Israeli-born real estate mogul Gil Blutrich is an entrepreneur with a keen sense of history. While his firm has a portfolio of modern hotels, condos and resorts, it also owns a number of historically significant properties, including Toronto’s majestic King Edward Hotel and the Cleveland Arcade – a beautifully restored glass-roofed shopping centre built in the Ohio city in 1890. One of his most ambitious projects is a huge waterfront development in Port McNicoll, Ont., a town on Lake Huron’s Georgian Bay, that was devastated in the 1960s when its port shut down. As part of the revitalization, Skyline paid for the return to the port of the S.S. Keewatin – the last survivor of a fleet of passenger ships that plied the Great Lakes.
Why are you so interested in historic properties?
I’m a true believer that a person, family, city, or country should have a strong foundation. You cannot build the present and your future without a strong alignment with your past. I love history. I’ve spent hours reading about the King Edward Hotel. I am still learning. It is so fascinating – it is life stories, and you can learn from the past.
Can you also make money while preserving the past?
Totally. I know it sounds very shallow, but I am a big believer in the win-win concept. And sometimes you can do a win-win-win-win. If I can save a historic property and make money off it, it is one win. Second it is a win for history and for future generations. It is a win for the city, because the city will get a property that will be there for the next 100 years, and it will not have a problem with a deteriorating building. The city is also making money from permits, fees and all of that.
Is that the case with your redevelopment of Port McNicoll?
It is an example where everybody wins. It is a game changer for Port McNicoll, which has suffered a lot, because this was a port that closed down in the 1960s. They lost the jobs and the activity in the port, and they lost access to the entire waterfront because it belonged to Canadian Pacific. For those who live in the area, it will be fantastic. It will create a sense of pride in the community.
How did you end up returning the Keewatin to the port this summer?
After I bought the Port McNicoll property I started learning about the history of the port. We started to find some artifacts on site – a piece of propeller, a life boat, pieces of china with the Canadian Pacific logo. Then one night I started to do some research on the Internet, and I found out about these fleets [of lake steamers], and their significance to the development of Canada. I tried to find out what happened to them, and whether I could get some of these boats back.
I found out that only one survived. A U.S. entrepreneur had bought it, and towed it to a marina deep in Michigan along a river that over the years had filled with muck.
It took us five years to negotiate a deal. We purchased the ship, [and had to] dredge the river [to tow it out]. It cost us around $1-million just to get it home.
It is five years older than the Titanic. The interior needs some work, but the hull of the ship is all dry.
What will happen to it now?
I am going to donate it to a not-for-profit organization. They will raise real serious money to sustain it, and make it a museum right in the centre of our real estate development.
Will you buy more historic properties?
If they present themselves, and they are sound investments, absolutely. But it should be something that will make sense economically, and something that is right for our size [of company] to buy into and deal with.
Do you think the condo bubble will burst?
It hasn’t happened yet, and there are lots of forces convincing me that it is not going to burst. I can’t speak about the market in Vancouver or Montreal, but we have a unique situation in Toronto. I see an inflow of new immigrants every year to this city, so there is a real demand. We also see a trend of young professionals who want to be downtown. Toronto is becoming very vibrant, very alive, which is so different from many other downtowns in North America.
What is the most attractive real estate market outside of Ontario?
It is the United States, and we have already started there. Our first acquisition was a Cleveland property that is considered a unique historic building – the first indoor shopping centre in America, with office towers on each side. It was built in the late 1800s by Rockefeller.
In 2001 an entrepreneur in Chicago bought the property and converted the two office towers to a 300-room Hyatt Regency Hotel.
He did an amazing renovation to the shopping centre, and spent over $70-million.
Then Sept. 11 hit, and the economy started to go down. We purchased it for $7.6-million.
What do you think of Canada’s entrepreneurial culture?
I am an immigrant to Canada from Israel, one of the most entrepreneurial countries in the world. But to say we don’t have entrepreneurs here in Canada is not true. We have very smart and very open-minded and entrepreneurial-spirited people. We should encourage them. There should be education into entrepreneurship starting right at school. In order to build a stronger economy into the future, we need to encourage entrepreneurs as much as we can.
Is the Canadian business community open to investors from outside the country?
Yes, absolutely, Canadians are very welcoming to business people from all over the world. The multicultural environment makes it more so. Canadian business people are cautious, but if you gain their confidence they are very open. They are intrigued by a good story and they are willing to participate in different ventures.
Are you optimistic broadly about the economy and the Canadian real estate market?
In the big picture, I am very optimistic about the world economy because, after all, the world is growing. Millions and millions of people every year are marching into the middle class. They are consuming more, and there will be more demand, more sales, and more business. Canada is a commodity-based country, and it is a great place to be when the world has such a long term growth.
How much time do you spend in Israel?
I am 90 per cent in Canada, 5 per cent in the U.S., and 5 per cent in Israel. In Israel I control the majority of shares in a public company that I started more than 20 years ago, that deals with income-producing properties in the centre of Israel around Tel Aviv. I am involved in charities in Israel, and most of my family is back there. But for the past 14 years I have developed my own life here. I have two young kids born in Canada, a Canadian wife, and we are establishing roots here.
You are interested in meditation. How do you apply that to your business life?
The biggest killer is modern life is stress. Meditation is one tool to release stress. But there are many other techniques. I love to go into nature, to get [away] from this jungle of cement. It is fantastic just to breathe fresh air and to be outdoors.
President, Skyline International Development Inc.
Born in Ra’anana, Israel; 46 years old.
Diploma from Israel’s Tadmor School for Hotel Management.
Founded Israeli real estate firm Mishorim Group.
In 1994 started Bright Future, a non-profit that supports at-risk youth in Israel.
Established Skyline International Development after coming to Canada in 1998.