Richest People

Two of B.C.’s richest families plan to build its first new ski resort in 40 years

The Gaglardis and the Aquilinis have set aside a decade’s worth of bad blood to pitch a controversial new $3.5 billion resort at B.C.’s Mount Garibaldi

Luigi Aquilini and Bob Gaglardi on a ski lift

Luigi Aquilini and Bob Gaglardi put aside a years-old dispute to cooperate on what could be Canada’s first new ski resort in 40 years. (Illustration by Andy Friedman)

In 1860, a British naval officer, G.H. Richards, was tasked with surveying the coast of Howe Sound, the fjord just north of what would become Vancouver. Dominating the head of the inlet was a 2,678-metre-high mountain perpetually swathed in snow and ice. Disregarding the local Squamish people’s name for the landmark—Chuckigh, meaning “dirty snow”—Richards labelled this most northern of the Cascade volcanoes Mount Garibaldi, after the dashing general Giuseppe Garibaldi, who at that point was leading the fight to unify Italy for the first time since the fall of the Roman Empire.

In 1927, the name would be extended to a provincial park covering most of the mountain and the alpine wilderness behind it. Wolfgang Richter, whose adult life has been inextricably tied to the mountain, smiles at the symbolism. “Nobody in B.C. knows who Garibaldi was,” he says. “Italians know. That’s got a lot to do with why these people are involved in this project, I would say.”

By “these people,” Richter means two Italian-Canadian billionaires: Luigi Aquilini and Bob Gaglardi. The pair represents the money behind a $3.5-billion resort proposal that took a huge step toward realization this year after four decades of frustration. On January 29 2016, the B.C. government granted their joint venture, Garibaldi at Squamish Inc., its long-sought environmental certificate—removing the largest hurdle to what would be the first entirely new ski hill built in North America since 1981. There are still challenges: residents downstream, the District of Squamish, the rival resort of Whistler Blackcomb and deteriorating skier demographics. The biggest challenge, though, might be a festering blood feud between the proponents’ own sons, who one day will likely assume control from the 83- and 75-year-old patriarchs.

To get to the site of this fraught project, you have to drive a few minutes north of modern-day Squamish, where the Sea-to-Sky Highway begins its ascent toward Whistler. You park in a pull-off to a gated logging road that switchbacks up Brohm Ridge, a shoulder of Mount Garibaldi that pokes out from the park. You then need to hike or mountain bike through the second-growth alder and hemlock to a shelf just above the 1,000-metre contour. Here Garibaldi at Squamish Inc., jointly controlled by Aquilini Investment Group and the Gaglardi family’s Northland Properties, intends to build a village featuring 1,500 hotel rooms and upwards of 2,000 private residences. Radiating from it will be 23 lifts. In addition to the construction activity over a 20-year build-out, the operation is forecast to create more than 4,000 permanent jobs and $160 million in GDP per year.

The idea stretches back to the 1960s, when an Austrian dreamer attempted to run a gondola straight from the highway to the top of Brohm Ridge. He got as far as laying a concrete foundation for the base towers, now overgrown with brush, before his venture ran out of money. Wolfgang Richter was in his early 20s and living in Victoria when his German uncle, Henry Roethel, asked him to check out the site. It was April 1978 and pouring rain. Over three days camped out on the ridge, though, Richter saw what an enormous mountain lay behind the clouds. “It’s pretty awesome and daunting up there,” he says. On his recommendation, Roethel began talks with the provincial government about developing a resort.

For builders, it was a simpler time. There was no environmental assessment process to go through nor any consideration for courting the favour of the Squamish Nation, on whose unceded traditional territories the resort would lie. Instead, it was a matter of negotiating with the provincial Ministry of Forests to free up the land. The B.C. government was eager to restart the aborted project—“it was a white elephant situation,” Richter says—and diversify the economy. The province had already green-lighted the development of Blackcomb Mountain, opposite Whistler, and a master-planned village that could accommodate 50,000 visitors between the two.

But before financing could be assembled, a global recession intervened. The B.C. economy in particular was clobbered, the unemployment rate rising into the teens. Seeing little future for the project, Richter moved to California to try his hand at the film business. But he returned in 1986, in time to catch Expo 86 in Vancouver. More than ever, tourism was seen as the salvation of B.C.’s hobbled resource economy. Richter decided to take up the Garibaldi resort torch again.

“I had a strong feeling if I didn’t go after this full time, somebody else would do it and I’d be angry with myself for the rest of my life,” Richter remembers. In time, he talked Luigi Aquilini, along with builder Art Bosa and then Edmonton Oilers owner Nelson Skalbania (“a likable rogue,” Richter calls him), into backing the scheme.

Aquilini was an Italian immigrant who had followed his wife’s family to a part of East Vancouver overlooking the docks that were the focus of immigration from his country in the postwar years. His sons—Francesco, Roberto and Paulo—would grow up in the shadow of the Pacific Coliseum, then home of the Vancouver Canucks. The low-profile Luigi quietly built an empire as a residential developer, a landlord and the operator of a large berry farm in Pitt Meadows. In a city where builders were becoming obsessed with concrete and glass highrises and pink stucco “monster houses,” Aquilini Investment Group had a respect for history and an Italian sense of style. Until this year, the company had its headquarters in the Standard Building, an exquisitely restored 1920s office tower downtown where the Italian Consulate still resides.

To see why Aquilini was interested in the Garibaldi project, you need only to look at what was happening just up the highway in Whistler. In the 1980s and ’90s, the owners of Whistler and Blackcomb mountains were locked in a race to attract more visitors with faster, higher-volume ski lifts to access more terrain. But the real action was at the valley’s bottom, in Whistler Village. Intrawest Corp., the owner of Blackcomb, took the lessons it had learned as a suburban-Vancouver condo builder and applied them to the resort business. The money was not in hawking lift tickets; it was in selling real estate and the whole mountain experience. Whistler expanded quickly, surpassing rivals like Vail, Colorado, by every measure—lift capacity, acreage, skier visits, beds—and becoming the largest ski resort in the Western Hemisphere. Intrawest ran its crosstown rival Whistler Mountain Ski Corp. out of business and then bought up its assets. As much as any paper mill or mining burg before it, Whistler was a company town. It still is.

Eager to replicate Whistler’s success, the province had a policy that provided a road map for would-be resort developers, and the new Garibaldi partnership followed it to the letter. But politics intervened in 1991 when a newly elected NDP government scrapped the application and later opened up the process to competing proposals. The Garibaldi group again secured the bid in 1996. But by this time the government had introduced a new Environmental Assessment Act, requiring the project to go through a systematic three-part review. The process dragged on. The partnership commissioned independent reports on “birds and bees and harlequin ducks,” Richter recalls, before even drafting a master plan for its own development. Eventually, the group ran out of money and motivation to continue.

Only after the B.C. Liberals’ landslide victory in 2001 on a pledge to get the province back to business did Richter and Aquilini think about restructuring the partnership. This time, Aquilini brought in a partner with the wherewithal to stick out the process as long as it took. His name was Bob Gaglardi.

The Gaglardis came from an earlier generation of Italian immigrants than the Aquilinis. By the standards of British Columbia’s relatively recent settlement, they were good ol’ boys from the Interior. Aquilini had long known Bob’s father, “Flying” Phil Gaglardi, famous as the province’s minister of highways in the 1960s and later as mayor of Kamloops. But the business brains of the family was Bob, who had built the budget Sandman Inns chain into a network of hotels, restaurants and other development properties. When that empire got into financial difficulty amid the interest-rate spike of the 1980s, one of the lenders who reportedly came to Bob’s aid was Luigi Aquilini.

When they formed the new Garibaldi at Squamish Inc. in 2002, the families needed each other. “This is a big project that will require lots of capital,” says Jim Chu, a vice-president at Aquilini Investment Group and official spokesman for GAS. “Both companies bring expertise with tourism and hospitality.” Indeed, by the time they signed up together on the Garibaldi project in 2002, the portfolio of assets held by the Aquilini and Gaglardi families looked remarkably similar: land development, hotels, restaurants (Northland owns Denny’s in Western Canada; Aquilini, Pizza Hut in B.C.) and tourist attractions. Each family’s approach differs—the Aquilinis tend to build from scratch, whereas the Gaglardis have proven to be opportunists, scooping up assets in distress. (Both share an aversion to media; neither side would comment for this story.) The second generation in each family also has a common interest in professional sports—a line of business that would ultimately cause a rift between them.

In 2004, Bob Gaglardi’s son Tom began talking with Luigi Aquilini’s son Francesco about making an offer for the Vancouver Canucks. (Also involved in the talks was Ryan Beedie, another scion of a developer family.) Aquilini backed away from the bid, and Gaglardi and Beedie continued haggling with then owner John McCaw for seven months. But when McCaw announced the sale of a 50% stake in the team later that year, they were shocked to discover the buyer was none other than the Aquilini family.

Gaglardi and Beedie sued Aquilini and McCaw for failing to act in good faith, and accused Aquilini of using confidential information in his bid. The gruelling trial began in 2006, with the parties testifying for weeks on the stand. McCaw sent decoy limousines to the courthouse to foil the paparazzi. Members of the Gaglardi and Aquilini families sat on opposite sides of the courtroom, avoiding eye contact with one another. Their only direct communication during the ordeal was an accidental confrontation between Francesco Aquilini and Tom Gaglardi in the courthouse washroom. Gaglardi’s lawyer claimed Aquilini issued a vague threat: “You better be careful.” Aquilini denied it.

When the court eventually rendered a verdict in 2008, Aquilini was cleared of all wrongdoing. His initial discussions with Gaglardi and Beedie did not constitute a formal partnership, the judge concluded, so there was no contract to breach. “Aquilini was not bound by any fiduciary obligation to Gaglardi and Beedie when he entered into negotiations,” according to the judgment. The plaintiffs appealed the decision to both the B.C. Court of Appeal and the Supreme Court of Canada. Both appeals were thrown out in 2009.

Aquilini had won, and in 2006 he bought McCaw’s remaining stake in the Canucks and Rogers Arena (including some valuable developable land alongside it, where the group’s head office is now located), but the trial seemed to have done even more damage to the two families’ relationship than the events that led to it. “There are real costs here, and the real costs are seeing my brother up there, being cross-examined by skilful, experienced, surgical lawyers asking him very tough questions, questions about his character, about his honour and things that he did not do wrong,” Roberto Aquilini told the Canadian Press in the aftermath.

Gaglardi, meanwhile, acquired the Dallas Stars out of receivership in 2011. Being on equal footing in the NHL has done nothing to dispel the frostiness between Gaglardi and Aquilini—both large, imposing men of middle age. “It doesn’t take a New York lawyer to figure out we’re not on good terms, but it doesn’t affect anything,” Gaglardi told the Vancouver Sun last fall. “I have been to his building to watch my team play, and I am not sure if he has been here or not. But if he wants to come, he can come.”

The younger generation have never sat on the board of Garibaldi at Squamish, and according to Richter, Luigi Aquilini and Bob Gaglardi have always kept things professional. But board meetings have been rare and sometimes uncomfortable since the Canucks dispute erupted. “They’re strange meetings,” Richter says. “They would never admit it, but who are you going to stay loyal to? Your own kin. It had some impact.”

The project’s next step is to hire a planner, come up with the first iteration of a master plan and commence consultations with the community. Plus, there are conditions to the environmental approval to be met, such as ensuring the development does not have an adverse effect on the water supply for property owners in Paradise Valley downstream. Chu, the spokesperson, declines to offer a timeline for any of these steps. “There’s no need to rush,” he says. “It’s been 40 years already. What’s another year?”

Building a brand new ski resort is hard—so hard nobody has been able to do it anywhere in North America since Blackcomb and Beaver Creek, Colo., both opened for the 1980 to ’81 winter season. (In a few cases, developers have succeeded in expanding community hills into destination resorts, including Kicking Horse Mountain and Revelstoke Mountain in B.C.) Part of the reason for the absence of new resort development lies on the demand side of the equation. The number of people skiing in North America is flat to falling—certainly not keeping pace with population growth. After hovering around 20 million for most of the past decade, skier visits (days on a hill) in Canada slumped to 18.5 million in 2014 to ’15. A number of reasons are cited: aging baby boomers, lower participation rates among non-European immigrants, and the increasing difficulty of fitting a $75-plus lift ticket into a middle-income budget.

Top-tier resorts like Whistler Blackcomb have compensated by raising prices and introducing new activities, such as summer sightseeing and lift-assisted mountain biking. These pursuits address another threat facing the industry: climate change. While the effects to date have been less pronounced in Canada than in the western U.S., virtually every resort is staking its future on four-season activity.

“We have an advantage over older resorts, because from inception we’re going to be all-season,” says Chu. “If it snows, it’s a bonus for us, but our business case is predicated on visitation throughout the year.” People will buy vacation properties and book rooms for the mountain air, the trees, the hiking trails, the wildlife. Plus, almost uniquely among mountain destinations, it would be within sight of the ocean. Richter still touts Garibaldi’s advantages for hitting the slopes. With a higher base elevation than Whistler, Garibaldi should enjoy a longer ski-to-your-door season, he says. “We have 7% more precipitation than Whistler. We get gobs of snow up there,” Richter insists.

The entrenched players, though, have done well by the status quo. “It’s pretty much impossible to open a new major ski resort now on account of it cannot be in conflict with the environment,” Vail Resorts CEO Robert Katz told The Atlantic in 2012. “It also takes a long time to build community support. Once you get to that point, it still takes decades to design the ski experience and build the resort.” The article posited that Vail and Whistler Blackcomb represent untouchable monopolies, free to charge a family $500 a day just for lift tickets and lunch. Paul Mathews, president of Whistler-based Ecosign Mountain Resort Planners, won’t say it’s impossible to develop a new resort, but notes the involvement of public lands makes the task complicated and expensive. Having worked on earlier schemes for Garibaldi, he opines, “this resort will simply never work, and we taxpayers may well pick up the cost of returning [it] to nature.”

Certainly the management of Whistler Blackcomb, which in August accepted an offer to be taken over by—you guessed it—Vail Resorts, would be content to see dreams of new resorts dashed. In a letter to B.C.’s environmental assessment office in 2015, Whistler Blackcomb CEO Dave Brownlie argued the Garibaldi project would “damage B.C.’s reputation and undermine its success as a world-class ski destination” and “have a negative impact on Whistler Blackcomb’s recognition as an iconic destination, ultimately compromising the assessed value of more than $10 billion worth of taxable property in Whistler.” The letter outlined six reasons GAS should be rejected, including the unsuitability of the site, excess resort capacity in B.C. and alleged gaps and errors in the application. (Brownlie declined to be interviewed for this story.)

A more surprising—and potentially damaging—critic of Garibaldi is the District of Squamish. “The district is not supportive of the project,” mayor Patricia Heintzman says. The plan doesn’t fit the regional growth strategy (for example, it brings more traffic to an already crowded Sea-to-Sky Highway) or the principles of smart growth, she says. This is an about-face from the 1990s, when the district was an enthusiastic cheerleader for Garibaldi. Heintzman admits she was a supporter at that time too. But Squamish has changed. “Back then it was predominantly a logging town that was really grasping at how to redefine itself, how to build a new economy,” she says. “We no longer see [Garibaldi] as the great white hope. We have all sorts of opportunity coming our way.”

Indeed, Squamish has been stealing some of Whistler’s fire as an outdoor recreation capital. The former mill town has been recognized by the likes of the New York Times and CNN as a top adventure destination, thanks to attractions such as rock climbing, mountain biking and kitesurfing. Population in the district, which uses the tag line “hardwired for adventure,” has swelled to more than 20,000 from 15,000 in 2006.

This reversal of fortune has made the municipality more attentive to the potential liabilities of the project, which have long been known. In the 1980s, Heintzman notes, a French consortium commissioned a study of 22 potential sites for ski resort development in B.C., and Brohm Ridge finished dead last. It cited the fact that marine cloud would cause frequent visibility-related closures. This, Heintzman notes, is not something the developer can remedy.

As much as Garibaldi at Squamish has touted the proposed resort’s all-season appeal, it has to succeed as a ski destination—which is counter-cyclical to the rest of the tourism business. “If you don’t have the winter season, you don’t have all-season,” Heintzman says. Then consider the potential liability to the district or the surrounding region once it has to maintain the roads to a white elephant. And as far as Heintzman is concerned, Squamish has a veto over the project despite the provincial approval. In announcing their decision, she says, the ministers made it clear that the project’s approval henceforth becomes a local government decision.

“I can see how someone living in Squamish might say, ‘Here it comes again,’” Chu says. But this time the project has an environmental certificate, the support of the Squamish Nation and experienced, deep-pocketed proponents. Speaking last spring, Chu promised GAS Inc. would listen closely to input at upcoming public meetings and use it to build the kind of resort Squamish residents will be proud of. Eight months on, however, no such meetings have taken place.

Regardless of what happens to skier numbers across North America, Chu lists a few reasons Luigi Aquilini and Bob Gaglardi are willing to play a long game with Garibaldi. First, B.C.’s Lower Mainland is expected to grow by a million residents over the next 20 years. Second, Garibaldi is better located than other North American resorts to attract Chinese tourists, who are expected to outnumber Americans venturing abroad in the near future. And the prospect of a big financial return is enough to ensure neither Aquilini nor Gaglardi let their sons’ personal differences derail the project.

As for Richter, the dearth of new resorts built over the past four decades is motivating him to ensure Garibaldi is done right. “The fact of the matter is that this may be the last one.”