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Posted Feb 16, 2008, 4:36 PM
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Join Date: Jun 2006
Location: Grand Bay-Westfield :: NB
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Metro's confidence in economy still high
And with good reason, say the region's economic development gurus
By Aloma Jardine
Times & Transcript Staff
Published Saturday February 16th, 2008
Appeared on page A1
Oh, Metro, your confidence is slipping.
That's right. In last year's CityThink survey, an annual Times & Transcript poll conducted by Bristol Omnifacts, a whopping 97 per cent of you felt Metro Moncton's economy would be about the same or better at this time next year.
This year a paltry 95 per cent felt the same.
Oh, the horror.
A horror most other communities in this province would love to have.
For the third year in a row Metro Monctonians polled for CityThink have stated loud and clear their confidence in the region's economy and in its future.
For three years, the percentage of people who rate the economy as good or excellent has stayed steady at 87 per cent, and 71 per cent of you wholeheartedly agreed that your community has a strong local economy. That's down a little from 77 per cent last year, but right in line with the 2006 survey where 72 per cent of people felt the same.
And if you don't believe us, there is plenty of evidence to prove that not only are consumers confident, they have every reason to be.
Ben Champoux, business development specialist with the City of Moncton, says one of the key indicators they use to assess consumer confidence is housing sales.
"When realtors continue to sell homes at a record pace and a record sell price, you know that consumer confidence remains strong," he says. "Housing is definitely the most significant investment that a family will make and we continue to sell a record number of homes year after year."
The number of MLS sales has more than doubled in Metro Moncton in the past ten years and the average house price has grown from just over $85,000 in 1997 to more than $140,000 last year.
At the same time, construction has remained strong, with all three communities posting record or near-record years for the past several years.
"Throughout the 1990s we issued an average of $58 million (in permits a year in Moncton)," Champoux says. "Since 2002, it has been well above $120 million, so doubled and sometimes nearly tripled, and that has been sustained for the last six years.
"In 2002 when we had $144 million, a significant jump over the previous year, many people said, 'This is not sustainable, you'll never see that again,' but it has sustained that level and in fact in 2006 it exceeded it."
Employment is another indicator of a strong economy as the many people who have moved into the region in the last decade can attest to. Nearly 74,000 people were employed in Metro Moncton by the end of 2007 compared to about 50,000 in 1990.
"When people feel good about their own personal circumstances, they feel good about the economy," says Brenda Orchard, director of corporate services and economic development for the Town of Riverview. "They feed off each other."
Orchard says there have also been a number of highly visible projects completed in the last little while, including the new bridge connecting Riverview and Moncton, and when people can see the signs of growth and prosperity, it helps boost their confidence in the economy.
Another good way to gauge how consumers are feeling is by what they buy.
When people have money to spare, they spend it on cars, high-end electronics, and other major purchases.
Given how many car dealerships in the area have recently relocated and built brand new buildings or expanded to build new and bigger showrooms, it's probably a pretty good indication that vehicles are selling pretty well.
An even better indication that Metro Moncton has arrived is the fact that BMW is currently building its second dealership in Atlantic Canada on Champlain Street.
"BMW would certainly not establish a point of service if they did not feel the community was growing and had reached enough high-end jobs to generate a demand for high-end, luxury cars," Champoux says.
Roger Melanson, general manager of the Economic Development Corporation of the City of Dieppe, says the dealership is a symbol of sorts.
"It represents the confidence of our area," he says. "When you see Cadillac Fairview investing $14 million (in Champlain Place), that is a sign of confidence (from them because there) has to be a return on investment."
Dieppe residents were most likely to rate their economy as excellent -- 36 per cent compared to 21 per cent in Riverview and 24 per cent in Moncton -- while Moncton residents were most optimistic about the future, with 30 per cent saying they felt the economy would be better at this time next year, compared to 17 per cent of those polled in Riverview and 23 per cent of those polled in Dieppe.
Melanson says seeing such high numbers is encouraging.
"These numbers show us we are on the right track," he says. "I look at these numbers as very encouraging in that decisions that were made by city council and the economic development corporation are giving us dividends."
Melanson says the local economy is strong because the conditions are right for investment, with competitive tax rates, a well-trained, well-educated labour force, and a critical mass of people with lots of disposable income.
Another part of the reason the local economy stays strong is because consumers believe it is strong, but that only works insofar as there is some truth to that belief.
"The collapse of the U.S. economy is, I wouldn't say entirely, but is mainly due to the fact that people were losing confidence in the economy and they started to panic in some regions," Champoux says. "Consumer confidence is critical in maintaining the strength of the economy, but it can't be fluff. You can't sustain consumer confidence with nothing to back it up."
Champoux, Melanson, and Orchard expect Metro Moncton will be able to survive any downturn in the economy quite handily because of its highly diversified economy.
Melanson says the latest numbers he's seen show that no more than seven per cent of the labour force depends on any one industry.
"There is no question that the Canadian economy is tied to the American economy -- they are our biggest trading partner -- but we won't feel as much of a pinch as manufacturing communities would like in southern Ontario," Orchard says. "Will it have an impact somewhat? Yes, there are certain businesses that will, but Greater Moncton has been pretty resilient... Even if one sector is down a little bit, we have other sectors that are doing well."
Melanson says the number of big projects in the works, like the Moncton courthouse and the new track and field stadium, will also help keep things moving as each new project entices developers to build more new projects near it.
Champoux says things have also been growing at a steady rather than astronomical pace, which bodes well.
"We haven't seen the tremendous growth, the doubling of home prices in two years, like you've seen in the States in some areas," he says. "We've seen smaller growth, but sustainable growth."
More than 600 people across Metro Moncton were interviewed in January for the CityThink survey.
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Convention centre idea too limiting
Published Saturday February 16th, 2008
Appeared on page D8
Even as City of Moncton officials return from a successful trip to Ottawa promoting our city as a great place to hold conventions -- which it is -- considerable thought is being given to switching the focus of downtown development efforts from building a convention centre to instead building a multi-purpose entertainment centre that could well end up serving the city better while still improving our ability to attract and stage conventions.
It is a discussion well worth having and, perhaps to the surprise of many, is an idea that appears to be attractive to most of the national planners of conventions who were wooed in Ottawa this week. Many of them, especially those who hold conventions of from 300 to 700 people, actually prefer to use hotel facilities where everything is under one roof, there is co-ordinated service for all needs, there is not a lot of walking involved between events and package deals mean cheaper costs. And these are the sorts of conventions that most often Moncton is likely to attract and host.
From the city's viewpoint, the idea also contains considerable merit. By building a downtown entertainment centre that is close to hotels, we'd not only be providing easily accessed leisure options for conventioneers, but also a facility that would draw large numbers of people downtown regularly; crowds that would ensure the downtown remain economically healthy and vibrant.
Such a centre could house the larger conventions, it would include a full-scale rink/concert venue considerably better than the aging Coliseum, some restaurants, retail outlets, some meeting space and trade shows, greatly expanding our present capacity in those areas. And unlike a dedicated convention centre, this facility is easy to visualize being in virtually constant use, which means it would require considerably less public subsidy to maintain, if any. Such subsidies are justified on the grounds the economic spinoffs return the money and more to our economy, which is true, but the less required, the better.
Nor is switching the focus and plan at this stage either unrealistic or likely to become controversial. The Bristol poll done recently clearly indicated that almost 90 per cent of Monctonians support a downtown Metro Centre idea that includes various entertainment options. That's an astoundingly high number that simply cannot be ignored.
A convention centre alone is a more limited, one-dimensional project. Given what the city has learned in Ottawa, it may not achieve what planners had hoped it would. A multi-use Metro Centre on the other hand offers benefits for conventions and the public. It is an increasingly attractive idea.
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Bring on the new casino . . .
W.E. (Bill) Belliveau
IN DEPTH
Published Saturday February 16th, 2008
Appeared on page D8
A few months ago, the provincial government, through its Lottery Commission called for proposals to build and operate a casino somewhere in New Brunswick. Logically that would be in or around the larger population centres of Saint John, Fredericton or Moncton.
Further logic suggests that Moncton/Riverview/Dieppe is the only centre that could meet the test. With a population of 127,000 people, it's the largest centre in the region, but more significantly it's the hub to an estimated 1.37 million people living within a 2.5 hour drive of the city.
Rationale for the call for proposals is linked directly to the state of New Brunswick's tourism industry. In 2006, the number of visitors to New Brunswick declined by 5.1 per cent to 1.57 million. Visitors from Ontario and Quebec were down 8.4 per cent and 10.9 per cent while numbers from the United States were down by 4.3 per cent.
Ironically, revenues were up slightly to an estimated $1.2 billion. This is explained by increased travel from residents and a strong performance in the shoulder and off-season months (Source: NB Department of Tourism & Parks online Marketing Plan).
While the number of visitors is significant, the more important statistic is how long visitors stay in the province and how much they spend here.
In-province travel by New Brunswick residents keeps money in the province and adds revenue to the provincial economy that might otherwise have leaked out to another province or state.
In my opinion, a casino will help the province keep more of those dollars and attract new dollars to the economy that otherwise might have passed through the province to Nova Scotia or P.E.I.
A casino will also cause some visitors to stay in the province a little longer. Recognizing that fact, the government has asked proponents to consider ancillary components that would attract visitors and give them reason to stay for a few days.
Some proponents may come to the table with racetracks. Others may propose downtown casino-convention centres and still others may come forward with casino resorts located away from the downtown core.
It's easy to support the notion of a downtown convention centre but I would prefer to see some sort of coliseum and trade centre that would give new life to the downtown and attract people, investment and residential development.
Thousands of downtown visitors every few days would do wonders for the city's economy. As for the casino, I don't think it should be located downtown for social and other reasons. The casino should be a controlled access destination, preferably located near the Trans-Canada Highway within a short distance of hotels and shopping.
The retail industry attracts thousands of people to Moncton every year. The most recent figures in my possession show sales in 2004 at $1.54 billion, 17 per cent higher than the per capita average for retail sales across Canada.
I suspect this number has grown exponentially with the addition of new outlets over the last few years.
As mentioned earlier, it's my guess that a casino by itself will not attract a significant number of out-of-province visitors to the area. It will help to hold them once they are here and it will be a factor in extending their length of stay.
What is needed is a major attraction that complements existing attractions but brings new people into the region.
A casino resort complex is one option. A racetrack casino is a second. A casino retail complex could be another. What if you married a casino to an LL Bean outlet? That would certainly attract visitors and give them reason to spend time and money at the site.
Moncton is a proven "concert" host. The Moncton Coliseum attracts 6,000 to 8,000 people to major performances but location dilutes its contribution to the hospitality industry. The Capitol theatre regularly attracts sell-out crowds of 800 to 900 people for events and contributes significantly to the downtown hospitality industry.
Big name entertainment is certainly a way to attract visitors but to maintain a year-round, high level standard of quality would be very expensive.
The most successful theatre event in Atlantic Canada may be the long-running Anne of Green Gables musical at the Confederation Centre in Charlottetown. It continues to sell out for six to eight weeks every summer. Le Pays de la Sagouine in Bouctouche also does very well with its summer dinner theatre. Maybe a permanent theatre "company" would work in a mixed use entertainment centre.
The deal-maker for casino proponents will be the differentiator that delivers visitors who become customers of both the casino and the community at large, including the hospitality industry.
At the end of the day, the winner will be the one who delivers on the tourism mandate and demonstrates maximum economic impact within the boundaries of taste and social responsibility.
* W.E. (Bill) Belliveau is a Shediac resident and Moncton business consultant. His column appears on this page every Saturday. He can be contacted at [email protected]
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