Friday, January 30, 2015

Everyone is walking away from the Cape



After years of stormy civic relations culminating last year with the construction of three docks nobody wanted that ruined the views and lead to nowhere, the current owners of Cape Roger Curtis want out.  They've subdivided the land, cleared it, built roads and these monstrous docks and sold the prime pieces of waterfront.  Now they want out and are willing to part with the upland lots.

And hot on the heels of that, one of the major development partners in the Cape, Wakefield, has declared bankruptcy which is devastating for many people here on Bowen.  They owe the Bowen Building Centre over $100,000 and owe substantial amounts to local contractors who have been doing work for them on the Cape.

In a small community this is big news.  Our local economy relies on the trades who build houses and help maintain existing structures (our primary economic activity is property values, supported by commuters who pay mortgages and tradespeople who keep the places looking good).  No amount of tourism will make the difference and it will be interesting to watch this situation unfold and see what we can learn about the way private property needs to be developed here.  Having large scale off island development companies insert themselves so fulsomely into the local economy is good during boom times, but is a bust when people get into trouble, as they are now. Boom-bust cycles and structural economics is not a good way to sustain an economy in a small town, especially when we have so many other options, like local developers, and our own particular brands of tourism.  Until these big firms arrived development on Bowen was largely run by a couple of local companies who had a substantial network of local contractors.  It was stable and reliable.  Now it runs the risk of being in tatters.

It remains to be seen how many people will be put out of business with Wakefield's bankruptcy, and what it mean for contractors who may have to declare bankruptcy themselves.  And the question we need to ask ourselves is this: how can we continue to develop an economy based on private property without getting overly attached to a very small number of large developers whose fortunes are tied to what is only going to become an increasingly volatile real estate market?

Maybe I should join the economic development committee.