A slew of coming new industrial development has the Town of Atikokan rolling out the welcome mat to investors.
The sleepy northwestern Ontario town of 3,300 is making early preparations to host one of Canada's largest open-pit gold mines.
The municipality has released an accommodations study to entice builders to beat a path down Highway 11 to the former iron ore mining town, 180 km west of Thunder Bay.
With a new mine on the horizon and several other job-creating developments on the schedule, the town anticipates a surge of construction workers arriving in the very near future, followed by the more permanent jobs in mining, power generation and wood pellet manufacturing.
A report by Crupi Consulting of Thunder Bay said Atikokan is facing a severe shortage of housing with “almost zero availability” for homes and rental units.
Five major development projects, plus an addition onto the hospital, could create an estimated 1,500 to 1,700 construction jobs over the next five to seven years, followed by the promise of as many as 800 to 1,000 permanent jobs.
For a town that's dealt with a decade's worth of disappointment in the forest industry, good fortune is coming in waves.
Osisko Mining expects to have 14 years of gold production if its Hammond Reef open-pit operation starts up in 2016.
The Montreal miner told Crupi they anticipate creating 800 construction jobs in 2013 and 2014, followed by 540 mining jobs by 2015.
Ontario Power Generation's (OPG) former coal burning plant, the Atikokan Generating Station, is undergoing a $170-million conversion to handle wood pellets. A workforce of 200 arrives on site next year.
A start-up company, Atikokan Renewable Fuels, is refurbishing the former Fibratech particleboard plant to make wood pellets. The plant could create jobs for 157 if its secures contracts with OPG and with European utilities.
There are also more spinoffs expected if Bending Lake Iron Group develops its iron ore property near Ignace, 70 km to the north. The company will need a construction crew of 170 starting in 2016 and expects a more permanent workforce of 64 by 2017.
A long-shot possibility is Cassandra Enterprises, which has tentative plans for a 1,300-megawatt hydroelectric pump storage project in one of the water-filled pits of the old Steep Rock mine. It could generate 20 to 40 jobs, but the province has declared that environmentally sensitive area to be off-limits to development for now.
Mining support services could net 100 more jobs past 2017.
“This is all great news and we have to prepare for it,” said Mayor Dennis Brown.
“Our biggest need is in homes, apartments and condos.”
Some jobs will be filled by the local workforce, but many more will need places to stay.
The municipality took its message to Thunder Bay in late July to showcase the opportunities at an invitation-only investors presentation to entice builders, developers and investors.
Consultant Franco Crupi said now's the time for the town and developers to get shovels in the ground to avoid reaching a housing bottleneck.
“It won't be in the first or second year, but towards the third and fourth year, they're going to be scrambling.”
The town has 70 lots on the books for a planned subdivision, but that's not nearly enough for the long haul.
The report said the current housing demand is for 157 units today and it's forecasted to increase to 540 by 2015.
“Those coming to town have a hard time finding units,” said Crupi. “If there's 1,000 new jobs in the next five years, there's going to be a mad scramble for housing.”
Crupi said one developer is considering buying some Atikokan property to erect a 20-unit apartment, and a mobile supplier is thinking about placing a demonstration home in the community.
If developers built on spec, Crupi said “houses would be sold immediately.”
What's needed is an array of starter and more upscale homes for well-paying jobs in the mining industry.
Brown wants to avoid a Fort McMurray-type situation with a transient, commuter workforce that adds nothing to the tax base.
“We don't want people flying in and out. We want people to live, work and play here. That's why were doing this (investors event) to make conditions right so we can market Atikokan as a great place.”
Crupi said keeping the workforce housed in town is a preference of Osisko as well, but that's something to be negotiated between the mining company and the town.
“They need to work with developers and the municipality and make this thing work if they want suitable housing in a short period of time.”
With the town's population rapidly aging, Brown said more homes could be put on the market by seniors if more apartments were available.
The Town of Atikokan is undergoing some internal revisons of its own as it petitions the Ontario government for funds to hire a town planner to control growth.
There will likely be upgrades to Atikokan's water and sewer infrastructure, but that didn't seem a concern for Brown, who mentioned that the town once housed 7,000 residents during the heydays of the Steep Rock iron ore mine in the 1960s.
If there’s a major house crunch coming, Atikokan realtor Deb Coulson isn’t seeing it yet.
“My phone isn’t ringing off the wall,” said the owner of Avenue A Realty. “I don’t have a hundred people looking for homes.”
Despite all the hype, Coulson said the local housing market remains flat. A 1,200-square-foot home in Atikokan ranges between $60,000 and $160,000.
She has 33 listings of mostly residential, commercial, lakefront and highway properties.
“Four or five years ago we had three times that many when the (Sapawe) mill first closed.”
What’s occupying most residents’ minds, she said, are the coming layoffs by Osisko starting in September as the exploration phase at Hammond Reef winds down.
Last fall, Osisko was conducting one of the most intensive exploration projects in Canada with 18 drills turning.
“I’m dealing with people who want to sell their homes now.”
There’s no word from the tight-lipped Quebec miner if those employees will be transitioned into new work.
“People don’t know if they’re going to have jobs in the next little while, so this is a sad time for some,” she said.
Many locals are doing the long commute to mining jobs in Red Lake and north of Thunder Bay, leaving their families behind, said Coulson. Others have made the permanent move out west to Alberta and Saskatchewan while holding onto their Atikokan homes thinking they’ll get a better price when more people arrive.
Coulson said the town is in limbo until Osisko gives the green light for a mine. And people aren’t likely to wait around without work for six months to a year or more until the company makes a final decision.
“I know they have a very different outlook than what the economic development people are looking at.”
