Mitch Collins
Daniel: What's the weather like in your neck of the woods there Mitch, these days?
Mitch: It's about minus five. I woke up this morning and it was 10 below.
Daniel: I don't want to take more than the next 20 seconds out of your time there because you have something absolutely amazing to share with us. I am making notes. I'm most probably going to be calling you over the next few days, because I'm really interested in doing something with you with what's happening in Fort St. John's. Go ahead, take it over. And if I have some questions at the end, I'll ask people to put the questions in the chat, but just go ahead, do it.
Mitch: I'll jump into a slide show. There's a lot to go through. So let me share my screen here. Let's take a little beak. Okay. Are you guys able to see that now the screen is coming up? Okay. My name is Demetra Collins. I'm an investor at Fort St. John, having been investing in the market here for just about 20 years. Been an agent for the last decade, specializing completely in investment real estate in our marketplace. Worked with hundreds of investors from coast to coast, qualifying and finding cash flowing properties in our market. Let me go through a few things here. We're up in the Northeast quadrant of BC. We're pretty close to Alberta. About eight hours Northwest of Edmonton. What is on the same level north is Fort McMurray.
It's going to where we're sitting in a relatively small town. This is from the last census, but our cities put out a stat saying we're about 24,000 residents right in our downtown. It was a bit of an idea of where we are and the size of our account at that population is going to be important as we go through some of the projects that are unfolding here right now.
First things, first guys, certain things drive the real estate markets. We're seeing across the country increased property prices pretty well everywhere. But what we're not seeing in a lot of cases is the underlying GDP growth and job creation that should be underpinning those things.
We're in a market right now that is driving these fundamentals massively. We're just going to take a peek at some of the projects here that are underpinning what's driving our market right now. The first thing folks, we're home to the site C dam, this is BC Hydro's they just made an announcement here about a week and a half ago that the project is about $16 billion. They're damming the peace river five minutes from my office. And before another project I'm going to tell you about in a few minutes, the sightsee dam was the largest project anywhere in construction in Canada. Major project, I work with a lot of site engineers.
We believe this bill is going to go up to over $20 billion by the time it's done. And the beautiful thing about site C dam folks is it's just entering in the main phase of construction right in the next two months and bringing in a boat 3000 additional employees this year alone. Major project because it's hard to find photos. I'm going to share with you guys really quickly here. Some drone photography and a video that I took here about two weeks ago onsite. Let's take a little break. It looks like I do not want to work for some reason. This is literally five minutes from my office.
This is the largest project outside of the LNG development. What you can see here is they've actually filled in the entire river and drilled through the mountain to divert the entire river. They've been working on this project for three years, approximately we're entering into the main phase where they're going to start building the dam itself.
2,500 to 3000 people coming in this year alone for this project. Fort St. John is just up here a mile away from this site, but this is a major project that's unfolding right now. And it's got about another six years ahead of it. These workers, the project length. Another thing I want to tell you guys about outside of site C, which is a major project by any standard, is the natural gas development going on in our region. We're home to what's called the Montney Shale Basin. This is the entire circle here. This is one of the most prolific natural gas plays in North America. Why should the most prolific natural gas play in North America and one of the top three on earth.
We happened to be super fortunate to be sitting right in the heart of the Montney play. And what's happening right now because we have essentially an unlimited reserve of natural gas in the region. Here it is, major multinational oil and gas companies have decided to take our supply of gas from the Montney play pipeline into the coastline.
And then from there, send it to the emerging markets across the Pacific ocean. And so why that's a big deal for us right now is to show
International's expecting global LNG. LNG is simply Liquified Natural Gas. And so they're expecting the demand on LNG to nearly double in the next 20 years.
That's major because especially in Asia, China, Japan, India, Korea, they're all turning away from dirtier fuel sources and leaning as heavily as they can into clean burning cheap fuel sources. And so natural gas fits the bill for that perfectly and what's occurring right now. If you look at where Canada sits from a global standpoint, the reason that shell is really wanting to protect the reason they're making LNG happening, Canada.
We're the closest shipping corridor that exists in North America to supply India, Japan, China, Korea in this corridor here. And on top of that, Canada was the only major country that actually allowed all of those countries that I just mentioned. It's a joint venture in the natural gas project here.
Royal Dutch Shell, who's the world's largest natural gas player. There's nobody bigger than that. I've actually got all their customers built into their project as joint venture partners. Something very unique. We don't see things like that in the oil and gas sector very often. But that is the group of us here. As we come into LNG Canada this is shell internationals, a project right now when they made their announcement in 2018, towards the end of the year they said it's going to be a $40 billion project since then they've doubled the export capacity.
We know that's going to be approximately $70 billion before they're finished. So again, at $40 billion, this was the largest investment of any kind in Canadian history. And so we know that number is actually going to double. And the economic impacts are going to be felt great across the country.
There's going to be a lot of manufacturing jobs coming out of Ontario as they're building the modules. Lots of folks that are a little bit slower in certain pockets of Alberta are coming into work right now in the natural gas. And so we're seeing just a major player. This is the largest thing that's ever happened in our country, coupled with sightseeing, a very unique opportunity.
We've got about a hundred plus billion dollars in those two projects. And they're not speculative. They're under construction right now. The joint venture partnership, this is something that a lot of people don't know. Shell's LNG terminal here in Fort St. John has got PetroChina Mitsubishi out of Japan and then Korea Gas Corporation out of South Korea.
All are joint venture partners. They've got their customers built into the project. What that means for us is they're not going to have to worry. Long-term 10, 15, 20 years into the project about who they're going to be selling their gas to. And they've actually got all their partners built in and their partners have spent billions of dollars each to get equity.
One of the things that's held us up a little bit last year, we started to see our market turned around in a pretty major way last year, but then COVID came up and COVID was a big deal for us in the industrial settings, because imagine if you're trying to build sightsee down, there's a great example.
You've got thousands of people working in proximity, living in industrial camps. COVID made that pretty hard to pull off. We saw a lot of the projects not slow down. They weren't able to do it. We'll get to max capacity. Here on March 17th, this was about a week and a half ago, two weeks ago.
We just got notice. Now 15,000 COVID vaccines have been given to us for site C dam, LNG, Canada, and the coastal gasoline pipeline that supports the LNG terminal. That's getting rolled out as we speak and we're expecting that it's going to have some major impact in the ability to get the projects rolling again, and start bringing in the thousands of people for these industries.
Next thing is the coastal gas link. This is the pipeline. That's going to take the natural gas supply from the Montney basin in and around Fort St. John to the coastline of BC. This on its own is a $6.6 billion project. Just taken by itself. This would have been, this would have been one of the biggest projects that we've ever seen in Canada and they're expecting full mostly because of the COVID vaccines. They're expecting full mobilization by this summer and that's a major project. We're seeing the sight-see the LNG and a couple of other things. But really we're expecting to see these projects take off in a major way.
They've already built about 225 kilometers of this. This pipeline had a lot of people ask me this year, if it's got all the first nations approvals and all of those things done that was all completed a number of years ago. And so everything is green-lighted. It took them a decade to get there, but everything is past the speculation phase.
This thing is under full construction here, right? Outside of LNG and sightseeing, this is super exciting. About three years ago, we were in a market stalled position. We had some new governments come in there. We weren't sure if they were going to throw red tape on our projects or allow them to go forward, now, we didn't know exactly what was happening when Trudeau got elected.
And then when the NDP got elected here in BC but what happened about three years ago because of the tariffs that were happening with Donald Trump self of the border, they actually shut down for a while. Our major OSB facilities. So for anybody that's not aware of OSB it is like a plywood major wood facility.
We use this for construction of homes, roofing walls, floors, you name it. They've just announced here in February, middle of February, that they're reopening our OSB Mill, this is a major thing. This is over 500 jobs coming in within the next 60 days. In addition to sightseeing and LNG and the major pipeline projects in a completely different industry.
That's something that we're at. We're looking very forward to and excited about giving me a little bit of context. When we first told them about this plant in 2015, we saw our market jump by 20% that year, just because of this project alone. So a big play. Next thing I want to show you guys is that Fort St John's average household income, just about $140,000, puts us at about 45% higher than the Canadian average.
Why that's important guys is the average house price in Fort St. John is about 400K. We've got pretty low, the most affordable market in the country. And the kind of jobs that are being generated in this marketplace are not part-time Mickey Mouse McDonald's jobs. We're dealing with petroleum engineers, heavy construction folks, some of the highest paying jobs you could get in any industry.
We're going to find that this number continues to increase because of the quality of paper jobs coming in our marketplace. Major plays there. One last thing I'll tell you is that we can see prices basically double it down and still be more affordable than pretty well every other major market because of the relative income here.
We're not in any kind of a bubble situation in our marketplace right now. A few things I want to go through with some market statistics. We've seen things completely change in our market in the last six months. And so just really quick here, I'm not going to spend a ton of time on it, but active listings, for example, I just pulled this off the market yesterday.
This is fresh info. We're seeing active listings down to the lowest level that we've seen just for a brief time in 2017, but we're getting into nearly record, low active listings in the marketplace right now. When we look at months of supply, again, we're down right now to about the lowest that we've ever been in the marketplace for months of supply inventory.
The next thing we're going to take a little peek up folks is the sales activity. It was not really moving a whole bunch from 2016 and 2019. It was pretty flat. We saw it come down a bit at the beginning of COVID. I think a lot of people saw that before it just started taking off, but our market is on a tear right now.
It's not as crazy, thankfully, as some of the other places like in Ontario where there's 20, 30, 40 offers across the board. Seeing that amount of silliness, but I think that's not too far behind, based on where we are in the market cycle right now. Last thing I want to show you guys is the average sales price.
We've seen since last summer pricing is starting to take off in the curve, especially given materials. And for us very unique here is that the costs to build due to labor is going to take off tremendously because if you're a plumber or a pipe fitter, an electrician, a framer they're heavy in demand and everything.
It's going to start costing a lot more just to get the trades to come in and build in our marketplace. We fully expect this trend is going to take off on the front of what we're seeing right now. Lastly guys, this just came off today, so literally I just added this slide in case the folks of the reef club haven't even seen this yet.
We've just seen Fort St. John's real estate sales have essentially doubled since the first quarter of last year. We're seeing a lot of strength in the market and lots of multiple offers pricing is trending upwards. Yeah. Just every agent I talked to was flat. All right. Now I guess that's similar to a lot of other places, but here it's driven by economic fundamentals which are not quite the same.
In some other places, last thing folks in our city back in January, I hired an engineering company to send over a review of what was going to be required in our housing stock. And the engineering company came back in January and basically told our city council that we're going to require a bare minimum 4,500 new housing units over the next 19 years, just to fulfill our city's housing stock gap.
I can tell you right now, I work with all of the major builders in our town, and I know all of the construction plays right now. We're maybe adding 40 to 50 homes per year. That's the average over the last six years. We would need to see that increase by a tune of six to seven, a hundred percent right now to even come close to meeting this demand.
We're not going to be able to hit the number in the short term as far as adding supply. Demand is going to, we're seeing it right now, overtake the demand is overtaking the supply and I expect some pretty sharp price increases as a result of. Llast thing, folks does it really take a crystal ball to see some of the market stats I just showed you guys are based on what we're seeing in the market right now today, but here's the coolest thing about what I'm telling you guys with the COVID vaccines with sight-see bringing in about 3000 people pipelines bringing in a couple thousand more the LNG drilling program, bringing in we're expecting about 10,000 in total there over the next two to five years.
With the OSB procedures. We're seeing our market takeoff and the lowest levels of inventory and the highest sales activity in 15 years. We're seeing that right now, before the projects are taking off in full swing. I've been active in the market for 20 years now.
I haven't seen an opportunity like this the way it's currently sitting in our marketplace right now. For me, I get a bit excited about it because we've had some ups and downs over the years, but it looks like right now we're coming into the home stretch. I'm super excited to see that. It's really quick.
I won't spend a lot of time on the properties, but to give you guys an example, I custom, I work with builders to custom build and design. From the ground up legal and conforming, Sweden properties, turnkey generating strong amounts of cash flow in brand new neighborhoods. And so one of the ones that we're looking at right now is called the Hillcrest plan.
This particular plan is at $599,000 turn keys. That's GST fencing, blinds, appliances, landscaping even the furnishing downstairs. There's a $10,000 credit for furniture downstairs. I don't have a bunch of time to get into why we do that. Just really quickly we're supplying alternatives to middle and upper management to get them out of long-term hotel stays.
We can offer way better housing accommodations at half the price, and we're going to see the demand for those furnished units take off tremendously. That's an example of what we can see. I won't go through the four plants here right now, but basically $599,000 includes everything here that I just went through.
As far as cash flows, what we're seeing right now is about $4,000 a month in today's rent for these, I just rented a couple of upper units earlier today for some clients. And so we're, by the time we factor out our vacancy and then all of our costs, including insurance taxes, repairs and maintenance property managers.
Utilities for the basement suite and even some dollars here for the furniture replacement downstairs. But the time we factor those things in, and we're sitting at about a thousand dollars a month cash flow, and these homes are going to be ready in August. So what we're looking at right now is a situation where we know in August the OSB mill is going to be in full swing 500 new jobs there. Sightsee will probably have an additional 2000 employees there. And we're guessing approximately 2000 employees on the natural gas side of things. By the time we have our next round of wolves done. What that means is what we're expecting is to see rental rates increase pretty sharply.
As the demand comes in with a limited amount of supply. Keep in mind guys, we're a town of 24,000 people. We're not we're not a major center. The demand fundamentals could change on a relative basis. That's one property. We've got another one here, $589,000. My idea, two months ago, we had these properties for $25,000 less than they are today, but the builder does God have material packages in him.
Land went up 25,000, $30,000 per year. Materials are now $30,000 per house, more to build. And so he's actually eating some of the costs for those because his price increases are not covering his actual cost to build. We're anticipating to see future demands or certain increases on land cost.
And I don't expect in any time in the near future, we're going to see material costs come down. We're fully expecting to see pricing continue to carry on based solely upon costs. So again with the Crosstown plant $589,000, we're seeing very similar levels of cash flow at $966. We had a couple clients purchases last year that are cash flowing anywhere between $1,000 and $1,200 a month net right now.
That is a quick idea. Here's an example of a subdivision that we built out mostly sold to investors across the country, or over the years, we've only got a couple lots left in this subdivision and we are finished. What we're working on right now is a major land play called the station. This is the largest master-planned community in Northern British Columbia.
The builder himself taught builders in Fort St. John lives right here. I just bought four lots in the corner. So we're building a pretty substantial single family residence for us to move into as we build this subdivision out. And so we've got both myself and the builder living on site in this one as well.
The guys on top of that, I always get asked the question about property management. Over the years have built from the ground up here, a really quality team with the largest property management company in Fort St. John that's Sterling management. They've worked with them for over a decade.
I've got pre-negotiated discounts for any clients that come in that end up doing something starting as a pre negotiated discount that we've set up. And I work with these guys on a daily basis at a fantastic organization, and they can handle everything from move-ins and move-outs to advertising tenants, lease ups the whole night.
That is the set up. And I guess next step guys, give me a ring in any questions you guys have. I'm happy to answer anything you guys might want to see. One last thing I'll let you know is I got a call from a developer, a major developer in Vancouver about three hours ago, looking to find a big piece of Atlanta to start coming in and doing some big things we're seeing right now. A lot of demand from other parts of the country, it's pretty neat where things are at. Thank you very much.
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