Get over it, Toronto. Oil-rich Calgary is the new centre of the universe -- and the party's just getting started.
ANNE KINGSTON | Mar 28, 2006
Here we are, Saturday night in downtown Calgary, March 4, 2006. Oil's trading at US$63 a barrel, the temperature is minus 17¡ C. Belly dancers undulating porcelain Prairie flesh snake through the crowded space. Waiters circulate, serving hors d'oeuvres of elk pastrami with horseradish aioli, scallop ceviche and duck confit with wild berry vinaigrette. A trio of drag queens quaff sparkling wine.
More than 500 people have gathered to celebrate the gala reopening of the Grand Theatre, the new home of Theatre Junction, a local performance company. Attire ranges from corporate to casual to slinky glam as decades-old Calgary money rubs shoulders with newly minted gonzo Calgary wealth.
Tonight's mise en scène itself can be viewed as a compelling performance piece, a vignette in which a buoyant populace reclaims its neglected past to create its future. As a symbol, the Grand is fertile. Built by Senator James Lougheed in 1912, at the top of a boom cycle, it was a landmark. Sarah Bernhardt, Fred Astaire and the Marx Brothers all performed on its stage. Over the years, the structure changed hands and function, falling into neglect and ending up a golf-practice dome at the centre of town.
Mark Lawes, Theatre Junction's 41-year-old founder and artistic director, first visited the rundown building in 2003 in his search for a new company home. He saw beyond the cheesy mountain mural painted on one wall and the beer bottles littering the floor. With the kind of can-do entrepreneurship the Alberta arts scene has learned to finesse for its very survival, Lawes and his company raised more than $12 million through private-public funding while culling hundreds of thousands of dollars in pro bono volunteer work.
As with everything in Calgary these days, oil money runs through the project. The first to donate was Jackie Flanagan, a local pistol and the publisher of Alberta Views magazine. Flanagan is also the ex-wife of Allan Markin, the chairman of Canadian Natural Resources Limited, a guy from a working-class neighbourhood who helped turn a junior resource penny stock into a major player with a market cap of $35 billion. The first major corporate donation of $400,000 came from Total E&P Canada, a subsidiary of the French oil and gas company. An anonymous private donation of $760,000 will fund 12 full-time resident artists, a first for the city.
The revived Grand is a 21st-century "culturehouse," a stylishly raw incubator for new work and visiting artists designed by Sturgess Architecture, a local firm. The 3,000-square-foot Flanagan Theatre, named for its primary benefactor, with 400 movable seats and a mobile stage, was created by Montreal-based Trizart-Alliance Inc., known for its work with Cirque du Soleil. Also on the premises are a rehearsal studio and Velvet, a lobby restaurant and bar.
Inside the theatre, the evening's entertainment begins. A female dancer, suspended 15 feet over the stage by white streamers, writhes in Cirque du Soleil-style acrobatic contortions while a video flashes on the brick wall behind her. The crowd is transfixed, riveted by the bold precariousness of it all.
For all its theatricality, however, the performance pales next to the biggest show in Calgary these days -- Calgary itself. Canada's fastest growing city is in turbo-drive, fuelled by an oil price jump from US$10 a barrel in 1999 to more than US$60 now.
The city boasts the highest GDP per capita in the country. In its concentration of corporate head offices, Calgary is second only to Toronto. Office space runs at the national high, fetching more than $40 a square foot in the most desirable buildings -- when it can be found. Last year, rents soared 49 per cent. Yellow cranes hover over the downtown cityscape, a mass of bland modernity that doubled as Metropolis in Superman III. Some 19.5 million square feet of real estate is currently under construction or being marketed, 6.7 million square feet of it downtown.
The residential housing market is also aflame. Resale house prices rose more than 18 per cent in February over the previous year, three times the national average. Ten years ago, the sale of a million-dollar house was rare. Now it's commonplace.
With no sales tax and a flat provincial tax, Alberta, with zero debt and a budget surplus of more than $10 billion, has become a wealth magnet. Jeff Rubin, chief economist of CIBC World Markets Inc. in Toronto, has forecast that the province's economy will grow by more than seven per cent this year, compared with less than two per cent for Ontario and 2.9 per cent for Canada. "If the province could lose the federal tax we'd be the Grand Caymans of Canada," a local businessman quips.
Political and economic clout has shifted west. The recognition that the oil patch is the anchor of Canada's territorial sovereignty has changed the equation. Calgary, at the deal-making hub of the oil patch, has been thrust onto centre stage as the new power nexus, the next hot city, nirvana itself.
Every day, it seems, a new honour is accorded. Recently, Calgary was pronounced the new capital of Canadian retail in terms of potential. The opening of Williams-Sonoma in Chinook Centre mall last summer was rumoured to ring in the chain's second-biggest first day after its flagship New York store(the chain doesn't comment on sales numbers). Last year, American Apparel opened its largest Canadian store there. Michael Kehoe, a broker with Fairfield Commercial Real Estate, reports American housewares chain Crate & Barrel is in negotiations to launch its Canadian beachhead in the city.
Tales of big consumption are rife. Tamar Zenith of the Newzones Gallery, which carries contemporary artists, speaks of 25-year-old tech guys buying million-dollar canvases. She has customers slapping down a Visa for a $50,000 painting, no authorization required.
"I've seen crazy things," says Geoff Last, owner of Bin 905, a wine store. "One customer walked in and said, 'I've got 15 minutes and $5,000. I want six cases. Go!' " Canadian photographer and art-world darling Edward Burtynsky, whose large-scale industrial-themed works are priced from $9,000 into the five-figures, routinely sells out, often sight-unseen over the phone, before a show is mounted at the Paul Kuhn Gallery.
Residents joke that the city's new prosperity can be measured by the influx of glossy Calgary-centric style magazines filled with stuff to buy. Vince Wong, co-owner of the popular club Bungalow, is part of a team about to launch the Canadian version of Ego, a Miami-based free city magazine distributed in boutiques and hotels. The plan is to begin with a Calgary version, then roll it out in other Canadian cities. "Calgary is a city on steroids," Wong says. "I don't want to be anywhere else. It's non-stop."
Calgary Herald columnist Val Fortney says the optimism has trickled down beyond the oil patch, noting she recently bought a pair of impractical pink leather boots. "The fact that someone like me thought it was safe to buy pink leather boots tells you everything you need to know about the boom," she says.
The showcase house is another hot topic. There's talk of 35,000-square-foot houses being built, and of the local businessman who installed a guest locker/change room for his home gym. Brian Mahoney, a realtor with Re/Max, says half the houses he sells are teardowns, many for two to three million. People are spending more than $350 a square foot to build. Decorator Sally Healy rhymes off the usual must-haves of the new super-rich -- go-cart tracks, fish-stocked pond, helicopter pad, instant wine cellar, imported furniture, the "state of the art" kitchen with two dishwashers, two refrigerators, and a "cappuccino centre."
Healy recently outfitted a 5,000-square-foot house in Zen opulence, complete with a floor-to-ceiling water feature on one wall and huge steam room with a massage table. There's also a yoga studio where her client practises meditation, which includes playing Tibetan singing bowls. The kitchen is clad in serene walnut. "Drywall is a thing of the past," she says. "Our clients are panelling everything -- with limestone, wood -- you name it."
Big art is another status signifier. Healy has clients who have never been to an art gallery. "I expose them, then make them spend all of their money," she says. "In the past, art was just something to put over the sofa. Now clients are turning into collectors."
"People are showier, buying better artwork, higher quality furniture, using exotic woods," says interior designer Paul Lavoie, whose former house was featured in Architectural Digest in 2003 -- the only Calgarian and fourth Canadian to have a home featured in the decorating bible. The city's sophistication has grown over the past 10 years, he says. What's new is the momentum. "Before we'd see people build the house, then take a break," he says. "Now they just keep moving. The attitude is less 'cowboy,' more 'how fast can we go?' " According to Lavoie, the prevailing aesthetic is generic global super-rich. "A 30-year-old investment banker and his wife might want 'New York ultra-modern,' " he says. "Others the same age could ask for 'European villa.' "
A vital marker of Calgary money is having at least one other house, with Phoenix or Hawaii being favoured hot-weather destinations. "The only way to enjoy Calgary is to leave Calgary," Peter Linder, an oil and gas analyst at DeltaOne Capital in Calgary, says, half in jest.
The artist Jenny Holzer once created a bold installation piece that read "money creates taste." The maxim plays out in Calgary. Most literally, it's reflected in a burgeoning wine and food scene. One hot spot is the newly renovated Teatro, a gorgeous room in the 1911 Dominion Bank building, a rare example of preserved beaux arts classicism. Owner Dario Berloni shows off his 10,000-bottle cellar and expansive open kitchen. He boasts that acclaimed chefs Rob Feenie of Vancouver and Thomas Keller of New York and Napa Valley purchased similar kitchens after he did.
Also apparent is a new-found interest in the city as a taste arbiter. About the time oil hit $60 last summer, Architectural Digest did a feature on shopping in Calgary and Vancouver. Canadian Art devoted their winter 2005 issue to Calgary's visual arts scene, suggesting the city's new money could engender arts patronage to rival that of Montreal in the 19th and early 20th centuries.
Calgary's new status has created an oil shock of its own in the East, most of all in Toronto, the former centre of the universe, which once took perverse pride in having the country's most expensive real estate and parking.
Behind the envy-tinged attention lies another cultural obsession -- with the makeover, as if watching Calgarians spend their money will provide the same entertainment as viewing the Clampetts settling in Beverly Hills.
Such stereotypes are misplaced. The Calgary show is far more complex than that. For starters, the city's redneck reputation is a tourist conceit, rooted in the yahoo-cowboy legacy of the Calgary Stampede. Sure, there are country bars with names like Cowboy's, but Cowtown is in fact a corporate, white-collar centre of "knowledge workers," boasting this country's third most ethnically diverse population, the greatest number of post-secondary degrees per capita and the highest percentage of library lending in the country. That guy driving the big honking status truck -- a Toyota Tundra or Nissan Titan -- is likely an accountant.
Calgary's new-found sophistication has been in evolution since the city successfully hosted the Winter Olympics in 1988. That said, with a population of just over a million, the city still functions as a small town, albeit one sprawled out in a footprint as big as New York City.
A pioneer work ethic prevails, one that celebrates mavericks who operate outside of the Establishment grid. "Calgarians don't give a shit about what other people think," says Fortney. "Calgary is a city based on itself," says Wong. As such, it has created a strong civic mythology. The city prides itself on being an unpretentious meritocracy, welcoming to outsiders drawn by the city's optimism and opportunity. Co-operation is valued. During the economic downturn of the early '80s, engineering companies would loan employees to their competitors rather than lay people off. Civic involvement has always been part of the social fabric, says Yves Trépanier, co-founder of the TrépanierBaer Gallery. "If you have a small business and you don't contribute, you're frowned upon," he says.
Calgarians like to talk about how low-key their city's wealth is -- how Marg Southern, the matriarch of the ATCO-founding family, shops at Safeway, how millionaires drive their own cars to work. They'll tell you that billionaire Murray Edwards, vice-chairman of Canadian Natural Resources, lives in a nice house, but it's hardly a palace. "People aren't loud and cocky about it, they worked for it," says Linder. "It's a very positive environment."
Calgarians know who they are. "We'll never be the big cosmopolitan city of Toronto or Montreal with the history," says Linder. "It's not Dallas, but it's more urban than it used to be," says Lavoie.
Whether or not the city's lottery-like prosperity will conflict with its entrenched self-mythology is what makes the Calgary show so riveting. "People now worth hundreds of millions were living in an ATCO trailer 20 years ago," says George Gosbee, the chairman, president and CEO of Tristone Capital, himself a shining example of new Calgary money who answers his own phone. The 36-year-old saw an opportunity to provide investment banking services to the oil patch in 1999, when oil was in the doldrums. In 2000, he founded Tristone, building it into a company with global reach. In 2004, he sold it to a Denver-based energy investment house for $101 million. He maintains an operating stake.
New money has already affected the city. Steroidal growth doesn't come without side effects. Major strains on the system are evident. Tradespeople(who can make six figures at Fort McMurray)are in short supply. It can take more than 2 1/2 years to get a house built. As for finding a contractor to clad those walls in limestone, good luck. A record-low three-per-cent unemployment rate has resulted in a paucity of minimum-wage workers. Stories abound of fast-food outlets being shut down and hotels being unable to take on new guests. Businesses are offering signing bonuses. Vacancy rates hovering near zero mean shortage of choice. Crime is on the rise.
There's a demand-supply imbalance for everything from Prada purses to membership in the posh Glencoe Golf and Country Club, where 315 sit on the waiting list. Calgary, a suburban city, used to roll up the downtown at night and on weekends. Now people can't get into the growing number of restaurants and clubs. More worrisome are reports of shortages in health care. The Calgary Herald reports a looming baby boom will see Calgary women diverted to rural hospitals to give birth.
"We weren't keyed up for this level of growth," says Daryl Fridhandler, a Calgary lawyer and chair of Calgary Economic Development. "There's huge pressure on the infrastructure -- roads, schools and hospitals. I don't want to scare businesses from moving here but they might have trouble finding everything they need."
There's also worry that the city's much-trumpeted quality of life and community spirit might be imperilled, says Calgary alderman and civic activist Druh Farrell. "There is real concern we'll lose what we value most."
That could explain why some Calgarians wish the hype would go away. Steven Itzcovitch, president of Hyatt Automotive Group, which runs six dealerships in the city, says the impact of the new oil wealth has been overstated. "I go to Toronto and people think the streets here are paved with gold," he says. "There's a lot of wealth but it's with a few players -- some oil executives, land guys and home builders. The average person has no more money than a few years ago."
Others argue the notion of the boom-bust oil cycle is archaic. Oil analyst Linder sees a new global dynamic -- no excess supply buffering oil shocks, the prospect of growing demand from China and India, and no alternative energy sources in sight. "Every time, people say, 'This time around the boom is different,' " he says. "But this time the boom really is different." Gosbee agrees. "I don't see boom, boom, boom, but I see sustainability," he says.
The conventional Calgary wisdom is that everyone's much more prudent this cycle, heeding the popular '80s bumper sticker: "Please God, let there be another oil boom. I promise not to piss it all away next time." "People are pretty smart," says Healy. "They're paying cash." Gosbee agrees. "Everybody has got their house in order; they've paid down debt." Last says a conservatism prevails among his wine-buying customers. "Someone with unlimited funds may spend half a million on a car but not on wine," he says. "He won't buy Château Pétrus for $1,000. He'll spend several hundred on a bottle."
Calgary status remains rooted in building, not acquiring. Size matters, as in big vision, not square footage. Where this is playing out most dramatically is in the secondary boom taking place in the city's cultural scene, which has suddenly been thrust forward as a national model for delivering the arts through private-public coalitions.
Such ventures are nothing new in Alberta, where funding for the arts hasn't increased since 1988. "That has forced us to be very creative," says Bob White, the artistic director of Alberta Theatre Projects. "We know how to get more out of a dollar than anybody."
Arts groups have learned to speak the same language as business, which has spawned a new creative dialogue. Central to this lexicon is the risk-reward equation, which encourages experimental ventures. White recalls the early days of the Enbridge playRites Festival, an annual showcase of six new plays staged over six weeks, many of which go on to be produced across the country or internationally. In the late '80s, "we would knock on corporate doors and they'd respond because it was exactly what they were doing," he says. "They understand the idea of 'believe my idea and take risks' more than anyone. Most of these guys and gals live international lives," he says. "They know how important a vibrant culture is for the city."
Mark Lawes is also adept at straddling the creative and business communities, as the resurrection of the Grand testifies. He wants to stretch the conventions of performance art. His dream is to stage a play at the internationally renowned Avignon Theatre Festival. And he knows he won't do that by playing it safe. "No company will get there doing Chekhov," he says.
At the Alberta Ballet Company, Jean Grand-Maître, who was named artistic director in 2002, grapples with making ballet relevant. Traditional court ballets don't cut it in Calgary, he says. "It's still a corporate city. The challenge is to make the arts and culture part of the fabric of everyday life." One way he hopes to do this is by employing the rich storytelling tradition of the West, which he compares to that of Quebec. "A vibrant culture is rooted in folklore," he says.
The newest voice on the scene belongs to Lance Carlson, the president and CEO of the Alberta College of Art and Design, or ACAD. Carlson, a critic, teacher and artist, was lured from Los Angeles in 2004 to give the college a national and international reputation. He saw the opportunity to make the kind of impact he couldn't in L.A., where there are four art schools. In the space of two years, ACAD is setting the city's visual agenda and Carlson has become a force on the Canadian cultural scene. Last year, the college set up the Institute for the Creative Process to present design in non-aesthetic applications, what Carlson calls "human systems," that can crack problems faced by health care and business. His real-world, solutions-oriented message resonates with business. Xerox, Exxon, and RBC Foundation have provided seed money.
ACAD is also staging "Stirring Culture," a series of free lectures, featuring speakers such as the famed British architect Will Alsop and conceptual artist and educator Tim Rollins, to discuss how to forge an urban vision. Carlson has big plans to bring the college, now located four kilometres from the city, into the downtown core to make it part of the community. "What I get from my board is: 'Do it. Think bigger. Think bolder,' " says Carlson. "I love that."
He's not the only one thinking big. At a recent opening, Glenbow Museum president Mike Robinson likened Calgary to Florence in 1450, when the Medici princes began investing in arts and culture, before the creation of the Uffizi Gallery. The comparison is obvious, he believes. Both cities are landlocked, with rivers running through them. Like Calgary, Florence had tremendous wealth. And like Florence in the 15th century, Calgary lacks a contemporary art gallery. "When you invest in culture, the legacy lasts centuries," Robinson says.
Legacy is a word you hear spoken a lot in Calgary, often in a concerned tone. "What does money mean?" asks Bob White. "How many vacations do you need? The question is, 'What kind of life do you want to leave for your children?' "
That the city's wealth is based on a diminishing resource lends a sense of urgency to the discussion. "We're debt-free. We have a responsibility to lead now," says Trépanier. "We have equal representation and a strong voice. As Harper said 'We're in.' " That such talk might threaten the rest of the country doesn't bother him. He's talking nationally, not provincially. "When do we grow up and stop talking about shifts in regional power?" he asks. "All of us feel we can build something interesting. There's still lots of potential here."
Rather than cashing out, many people in their late 30s and 40s are looking for new outlets, says Gosbee, who became chairman of ACAD's board in 2005, inspired by Carlson's ambitions. He's also busy organizing funding for the Edge School, a $45-million facility that will meld academics and athletics. Some $23 million has been raised so far.
"I don't know one billionaire in Calgary who's not working," Gosbee says. "A lot of people could retire tomorrow but aren't. They're staying here to figure out what to do."
But there's also talk of a new breed of wealthy Calgarians dubbed "buffalo shooters," a reference to hunters who arrive, bag their prey, then leave. Buffalo shooters keep a base in Calgary to benefit from the tax system, but opt out of community involvement.
They're the exception, for now. "The effect of new money is that people are taking risks in terms of diversification beyond energy," Fridhandler observes. "People are staying here, saying there's a real opportunity," says Lawes. "If you live in Mississauga, you're wasting your time," says Lavoie. "You might as well come to Calgary."
With files from Rebecca Eckler
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