page num- that meal into an occasion from her mother, and was told bers, slightly larger text for readability, and simple recipes ALBERTA VENTURE | THE CENTURY with ingredients most people have in their kitchen are still hallmarks of the Company’s Coming brand. Edmonton-based food journalist Judy Schultz is currently at work on Paré’s authorized biography, to be Paré decided to print 15,000 copies. “I had no idea published in 2006 for Company’s Coming’s 25th anni- that a bestseller was 5,000 copies in Canada, so when I versary. Apart from the obvious business successes that got my first book printed, I thought I’d get 15,000 copies Paré has achieved, Schultz credits Paré with compiling to make it worth my while.” Using her daughter Gail’s old miniature histories of food on the prairies by recording bedroom as an office and shipping out of the garage, this recipes that have been passed along through three and sales force of one took her books around to every place four generations. “She has become an archivist of prairie she thought they might sell. “In three months,” Paré re- food,” says Schultz, “and also of women’s history on the calls, “I had all 15,000 pretty much sold.” She had de- prairies.” cided that cookbooks were like any other product people At 78, Paré still defies the odds with one successful needed; why limit them to bookstores? Though it seems cookbook after another and a company built on one commonplace now, Paré was the first publisher to intro- simple rule: “Never share a recipe that you wouldn’t use duce cookbooks into grocery stores. yourself.” “If the story needs to be written, we write it without fear of reprisal from anybody.” Bert Crowfoot I N 1990, WHEN THE FEDERAL GOVERN- ment killed the Native Communications Program, nine of its 11 aboriginal publications died. Not Windspeaker. Founded by Bert Crowfoot in 1983 as part of the Aboriginal Multi-Media Society of Alberta, Windspeaker thrived. It became a national newspaper known for not pulling any punches – and it started turning a profit. Crowfoot, the paper’s publisher and CEO of AMMSA, calls himself a capitalist; he says he started Windspeaker because he needed a job. Now AMMSA runs four more aboriginal publications and a radio network. The following quote is happens is what the politicians want the people to hear. We are from the July/August 2004 issue of Alberta Venture, when 100% independent and it is especially important on the political Crowfoot was named one of the province’s 50 most in- side because our writers are respected because of the objectiv- fluential people. ity. We’ve taken federal politicians to task; we’ve taken our own politicians – whether they have been national, provincial or local It is important to have independent media. There is aboriginal chiefs – to task. If the story needs to be written, we write it with- media controlled by political organizations. In that media, what out fear of reprisal from anybody. ALBERTA VENTURE | THE CENTURY 111 Bernard Callebaut I On March 23, 1983, just as oil prices were bottom- Curious customers wandered in wondering how a gourmet retailer could open when other businesses were getting out of Dodge. ing out, the well-heeled were pulling out and banks they would enjoy it,” says Callebaut, whose eponymous were beginning a sweep of foreclosures, Callebaut cut company today has 35 locations in Canada, the United the ribbon at his high-end shop on 17th Avenue SW. “I States and Japan. “Coffee went through the same thing was convinced by more of a gut feeling than anything 30 years before. It was hot brown water worth 25 cents else that if people were exposed to gourmet chocolate, until people discovered they could pay a little more to N 1982, SEDUCED BY THE MOUNTAINS AND ON A WHIM, Bernard Callebaut moved to Calgary from Belgium with a dream of producing some of the world’s best chocolate. He didn’t realize Alberta’s economy was about to tank. Walter Twinn W ALTER T WINN WAS A CON- troversial figure. Succeeding his father as chief of the Sawridge Cree near Slave Lake two years after oil was discovered “He lived in the world of corporate jets, but he never forgot the world from which he came.” on the reserve, he led a number of profitable ventures that trans- Senator Twinn bridged the gap between his aboriginal roots and formed the northern band into what was best described at the service yesterday as the domi- a $100-million conglomerate: a nant society that has encircled our aboriginal people. Walter hotel, shopping mall and truck Twinn transcended all racial, business and political barriers. The stop in Slave Lake; hotels in Jasper best example I can give of what the man really accomplished in and Fort McMurray; a bottled water some ways is what happened when I decided to attend the serv- business and stakes in oilfield serv- ices yesterday. For me, transportation was a problem. However, ices companies. But Twinn, a boxer it did not stay a problem, because his family decided that I should turned fight promoter, was also use their family aircraft, be picked up in Edmonton and flown to criticized for fighting legislation that allowed women 112 Slave Lake in order to participate in the service. who married non-natives to restore their Indian status, The contrast is that while I was picked up in one of Walter’s and for being Canada’s most absentee Senator in 1993 private corporate aircraft, when his casket was taken to the small after Brian Mulroney named him to the upper house Roman Catholic church in Slave Lake, it was placed on a simple (a decision that was deemed “a clever move to appoint wagon, which had been used for that purpose by Cree Indians for one of their people from among our people,” by George generations in this country. The wagon was drawn by a team of Erasmus, then head of the Assembly of First Nations). horses and driven by an elder, with an honour guard of aborigi- The following comments were made by Senator Gerry St. nals riding on horseback. That best epitomizes the world in which Germain in November 1997, a month after Twinn died Chief Walter Twinn lived. He lived in the world of corporate jets, of a heart attack. but he never forgot the world from which he came. ALBERTA VENTURE | THE CENTURY get something really good. I knew with chocolate that would happen too.” Callebaut’s first customers were curious people who wandered in wondering how a gourmet retailer could open when other businesses were getting out of Dodge. “They were taking bets on whether I would survive,” he says. But the skeptics hadn’t anticipated the potent lure of the cocoa bean. One taste was enough to convince a city, then a province, then a country. Asked how he managed to not only survive the lean years but expand, Callebaut offers a delightfully simple assertion: “Chocolate is an affordable luxury. Sure, it was a time of doom and gloom, but anybody could afford 80 to 90 cents for one really good piece of chocolate. And for that instant it spent melting on your tongue, you were pampered.” – Natasha Mekhail Jack Donald J “You don’t want to work extra hours? Get used to it.” ACK DONALD BEGAN HIS CAREER WITH A PAIR OF GAS your capital available. You stations and a truck. Under his leadership, the Fas don’t want to work “extra Gas chain swelled to more than 400 outlets; he also hours”? Being in business ran a refinery and trucking fleet under the umbrella of for yourself is not seven- Red Deer-based Parkland Industries. The origins of the and-a-half-hour days, so name go back to 1976, when Jack and his wife Joan bought get used to it. Parkland Beef Industries, which had a single feedlot. They • Save – old fashioned, but it steered the business away from beef and into oil, building works! You can never have a central Alberta empire. The following is an excerpt from too much capital. a signature Donald speech entitled “Jack’s 10 Rules: Advice for Prospective Entrepreneurs.” • Do market research. Does anyone want to buy what you have or do? Really? At what price? How much or how many? • Get spouse/family committed. You’ll be away long hours and • Enjoy what you’re doing – 12-hour days get really long if it’s not fun. • Try what you want to do on a part-time basis – evenings, holidays, weekends or whenever. Besides, a part-time job adds to be mentally at work even when you’re not there. • Seek and heed advice. Talk to professionals and other entrepreneurs who have “been there” and will share their experiences with you. ALBERTA VENTURE | THE CENTURY 113 Reg Isley W BY DEANNA KENT-MCDONALD HEN REG ISLEY WAS GROWING UP ON A HOME- stead outside Beaverlodge, his father, a trapper in summer and a construction worker in winter, was away for weeks on end. Young Reg spent count- less hours in his father’s dusty, dirt-floor workshop, de- vouring stacks of old Popular Science and Popular Mechanics magazines, studying the fantastic designs. He learned how to remove the gas engine from a washing machine and attach it to his bicycle – “it was seven miles to school “Everything we dream of having can be built with a good design.” on a dirt road,” he explains. Isley didn’t want to trap or farm. head that cuts trees faster and with less fibre damage than At 17, he desperately wanted to be- other logging mechanisms. Isley’s RotoSaw revolutionized come an aeronautical engineer. But the forestry industry. With 32 other patented products in his family couldn’t afford to send its arsenal – such as the Lim-mit de-limber and the Timber him to university. Instead, alone and scared to be away King feller buncher, eventually sold to Caterpillar – from home, he found himself on a bus bound for Edmon- the Risley Group was generating $30 million in annual ton, and after a 2 a.m. transfer, onward to Calgary. His sales by 1996. “Thanks to the industrial revolution,” destiny was a practical education in welding at SAIT and Isley says, “everything we have today, and everything we later NAIT, one that has served the founder of the Risley dream of having, can be built with a good design and Group of manufacturing companies extremely well over some skills in welding and machining.” the past three decades. Employing 180 workers today, the Risley Group re- A juxtaposition of brilliant and down-to-earth, with mains firmly rooted in Grande Prairie. Its diverse range of an intense voice and eyes that never rest, Isley returned to products, mostly for niche markets in the forestry indus- Peace Country after graduation. He got a job in the steel try, have been sold throughout Canada and the United trade in Grande Prairie, and later opened a machine shop States as well as Europe, Australia, New Zealand and Ja- with a friend. In 1978, Isley started his own small busi- pan. “But we would not have this success elsewhere,” says ness, Fluidic Power Ltd., designing, repairing and servic- Isley. “Mine was the right vision in the right place at the ing hydraulic equipment and systems. right time.” When economic collapse hit the province’s oil sector Despite all of his accomplishments, however, past in the early 1980s, service industry businesses like Fluidic dreams have never waned for Isley. In the Risley board- suffered. Jobs became scarce. But unwilling to submit to room hangs a large colour photograph of the Voyager the pervasive pessimism of a stagnant marketplace, Isley aircraft, the first plane to fly around the world, non-stop, stepped back and looked at the big picture. With advice without refueling. Isley’s eyes go saucer-round and his from friends in the forestry industry who speculated voice fills with a marvelous child-like energy. “You see about future trends, he saw a niche. “If we’re going to do that?” he asks. “Now that’s amazing.” Even more ama- this,” he thought at the time, “we’ll do it differently.” zing, the boy who dreamed of flight in his father’s work- In 1984, after investing about $750,000, Risley Equip114 ment unveiled the RotoSaw, a mechanical harvesting ALBERTA VENTURE | THE CENTURY shop is today building a helicopter in his own garage. “I want the customer to come in, buy a pair of shoes and talk to us, dripping with sweat.” John Stanton T HE STORY BEHIND JOHN STANTON’S TRANSFOR- better. Over a period of time, I lost weight, I got into shape and I mation into a runner – and entrepreneur – felt really good. In business, you can do the same thing – be the has been repeated so frequently it’s practically best you can be. legend. In 1983, weighing in at 238 pounds and I like the term “rumpus room.” We’ve spent a lot of time, ef- smoking two packs of cigarettes a day, the grocery ex- fort, skill and money designing our stores. I want the customer to ecutive did a three-kilometre run with his son. It felt like come in, buy a pair of shoes and talk to us about their running. a marathon. Stanton quit smoking, began jogging, and a I also want that customer to visit in the middle of a run, drip- year later launched the Running Room in an old house in ping with sweat, to get a drink of water, say hello and pick up a Edmonton. The company now has 75 outlets in Canada race form. The frequency of customers visiting our stores is very and the United States. The following Stanton quotes are high. Often, they’ll come in just to talk to our staff about a local from the May/June 2003 issue of the Retail Council of run, or ask a question about training. We’ve created a clubhouse Canada’s Canadian Retailer magazine. atmosphere. We don’t want it too fancy because it wouldn’t be comfortable for people who are running. My motivation was fear. When I finished that first little fun run, I I’m passionate about people, I’m passionate about running, thought, “My goodness, I have two sons and I’m in bad shape. I and I’m passionate about being successful. And I want to make have to do something about it.” I just wanted to enjoy my family sure I can share that with the team. My biggest achievement to more and enjoy life more. date is the fact that we’ve built something far bigger than one The thing I learned about running is that I had to be the best I could be that day. The next day, I wanted to be a little bit person. I’m part of it. But if I’m out for a jog and get clipped by a bus, the Running Room will go on. ALBERTA VENTURE | THE CENTURY 115 “The individual always has their own choice as to what they will do with their life.” ton now lives in California, where he is involved with a golf club company and medical products firm, and races a jet boat named Free Enterprise. The following excerpt is from a 1982 speech he delivered to the Canadian Women’s Club in Edmonton during his unsuccessful run for leadership of the federal PCs. These days, free enterprise has been getting a lot of criticism in certain quarters. And it’s about time somebody spoke out in its behalf.... Any society which attempts to regulate enterprise – while at the same time it attempts to supply everyone with things – is a society which is bound to fail. Democratic capitalism does not strive to provide everyone with an equal number of things – but only with an equal degree of opportunity. The individual always has their own choice as to what they will do with their life.... This has always been my understanding of the Canadian Peter Pocklington O further and further down a socialist path of state control. And we’re not marching anymore – we’re stumbling! It is not the job of government to act as big brother to a whole N HIS WEBSITE, PETER POCKLINGTON SHARES AN ANEC- population. There’s a big difference between helping the little dote about his first entrepreneurial venture: at age guy – the guy in need – and so orchestrating his life that it’s virtu- five, he picked cherries, put them in jars with water ally impossible for him not be in need. The responsibility for the and sold them to neighbours as his mother’s preserves. person in need can not be solely the responsibility of government. Some might consider this a metaphor for his years in Al- Among a free people who believe in free enterprise, some of the berta. After arriving in Edmonton from Ontario in 1971, responsibility for those in need must be taken up by the family, he made money selling cars and speculating on real es- the church, the community... and the individual himself. Broadly, tate. Buying and selling dozens of businesses, he made what I advocate is that each individual must be given the chance headlines during the ugly strike at his Gainer’s meatpack- to develop his own life: according to his own desires; according to ing plant (which drove the company into receivership) his own aspirations; according to his own abilities. and for infamously “selling” Wayne Gretzky to the Los Angeles Kings as owner of the Oilers in 1988. Pockling116 way of life. But today, we are a people who have been marching ALBERTA VENTURE | THE CENTURY If the government controls your life, you are being disenfranchised from your own destiny. “Rather than bragging that we are debt-free, the province should be bragging to the rest of the country that Alberta has no homeless, hungry or disadvantaged children.” Bruce Saville I N 1982, WITH CITY-OWNED EDMONTON TELEPHONES battling provincial rival Alberta Government Tele- speech he made at a social policy conference at Edmonton’s Grant MacEwan College. phones for long-distance revenue in the newly de- regulated telecommunications industry, Bruce Saville Rather than bragging to the rest of the country that we are debt- put his three-person company to work for Ed Tel. Saville free, the province should be bragging to the rest of the country developed an innovative billing system, giving Ed Tel the that Alberta has no homeless and no hungry or disadvantaged edge and putting Saville Systems on the map. The com- children. Let us not forget that we are the government. We munications software company grew into a global op- choose our representatives, we hold them accountable and if we eration with 1,400 employees by 1999. And then Saville believe that homelessness and hunger should be eliminated and sold it for $700 million, allowing the part owner of the that the government should do more in this area, then we must Edmonton Oilers to concentrate more on philanthropy. withhold our vote from those who do not support us. The following comments are from a November 2004 ALBERTA VENTURE | THE CENTURY 117