Anchor Tenant

Posted on November 09, 2010 | Atlantic Business Magazine | 0 Comments

The Halifax Regional Municipality is the undisputed economic engine of Nova Scotia, the central wheel from which fiscal spokes protrude into the rest of the province, but how does the city draw businesses, students and visitors?

A man dancing quietly in a room overlooking Barrington Street and Spring Garden Road in downtown Halifax points to an answer. His name is John Jennings. Waving a game controller in one hand as he mirrors the onscreen images of dancers in slinky outfits, Jennings is playing a demo version of ‘Dance on Broadway’. The highly anticipated new Wii game was released in the summer of 2010. Plain old ‘Dance’ for Wii made $44-million in 2009. Jennings, a producer for ‘Dance on Broadway’, is hoping for similar success.

Jennings works for Longtail Studio, an up-and-coming gaming company with offices in New York, Vancouver, Quebec City and, as of November 2009, Halifax. What brought Longtail to Halifax illustrates the strengths that make it the anchor city for Atlantic Canada.

Estelle Jacquemard, general manager of Longtail’s Halifax branch, explains. Longtail is headquartered in Quebec City, but it’s hard to draw English-speaking game-builders there. Looking for a new East Coast office, the company tried Charlottetown, PEI, and found the city had a lot of attractive features, but they had a hard time attracting young workers to its semi-rural lifestyle.

“In our industry, most of the people are very young. What they would like is to also have a life outside of work. Charlottetown is very nice, but there is not so much to do after work,” Jacquemard says diplomatically. “Halifax is more attractive.”

Halifax also has the high-tech infrastructure Longtail needs to link up to the global community required for building games. With ‘Dance on Broadway’, that included India, China and Japan.

Just as importantly, HRM has the cerebral infrastructure. Longtail is working with the Centre for Arts and Technology, Acadia University and eventually Dalhousie University to tailor courses to produce graduates Longtail can employ. Longtail will have first crack at that top gaming talent, as competitors Electronic Arts and Ubisoft don’t have a presence in the city.

Jacquemard also says Nova Scotia Business Inc. made Halifax the obvious choice. NSBI staff helped them find office space, contractors, incentives, payroll rebates and other carrots. “Each time I have a question, each time I have an issue, I call NSBI,” she says.

In Longtail’s open-concept office, two dozen programmers, animators and 3-D modellers work together to build new games. It’s planning on growing to 60 people within five years and has no plans to stop there.

Stephen MacDonald illustrates the change in the HRM economy. When he graduated as a 3D modeler from a now-defunct Halifax college, he briefly worked in the province before following the job market to Vancouver. While the video game industry was virtually non-existent in Halifax, Vancouver had 86 companies. He landed a job and worked for three years. He married and started planning for a family.

When the Halifax branch opened, it was a happy homecoming for the 28-year-old, his teacher wife and their toddler son. Halifax had become the ideal location to raise a family and he could do it while working his dream job.

That’s how Halifax works: it’s big enough to pull in major businesses and they bring jobs that attract and retain the province’s best and brightest.

Fred Morley, the executive vice-president and chief economist of the Greater Halifax Partnership, calls it the “enabler” effect. HRM’s hub-city assets (its airport and port, its banks, universities, hotels, convention centres, hospitals, law firms, business headquarters, insurance companies and research and development labs) allow it to act as a socket plugging the province into the world.

As an example, the Halifax Stanfield International Airport brings in some 3.5-million people a year. “It’s located in Halifax, but it enables the economy of the whole region and certainly the whole province,” Morley says. It’s the same with the Port of Halifax. “There are no Michelin tire plants in Halifax, but those plants [in Waterville, Granton and Bridgewater] wouldn’t exist unless there was the Port of Halifax to move the materials in and out.”

Halifax is developing a global reputation as a financial centre. That pulls in major insurance companies and they in turn open up offices in parts of Nova Scotia they wouldn’t otherwise have visited. “It’s a good place to recruit, it’s a good place to get people to, but at the same time they will also reach out to the broker network,” Morley says. “Without that regional presence in Halifax, there wouldn’t be that.”

The region accounts for 40 per cent of provincial GDP and about 20 per cent of Atlantic Canadian GDP. From the period between 1996 and 2001, HRM experienced 4.7 per cent population growth, a pace faster than any other large Atlantic Canadian community.

Speaking during a break at a conference arranged by the GHP, Morley noted that the conference had attracted business people from across the world and they had grown curious about Nova Scotia. “About half of the people here seem to be taking a few (extra) days, renting a car and driving across Nova Scotia,” he says.

Business people often tack vacation onto working trips, meaning B&Bs in Lunenburg benefit from busy hotels in Halifax. “And folks that come in for conferences generally spend more money than your average tourist and that spending continues when they go off on their own,” he says. “Often we don’t see the connectivity of the economies. We tend to see borders in political terms.”

The economy doesn’t heed municipal or provincial borders. Redistributing jobs to non-HRM Nova Scotia is just cutting the existing pie into smaller pieces, he says. Urbanization is a global trend and it’s better to draw jobs and workers to HRM than Toronto or London.  “No jurisdiction on earth has been successful at fighting against these [forces]. It’s like railing against the ocean. You can scream at it, but it’s not going to change anything,” he says. “What we need to look at is, how do you better connect urban and rural Nova Scotia more effectively to make sure those economies are not artificially separate.”

That means good transportation and communications networks linking people and economies. The relatively dense Maritimes population gives it an advantage over the northern prairies or rural Ontario, in that few people live more than a couple of hours from HRM.

Jim Donovan, manager of economic development for HRM, agrees.  “All roads lead to Halifax when you come to Nova Scotia,” he says.

Donovan is on the board of directors of Destination Halifax, the organization tasked with attracting tourists to HRM. It also works with the hotel industry to collect a hotel-marketing levy of two per cent on the costs of rooms for operations of more than 20 rooms. “We collect a significant amount of money from that levy,” he says. Sixty per cent of the money goes to promoting Halifax. The other 40 per cent funds Halifax festivals like the Buskerfest, the Tall Ships, the Jazz Festival and the Concert on the Common. Those marquee events draw visitors to Halifax and that acts as a gateway to exploring the province.

Groups like Events Nova Scotia work to spread opportunities around the province. The new organization, implemented by Halifax’s Trade Centre Ltd., brings marquee events to the province. Usually, that means Halifax, with satellite events seeded in the rest of the province. An example is hockey’s World Juniors and World Championships, held in Halifax with training camps across Nova Scotia.

“It probably makes sense to take advantage of that and not pump up artificial differences between rural and urban in such a small place as Nova Scotia or the Maritimes, for that matter,” Morley concludes. He asserts that the days of zero-sum politics belong to a past generation. If Nova Scotia wants a growing economic pie, it needs a hot oven, and that oven is HRM.

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