Tourism Investment - Lake Huron Shoreline

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. Prospectus
Brucelnvest
BRUCE
www.bruce.on.ca
TourismInvestment-Lake
HuronShoreline
. Prospectus
Tableof (ontents
Howto reachus
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Appendix
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Introduction
Business
Development
Opportunities
MarketAnalysis/Tourism
Highlights
InvestmentArea(map)
Communities
CommunityLocations(map)
Attractions/Events/Services
Business
Opportunities
ThemedWaterpark&:MiniatureGolf
LifestyleCommunity&:RVPark
Full ServiceResort&:LifestyleCommunity
ChantryIslandTourService
InboundReceptive
TourOperator
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Introduction
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The Lake Huron Shoreline is a popular tourism
destination within Bruce County, "Ontario's Natural
Retreat."Known for it's spectacularsunsets,
uncluttered beachesand historic villages, this region
has recently added a lighthouse tour, new cultural
activities and special eventswhich position it
extremelywell in today's tourism marketplace.Many
opportunities exist to invest in the growing tourism
sectorand to servean increasing number of active
retireeswho seeka high quality outdoor lifestyle
along the Lake Huron Shoreline.
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Business
Development
Opportunities
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In February2001, Pannell Kerr Forsterwas retained by the.
BruceCommunity Futures Development Corporation
(Bruce CFDC) to identify tourism businessopportunities
along the Lake Huron Shoreline that representgood
investment prospectsfor the private sector.The main
objective of the study was to produce five high probability
investment plans, which will lead to additional business
awarenessand investment in this growing region.
After evaluating the product and market of Bruce County,
Pannell Kerr Forsterand Bruce CFDC compiled a list of 36
businessand development opportunitiesl. The following
five opportunities, among the long list, were indentified as
offering high businessdevelopment potential:
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1. Waterpark and Themed Miniature Golf
2. Lifestyle Community and RV Park
3. Full ServiceResort Accommodation
and Lifestyle Community
4. Chantry Island Tour Service
5. ReceptiveTour Operator
Theseopponunitiessupportthe area'spositioning as
"Ontario's Natural Retreat"and they build on the efforts of
regional tourism development and marketing agencies.
Businessplans are available for each opponunity to allow
investorsto evaluateeach businesscaseand compare it with
their objectives.Additional information will be required to
fully explore each opponunity and investors are expected
to undertake their own due diligence. Templatesare
available for each opportunity to facilitate inputting of
various assumptions and creating alternative scenariosbased
on current market trends.
L SeeAppendix 1 for a full listing of all businessopportunites.
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LakeHuronShorelineTourismHighlights
MarketAnalysis
BruceCountyTourism
. In 1999, BruceCounty attracted close to 1.375
million person visits, up from 1.2 million in 1998.
. In 1998, visitors spent $133 million in BruceCounty:
35% on Food and Beverage,25% on Accomodation,
20% on Auto{Transportation, 11%on Retail/Other
and 9% on Recreationaland Entertainment.
.80% of all visitors stayedovernight as compared to
37% of all visitors to Ontario. Averagelength of
overnight stay was 3.3 nights with 59% of visitors
participating in an outdoor activity. (1998)
.The Lake Huron Shoreline provides some of the best
beachesin Ontario, spectacularvistas and a diversity
of outdoor recreation opportunities, including
boating, fishing, swimming, hiking and golf.
. Extremely busy in the summer seasonwith
increasingvisitation in shoulder seasons.
Emerging activities include golf, cycling, gardening
and lighthouse touring.
. Strong municipal and community group support for
tourism through operation of facilities (marinas,
airports), attractions (museums, lighthouses) and
sponsorship of major festivals and events.
Source:Tourismin Bruce & Grey Counties-2000
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LakeHuronShorelineTourismInvestmentArea
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LakeHuronShorelineCommunities
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Kincardine
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(Amalgamated Town of Kincardine, Kincardine Twp. & Bruce Twp.(TIverton)
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TheLakeHuron ShorelineTourismInvestmentArea
extendsalongthe shorelinefrom Point Clark in the
souththrough Kincardine,PortElgin,Southamptonto
SaubleBeachin north. The studyareaalsoextends
inland to include Paisley,Ripleyand Lucknow.
heritage.Tourist attractions include Kincardine
Lighthouse, Harbour and waterfront, Boardwalk and
beach, Bluewater Summer Playhouseand the
Kincardine Scottish Festivaland Kincardine Music
Festival.
Saugeen Shores
(Amalgamated Southampton, Pon Elgin and SaugeenTwp.)
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. Kincardine has a strong Scottish and Marine
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. Pon Elgin is well known for its successfuleventsand
festivals,the largestof which is Pumpkinfest which
attracts32,000 visitors. pon Elgin also boasts an active
harbour, a vibrant downtown and miniature steam
train.
. Southampton is the oldest pon on the Bruce Coast
and is well known for its interesting marine heritage
and local architecture.Attractions include the Chantry
Island lighthouse and boat tour, the Southampton
Am School and Bruce County Museum & Archives.
Huron-Kinloss
(Amalgamated Point Clark, Ripley, Lucknow, Kinloss Twp. & Huron Twp.)
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. The Municipality of Huron-Kinloss is home to the
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Point Clark Lighthouse, a national historic site and
the adjoining Lightkeeper'sHouse Museum.
Lucknow is well known for the Lucknow Rodeo.
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Community of Sauble Beach
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. SaubleBeachis a popular summer tourist
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destination with its 11kilometres of sandy beaches
and boasts attractions such as the Sauble Speedway,
waterslidesand go karts.
Community of Paisley
. Paisleyis located northeast of Kincardine at the
convergenceof the Saugeenand TeeswaterRiversand
is best known for its quaint heritage village and
excellent canoe and kayak routes.
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LakeHuronShorelineCommunities
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LAKEHURONSHORELINE
TOURISMINVESTMENTAREA
Heritage Attractions
1. Bruce County Museum & Archives
2. Kincardine Lighthouse Museum
3. Point Clark Lighthouse
4. Chantry Island Lighthouse
5. SaugeenAmphitheatre
6. TreasureChest Museum
7. Heritage Farm Show-Antique Steam
& Tractor Show
Arts & Theatre
1. BluewaterSummer Playhouse
2. The Old Church Meeting House Dinner Theatre
3. Southampton Ans Schools
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Tourist Services
Roofed Accommodation
. There are 120 properties in the areawith
a total of 1,091rooms
Campgrounds
. The investment area has a total of 23
campgrounds and 4,300 campsites,of which 14
campgrounds are fully serviced.
Specialty Retail and Foodservice
. There are an extensivenumber and diversity of
specialty retail storesand foodservice outlets
throughout the shoreline area.
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Festivals and Events
. The area draws over 150,000 visitors to 26+ major
festivals and events.Top draws in the area include
Pumpkinfest in Port Elgin, Kincardine Scottish
Festivalin Kincardine, Southampton Craft and
Hobby fair, Maplefest (Paisley) and The Chantry
Chinook ClassicFishing Derby.
Amusements
1. Sauble BeachAmusements
2. Miniature SteamTrain
3. PaisleyRATTrack
4. SaubleSpeedway
S. Family Funland
Golf Courses
. There are nine golf coursesin the area,
4 9-hole courses,4 IS-hole coursesand
1 27-holecourse.Of theses,2 arepublic and
5 aresemi-private.
Two newcoursesareunder
construction.
Outdoor Outfitters
. There are nine outfitters in the areathat offer
rentals, guiding and rental salesfor: canoeing,
kayacking, cycling, scubadiving and horseback
riding.
Parks
MacGregorPoint Provincial Park
Inverhuron Provincial Park
Sauble Falls Provincial Park
Stoney Island Conservation Area
BrucedaleConservation Area
Dennys Dam Conservation Area
SaugeenBluffs Conservation Area
Marinas
Marinas in Kincardine, Port Elgin, Southampton and
Sauble Beach
Boat Charters
Fishing chartersavailable in Kincardine, Port Elgin,
Southampton and Sauble Beach.
Sailing Charters
Sailing Charters available in Port Elgin, Southampton
and Sauble Beach.
Natural Attractions
1.BervieZoological Park
2. Chantry Island Bird Sanctuary
3. Sauble River Falls
Tourist Services
Roofed Accommodation
. There are 120 properties in the areawith
a total of 1,091rooms
Trail-based Activities
104 kIns of canoe/kayakroutes
347 kIns of cycling trails
30 kIns of hiking trails
360 kIns of snowmobe trails
52 kIns of cross-countryski trails
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LAKEHURONSHORELINE
TOURISM
INVESTMENT
AREA
Business Opportunities
The Lake Huron Shoreline Tourism Investment Area
provides a variety of high quality outdoor tourism
experiences.Traditional family activities of beaching
and cottaging are being supplemented by interest in
cultural and heritage experiences,often with a
learning component. Emerging markets of mature
families, couples and senior couples are looking for
upscaleactivities, accommodations and shopping.
The lighthouse tour has strong growth potential as a
value-addedexperienceand offers many partnering
opportunities. An extension of the tourism market is
the active retirement market which demands many of
the sameproducts and servicesas transient tourists.
Following an extensiveconsultation and study
process,Pannell Kerr Forsterand the Bruce
Community FuturesDevelopment Corporation have
identified 5 high potential tourism business
opportunities. A shon summary of each opportunity
follows. Pro-forma businessplans and interactive
templates are available from Bruce CFDC with contact
information provided at the end of this document.
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THEMED
WATERPARK
& MINIATURE
GOLF
Concept
The proposed development provides family
amusementsnamely miniature golf and waterpark,
in a themed atmosphere.A lighthouse theme is
proposed as a natural extension of the area'smarine
heritage.The businessmodel incorporates:
. 18 holes of themed miniature golf with at least one
waterfall and two splash ponds-lighthouse theme
. 5 waterslides, 1 splash pad and swimming pool
. Small snackbar, Souvenir shop and Arcade
Due to the nature of the development and the
seasonalityof the primary target market, it is
anticipated that the development's operating season
would extend from May to September.
The waterpark would operate for approximately 80
daysover the summer season,primarily on
weekendsduring May, June and Septemberperiods,
and sevendays a week during the July/August
period.
Key Rationale
It is expectedthat the proposed miniature golf and
waterpark development would attract 68,000 visitors
seasonally.The target market includes families and
youth visiting the area as tourists and seasonal
cottagers,and local residents.It is expectedthat the
waterpark will penetratethe seasonalresident
market at a rateof approximately 7%, the resident
market at 5% and the tourist market at 1% for total
seasonalvisitation of approximately 34,500. In order
to reach its market potential, the miniature golf
component of the development is expectedto
capture 4% of the seasonalmarket, 3% of the tourist
market and 2% of the resident market for attendance
levels of approximately 34,000 per season.
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Site & Location Requirements
The proposed development will require a serviced
site of at least 4 acres.Furthermore, the site should
be located in a high traffic volume area in order to
provide visibility. The site should provide convenient
accessand egressfor vehicular traffic.
Investment
The total capital cost for the themed waterpark and
miniature golf development is estimated at close to
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LIFESTYLECOMMUNITY« RV PARK
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Concept
BruceCFDC is interested in attracting a private
sectorproponent to development a Lifestyle
Modular Home Community and an RV Park.
The proposed development would combine a
modular home residential development of 180 lots
and an RV park consisting of a minimum of 50 sites.
The RV siteswill be offered as transient or seasonal
sites.The development would include a 12,000
squarefoot clubhouse aswell as two tennis courts
and accessto hiking trails.
The Modular Home Lifestyle Community would be
operated year round and the RV park operated on a
120 day season.The concept is based on the
purchaseof 1 to 3 bedroom modular homes from a
supplier, who in turn installs the homes at a site
prepared by the Lifestyle Community developer.
The homeowner leasesthe land on which each
home is located, and pays monthly maintenance
feesto the developer.
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Key Rationale
The Lifestyle Community will draw largely on
Canada'saging population, providing affordable,
safeand low maintenance housing. The Lake Huron
Shoreline is growing in its appeal to this market
segment.This concept will also attract the summer
home market as an affordable alternative to cottages.
Basedon salesin similar locations, it is expectedthat
there is sufficient demand to sell the 180 modular
home lots within the first three yearsof
development. The RV park will provide additional
transient accommodation in the area as well as
seasonalaccommodation. It is expectedthat the RV
park will operate at an occupancy of 60% in its first
year of operation, stabilizing at 65% or 3,900
occupied site nights by year five.
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FULLSERVICERESORT& LIFESTYLECOMMUNITY
Concept
BruceCFDC is interested in attracting a private sector
proponent to develop a Full ServiceResortand
Lifestyle Community. The proposed development
would combine a traditional full serviceresort, a
residential modular home lifestyle community and a
small RV community.
The proposed businessdevelopment model includes:
.75 hotel rooms
. 6,000 square feet of meeting space
. 75 food & beverageseats
.3,000 square foot recreation facility
. 180 modular home lots
. 12,000 square foot clubhouse
. 50 RV sites
This development would be operated on a Yearround basis, however,due to the seasonalityof
BruceCounty's tourist market, the summer season
will provide the majority room night demand and
RVsiteswould be operated on a seasonalbasis.
Key Rationale
The lack of adequatefull serviceroofed
accommodation in the Lake Huron Shoreline Impact
Area has a negative impact on the study area'sability
to satisfy overnight demand, particularly during the
peak season.The challenge in this type of
development is the seasonalityof the tourist market,
however,the addition of the lifestyle community
adds to the economic feasibility of the project. It is
expectedthat the proposed resort development has
the potential to capture approximately 15,000 room
nights in its first year of operation. Of these nights,
approximately 10% are expectedto be corporate
room nights, 40% meeting!conference,40%
independent leisure and 10% group leisure. It is
expectedthat the lifestyle community will draw
largely upon Canada'saging population as well as
the cottage market. Basedon salesin similar
locations, it is expectedthat there is sufficient
demand to sell the 180 modular home lots within
the first three yearsof development.
amenitiesrequiredby guests.Additionally,the site
shouldprovideconvenientaccess
and egressfor
vehiculartraffic.This developmentopportunity has
the potentialfor success
alonganysectionof the
LakeHuron Shorelineor interior lakelocation.
Investment
The total capital costs for the Resort,Lifestyle
Community and RV Park are estimated at $10.8
million, of which the resort accounts for $6.8
million (2/3 of the cost). At the completion of the
$10.8 million development program at the end of
Year4, the sale of the modular homes will have
reduced the debt costsmarginally by $600,000 to
$10.3 million - thereby paying for the RV Park.
However, the development program will have
enhanced the value of the project by creating a 75
unit resort hotel operating entity and 180 unit resort
community with a 50 site RV Park.The operation
will generatea return of 19.1% on equity by the end
of Year5.
Additional information will be required to fully
explore each opportunity and investors are expected
to undertake their own due diligence.
Site & Location Requirements
The proposed development will require a site of at
least 35 acres.Funhermore, waterfront accessis
essentialto the successof the development, in order
to provide the resort "experience" and recreational
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CHANTRYISLANDTOURSERVICE
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In Progress
Southampton's Marine
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INBOUND RECEPTIVETOUR OPERATOR
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Concept
BruceCFDC is interested in attracting an inbound
ReceptiveTour Operator as a private or public sector
venture. An Inbound ReceptiveTour Operator is
defined as an operator that develops and sells the
travel experienceto the inbound market. Examples
include activities that the visitor will buy once they
are at their destination, such as a lighthouse tour.
Alternatively, a complete packagecan be sold, which
would include accommodation, transportation,
visits to attractions, food and beverage;such as an
"0 ld SaltsWeekend". A local individual, travel
agencyor tour wholesaler who has knowledge of the
tourism product and inventory could develop and
sell Group, FreeIndependent Tourist (FIT) and
customized packagesto the tourism market. All
developed packageswould then be promoted
through a licensed tour wholesaler/travel agency.
Becauseof the capital investment required to
become a licensed travel agent, it is recommended
that the Inbound ReceptiveTour Operator develop a
working relationship with an existing licensed tour
wholesaler in the region or province. Alternatively a
TICO licensed travel agent and wholesaler in the
local areacould provide the servicesof an Inbound
Tour ReceptiveTour Operator. The ability to develop
tour packageswithin the areawill be contingent on
the availability of "five star" operators within the
areawhich will comprise the tour "experience".The
Inbound ReceptiveTour Operator is encouragedto
work with Ontario Tourism Marketing Partnership's
Ontario ReceptiveAlliance program for the province.
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Maintainingthe inventory;
Issuingcoupons;and
8Tracking and reporting.
The Wholesaler will be TICO licensed and will be
responsible for:
. Dealing with the Travel Trade;
. Bookings;
. Revenuesharing and distribution; and
. Marketing the packages.
Alternatively, a TICO licensedTravel Agent and Tour
Wholesaler operator could provide both the services
of an Inbound Receptiveaswell as the wholesaler,
thereby retaining the 10% to 20% commission fee.
Site and Location Requirements
Ideally, the Inbound ReceptiveTour Operator could
share office spacewith a retail travel agent or
wholesaler in the local region. The retail travel agent
could then provide servicessuch as booking flights
and arranging ground transportation for consumers.
Alternatively, the Inbound ReceptiveTour Operator
could operate from a home office at any location
within Bruce County.
Key Rationale
Operators in the Lake Huron Shoreline Area, have
indicated that selling tour packagesthrough an
Inbound ReceptiveTour Operator will free up more
of their time to concentrate on their own businesses.
The Inbound ReceptiveOperator will work with
suppliers to createand assembleFIT, Group and
Customized packages.
The Inbound Receptivewill be responsible for:
. Developing the packages;
. Administrative details;
. Negotiating the best net price with each of the
tourism suppliers in the packageand adding 10% to
20% commission fee;
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to reachus
N2Z 2Y7
1-888-832-2232
1-519-396-8141
Fax 1-519-396-8346
[email protected]
www.bruce.on.ca
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Brucelnvest
BRUCE
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Appendix 1
Tourism
BusinessDevelopment Opportunities
In order to identify tourism businessopportunities
for the Lake Huron Shoreline Tourism Investment
Area, a long list of opponunities was compiled by
BruceCommunity Futures Development
Corporation and Pannell Kerr Forster,with input
from public workshops. This long list has been
categorizedin order to identify private sector
businessand development opportunities as
compared to tours, events,packagesor activities,
which tend to be more "experiential" in nature.
Theseare important components in the
development of tourism, however,they cannot be
consideredviable businessopponunities in their
own right.
. Accommodations
. Recreation & Attractions
. Tourism Services
. Tours, Events, Packages& Activities
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Tours, Events, Packages& Activities
A total of 19 tours,events,packages
and activitieshave
alsobeenidentified asopportunitiesfor the area.
The majority of thesecannotbe consideredprivate sector
developmentopportunitiesbut ratherdevelopmentsthat
supponthe largertourism industry.
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Private
Sector
1 CulinaryTrainingApprenticeship
2 ExtendTheatreSeason
3 FishingCharter
4 Franchise
Foodservice
Operation
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Private
Sector
1 AboriginalHeritageTour
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4 Canoe
Festival
9 Driftwood
Festival
10Shuttle
Service
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10Fly-Fishing
Festival
7 SailingCharter
8 SailingSchool
11 SpecialtyGardening
Centre
12 Receptive
TourOperator
13 Reservation
Service
14 Retail ProductFacilitator
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3 BoatersFestival
9 Ship
toShore
Community
Business
Centre.
6 GuideTrainingSchool
Public
Sector
2 Antique Store & Auction Guide
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5 FurnitureMaking
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Public
Sector
5 CelticFestival-2002
6 ConcertSeries
7 CountryMusic Festival
8 CulinaryEvents& Classes
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11 Genealogical
Research
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12 GolfPackage
13 KiteFestival
14 LighthouseTour
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15 MarineHeritageEvent-2004
16 SalmonSpawning
Viewing
17 Southampton
School
of ArtsPackages
18 StormWatching
19Trails
Festival
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BRUCE
Commun.,
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281 Durham Street,
P.o. Box 208
Kincardine, ON
N2Z 2Y7
1-888-832-2232
1-519-396-8141
Fax 1-519-396-8346
[email protected]
www.bruce.on.ca
Bru(elnvest
CE