City of Vancouver finally focussing on business development

[raggedy13]

Alright, knowing how many of you forumers can be, I don't want discussion here to turn overtly political or into some sort of Gregor Robertson bashing session, etc. Let's focus on the ideas here not the people behind them and whether you like them or not.

Vancouver ready to push head-office recruitment

BY BARBARA YAFFE, VANCOUVER SUN

OCTOBER 19, 2009 9:00 PM

On a February day, when crocuses are abloom in Vancouver and snowplows clear yet another dump of snow in Calgary, Calgarians can thumb their noses at Vancouverites and taunt: "We have more top-500 headquarters than you do."

But now, Mayor Gregor Robertson, himself an entrepreneur, says that's going to change.

He's pledging to address a longstanding situation whereby Vancouver badly trails Calgary in the race for corporate head offices.

Cowtown boasts 6.7 corporate headquarters per 100,000 population compared to 1.8 in Vancouver, according to new figures cited by the Fraser Institute.

Robertson said Monday plans are afoot to "transform the city's image this winter."

The Olympics are "an ideal forum to promote our strengths aggressively to a massive global audience and to targeted business leaders."

"I will be leveraging 2010 for maximum exposure, pursuing potential companies, and promoting Vancouver on trade missions."

Robertson believes city hall "historically has been quite passive when it comes to head-office recruitment."

Vancouver regularly tops quality-of-life surveys. But "we can't expect that businesses are going to choose Vancouver to set up simply because we've got nice scenery.

"We need to change how companies and business leaders view us," asserts Robertson, co-owner of Happy Planet, an organic juice and soup company.

"There's also an impression that we're not aggressive and hungry for business here, or a powerhouse in any particular industry because of our diverse economy."

So, what is it businesses are looking for?

A 2006 study by the B.C. Business Council lists the key criteria for attracting head offices: an appealing tax regime, followed by availability of qualified managers, then quality of life.

The study noted B.C.'s tax regime has become more competitive in recent years. And efforts are under way to shift more property taxation to homeowners.

The mayor says Vancouver is now "very competitive -- but it takes time for the awareness to spread."

Continuing problem areas cited by the B.C. Business Council include Vancouver's high cost of land and office space and a shortage of industrial land, a difficulty aggravated by encroachment of residential development into areas traditionally reserved for business.

But Vancouver recently unveiled a fabulous new transit line which should ease traffic congestion in its core. It has an exquisite, widely admired airport. We're on Asia's doorstep with the benefits of the Pacific Gateway strategy at our feet.

The mayor points out Vancouver recently released a new business brand: "Vancouver Green Capital."

"We want the head offices of the emerging giants in the green economy. ... Vancouver will be an urban laboratory for green innovation and technologies.

"We also want to bolster our local leading-edge companies in clean tech, digital media, information technology, film and television -- industries that are growing during the economic downturn."

Vancouver has its work cut out for it. In raw numbers, Toronto has the biggest cluster of headquarters, 35.2 per cent of the Canadian total. Second-place Calgary has 15.8 per cent, ahead of Montreal with 15.2 per cent. Vancouver has a scant 8.2-per-cent share.

At least we're ahead of Winnipeg, with just 3.4 per cent.

Back in 1990, Vancouver had a bigger share of Canadian head offices than Calgary.

The Fraser Forum notes that head offices are crucial because of spinoff effects in terms of jobs and the nurturing professional communities of lawyers, consultants and accountants.

They also give a city cachet, the way Los Angeles is known as an entertainment hub and Paris as an international style headquarters.

So, how about Vancouver as a hub for global environmental organizations and businesses interested in the Asia-Pacific?

"We are launching an economic development strategy this fall," Robertson says. "We have a focused plan to attract head offices, instead of a wishful, sporadic approach."

Better late than never.

byaffe@vancouversun.com

© Copyright (c) The Vancouver Sun

BY BARBARA YAFFE, VANCOUVER SUN

[raggedy13]

Robertson believes city hall "historically has been quite passive when it comes to head-office recruitment."

I fully agree with this which is why it makes me happy just to hear the City is even considering such plans. I realize whether their plans turn to real action or are ultimately successful or not still remain to be seen but this shift in thinking/focus is at least a step in the right direction. I'm sure a number of you forumers would agree based on many of the comments/complaints I've seen made about the resortification of downtown, lack of new office development, lack of corporate sponsors for local events, etc.

I'm not sure how successful other cities have been with such "aggressive" approaches in the past, but whether or not such strategies tend to be worthwhile, at least we will have the added advantage of worldwide exposure during the Olympics to give us a boost. It also seems like a good time to push this plan considering the relative success the region has had lately in attracting such companies as Microsoft and Pixar. I know, it's really only a success for just one of a number of industries but it's a good sign that we're doing something right nonetheless. If we're already attracting some big names without the added benefit of worldwide media exposure and aggressive political schmoozing, who knows how much further we stand to gain. It also couldn't hurt that Canada and Vancouver are seen as being a relatively economically stable part of the world in these troubled times.

[EastVanMark]

Did I just read that correctly? a Vancouver mayor that actually gives a crap about head offices? Something actually to be done about it? This coming days after it was hinted that the city may actually allow a building of 700ft. Incredible. Maybe their is hope for this sleepy town to become an actual full functioning city. A place to live and work!!!!!!.....gotta give credit where it is due; great job mayor Gregor.

[agrant]

Originally Posted by EastVanMark

Maybe their is hope for this sleepy town to become an actual full functioning city. A place to live and work!!!!!!.....gotta give credit where it is due; great job mayor Gregor.

You mean... a place where we can work in a corporate head office, which isn't going to be me. But I hear ya.

[junius]

I am glad to see the Mayor at least approaching this issue. However this requires long term planning and vision in order to succeed. Rent costs and tax rates are only part of the situation. In the long term we need to stake out a competitive advantage as a city and build the infrastructure necessary to attract the talent, capital and other resources to create a community of successful businesses.

[jlousa]

Vancouver doesn't lack head offices due to high property taxes or costs downtown, lease rates and parking rates are both higher in Calgary then they are here and it isn't hurting them. Head offices left due to the provincial tax regime in BC during the 90s compared to the Alberta. With the current provincial tax regime we are no longer losing businesses to Calgary. The tax regime isn't great enough to steal business back but it's good enough to stop us from losing additional head offices. There is not much the mayor can do to attract business, all he can do is talk and that's what he's doing. The NPA did the exact same thing during the tech boom with the exact same results, so this isn't political bashing.
The plan that Gregor has for the Flats is bound for dramatic failure in it's current format. Expect to see his green ecomony plan later this week and judge for yourselves.

[djmk]

Originally Posted by jlousa

Vancouver doesn't lack head offices due to high property taxes or costs downtown, lease rates and parking rates are both higher in Calgary then they are here and it isn't hurting them. Head offices left due to the provincial tax regime in BC during the 90s compared to the Alberta. With the current provincial tax regime we are no longer losing businesses to Calgary. The tax regime isn't great enough to steal business back but it's good enough to stop us from losing additional head offices. There is not much the mayor can do to attract business, all he can do is talk and that's what he's doing. The NPA did the exact same thing during the tech boom with the exact same results, so this isn't political bashing.
The plan that Gregor has for the Flats is bound for dramatic failure in it's current format. Expect to see his green ecomony plan later this week and judge for yourselves.

just to add to your point...

the provincial portion of the general tax rate for non-CCPC's in alberta is 10% (with a long term goal of 8%) and the general tax rate in BC is 11% (with the goal of 10% by 2011)

The mayor can't do much to change this... but he can help with cutting bureaucratic red tape and other useless regulations...

[Prometheus]

The key to Vancouver's becoming an economic and financial powerhouse lies not in government getting more involved, but in getting out of the way. To that end, the province and city should start by doing the following:

1) Do not tinker with the corporate tax rate. Eliminate it completely.
2) Repeal all buisness-killing rules and regulations.

Make the message unequivocal: Vancouver is a place to do business, a place to make and keep money. If the province and city instituted the above changes, Vancouver would experience a renaissance of unprecedented proportion.

[ozonemania]

Let's hope we can capitalize on any surge in growth should we ever emerge from this recession.

I fully support Gregor Robertson's initiative and I hope it's successful. However, part of what needs to be done is to change the mentality of the population. We tend to accept that we aren't a leader in business, and our strength is a place to live, work and play. Maybe it should be live, get rich, and play? We tend to be skeptical or even cynical if there is a Vancouver business that is doing well. There also tends to be a lingering anti-corporate, stick-it-to-the-man, attitude that exists, which I feel somehow manages to permeate through our business culture here. I know these are hard to prove, touchy feely things, but that is my perception. I hope I'm wrong about that.

--

Also, I have wondered this for a while now... with BCs recent 'boom' in oil and gas exploration and development in its northeastern sector, is that economic benefit flowing into our province or Alberta? I am suspecting that the companies doing this may be based in Calgary, which means the 'corporate business' part of that economic gain is not really benefitting BC and in particular, Vancouver.

I know that it isn't a very green industry, but there are opportunities, and big money, that can come from this industry.

[trofirhen]

with reference to Prometheus' post .................. and a very good way of doing that would be to get more overseas airline destinations, both in Asia and Europe, as well as possibly Latin America and Oceania ( Melbourne, for example).

However, Ontario (read "Air Canada and the Ontario Feds") wants to keep our wings clipped, and the only thing to do is to some how lobby using our MPs to put continuous, high-pressure on the ruling party in Ottawa (no matter which party it is) and let them open us our destinations.

Calgary is adding a large new international wing to its airport, and has two long parallel runways, although, being centered in the oil industry, much of their business traffic is intra-North American.

We already have two runways, and are planning a third.

But we CANNOT become a major international business centre when our overseas nonstop destinations are so limited - particularly in Europe, where we have only three (3): (London, Amsterdam, and Frankfurt.)
Paris, Copenhagen, and Zurch or Rome might be good.
We have reasonable Asian connections, but could use a few more (Dubai, Bangkok, Singapore-which we lost- not to mention regaining Osaka ....)

So, people, start a movement. Yell. Write. Push. Lobby. Shout and yell some more. Don't back down until we get an even break.

[AlexYVR]

Originally Posted by Prometheus

The key to Vancouver's becoming an economic and financial powerhouse lies not in government getting more involved, but in getting out of the way. To that end, the province and city should start by doing the following:

1) Do not tinker with the corporate tax rate. Boldly slash it by half.
2) Repeal all buisness-killing rules and regulations.

Make the message unequivocal: Vancouver is a place to do business, a place to make and keep money. If the province and city instituted the above changes, Vancouver would experience a renaissance of unprecedented proportion.

Repeal all business-killing rules and regulations? Are you kidding me? We should probably abolish anti-trust laws and the minimum wage while we're at it, they totally get in the way of business

[Prometheus]

Originally Posted by ozonemania

I know that it isn't a very green industry, but there are opportunities, and big money, that can come from this industry.

That is why the article is more depressing than it is encouraging. If the goal is to push a new, vague form of "green" business at the expense of proven, wealth-producing industries, as opposed to unlocking the shackles on business as such, then the future for Vancouver's economic dynamism is bleak.

[Prometheus]

Originally Posted by AlexYVR

Repeal all business-killing rules and regulations? Are you kidding me? We should probably abolish anti-trust laws and the minimum wage while we're at it, they totally get in the way of business

Absolutely. Not only are such coercive interferences a moral affront to our liberty, but minimum wage laws actually cause higher unemployment and thus harm the very people who poverty activists profess to care about.

If you are serious about such issues, I highly recommend a classic text: Economics in One Lesson, by Henry Hazlitt.

[Metro-One]

OK, here is a question, looking at the Toronto forums I see that Telus has just finished a new office tower in Toronto. Are they moving their HQ out east, have they already done so, and if not, why are they not building a nice new office tower here?

Also, I feel Vancouver should be doing whatever it can to promote HQs of high tech and shipping businesses to our area. To me these sectors only make sense since we already have a large high tech background and for shipping we are located on the Pacific Rim and have the largest port in Canada.

What s funny is some forumers on here seem to have a "we are defeated before we try" attitude, which we all know is guaranteed to produce no results.

[junius]

Originally Posted by Prometheus

Absolutely. Not only are such coercive interferences a moral affront to our liberty, but minimum wage laws actually cause higher unemployment and thus harm the very people who poverty activists profess to care about.

If you are serious about such issues, I highly recommend a classic text: Economics in One Lesson, by Henry Hazlitt.

I am pretty sure you are going to have a hard time getting much traction for full blown libertarian economics policies in light of their obvious negative role in the current recession. Although clearly a stable and competitive tax environment would be productive most of these areas are not within the mayor's jurisdiction or even influence.

It seems to me that the mayor could and should get involved in initiatives that add to the development of the intellectual capital of our city and help us develop a clear positioning statement on where we see our opportunities in the future. There is no point in pursuing oil, auto or aerospace head offices at this point.

I think our future is in the emerging economy and we are better off trying to become an incubator of future head offices than try to become a magnet to attract existing ones.

[junius]

Originally Posted by Metro-One

OK, here is a question, looking at the Toronto forums I see that Telus has just finished a new office tower in Toronto. Are they moving their HQ out east, have they already done so, and if not, why are they not building a nice new office tower here?

Also, I feel Vancouver should be doing whatever it can to promote HQs of high tech and shipping businesses to our area. To me these sectors only make sense since we already have a large high tech background and for shipping we are located on the Pacific Rim and have the largest port in Canada.

What s funny is some forumers on here seem to have a "we are defeated before we try" attitude, which we all know is guaranteed to produce no results.

I don't think Telus is moving. They just have lots of business back East. Bell has a sign on one of Vancouver's highest office towers. The telecommunications companies like to be ubiquitious to their customers.

Your comment on the high tech is very good. We really need to look south for our competitive advantage. The corridor that runs from Seattle to San Diego contains many of the most creative and future thinking companies on the planet. Our future as a city is tied to our ability to leverage this proximity and to find competitive advantages that complement these industries from information technology to bio-engineering to entertainment.

[djmk]

Originally Posted by Prometheus

That is why the article is more depressing than it is encouraging. If the goal is to push a new, vague form of "green" business at the expense of traditional, wealth-producing industries, as opposed to unlocking the shackles of business as such, then the future of Vancouver's economic dynamism is bleak.

I would love to know the definition of "green business". Are we looking for manufacturing , retail, recycling, energy, transportation and/or farming companies? And what constitutes "green". I am sure this definition is rather gray.

Lets face it. Vancouver (and BC in general) is not a manufacturing hub. I highly doubt green technology will ever be massed produced here in the long term. This will eventually become any other profitable industry and move to Latin America or Asia (maybe Ontario?) where manufacturing is cheaper or there is better infrastructure. BC does have an advantage in forestry and perhaps "green" products could come from here, but somehow logging does not scream "green" to me.

I think Green Business in Vancouver (and BC) must concentrate on R+D. We have a highly educated workforce with excellent Universities.

Moreover, I would imagine that there is significant start-up risk involved in green technologies and acquiring proper financing would be harder because of it. Vancouver and BC could help in this regard. Low / no interest loans with extreme tax credits for green technology R+D (like the federal version of Scientific Research and Experimental Development (SR&ED) Tax Incentive Program) I'm sure would help.

[Calgarian]

You guys have another thing coming if you think you're going to take away our business.

Seriously though, it's about time Vancouver step up and try to attract more head offices, you're downtown could use a Bow tower or 2, right now it's almost all residential. I'm sure a lot of Asian companies would love to set up a regional office in Van instead of having to go south or to Calgary.

[Stingray2004]

Originally Posted by jlousa

Head offices left due to the provincial tax regime in BC during the 90s compared to the Alberta. With the current provincial tax regime we are no longer losing businesses to Calgary. The tax regime isn't great enough to steal business back but it's good enough to stop us from losing additional head offices.

Very good point. During the 1990's BC had one of the highest tax regimes in North America aside from Quebec - some manufacturing concerns were even moving across the line into Washington State.

Vancouver once had the "Shell Oil Building" during the 1950's, which I assume was their western head office extant at the time (the current Ritz-Carelton site).

And another I recall was Gulf Canada Resources (Vancouver division for coal/minerals), which relocated back to Calgary.

I see no reason why Canada Safeway, Westjet, and Canadian Pacific, for example, need to be head-quartered in Calgary.

Attracting head offices to relocate is very difficult but attracting corporate divisions/branch offices might be an easier sell. But that would require someone with proper analytical skills to 'target' those potential companies and then sell them on the benefits of such a move. Heck, even a property tax holiday for a few years might be needed as an inducement. Office/shopping centre landlords poach tenants like that all the time.

Here are the 'head office' stats for Metro Vacouver from 1983 and 2004:

Vancouver: 46/27
Rest of Metro Vancouver: 1/15
Total Metro Vancouver: 47/42
Rest of BC: 2/8
Total BC: 49/50

http://vancouver.ca/commsvcs/plannin...eadoffices.pdf

[Prometheus]

Originally Posted by junius

I am pretty sure you are going to have a hard time getting much traction for full blown libertarian economics policies in light of their obvious negative role in the current recession.

Freedom had no role to play in this recession or any other recession. We live in a regulated economy, not a free one, and it is government regulation, not freedom, which is the cause of economic disasters.

For example, at the heart of the current recession is the sub-prime mortgage epidemic, which was caused, inter alia, by the following government regulations and interferences: the Community Reinvestment Act (which coerced banks into granting imprudent loans), the government-sponsered enterprises of Fannie Mae and Freddie Mac (which bought, securitized, and sold those imprudent loans world-wide), and the artificially low interest rates set by the Federal Reserve (which encouraged irresponsible borrowing).

Under the discipline and due diligence required in a free economy, such moral hazards, and the economic disasters caused by them, do not arise. Theory and history have proven these truths time and again for those who care to see them.

In addition to Economics in One Lesson mentioned above, for further study I highly recommend the works of the great economist, Ludwig Von Mises, and Capitalism: The Unknown Ideal, by Ayn Rand.