Fortmac part1 web

Following Fort McMurray:

PART 1 - GETTING READY FOR RESTORATION

BY JOHN HARDY & NERISSA MCNAUGHTON Special supplement published by Business in Edmonton.

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FOLLOWING FORT MCMURRAY: PART 1 - GETTING READY FOR RESTORATION

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n April 29, 2016, the Regional Municipality of Wood Buffalo put out a media release cheerfully advising the area’s residents to engage in emergency preparedness week. The release noted that flooding, forest fires, and dangerous goods were the area’s biggest risks. Events were to include a mocked-up reception centre and a look at potential services that could be offered to evacuees during a large-scale emergency.

One day later, shifting winds brought The Beast and a state of emergency to Fort McMurray, and the evacuation began.

It would take until June 13, 2016, before the blaze would be classified as being “held”. At that point well over 500,000 hectares of land had burned, destroying over 2,400 structures and nearly 10 per cent of the city. Over 80,000 residents had fled, and those that returned faced a mountain of problems, including scavenging bears, fridges full of rotting food, and the worst case scenario – a charred lot where the family home once stood.

Alberta rallied behind the evacuees. Donations and assistance poured in from around the world. Tales of hope and survival abounded in the news; but when the ash settled and The Beast died down, the Regional Municipality of Wood Buffalo faced a monumental task.

Likes on Facebook for inspirational posts about rescued

pets, cheers for airlines for flying out evacuees for free, and many other tales of heroism and survival during the height of The Beast kept the media hopping, but now the real work begins. It’s time for the city to sift through the ashes and rebuild – and it won’t be easy.

On the heels of the recession, is Alberta up to the task?

Premier Rachel Notley thinks so. Upon request, she kindly provided Business in Edmonton readers – and those affected by the disaster – with this special message of hope.

“Here in Alberta, in tough times, Albertans pull together. We address the challenges before us and emerge stronger as a whole. As residents return to Fort McMurray and begin to rebuild, they will have to call on the strength they have shown so abundantly throughout this disaster – tremendous courage under the most difficult of circumstances. The road ahead is a long one. There is still a lot of work to recover and rebuild Wood Buffalo. And it is work we will do together.

Our government will be with you as you face challenges along the way. I encourage you to continue to support each other and work together as a community in the spirit that you have demonstrated over the last difficult weeks. Together, all of us will make this city strong, and whole, and even better once again.”

“Here in Alberta, in tough times, Albertans pull together. We address the challenges before us and emerge stronger as a whole. As residents return to Fort McMurray and begin to rebuild, they will have to call on the strength they have shown so abundantly throughout this disaster – tremendous courage under the most difficult of circumstances.” ~Premier Rachel Notley

FOLLOWING FORT MCMURRAY | PAGE 3

PHOTO COURTESY OF REGIONAL MUNICIPALITY OF WOOD BUFFALO.

According to Pedro Antunes, deputy chief economist with the Conference Board of Canada, “The true cost of this tragedy is the effect on people’s lives and livelihoods, the loss of homes and personal items. There is absolutely no way to suggest that Albertans will be better off, but despite the specifics of any situation, economists focus, track and calculate the economy and measure GDP based on facts and forecasts,” he explains, “and when you measure the economy as income, the massive rebuild will actually stimulate the economy.

Next year, Alberta’s economy is expected to slowly climb out of a two-year recession and the Fort McMurray rebuild will actually boost the real GDP by nearly half a percentage point.”

Antunes continues, “There’s no doubt about it, lost assets will be rebuilt, generating much economic activity for the area and for Alberta as a whole. The business downside, but a practical business reality of the rebuild, is that the spending will be mostly debt-financed. The funds for rebuilding and replacing lost capital will leave the provincial and federal governments with more debt, and the insurance industry absorbing what will likely be the most expensive natural disaster in Alberta, and maybe even Canadian history.”

Antunes also underscores the ironic timing of the Fort McMurray devastation, when it comes to the sheer facts and figures of the economy. He points out that before the massive fire, Fort McMurray, like Calgary and other Alberta areas, was already dealing with various broadsides of the downturn and oil price slump.

For the past two years, Fort McMurray unemployment was a painful jolt. The Canadian Home Builders’ Association (CHBA), local real estate, and other statistics showed that the Fort McMurray market was suffering significant declines.

In 2015, as some Fort McMurray workers left to find other careers and jobs and others stayed, hoping for the recovery, Fort McMurray new home construction starts dropped to 193 units, their lowest level in more than 20 years. MLS sales fell 43.5 per cent to 974 from 2014. This year, before the fire, there were only 13 new home starts in the first four months of 2016.

According to Canada Mortgage and Housing Corporation, by year-end 2015, the once near-zero Fort McMurray vacancy rate in rental apartments had skyrocketed to 30 per cent.

FOLLOWING FORT MCMURRAY | PAGE 4

FOLLOWING FORT MCMURRAY: PART 1 - GETTING READY FOR RESTORATION

THANK YOU. More than 1can million Canadians showed care and compassion Canadians be proud of the compassion and care they have through a donation to the Red Cross Alberta Fires response.

Thanks to the generosity of individuals, groups, businesses,

From coast-to-coast, will continue to work together and the governments ofwe Canada and Alberta, the Red Cross to improve the lives of those in need. throughout their recovery.

redcross.ca/AlbertaImpact

To learn more about the Red Cross response, or if you have redcross.ca/AlbertaFiresInfo

SHARING YOUR VISION. BUILDING SUCCESS. We are more than builders. We are friends and neighbours who care about the communities in which we work and live in. Just like our commitment to quality construction, so too is PCL’s commitment in helping Fort McMurray continue its important role in building Alberta’s future.

Watch us build at PCL.com

FOLLOWING FORT MCMURRAY | PAGE 5

THE MODERATE RESOLUTION IMAGING SPECTRORADIOMETER (MODIS) ON NASA’S TERRA SATELLITE CAPTURED THE GROUND TEMPERATURE ANOMALIES DURING THE FIRE. THIS MAP SHOWS HOW LAND-SURFACE TEMPERATURES DURING APRIL 26 - MAY 3, 2016, COMPARED TO THE 2000-2010 AVERAGE FOR THE SAME ONEWEEK PERIOD. RED DOTS SHOW HOTTER-THAN-AVERAGE TEMPERATURES, BLUE DOTS ARE BELOW AVERAGE AND WHITE AREAS ARE NORMAL. PHOTO COURTESY OF NASA.

FOLLOWING FORT MCMURRAY | PAGE 6

FOLLOWING FORT MCMURRAY: PART 1 - GETTING READY FOR RESTORATION

THIS PHOTO WAS TAKEN BY NASA’S AQUA SATELLITE ON MAY 24, 2016. THE RED OUTLINES ARE HOT SPOTS (FIRES) AND THE WHITE, DESPITE LOOKING LIKE SNOW CAPS, ARE BILLOWS OF SMOKE. AT THIS POINT THE FIRE HAD CONSUMED APPROXIMATELY 2019 SQUARE MILES. PHOTO COURTESY OF NASA.

FOLLOWING FORT MCMURRAY | PAGE 7

PHOTO COURTESY OF REGIONAL MUNICIPALITY OF WOOD BUFFALO.

However, a silver lining is the availability of Fort McMurray workers.

knows the protocol and process of the insurance claim paper trail.

Just three or four years ago, during $100-per-barrel oil era and when business was booming, every trade, supplier, and contractor in the Fort McMurray area was working. Builders were scrambling to find workers. The timing of Alberta’s economic slowdown will now make it easier to find the staff and equipment needed to achieve the rebuild.

“It’s going to be a bit complex,” Rivait points out. “If you are in an area where 100 houses need to be rebuilt, it’s hard to have 80 builders in there.

There is an expectation that the enormous rebuild project will take at least two years or longer, depending on many factors: from insurance companies processing, approving and resolving claims (it’s a naive assumption that they will simply ‘cut a cheque’), the Regional Municipality of Wood Buffalo’s willingness to fast track the review and approval of permits, the planning and coordination of developers with northern Alberta weather, construction scheduling and completions.

“You can’t just start building 2,000 houses all at the same time; it won’t happen,” says Jim Rivait, CEO of the Alberta branch of the Canadian Home Builders’ Association, who previously served as the vice president of the Insurance Bureau of Canada. As a result, he

“It sounds a bit odd, but on a duplex where you have two owners and two different insurance companies and the owners can determine their builder, there are some things that will have to be considered from a practical standpoint.”

What this means is, if you have one builder that decides to use the opportunity to upgrade and create a stunning duplex inside and out, but the other builder chooses an economical approach and has to wait for a contractor to become available, property values – not to mention neighbourhood relations – will be affected. While the one homeowner wants to come home to a nice, restored property each day, the other may resent the sudden inequality in the look and value of the complex. Both homeowners should work together to come to a mutual consensuses, much like the way homeowners have to cooperate when it comes time to build a fence on bordering backyards, or to deal with overgrown trees that branch out over boundary lines.

FOLLOWING FORT MCMURRAY | PAGE 8

FOLLOWING FORT MCMURRAY: PART 1 - GETTING READY FOR RESTORATION

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FOLLOWING FORT MCMURRAY | PAGE 9

FOLLOWING FORT MCMURRAY | PAGE 10

PHOTO COURTESY OF REGIONAL MUNICIPALITY OF WOOD BUFFALO.

PHOTO COURTESY OF REGIONAL MUNICIPALITY OF WOOD BUFFALO.

FOLLOWING FORT MCMURRAY | PAGE 11

Rivait gives another probable example showing that this issue can extend far beyond duplexes and triplexes.

Consider a 12-unit townhome with different owners and no condo association. With everyone having the right to select their own builder, one unit owner could go with a premium builder and completely upgrade their unit while his or her neighbour could go with his buddy that put up a few houses once and only had time to work the townhome during the weekends. Once again, the entire look of the complex becomes unbalanced. “Ultimately, who they select is up to them, but if delays happen and costs increase, you have to do something different,” he says, noting that practicality, communication, and a coordinated response are key as the city rebuilds.

Rivait provides some things for homeowners to think about when it comes time to select a company to rebuild or repair their damaged homes. “In Slave Lake, for example, builders said they could do the job in three to four months. There was no chance of that. Speak to your insurer so they can vet the builders. If you are in a car crash, you can go to your brother-in-law to fix your car and be on your way, but if you speak to your insurance agent, they have a list of preferred suppliers that have experience and guarantee their work. Insurance companies have preferred suppliers in the restoration industry too. It’s always the client’s choice, ultimately, but insurers know the real costs involved and what is required. I think recommendations from insurers would provide some security in the mind of the claimants. It would differentiate inexperienced part-time builders from the professionals. Claimants need some level of assurance that whoever is promising to build your place can actually do it.

“One of the things that happened before in Slave Lake was builders and others were involved too early in the rebuilding process. Anyone building up there has to

respect that the community has been traumatized and that the community needs some time to make some decisions. Making a decision on a new home is a huge decision. It’s not like buying an iPod. Both the people and the process need to be respected for the time they need.”

Rivait cautions, “[The disaster] will increase economic activity. There is no question about it, but there are things outside of housing we have to worry about. It’s businesses, too. Some might not survive.” To use Calgary’s flood, for example, 7,000 companies were affected, 23 per cent of which were SMEs. One per cent failed to reopen.

Seeing how quickly SMEs could fail thanks to a natural disaster is nothing new for Madan Murthy, chief sales and marketing officer at AbleIT Inc. “Anyone that did not have an outside backup at another location or a cloud-based backup could be facing complete data loss,” says Murthy. “This may include customer information, financial details, accounting information, and other critical data – it’s potentially devastating. Our hope and prayer is that [Fort McMurray businesses] have an outside backup, which minimizes the loss based on how often they backed up their data.

If a business lost their data in the fire, is there anything that can be done?

“One of the first steps we would take is to check all the information, from all available drives, that is recoverable,” says Murthy. “The key is seeing if there is any salvageable component from the existing networks. If every existing machine is gone, we then look at the recovery of data that was kept manually and input that information into a database. It’s a painstaking procedure as it is a long process of analyzing what is available to us and using that as a starting point.”

“[The disaster] will increase economic activity. There is no question about it, but there are things outside of housing we have to worry about. It’s businesses, too.

Some might not survive.” ~ Jim Rivait

FOLLOWING FORT MCMURRAY | PAGE 12

FOLLOWING FORT MCMURRAY: PART 1 - GETTING READY FOR RESTORATION

SOME NEIGHBOURHOODS WERE COMPLETED DECIMATED, BUT HEROIC FIREFIGHTERS WORKED HARD TO SAVE EVERY SQUARE FOOT THAT THEY COULD – AND SOME AREAS REMAINED, THANKFULLY, UNTOUCHED. HERE WE SEE CHARRED REMAINS OF HOUSES OVERLOOKED BY ONES THAT ARE STILL INTACT. PHOTO COURTESY OF REGIONAL MUNICIPALITY OF WOOD BUFFALO.

Local Solutions for Recovery and Reconstruction in Our Communities We are committed to working together with the families of Fort McMurray, and surrounding communities, to rebuild their lives and strengthen the bond of the community.

We are ready to assist with restoration and repairs for damaged properties, as well as turnkey construction services for rebuilding properties to help restore our community.

DEVELOP. COORDINATE.

WORKING WITH:

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Contact Information: Sean Crockett, MBA, ICD.D | Vice President, Clark Builders O 780.395.3446 | C 780.699.0151 | sean.crockett@clarkbuilders.com | clarkbuilders.com FOLLOWING FORT MCMURRAY | PAGE 13

FOLLOWING FORT MCMURRAY: PART 1 - GETTING READY FOR RESTORATION

It’s going to be frustrating at times, rewarding at others; some areas will innovate and be stronger and better than before, others will struggle and may have to revaluate whether or not they still want to live or operate their business in Fort McMurray. There is a long, uncertain future ahead, but one fact is clear: Albertans will work together for the best possible outcome, no matter how long it takes.

He has advice for those looking to avoid such a disaster, and for Fort McMurray businesses to protect the future of their companies.

AbleIT is keeping an eye on the developing rebuild and hopes to put their skills to good use as SMEs start reopening in Fort McMurray.

“This is the key – cloud backup. Organizations need to understand that the cloud is more secure than having your data in-house. The data is encrypted and the security levels for most clouds are better than what you will get at a bank. The main misunderstanding about cloud backups today, and what SMEs need to understand, is that the cloud is so much more secure and nobody can access it but you. Over the years the reliability of cloud backup has become so good, we can guarantee it. In the case of a natural disaster, it’s better, faster and cheaper to recover.

You could be up and running within hours.

“SMEs avoid developing a backup plan. They think they will not be affected and they take the good times for granted. That’s wrong. You have to have a plan.”

“We are developing a plan and our plan is fluctuating. We have not heard enough about how businesses are currently being affected, besides the oil sands situation. We are in the process right now of analyzing the impact on SMEs, which we will use to guide our plan. That may mean we have to make a trip up there and see what the scope of the damage is and what services we can provide to the companies. This is not a money making scheme for us. Do our costs need to be covered? Yes, but there is a humanity factor. We want to help. As such, we won’t charge market price and will be implementing a Fort McMurray price to ensure speedy and cost effective recovery.”

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He urges businesses to take evasive action. “The most important part of any computing system is the data, and any and all measures must be taken to protect the data.

In the event of a disaster, a copy of the data must exist in a different location than that of the disaster or the data is gone, forever.”

Rebuilding Fort McMurray, which is one of Alberta’s important economic hubs – is going to take time, effort, money, and cooperation among residents, all levels of government, home owners, businesses, contractors, and service providers. It’s going to be frustrating at times, rewarding at others; some areas will innovate and be stronger and better than before, others will struggle and may have to revaluate whether or not they still want to live or operate their business in Fort McMurray.

There is a long, uncertain future ahead, but one fact is clear: Albertans will work together for the best possible outcome, no matter how long it takes.

FOLLOWING FORT MCMURRAY | PAGE 14

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