VANCOUVER -- Forget humble logs and two-by-fours. The real value in the B.C. woods these days is as high-priced real estate, a trend that has picked up speed with TimberWest Forest Corp.'s new agreement to sell more than 14,000 acres through an online auction.
The sale, announced yesterday, features six parcels of land ranging from the mountaintop, 12,000-acre Capes Lake site - about 70 kilometres west of Comox with a minimum bid of $2.9-million - to an industrial site in Campbell River. California-based LFC Online is conducting the auction and the deadline for bids is Nov. 8.
"In many ways, Vancouver Island is just getting discovered," TimberWest chief executive officer Paul McElligott said in a recent interview, adding that real estate prices on the island have roughly doubled in the past five years. Demographics are also driving the company's real estate strategy.
"What we have going for us on the real estate side is that baby boomers who are starting to think of a second home or recreational property or retirement home are looking at Vancouver Island as a really attractive place to go and live," Mr. McElligott said.
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Well-heeled Alberta investors are a big part of the picture and interest among that crowd has grown with direct flights from both Edmonton and Calgary to Comox, he said.
The loss of forest land to other uses is cause for alarm, said Thomas Maness, an associate professor in the University of British Columbia's faculty of forestry.
"From a conservation point of view, the biggest problem we have is the loss of forest land to other uses," Mr. Maness said.
The trend is not as pronounced in Canada as in the United States because most Canadian forest land, about 95 per cent, is publicly owned, Mr. Maness said.
But on Vancouver Island, where forest companies own big chunks of picturesque property in areas close to major communities, real estate development could displace wildlife and have other negative effects, he said.
The sale is in keeping with Vancouver-based TimberWest's previously announced plans to put its privately owned land to "highest and best use." TimberWest owns about 11 per cent of Vancouver Island by land mass and is the biggest private landholder in Western Canada, Mr. McElligott said.
Other forest companies that have private land on Vancouver Island, including Western Forest Products, have also sold sites for real estate development.
The auction is also in line with trends in the United States where millions of acres of forest land have been snapped up by REITs or TIMOs - real estate investment trust and timberland investment management organizations - and is making the old-fashioned, vertically integrated forest company as endangered as the spotted owl.
In 10 years as a public company, TimberWest has evolved from an integrated operation running numerous mills to a timber- and land-management firm that has one remaining mill - and that Campbell River operation is up for sale.
The company is now focused on generating the greatest value from its land base, Mr. McElligott said, emphasizing that most of the company's land will remain forest operations.
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