Edmonton’s fortunes changed in 1905 when a second transcontinental railway, which would eventually become the Canadian National Railway, reached Edmonton. This time on the correct side of the North Saskatchewan. Edmonton doubled down by beating out Calgary as the Capital City for the newly created Province of Alberta, and incorporating Strathcona along with the University of Alberta on the CPR side of the river in 1912.
Edmonton with Strathcona’s population added in went from just over 8,000 in 1904 to 72,000 1914. Edmonton’s first genuine real estate boom was on.
When the first settlers arrived in Edmonton in the 1870’s, they found that all of what was to become Edmonton was either Hudson’ Bay Company Reserve, land the company had retained when it transferred ownership to Canada, or had already been claimed as river lots by HBC employees and former employees. A river lot was a Quebec style survey of a strip of land on the river bank that extended back from the river, one of the outcomes of a settlement Canada made with the Red River Colony settlers following the Red River rebellion of 1870.
There was a rumor that at least some of the river lots were actually owned in proxy by HBC partners, the ones who had been handed cash and a vast amount of real estate throughout their former territory in exchange for relinquishing their ownership rights to Canada.
By 1900 most of the river lots had changed hands, the closest in had been surveyed into streets and lots in Edmonton and Strathcona. The Hudson’s Bay Company had sold some of their reserve land, mostly between Jasper Avenue and the Saskatchewan River. But they had retained a large block of land between 97 street (Namayo Avenue), 121 Street on the west, and 127 avenue on the north, most of what is Downtown Edmonton, Kingsway and the former municipal airport. In 1910 Edmonton was a huge hole of unoccupied reserve land surrounded by housing developments and a business center on Jasper avenue between 101 street and 95 street. People were starting to complain. The Edmonton Bulletin, the newspaper owned by Frank Oliver, who at the time was also Canadian Minister of the Interior and Indian Affairs was making vague threats in 1910 about using taxation to encourage the company to make the land available for development.
The biggest business in Edmonton was real estate. People had come from far and wide to make their fortunes here. Everyone was involved, from people selling lots on street corners to those who had apparently arrived at the new train stations with suitcases full of cash and promises of more from overseas investors.
In 1912, with land speculation going crazy, the Hudson’s Bay Company decided it would be a good time to sell the rest of their land. In order to prevent a riot at their land office, they would first hold a lottery for the privilege of purchasing up to four of the 1300 lots they intended to sell. The lottery itself would be for one of 1500 numbered tickets. The ticket number would determine the order in which the holder could make their choice of up to four of 1300 lots, the actual sales to be spread out over several weeks.
To be certain of getting anything, assuming every ticket holder would exercise their option to buy four lots, would be a ticket numbered 325 or less. The lottery would be held 10:00 AM Monday, May 13 at a secret location to be disclosed by the Edmonton Bulletin newspaper in the morning edition of the day of the lottery. However, watchful eyes were able to determine the location a day ahead of time. By early Monday morning 1500 hopeful real estate tycoons had already lined up.
Latecomers dickered with those in line for their spots, hundreds of dollars were offered to buy a place in line, but most who had a spot refused to sell. As any one of the 1500 tickets could be for any number, wiser heads waited until the draw was over before offering to buy low number tickets. The man who was first in line for the lottery was offered large sums for his place, he refused to sell and drew ticket number 910. The very last ticket out of the barrel, number 186, went to a man who had lost his place in line and had to go to the back. A Mr. Walsh, 928th in line, drew ticket number one. He was offered twenty five thousand for his ticket but refused to sell. A man who bought a place in line for fifty dollars drew ticket number 136, which he promptly sold for a thousand dollars. The firm of Magrath and Holgate bought ticket number 3 for $6000.00, which they used to buy four lots on first street (101 street) for between $17,500 and $15,000 each.
The first law of real estate is location. Edmonton was surrounded by hundreds of miles of empty land in every direction. Affordable land farther from the center needed to be serviced and connected by road and street railway. Incorporated cities and town could issue debentures (the 1912 version of municipal bonds) to raise the money needed for infrastructure. Overseas investors, mostly in England, bought the debentures based on what they heard and what was written in their newspapers and magazines.
The same was true for the rest of Western Canada. All the new cities and towns needed money. Every new western town and city competed for investors by “boosting” or “booming” making outrageous exaggerations of their assets and prospects. Scammers created towns, subdivisions and developments, even entire colonies out of distant townships, homesteads, unsuitable land or even thin air. By 1913 distant money was starting to get nervous about western promises and looming European war clouds.
1912 would be the last good year for Edmonton. By the end of the 1912 over fourteen million dollars of building permits had been issued, a number that would not be approached again until 1947. Permits dropped to nine million in 1913 and four million in 1914. In August 1914 Canada went to war, taking the men and money needed to transform Edmonton from an unfinished patchwork of unpaved roads and mostly empty developments to the trenches in Europe. By 1915 building permits had dropped to $288,375, the level where they would stay until the 1940’s.
Not for the last time, world events had smashed Edmonton’s dreams of glory.