Bubbe wannabes

REBECCA ECKLER December 26 2005

Bubbe wannabes

REBECCA ECKLER December 26 2005


It instalment is entirely oí appropriate Maclean’s series that for on the this Newfinal Canadian Establishment, my subject should be Navjeet (Bob) Dhillon, a very different breed of entrepreneur than his halfdozen predecessors. Unlike his peers, he is a master scuba diver, expert spear fisherman, and professional-level salsa dancer. He does not wear the traditional Sikh turban and prefers yoga and meditation to religious observance. As a businessman—he boasts that he will become North America’s first Sikh billionaire— he runs and controls a $308-million publicly traded real estate company, snaps up apartment buildings in Calgary, Edmonton, Toronto and Vancouver, and for fun on the side, markets luxury beach lots in the Central American playground of Belize.

A 40-year-old, barrel-chested extrovert who lives in a palatial $2-million house on a mountainside overlooking Calgary, Dhillon justifiably describes himself as having “a triple A-type

tion, you develop a survival instinct, as I have. The image of being Sikh is that it’s orthodox-oriented, but it actually is very liberal. You go to a Sikh temple, and they sing songs like the southern Baptists and invite you in for a meal. When the Canadian Legion wouldn’t allow turbaned Sikhs into their halls, they didn’t realize that we’ve won more Victoria Crosses than any other group. Sir John A. Macdonald once suggested bringing in a Sikh battalion to protect Canada from the Americans.”

Although he considers India to be his homeland, Dhillon was born in Japan. His grandfather Saproon Singh Dhillon had migrated from Punjab to Hong Kong at age 16. There he eventually became a trader and established the North China Shipping Co., which exported goods to Japan. That was where Dhillon was born in 1965. Six years later, the family moved to Liberia to tap the trading market of West Africa. During the 1970s, when a bitter civil war erupted in that unstable republic, the family lost everything and sought refuge in Vancouver. It was not a happy time.

When he's not skippering his yacht off the coast of Belize, where he's marketing beachfront lots, Dhillon's negotiating to buy more land there, predicting it 'will be the next St. Bart's without the Eurotrash'

personality.” He has never been interviewed before, except for two-minute segments on business channels, and is inordinately shy about his personal life, which he insists must remain private for religious reasons.

Dhillon’s frantic schedule allows few quiet moments to discover balance in his life. “When I’m travelling alone on plane rides, that’s the only time I have for myself,” he tells me. “On those four-hour trips from Toronto to Calgary, I can reflect on my future. I’m always writing notes to myself and sketching out business plans. But I do meditate, which gives me calmness.”

He almost didn’t have a future. “I was diagnosed at one time for having cancer, and I beat it,” he reveals. “I got my clean bill of health three years ago. I also beat racism in Alberta and the odds of a falling capital market. What drives me is the second wind on my life when I beat cancer, and went through chemo. Now the stars are realigning. My personality is a fabric of my family, being an immigrant, and beating cancer.

“If you ask me what religion I am, I would say, I am a Sikh,” he says. “But if you ask me whether I am a real practising Sikh, I would say that would be a false statement. I am more spiritual than religious. Sikhs were persecuted like the Jews. They’ve always been at war. For hundreds of years, we guarded the foothills of the Khyber Pass, beating off the invaders who came from the north. When you’re fighting for your life, generation after genera-

Racial slurs were regularly directed at the youthful Bob as he walked to school.

The family relocated to Calgary, which they initially found to be no more welcoming. His mother was fired from her job at the post office strictly because of'its racist attitude. “Now, this is a fact,” Dhillon insists. “We fought the case with the post office, a Crown corporation, and won. I don’t want to give you a story about someone hitting me in a bar, or somebody calling me a Paki and pulling my hair—these are things that happen because some guy behaves like an idiot. I’m telling you about an institutional fact. My mom fought the case, and was reinstated a year later.”

The family soldiered on in Calgary. “It was tough getting a job,” Dhillon remembers. “There were only stereotyped positions available for the Sikhs, and it was really hard

A secular Sikh, he is a master scuba diver and spear fisherman, and pro-level salsa dancer

to break through the glass ceilings. For example, we were banned from any front-line positions in offices, and no oil companies would hire me.”

With no obvious prospects, he decided to go into business for himself. In 1984, at age 19, he bought two houses, fixed them up, and sold them for an $18,000 profit. That was his modest grubstake. For the next 15 years he bought and sold Calgary real estate worth about $150 million, a hectic pastime better known as flipping. “I worked out of the trunk of my car and with a cellphone,” he remembers. “What drove me to work 70 hours a week or more was that my family had lost everything in Liberia after the coup,

and I vowed it would never happen again.”

Incongruously, his first success was to establish the grand-sounding Pan-Pacific Mercantile Group, which he hoped to spin into a major distributor of three-dozen North American brands throughout South Asia. It never happened, but until recently if you ordered a Bloody Mary anywhere east of Hawaii, you’d have flavoured it with Tabasco sauce that was distributed by Bob Dhillon.

He underwent a significant sea change in 1996 when he decided, at age 32, to spend two years getting his executive MBA at the University of Western Ontario’s Richard Ivey School of Business. Larry Tapp, then the school’s dean and now a director of Dhillon’s companies, described him as “a very direct, driven guy.” In May of his first year, he incorporated Mainstreet Equity Corp. as a numbered Alberta company that would become his main investment vehicle. “I used every available course at Ivey to formulate the strategy for Mainstreet,” he recalls. “Whether it was building a brand, running an efficient operation, financing growth or making a speech, I thought about the lessons in terms of what they meant for Mainstreet.” When he graduated, his company went public, and he began buying properties to hold instead of flip. Once back in Calgary, he moved his office out of the car trunk to the main floor of one his buildings, which was also used to store construction supplies.

In the process of moving in new directions, he came up with every entrepreneur’s wet dream: a neglected yet accessible real estate niche that could profitably be filled without having to raise too much new capital. The building industry was polarized into local mom-and-pop-size operations running a few buildings, and at the other end, the giants— the Bronfmans, the Reichmanns, Brookfield, Trizec and others. In between was where Dhillon wanted to be. He became a consolidator of multi-family, mid-tiered

residential rental properties, starting in Alberta, then moving west to Vancouver and east to Toronto. During the past seven years, Mainstreet Equity (of which he owns 41 per cent) has mushroomed from 276 units to nearly 4,000, with a portfolio worth more than $300 million. The year 1999 was a particularly stellar one, with the Globe and Mail Report on Business Magazine ranking his company the following year at the top of its list of Biggest Profit Gainers, recording a stunning 15,791 per cent increase.

His technique is to buy buildings that require drastic repositioning, such as one in Calgary’s Forest Lawn area that had 60 deserted cars and trucks in its derelict parking

lot, holes in living-room walls, and all the telltale signs of having been a druggie hangout. Dhillon invested $2.3 million, doubled the rents, and turned a slum into a middleclass complex. His fix-ups do not break any luxury barriers. Expenditures are calculated to the nearest penny. (Replacing toilets with modern, low-volume fixtures, for example, reduces water consumption from six gallons per flush to 1.6; substituting 60-watt light bulbs with $20 fluorescent lights reduces annual electricity consumption from $30 to $8.) He doubles rents and three-quarters of his pre-renovation tenants usually move out, but the increased cash flow covers the cost of the upgrades.

Fifteen years ago, when he was looking around for something interesting to fill his non-existent spare time, Dhillon discovered Belize, a tiny former British colony bordered by Mexico’s Yucatan Peninsula and Guatemala to the west. It was an English-speaking democracy with little poverty, and still virgin tourist territory. With only 280,000 people, it boasted all the trimmings fit for expats: offshore banks protected by secrecy laws, a diving paradise second only to Australia’s Great Barrier Reef, dozens of Mayan ruin sites, and 540 species of wild birds.

Dhillon purchased a 2,300-acre island and marketed beach lots, only a few with price tags of under $1 million. Leonardo DiCaprio is a neighbour, and Madonna is said to own a nearby estate. When Dhillon is not skippering his 55-foot yacht into the surf (occasionally crossing over to Cuba), he is nego-

tiating to purchase an 88,000-acre patch of jungle for more development. His original island is now worth well over $100 million. “Belize will be the next St. Bart’s without the Eurotrash,” Dhillon says. “It has the best fishing, the best diving, the best sailing, white sand beaches, and the kind of lifestyle we all dream about.”

In the upcoming election, Dhillon will remain one of Alberta’s few Paul Martin Liberals. “I don’t like the idea of Canada splitting up,” he says. “I don’t like the idea of dissension. We have the most beautiful country, where

journalists and authors like you can speak your mind, and you’re not going to get shot or killed or blackballed. That’s what the Liberal government stands for, and I’m all for it. I find that Paul Martin has a unique blend of business and social conscience that I respect.” The one constant in Dhillon’s cheerful litany is his unstinted praise for the country of his choice. “I owe my success to Canada. No matter how bright I may be, or articulate or generous,” he confesses, “if I wasn’t in Canada, I wouldn’thave had one-tenth of the success anywhere else in the world. I owe my start

As a boy in Vancouver, he had to field racial slurs; his mother was fired due to racism

to Alberta, because it was not a closed shop, like some of the other places. If you create a business model there that has a success pattern, you can branch out to other parts of Canada. The rest of the country can learn something from Alberta, which is that the No. 1 economic engine is lower taxes. Let the people be free. Governments cannot create jobs. Governments cannot create anything.”

In the real estate world, Mainstreet remains a mid-size company. “I’ve got to be at about $5 or $10 billion before anybody will recognize me.” But Bob Dhillon intends to double his holdings in the next five years, and he has another advantage. “I’m now learning kundalini, which is a higher level of yoga,” he confides as we part company. “I’m a very spiritual individual. Meditation combined with yoga means I can live forever. Literally.” M