Lethbridge - First Boom and Bust (1907-1918)
Between 1907 and 1913, Lethbridge, like other cities across the province, witnessed a development boom as it became the main distribution and service centre for southern Alberta. Municipal projects were approved and the city rapidly built a water treatment facility, a power plant, and large exhibition facilities. The era marked a huge increase in residential and commercial construction accompanied by high real estate prices, creating a wealth of financial prosperity and potential for land developers and others directly associated with the real estate industry. To ensure fair and honest real estate practices, the city mandated licensing for real estate agents to conduct business. However, insider information and collusion remained common practice for many real estate agents.
In 1906, when Lethbridge was incorporated as a city, it began to take on the typical characteristics of a burgeoning urban centre. For instance, the three-storey Bentley Block or the new Hudson's Bay store with its showcase windows quickly replaced the rundown wooden structures lining Lethbridge's main streets. The Bentley Company Ltd., a prosperous retail and wholesale firm, occupied one large store and two warehouses. Stately homes of prominent businessmen demonstrated Lethbridge's economic stability. Gradually, Lethbridge's economy began to diversify; coal was still a vital commodity but of increasing importance was the fertile land surrounding this prairie city. The emergence of new farms dotting the landscape was a common occurrence during this time. As one promotional pamphlet stated, "Lethbridge was a coal city in the wheat country."
Government officials openly promoted the western prairies as a place filled with cheap land complemented by a diverse economy. In time, thousands of migrant workers flooded the fields of southern Alberta in search work. In 1910, for instance, the Lethbridge Land Office filed 4,952 dryland homestead applications. Rapid settlement as a result of new employment opportunities directly affected the real estate market. Prices continued to increase while property was sold to investors as far away as Europe. Purchasing land and selling it at an increased price to investors located in other cities was common practice. For instance, one realtor purchased 40 acres of land near Queen Victoria Park and then sold portions of it to clients in Calgary, Toronto and Detroit. Property prices soared in 1912; property located on 5th Street originally sold for $1,000 in August 1912 surpassed $1,200 a mere month later.
City councilors staunchly encouraged rapid subdivision development. Such examples were the village of Stafford (west of 13th Street between 9th and 14th Avenue North), the southern portion of the North Ward (east of 13th Street between the railway and 14th Avenue North), and North Lethbridge (west of 13th Street between the railway and 9th Avenue North). The latter was further subdivided for future industrial development. Between 1908 and 1912, city councilors approved the development of a number of residential subdivisions including Parkdale, Sunnyside, and Arico Park among others.
Meanwhile, improved technology encouraged a rate of increased property development. In the city framed houses with thatched roofs replaced shoddy tarpaper shacks while the mechanization of farming prompted large farms, increased productivity and greater wealth on the outskirts of Lethbridge.
In an effort to promote and encourage industrial growth in Lethbridge city council offered free land, water and power at cost, and one decade of tax exemption to any company willing in invest in the city. A number of businesses wholeheartedly accepted the offer including the Ellison Milling and Elevator Company (1910), Lethbridge Sash and Door (1910), Columbia Macaroni Company (1910), and Purity Bottling Works (1913) among others.
Careless planning and rapid expansion would soon catch up with the community of Lethbridge. The inevitable real estate bust occurred in 1913 characterized by plummeting real estate prices, decreased construction activity, and a reduction in land sales. In an effort to encourage slower and organized development, the Alberta Town Planning Act required municipalities to obtain provincial approval prior to future urban expansion. Lethbridge's rapid real estate boom was largely spurred by ill-advised local boosterism. For instance, The 25,000 Club, an organization formed in 1907, sought to boost the city's population to 25,000 by 1912 through widespread advertising. In hindsight, the efforts of The 25,000 Club were brash, disorganized, and short-sided.
The Dry Farming Congress of 1912 was the largest gathering of agricultural experts ever assembled in North America and Lethbridge was chosen as the host largely because of effective boosterism. 5,000 delegates were to be housed in a city of only 8,400 citizens. City council spent approximately $1.5 million on various civic improvements, including the paving of streets, construction of a streetcar system, and the building of several structures, most notably a large grandstand at the Henderson Park Exhibition Grounds. All of these projects directly contributed to reckless deficit spending.
The rapid and hasty development of industrial, commercial, residential and transportation facilities strained both the city's finances and utilities. An insufficient supply of water, power outages, and continual malfunctions forced the city to spend hundreds of thousands of dollars on utility upgrades.
Lethbridge, like other burgeoning cities on the Canadian prairies, experienced the highs and lows of rapid economic development. In spite of the financial setback, Lethbridge continued to grow and by the end of the First World War the city was largely recognized as a dynamic railway, service, and distribution centre.
Johnston, Alex and den Otter, Andy A. Lethbridge: A Centennial History. Lethbridge: City of Lethbridge, 1991.