Is it the early days of a real estate revolution? Online realtor Redfin launches in Canada

Is it the early days of a real estate revolution? Online realtor Redfin launches in Canada

U.S. real estate brokerage firm Redfin launched in Canada this week — a firm that positions itself as a tech-powered company ready to shake up the way consumers buy and sell homes.

Founded in 2004, the Seattle-based Redfin is looking to challenge conventional brokerages through its primarily online operation and one per cent listing fee. The company offers a suite of online tools, including 3D video tours, but also hires agents on salary, who offer the same services as conventional brokers.

Turning to technology is what allows the company to keep its buying and selling process efficient, Redfin says. In Canada, a listing fee with a conventional brokerage is typically around 2.5 per cent.

“Our track record in the United States is that we sell homes for more money, and we sell them faster and with more certainty,” said Redfin CEO Glenn Kelman. “We hope to do the same thing here in Canada.”

The high tech-low commission combination has helped Redfin grow into 85 markets in the U.S., as well as raise a lot of money through an initial public offering (IPO) in 2017. Now worth about $1.7 billion US, the company has the money to expand — even if it’s not yet profitable.

Redfin CEO Glenn Kelman believes technology’s impact on the real estate sector will continue to grow. (Andy Hincensberg/CBC)

The brokerage launched in Toronto on Tuesday, with plans to open in Vancouver by spring, before expanding to other Canadian cities.

Redfin’s entry into the Canadian market also comes on the heels of two other web-based operators: Purplebricks, a commission-free, U.K-based brokerage, and Zillow, a popular U.S. listing service and mobile app.

It also comes just months after the end of a years-long court battle that saw the Toronto Real Estate Board (TREB) ordered to allow its brokers to publish more sales data online, such as sold prices and delistings — a move touted as a way to start opening up the market to data innovation.

Tech transforming home-buying for Americans

The arrival of these potentially disruptive new players might be the early days of a real estate revolution long-awaited by industry watchers, according to Will Strange, a professor of economic analysis with the University of Toronto’s Rotman School of Management.

“It’s the kind of industry that is really ready to be revolutionized,” said Strange, who has been predicting change in the real-estate sector for more than two decades.

While Strange initially believed that revolution would come to real estate as quickly as it came to the travel industry — starting in the late 90s. Now there are signs it may have finally arrived.

An Offerpad home is shown for sale in Gilbert, Ariz. The company is what’s known as an iBuyer. (Offerpad)

Over the past two years, investors have poured billions into real estate firms that are using technology to do more than just list and promote homes. 

And while online realtors like Redfin may challenge convention in Canada, much more radical changes are being rolled in the U.S. market.

The ‘iBuyers’

One of the biggest disruptions south of the border has come in the form of real estate companies known as “iBuyers,” or institutional buyers.

These investor firms use algorithms, or automated valuation models (AVMs), to determine the market value of a home, before making an initial offer on the property, often sight unseen. They’ll then send in staff to inspect the home, finalize the price and close the deal within a week.

The process is aimed at speeding up and streamlining the selling process for homeowners, providing certainty about the sale, the price and giving them control over the timeline. The seller picks the closing date and can change it as needed — an ideal scenario for people who might unexpectedly be relocating for a job or moving into a house still under construction. There’s also the bonus of not having to spruce up your home for showings.

But the convenience also comes at a cost: iBuyers charge a fee of anywhere from six per cent, up to as much as 13 per cent — the top end being significantly higher than a traditional commission.

Consumers can make offers online on homes listed for sale with Offerpad. The company can also give sellers an initial offer on their a home within hours of them answering some questions about the home. (Offerpad)

Still, the iBuying space is taking off in the U.S. Opendoor got it started in 2014; Offerpad quickly followed. Both have raised hundreds of millions in investment and are expanding rapidly. Zillow and Redfin have, too, recently moved into iBuying, and growth in the sector convinced traditional brokerages, like Keller Williams and Coldwell Banker, to test the concept.

Offerpad, which operates in nearly a dozen U.S. markets, says the fee model — not profit on resale — is the key to the business. 

“Our intention is to get people as close as possible to what they think their home is worth,” said Cortney Read, Offerpad’s communications director.

Offerpad’s sweet spot is in cities with diversified economies, buying houses built after 1960 that are generally priced under $600,000. The company believes its model could work in Canada, even accounting for seasonal buying trends.

​Trading in your house like a car

Another radical iBuyer approach comes from Knock, which essentially arranges a home swap for its consumers.

The company buys their clients’ new home for them in cash and moves them in. Then it does the needed repairs on the homeowner’s old home, before putting it up on the market as a Knock listing.

Knock co-founder Sean Black says the trade in model solves a chicken-and-egg problem because “70-plus per cent of people in the U.S. that are buying homes every year are also selling one.”

Knock advances up to $10,000 US to the homeowner to pay for repairs on the old house, which is paid back when it sells. The client also continues to pay the mortgage on their old home until it is sold, when the title and mortgage for the new property is finally transferred over.

Knock CEO Sean Black believes his company is part of a long-awaited real estate revolution in an on-demand world. (Knock)

Knock makes its money by taking a three per cent commission from the homeowner on the sale of their old house, and another three per cent from the seller of the new house. Tech is at the core of the company, which uses algorithms to determine how much a home is likely to sell for, and to help choose which markets to enter.

Black believes his company, and the other innovators in the space, like Ribbon and Bungalow, are the long-awaited real estate revolution in an on-demand world, where consumers expect consistency and transparency.

“The big picture here is what you’re witnessing is the transformation of this industry,” he says, moving from a world where going individual agents have control to one where institutional buyers can “give you a really professional, certain and hopefully cost-effective solution.”

Black admits the change could a take a generation — a sentiment echoed by industry-watcher Strange.

Still, there’s also the potential for the snowball effect to take hold, Strange says.

“I would expect change to happen overnight, I just don’t know which night.”

WATCH: Tech-brokerage Redfin hopes to shake up Canada’s real estate market

As the price of a home in Canada has shot up over the years, the corresponding fees have skyrocketed as well. Now Redfin, a tech-focused U.S. brokerage, is hoping to change that by promising lower fees in a push to shake up Canada’s real estate market. But will it work? And if so, at what cost? 2:53

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Mnuchin says U.S. had ‘productive’ trade meetings with China

Mnuchin says U.S. had 'productive' trade meetings with China

Top U.S. and Chinese trade negotiators had “productive meetings,” U.S. Treasury Secretary Steven Mnuchin said in a tweet on Friday, as the world’s largest economies wound down two days of high-level talks to resolve their bruising trade war.

Mnuchin did not elaborate on the discussions he and U.S. Trade Representative Robert Lighthizer had with Chinese Vice-Premier Liu He, a top economic adviser to President Xi Jinping, who the two U.S. officials met later on Friday in Beijing.

The U.S. delegation had a banquet with Chinese counterparts at a Beijing hotel on Thursday night, a person with knowledge of the meetings said. But neither country had offered details on how the two sides might de-escalate a tariff war that has roiled financial markets and disrupted manufacturing supply chains.

U.S. duties on $200 billion worth of imports from China are scheduled to rise to 25 per cent from 10 per cent if no deal is reached by March 1 to address U.S. demands that China curb forced technology transfers and better enforce intellectual property rights.

Although U.S. President Donald Trump said earlier in the week that an extension of the deadline was possible if a “real deal” was close, Larry Kudlow, director of the National Economic Council, said the White House had made no such decision.

Several sources informed about the meetings told Reuters there was little indication negotiators had made major progress on sticking points to pave the way for a potential meeting between Xi and Trump in coming weeks to hammer out a deal.

Lighthizer and Mnuchin left their Beijing hotel on Friday afternoon without taking questions from reporters.

Reuters reported earlier that in recent meetings China has pledged to make its industrial subsidy programs compliant with World Trade Organization rules and end those that distort markets, but had offered no details on how it intends to achieve that goal.

The offer has been met with skepticism from U.S. negotiators, in part because China has long refused to disclose its subsidies.

And some in U.S. industry have been unimpressed with the extent of other reported Chinese offers to address U.S. concerns, such as Beijing’s proposal to increase purchases of U.S. semiconductors to $200 billion over six years, which was first reported by the Wall Street Journal.

John Neuffer, President and CEO of the Semiconductor Industry Association (SIA), told Reuters that the offer would be “akin to an accounting sleight of hand” and “an attempt to rearrange our supply chains and drive them deeper into China.”

“We are confident U.S. government negotiators will wisely dismiss this offer and continue pushing for meaningful reforms that create a fair and level playing field for U.S. companies doing business in China,” Neuffer said.

Many U.S. lawmakers and business groups have urged Trump in recent weeks not to settle for an agreement based largely on increased Chinese purchases of farm and energy commodities.

Trump has said he did not expect to meet with Xi before March 1, but White House spokesperson Sarah Sanders has raised the possibility of a meeting between the leaders at the president’s Mar-a-Lago retreat in Florida.

China has long denied Washington’s accusations of trade abuses, and it has retaliated to U.S. tariffs with its own duties on American goods.

Some trade experts say China appears focused on securing a Xi-Trump meeting, in the hope that it would make a near-term deal to limit or reduce tariffs more likely.

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Airbus to halt production of A380 superjumbo due to lack of orders

Airbus to halt production of A380 superjumbo due to lack of orders

European plane-maker Airbus said Thursday it will stop making its superjumbo A380 in 2021 for lack of customers, abandoning the world’s biggest passenger jet and one of the aviation industry’s most ambitious and most troubled endeavours.

Barely a decade after the double-deck, 500-plus-seat plane started carrying passengers, Airbus said key client Emirates is cutting back its orders, and as a result, “we have no substantial A380 backlog and hence no basis to sustain production.”

The decision could affect up to 3,500 jobs and already cost the plane maker the equivalent of almost $700 million Cdn in losses in 2018, according to Airbus.

The company, a European economic powerhouse, is also girding for serious disruption to its cross-continental manufacturing from a likely chaotic British exit from the EU next month.

CEO Tom Enders, however, said Thursday, “We are getting signals that make me a little more optimistic that we’ll see a more orderly Brexit.” He wouldn’t elaborate.

The end of the young yet iconic jet is a boon for rival Boeing and an embarrassing symbolic blow for Airbus. A pall of mourning hung in the atmosphere Thursday at its headquarters in the southern French city of Toulouse — but there was also a hint of relief after years of straining to keep the A380 alive.

“It’s a painful decision for us,” Enders said. “We’ve invested a lot of effort, a lot of resources, a lot of sweat … but we need to be realistic.”

It’s also sad news for Emirates, which has the A380 as the backbone of its fleet, based out of Dubai, the world’s busiest airport for international travel.

When it started taking on passengers in 2008, the A380 was hailed for its roominess, large windows, high ceilings and quieter engines. Some carriers put in showers, lounges, duty free shops and bars on both decks.

Airbus had hoped the A380 would squeeze out Boeing’s 747 and revolutionize air travel as more people take to the skies.

Instead, airlines have been cautious about committing to the costly plane, so huge that airports had to build new runways and modify terminals to accommodate it. The double-decker planes started flying in 2008.

The A380 had troubles from the start, including tensions between Airbus’s French and German management and protracted production delays and cost overruns. Those prompted a company restructuring that cost thousands of jobs.

Among early detractors of the A380 was Richard Aboulafia, an analyst with Washington-based Teal Group who said its demise “was inevitable.”

“But thanks to the strength of the market right now, and the strength of Airbus’s other products, the damage will not have a huge impact on the industry,” he told The Associated Press. “For Boeing, it has been a very long time since they needed to worry about the A380 as a competitive factor.”

Airbus reported net profit of almost $4.7 billion over last year, up by about $1 billion from 2017’s level.

But it also reported losses: In addition to the A380 hit, Airbus reported a charge of almost $650 million on the A400M, used by several European militaries — and another $185 million charge for complying with ethics rules as the company faces fraud investigations in the U.S., Britain and France.

Airbus also acknowledged Thursday that a recent data breach apparently targeted intellectual property.

Guillaume Faury, head of Airbus commercial aircraft and future CEO of the overall group, said the company is taking technical and legal measures in response.

Airbus said it forecasts similar profits in 2019, in line with growth in the world economy and air traffic.

It promised airlines that it would still maintain the more than 230 A380s currently in flight, with Faury calling it a “benchmark” for the company even as its death is being programmed.

Emirates said Thursday it had struck a deal valued at $21.4 billion US with Airbus to replace some A380s with A350 wide-bodies and smaller A330 planes.

Emirates has long been the largest operator of the A380. Before Thursday’s announcement, it had 162 of the jets on order.

“While we are disappointed to have to give up our order, and sad that the program could not be sustained, we accept that this is the reality of the situation,” Sheikh Ahmed bin Saeed Al Maktoum, chairman and CEO of Emirates, said in a statement. “For us, the A380 is a wonderful aircraft loved by our customers and our crew. It is a differentiator for Emirates. We have shown how people can truly fly better on the A380.”

Industry experts initially expected A380s to long outlast the Boeing 747, which is celebrating its 50th birthday this year.

But airlines seem to increasingly favour more mid-size planes for regional routes, notably in Asia, instead of the hulking A380s or even 747s, increasingly used as a cargo plane.

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‘We’ve been treated unfairly’: Truck convoy sets off from Alberta to protest Ottawa’s oil and gas policies

'We've been treated unfairly': Truck convoy sets off from Alberta to protest Ottawa's oil and gas policies

After months of pro-pipeline rallies across Alberta, a protest convoy of about 170 trucks, big and small, left Red Deer early Thursday morning for a four-day trek to Ottawa.

Convoy participants and their supporters gathered before dawn, with the temperature sitting at about –25 C. Their vehicles were dressed up in banners denouncing Prime Minister Justin Trudeau and many of his government’s policies.

They want to show their opposition to the federal carbon tax and Bill C-69, federal legislation that would change the way energy projects are reviewed, as well as a host of other policies they believe are adding to the economic pain that first hit Alberta when the price of oil plummeted four years ago.

The United We Roll protest comes as lawyers for the federal government and its supporters make their case today in a Regina court on why they believe Ottawa has the legal power to impose a carbon tax on Saskatchewan.

After months of pro-pipeline rallies across Alberta, a protest convoy with about 160 trucks, big and small, left Red Deer early Thursday morning for a four-day trek to Ottawa. 2:18

Regina is the first stop planned for the convoy. Organizers plan to hold a rally at Parliament Hill when they arrive in Ottawa.

Mike Jepson, one of the lead drivers, said he hopes the convoy will grow to more than 200 trucks. 

“Our point is to get our jobs back. I mean, a lot of us who work in the oil and gas industry and other industries, and Alberta’s hurting. We’re hurting for jobs and it shows,” he said.

“All these trucks out here, they should be working, but they’re not because of what’s happening in our energy sector. So, we need to put this forward.”

The group passed through Medicine Hat around 3:30 p.m. MT, with plans to arrive in Regina on Thursday evening. 

RCMP counted 170 vehicles when the group departed Thursday morning and participants reported that another 20 or so joined the convoy in Medicine Hat.

Many of the trucks have banners denouncing Bill C-69, the new Impact Assessment Act, which the federal Liberals say is meant to revamp and streamline the country’s system for approving industrial projects, including new oil pipelines. Opponents fear the bill will do the opposite.

The new law would lift limits on who can participate in the assessment process and create an early-phase consultation with Indigenous communities and anyone else who could be impacted by a project.

It would also set out new timelines and parameters for reviews of proposed projects and eliminate overlapping assessments that are currently required for some projects, the federal government says.

Convoy driver Mike Jepson says the point of the four-day trek to Ottawa is to raise awareness of the problems facing the oil and gas sector. (Colleen Underwood/CBC)

Protesters in the convoy are also opposed to Bill C-48, which would prohibit tankers carrying crude oil from loading or unloading at ports in northern British Columbia, formalizing a similar, voluntary ban that has been in place in the region for the past 20 years.

Opponents fear it would kill off a potential international shipping route for Canada’s energy products at a time of constrained pipeline capacity for Alberta oil.

Convoy ride-along

CBC News rode along with Ralph Sinclair as he set off in the convoy.

“Away we go. This is fantastic support for the oil industry in Canada,” said Sinclair, who operates a company that supplies automotive parts to many different sectors, including the oil and gas industry.

“Sales have been down considerably this year. No optimism of work coming ahead, so nobody’s fixing vehicles and moving ahead with anything.”

A convoy of trucks left Red Deer on Thursday, bound for Ottawa to demand the federal government do more to help the oil and gas industry in Western Canada. (Tiphanie Roquette/Radio Canada)

It’s not just the oil industry that’s being harmed by the downturn and the failure to build new pipeline capacity to get oilsands crude to market, Sinclair said. 

“It’s every industry. It trickles down.”

On the road, Sinclair pointed to the parking lot of a central Alberta oilfield service’s firm as an example of the hard times facing the industry.

“We’re going past one of Calfrac’s yards. It’s right full of trucks. Normally at this time of year there’s maybe a third of those trucks sitting there. Most of them are sitting there parked because they’ve got no work.”

Convoy participant Ralph Sinclair talks to CBC News as he sets off from Red Deer for the long drive to Ottawa. (CBC)

Many of the convoy participants are sporting yellow vests, which became the symbol of a protest movement that began in France last year and was initially focused on economic injustice. Convoy organizer Glen Carritt told the Calgary Eyeopener that his movement does not share any of the racist or radical views espoused by some people who refer to themselves as yellow vesters.

“Every respectful, peaceful, non-radical Canadian is welcome to join in this rally. We have no tolerance for racism, hate or any people of that nature. That’s not what this is about,” he said.

“Everybody’s welcome that has had any concern with the current government.”

One of those sporting a yellow vest was Kevin Peters. He said came down from Fort McMurray, Alta., to join the convoy, because he wants the country to realize how much his hometown is suffering.

Kevin Peters of Fort McMurray, Alta., says the federal government is treating Western Canada disrespectfully. (CBC)

“People are losing their jobs daily,” he said. “People are losing their homes, losing their businesses. Fort McMurray is almost the heart of this country when it comes to the money going to the government, and they think it’s acceptable to disrespect us?

“We’re worried about what our government’s doing. Everyone’s feeling like we’ve been treated unfairly. So we’re convoying to Ottawa to let them know exactly how we feel.”

Another convoy participant, Patrick King, said putting a tax on carbon puts Canadians at a disadvantage.

“We have the opportunities to be one of the richest countries in the world with our resources, but yet we reduce our production in oil and gas, while Saudi Arabia goes and ups their production to meet what we’ve reduced,” he said.

“They don’t have to pay carbon tax on their foreign oil coming into our country, but yet we have to pay carbon tax on our bread, on our gas, on our heat, on our bills. It’s bull.”

Watch the convoy roll out in the tweeted video below:

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Rolling Stones fan calls out Ticketmaster for ‘bait and switch’ after mid-sale price jump

Rolling Stones fan calls out Ticketmaster for 'bait and switch' after mid-sale price jump

A fan of the Rolling Stones is accusing Ticketmaster of pulling a “bait and switch” while he was buying tickets for the band’s Canada Day weekend concert north of Toronto.

Edward Mair went online shortly after 10 a.m. Wednesday hoping to land four tickets during the show’s presale period for members of the Rolling Stones mailing list.

But after adding the tickets to his cart, he noticed the price jumped from $119.50 to $179.50 per ticket, without any warning during the checkout process.

Mair then tried to buy the tickets again while filming the screen.

“They said, ‘Congratulations, you got the seats.’ [They] just didn’t make any mention that the price had changed,” Mair told CBC Toronto.

The Toronto man, who buys tickets for more than 50 events every year, said he’d never seen ticket prices change so surreptitiously.

“When that happens, they notify you that they’ve put you to different tickets and the price has changed,” he said. “That’s not what happened here. They just changed the price in the lower corner.”

Mair bought the tickets, which totaled $801.50, but later contacted Ticketmaster for an explanation about why the price appeared to jump during the transaction.

After contacting Ticketmaster and sending video of the transaction, he says the company has agreed to honour the $119.50 tickets he originally tried to buy.

The offer came after more than a day of back-and-forth communications, in which he said the company initially balked at the request and suggested that he incorrectly added the tickets to the cart.

Customers ‘automatically redirected’

In a statement, a spokesperson for live-concert company Republic Live said presale tickets were limited and divided into different price tiers. The spokesperson said customers were being “automatically redirected” to the next price tier when cheaper tickets sold out.

However, the company did not explain why Mair was able to add the $119.50 tickets to his shopping cart if they were no longer available.

“We are aware of the issue and are encouraging purchasers to contact directly to discuss any inquiries related to their purchase,” the statement continued.

Ticketmaster has not responded to multiple inquiries from CBC Toronto. 

‘Drip pricing’ a problem

“This isn’t going to help,” said Alan Cross, a Toronto music journalist who has covered ticketing issues. “What this does is it adds to the confusion of buying tickets online.”

After watching Mair’s video, Cross wondered if the price jump was a case of “drip pricing,” in which an advertised price increases after a slew of added fees are added to the bill.

He said Ticketmaster has done a poor job of making it clear to customers why extra fees are added and what they cover.

“Things aren’t itemized as clearly as they could be in the ticketing process,” Cross said.

“This will not endear people to Ticketmaster any further.”

The Rolling Stones, left to right Ronnie Wood, Mick Jagger, Keith Richards and Charlie Watts, will play an outdoor concert in Oro-Medonte, Ont., over the Canada Day long weekend. (Michel Euler/Associated Press)

As general sale tickets for the concert go on sale Friday, he’s advising customers to monitor their screen “very carefully” during the checkout process.

The Stones are scheduled to play June 29 at the outdoor Burl’s Creek Event Grounds in Oro-Medonte, Ont., a sprawling space about 130 kilometres northeast of Toronto.

It is the final date and only Canadian stop on the band’s North American tour.

‘Fighting bots’ adds stress

While Mair spotted the price jump, he said the stress of buying tickets online makes it likely that other customers will go through the process without noticing the change.

During the rush to buy presale tickets in the moments after they go on sale, Mair said the goal of simply obtaining the tickets can make it hard to pay attention to details.

“As everybody knows, you’re fighting bots, you’re trying to get through these tickets as fast as you can, competing with everybody,” he said. “It’s a nightmare to try to get tickets as a regular person.”

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Iceberg Vodka CEO baffled by bizarre heist of ancient water

Iceberg Vodka CEO baffled by bizarre heist of ancient water

In a theft fitting of the Oceans franchise, somebody has stolen 30,000 litres of iceberg water from a Canadian vodka company.

Iceberg Vodka is now saying it was the rightful owner of the glacial goodness, which was allegedly stolen from a tank inside a warehouse in Port Union, a tiny town on the east coast of Newfoundland.

“We were shocked that we would be missing 30,000 litres of our precious water,” said Iceberg CEO David Meyers. “We store it in secure tanks and we never, ever would have expected anyone to take such a quantity of water.”

‘Whoever did it, they knew what they were doing’

While some questioned if the water was the target of nothing more than a simple leak and evaporation, Meyers said it wasn’t possible.

There’s a high level of quality control, he said, and it is monitored by employees every week from Monday to Friday.

“It’s under very, very good care, so it’s not a matter of just leaving a tap running.”

Iceberg Vodka CEO David Meyers says he was stunned by the apparent theft of 30,000 litres of iceberg water from their Port Union plant. (CBC)

Meyers said the tank was found empty on Monday morning, with no traces of water inside the building.

“Whoever did it, they knew what they were doing.”

Meyers said the building is padlocked, and so is the gate outside. Someone would have needed to load up a tanker truck to get away without a trace.

The first step after discovering the heist was calling the Royal Canadian Mounted Police. Each employee at the plant has been interviewed, and the scene has been dusted for fingerprints.

Who knows what people are thinking when they come in and take something like that?– David Meyers, Iceberg Vodka CEO

At this point, Meyers said there are no suspects and no idea of what the motive was for stealing a tanker truckload of water.

But what if the thief (or thieves) mistook the crystal clear liquid for enough premium vodka to last a lifetime?

“If they did [think it was vokda], they’re going to be thinking that vodka is pretty weak,” Meyers laughed. “I’d be surprised, but who knows what people are thinking when they come in and take something like that?”

Yes, they had water insurance

The missing water was enough to make 150,000 bottles of vodka.

Meyers said his employees are taking close stock of what water they have left, to make sure they can get through to May or June when they can harvest again. He doesn’t expect business to take a hit from the heist.

As for replacing the water in the meantime, it’s an impossible task.

Iceberg water can only be harvested once a year, when the iconic icy chunks drift close to the rocky shores of Newfoundland and Labrador.

Iceberg Vodka harvests its water once a year, as bergs drift off the coast of Newfoundland and Labrador. (Submitted by Michael Winsor Photography)

While no amount of money can purchase a 15,000-year-old chunk of ice, Meyers said they likely have a financial reprieve. The stolen water was insured.

“We are looking at what’s involved in a claim right now and it sort of hinges on what happens with the investigation as well,” he said.

The RCMP is urging anyone with information to come forward and call the local detachment in Bonavista. Meyers said he’ll even throw in a case of Iceberg Vodka if anyone can help solve the mystery.

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Warren Buffet’s company takes new stake in Canada’s Suncor

Warren Buffet's company takes new stake in Canada's Suncor

Billionaire Warren Buffett’s company has taken a new stake in Canadian firm Suncor Energy and trimmed its huge Apple stake.

Berkshire Hathaway Inc. filed a quarterly update on holdings with the Securities and Exchange Commission on Thursday.

The Omaha, Nebraska-based company said it owned 10.76 million Suncor shares at the end of last year. But these quarterly filings don’t make clear who made all the investments.

Berkshire said it sold nearly 3 million Apple shares but it still held 249.6 million shares of the iPhone maker.

Investors follow what Berkshire buys and sells closely because of Buffett’s successful track record. Berkshire officials don’t generally comment on these quarterly filings.

Berkshire also sold the 41.4 million Oracle shares it disclosed last quarter and revealed owning 4.2 million shares of Red Hat.

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Possible ban on Huawei over national security could delay 5G rollout, Telus says

Possible ban on Huawei over national security could delay 5G rollout, Telus says

Telus Corp. acknowledged Thursday that the deployment of its fifth-generation wireless network could be delayed and be more expensive than anticipated if Ottawa chooses to ban equipment from Huawei Technologies Inc.

The Vancouver-based company — which has used Huawei radio equipment in non-core portions of its 3G and 4G wireless networks — said it continues to believe the China-based company doesn’t pose a big risk to national security.

However, Telus said in its discussion of fourth-quarter and year-end financial results, that it can’t predict the outcome of a review of 5G cybersecurity being conducted by the federal government.

A ban on Huawei equipment “could have a material, non-recurring, incremental increase in the cost of Telus’ 5G network deployment and, potentially, the timing of such deployment,” the company said.

Telus said it seeks to reduce the potential risk of a Huawei ban, through its dealings with the government and federal telecom regulator, but has yet to select its suppliers for 5G equipment.

Last week, George Cope, chief executive of BCE Inc., told analysts that a government ban on Huawei equipment wouldn’t delay plans for rolling out fifth-generation wireless services but provided few details.

Cope, who is CEO of both BCE and Bell Canada, told financial analysts that the company is “quite comfortable” that it can manage all the potential developments.

Although Bell and Telus have a network sharing agreement in terms of cellular towers used by their wireless networks, they each independently select equipment installed at the towers.

Despite the uncertainty over Huawei, which Canada already bars from supplying core network equipment like switches and servers, Telus said its outlook for 2019 assumes “no material adverse regulatory rulings or government actions.”

Telus issued guidance Thursday that estimates 2019 revenue will grow by up to five per cent and earnings before taxes and other expenses will rise by up to six per cent over last year’s level.

Quarterly earnings

For 2018, Telus reported overall revenue of $14.37 billion — up 7.2 per cent from 2017 — and $5.1 billion of EBITDA, up 3.9 per cent from 2017.

For the fourth quarter of 2018 ended Dec. 31, Telus said its net profit edged higher and operating revenue grew by 6.3 per cent over the comparable period in 2017, slightly above analyst estimates.

Profit attributable to shareholders amounted to $357 million or 60 cents per share for the quarter ended Dec. 31. That was up from $353 million or 59 cents per share in the fourth quarter of 2017.

Adjusted net income was $409 million or 69 cents per share, up from $396 million or 66 cents per share a year earlier.

Telus says its revenue was $3.76 billion, up from $3.54 billion in the fourth quarter of 2017.

Analysts on average had expected 69 cents per share of adjusted earnings and $3.69 billion in revenue, according to Thomson Reuters Eikon.

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Amazon cancels plans to build second headquarters in New York City

Amazon cancels plans to build second headquarters in New York City

Citing opposition from local politicians and community activists, Amazon abruptly announced Thursday that it has cancelled its plans to build its second headquarters in New York City.

“After much thought and deliberation, we’ve decided not to move forward with our plans to build a headquarters for Amazon in Long Island City, Queens,” spokesperson Jodi Seth said. “For Amazon, the commitment to build a new headquarters requires positive, collaborative relationships with state and local elected officials who will be supportive over the long-term.”

In November, Amazon announced it would build a huge complex in the borough of Queens to employ more than 25,000 people. It made that choice after a year-long process that saw hundreds of cities pitch the company on becoming the site of so-called HQ2. One Canadian city, Toronto, made the short list of 20 potential destinations, but ultimately wasn’t selected.

While Amazon trumpeted opinion polls that suggest 70 per cent of New Yorkers support the project, the company’s statement says a number of state and local politicians have made it clear they oppose Amazon’s presence and will not work with the company to “build the type of relationships that are required to go forward with the project.”

Opposition has keyed in on the $2.8-billion US worth of tax incentives the company was granted to set up in the city, at a time when other city services are starved for cash.

“This announcement … shows the power of the people, even when taking on the world’s richest man,” said Deborah Axt, the co-executive director of anti-poverty group Make the Road New York. “Our members and allies stood firm against Governor Cuomo’s plan to give away … $3 billion in taxpayer giveaways so that Amazon could force its empire-building on our neighbourhoods.”

Retail workers union RWDSU wasn’t impressed with Amazon’s reaction to the local concerns about the project, saying in a statement: 

“Rather than addressing the legitimate concerns that have been raised by many New Yorkers, Amazon says you do it our way or not at all, we will not even consider the concerns of New Yorkers — that’s not what a responsible business would do.”

Among the leading opponents of the plan on the political side was the newly minted congresswoman Alexandria Ocasio-Cortez, who represents New York’s 14th District, right next to the bohemian but gentrifying 12th District in Queens where the sprawling complex was set to be built.

“Today was the day a group of dedicated, everyday New Yorkers & their neighbors defeated Amazon’s corporate greed, its worker exploitation, and the power of the richest man in the world,” she said on Twitter.

Seth said there are no plans to have another search for a second headquarters. The company’s existing New York-based operations in Brooklyn, Manhattan and Staten Island — which collectively employ 5,000 people — will not be impacted, or could even expand a little over time, Seth said.

“We will continue to hire and grow across our 17 corporate offices and tech hubs in the U.S. and Canada.”

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‘Mind-blowing’ gaffes at QuadrigaCX leave cryptocurrency watchers ‘gobsmacked’

QuadrigaCX granted creditor protection while it searches for $250M in cryptocurrency

Industry observers are in disbelief over the revelation the embattled QuadrigaCX cryptocurrency exchange recently lost track of more than $460,000 in crypto coins.

“I’m totally gobsmacked … that such a thing could happen,” says Manie Eagar, CEO of Vancouver-based DigitalFutures, a business development consultancy that focuses on digital currency and blockchain technologies.

“Whoever took over the reins and is acting as the custodian of these funds should have at least done due diligence to avoid whatever happened.”

The court-appointed monitor overseeing the search for $260 million in cash and cryptocurrency owed to QuadrigaCX users revealed on Tuesday that the exchange had access to $902,743 in online digital assets, stored in so-called hot wallets as of Feb. 5.

Basically, hot wallets are storage accounts that are easy to get in and out of because they are on the internet.

However, Ernst and Young said that on Feb. 6, someone working for QuadrigaCX “inadvertently” transferred 103 Bitcoins valued at $468,675 into a so-called cold wallet that remains beyond the reach of the company. Cold wallets are not fully connected to the internet, which makes them more secure but also next to impossible to access using failsafe plans.

Meanwhile, lawyers were expected to gather Thursday in a Halifax courtroom, where a judge will decide who will represent QuadrigaCX’s creditors.

Insolvency expert Tim Hill said the case is highly unusual, given QuadrigaCX has no offices, employees or bank accounts.

“We certainly haven’t seen anything like this in Nova Scotia — and nothing in Canada that I’m aware of,” he said in an interview.

The Vancouver-based exchange was shut down Jan 28 amid a flurry of speculation about the sudden death of its CEO and lone director, 30-year-old Gerald Cotten, who led his five-year-old virtual business from a home north of Halifax.

Court records say Cotten, who died suddenly on Dec. 9 while travelling in India, was the only person with access to the digital keys needed to access $190 million worth of Bitcoin and other cryptocurrencies.

As well, the insolvent company owes about 115,000 affected users another $70 million in cash.

“Transferring funds to wallets they can’t retrieve money from is really mind-blowing,” said Samir Saadi, professor of finance at the University of Ottawa’s Telfer School of Management.

“They know they don’t have access to those cold wallets and they still managed to make that terrible mistake … It tells us a lot about the company’s practices. There’s no backup plans — nothing.”

The selection Thursday of representative counsel, which will be overseen by Nova Scotia Supreme Court Justice Michael Wood, is part of a court-ordered insolvency process that was set in motion when the virtual company was granted protection from its creditors on Feb. 5.

The purpose of the federal law is to allow insolvent companies owing more than $5 million to continue to operate while drafting a plan to pay off creditors, thereby avoiding bankruptcy.

The court order includes a standard 30-day stay of proceedings, which means creditors are prohibited from filing lawsuits against QuadrigaCX until the order expires. An extension is widely expected to be granted by the court on March 5.

As the Quadriga mystery deepens with little evidence that nearly $250M in assets is locked away where the founder’s will claims they are, here’s a breakdown of some key terms that may help you understand cryptocurrency and how it works. 0:41

Hill, a Halifax lawyer who specializes in insolvency and debt restructuring, said the law firms that will be selected as representative counsel will be paid by QuadrigaCX’s parent company, Quadriga Fintech Solutions.

“There’s a real danger here that there’s going to be no money to pay these guys,” said Hill, a member of BoyneClarke’s business litigation team and a former registrar in bankruptcy.

“Unless they can move quickly to identify some assets, some money, this may not go on too long. People need to be paid.”

The representative counsel will speak for the creditors in court, but there’s nothing stopping creditors from hiring their own lawyers.

Lawyers from across the country have expressed an interest in the case. A courtroom at the Nova Scotia Supreme Court will be back in session on Thursday, trying to decide which law firms should represent the more than 115,000 victims.

Much of the actual money that is owed to creditors is in the form of bank drafts, which the company has failed to deposit in a financial institution because regular banks remain leery of dealing with cryptocurrency businesses.

QuadrigaCX founder Gerald Cotten, who died in December, seems to have run the company from a single laptop with minimal backup plans. (Facebook/QuadrigaCX)

“That’s obviously going to be a challenge, but at some point the court will be asked to assist with that,” Hill said. “The court has very broad authority in these matters.”

One user of the platform, Tong Zou of Orillia, Ont., submitted an affidavit to the court, saying he is owed $560,000.

The professional software engineer said he had been using QuadrigaCX since 2017.

His statement was part of an application to the court to have two law firms — Toronto-based Bennett Jones and Halifax-based McInnes Cooper — appointed a representative counsel.

“After speaking with various affected users, I know that the affected users are very worried, confused and in need of assistance,” Zou said in the affidavit.

He said he was aware of several other users who are owed more than $100,000 — but he said they have chosen to remain anonymous

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