Manitoba History: The Great Winnipeg Boom

by Charles N. Bell

Number 53, October 2006

This article was published originally in Manitoba History by the Manitoba Historical Society on the above date. We make this online version available as a free, public service. As an historical document, the article may contain language and views that are no longer in common use and may be culturally sensitive in nature.

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Charles Napier Bell (1854-1936) had a taste for adventure. At the age of sixteen, he signed on as a bugler with the Wolseley Expedition to the Red River Settlement. After a brief time hunting and trading along the Saskatchewan River, he began work in Winnipeg as a customs officer, being well placed to observe the Great Boom of Winnipeg in 1881-1882, which he described in a series of letters published in March and April 1887 in the Winnipeg Daily Sun—excerpts of which are presented here.

Charles N. Bell
Source: Archives of Manitoba, Personalities - Bell, C. N. 4, c1887.

The spring of 1881 was remarkable for the crowds of men arriving to work on the Canadian Pacific Railway. The syndicate proceeded to push construction, and immense quantities of railroad material and supplies were poured into the city. An army of men were sent out west along the main line, and soon the track was laid towards Brandon. Great excitement ensued regarding the prospects of certain proposed town sites, near which it was supposed the CPR would be located.

The operations of the CPR in constructing so rapidly the main line west of Winnipeg, necessitated the placing of orders in the markets of Ontario and Quebec, as elsewhere, for an immense amount of material and general railroad supplies, a fact that was advertised to an absurd extent by the Canadian papers. The attention of the whole public of the Dominion was drawn to Winnipeg, as the headquarters of the railway in the Northwest, and the knowledge that the population and commerce of the city was extending rapidly caused thousands of people to seek investments in Winnipeg properties. At once, almost every city, town, village, and corner in the east, and especially in Ontario, supplied a company, of greater or less size and importance, the members thereof contributing each a few hundreds of dollars towards forming a lump sum of cash, which was placed in the hands of a representative who immediately left for Winnipeg with a letter of credit covering the capital sum, with the intention of buying lots at low figures and of selling them at an advance. No wonder we had a floating population of 5,000 when they came from all parts of the Dominion. It is truly amusing now to remember the character and appearance of some of the “managing directors” who arrived here during the boom, became excited and dropped their money in a syndicate composed entirely of eastern men of their own kidney, that had purchased a farm from some honest granger, situated five or six miles from the city, with the avowed intention of subdividing the land into fifty-foot lots, which were to be sold to their fellow-countrymen rushing in from their own provinces. Many of these representatives of petty village syndicates in the east had instructions not to place more than a couple of hundred dollars in any one deal, and were forced, in consequence, to invest in lots far away from the business centre of the city, in positions where lots were cheap. It then became their interest to boom, to the greatest extent possible, suburban properties, and if blowing, misrepresentation and trickery is worth anything during a period of great excitement, these men took full advantage of it. “Outside property” was the mild term used by the auctioneers and real estate men to describe a sub-divided farm some miles from Main Street.

The general plan on which these syndicates worked was perfectly simple. Several men with capital would combine and purchase a lot running back perhaps two miles from the Assiniboine or Red River, with a width of fortyfour, or six chains frontage on the stream. A plan was at once made, which showed an odd park or two, with beautifully laid out streets bearing, as a rule, every name given to the fair sex within modern times. This plan was lithographed, if there was sufficient time, and at once the “syndicate” was ready for business. Each member made it his object to frequent, for a day or two, the habitual haunts of the speculative crowd, extolling the advantages to be gained by the first purchasers of the lots in question, and soon all eyes were turned to No. — St. James, No. — St. Johns, or No. — Kildonan, as the case might be. After a vast expenditure of printers’ ink, the syndicate placed the plans in an auctioneer’s hands for the sale, usually taking care to mark off a few lots, “which by particular request had been sold at private sale.” People rushed to buy the lots, and after one or two nights’ auctions the owners of the main property sold out their interest in the remainder for a lump sum.

Construction was almost constant, as shown in this early view of Main Street.
Source: Archives of Manitoba, Elswood Bole Collection 4, c1880, N13801.

How Lots Changed Hands

The system of buying on margin allowed individuals with but a limited amount of ready cash to obtain possession of large blocks of land. The Hudson’s Bay Company required but one-fifth of the purchase amount, to be paid down at the time of issuing the agreement of sale. But as time went on, and the lots changed hands several times, of course with an advance in each case, the amount to be paid in cash for possession of a lot increased and the men of limited means had to turn to less valuable properties, which state of affairs continuing for some time, forced on the market the suburban estates.

An instance of how quickly lots changed hands, and which came directly under the notice of the writer, may be given in illustration. “A” went into the Hudson’s Bay Company’s land office one morning in 1881 and purchased two lots for $700 each, making the required payment of one-fifth at the time. On passing through the corridor he met a gentleman going in, and had scarcely cleared the steps before he heard him calling to him to wait for a moment. He said, as they walked on down street, “You were just a moment before me in securing those two lots; I wanted them very much. What will you take for your bargain?” A said, “$200 each lot.” His reply was, “Come back to the office and ask them to make out the papers in my name and I will write out a cheque for $400.” In five minutes A had cleared $400 and his cheque was replaced by one from the purchaser, so that as a matter of fact he had not invested a cent.

Another case to the point. Dropping into Wolf’s auction rooms at the Queen’s hotel one evening, A found a great crowd anxious to get an opportunity of bidding for some city lots that Joseph was knocking down in great style. Though entering simply from motives of curiosity he saw a good opportunity to purchase four lots, and within half an hour had Wolf put them up again, when they were knocked down at an advance of $600, a cheque for which A received though he never saw any papers in connection with the land, the last purchaser dealing direct with the individual who had placed them for sale when A bid them.

I remember a case where a property had passed through the hands of seven individuals without regular deeding, the deals following each other with such celerity that there was no time to get regular papers drawn out, and the seventh on the list received only slips of paper representing deposits, before at last having a proper deed from the seventh purchaser before him.

The Excitement

It was wonderful how excited newcomers became within a week after their arrival. The first day was spent by a speculator in walking about the streets and gazing in astonishment on the hurly burly of the real estate auction rooms, and he came to the conclusion that the people were completely insane. The next day he saw men reselling, at an advance of 10 per cent, the lots purchased by them the evening before, and he began to think that unless he took some of the cash floating about some one else would. On the third day, with considerable trepidation, he invested perhaps in one small low-priced lot, situated in a town out west, which, according to the advertised plan, was expected to be a second Chicago within three years. On the fourth day he invested a larger sum, and was thunderstruck when he found he could sell his first purchase immediately at an advance. He had now gone the rounds of the land offices and heard the most marvellous stories of fortunes made in a week. On the fifth day he was buying and pushing his way up to the front rank at larger sales, and knew for a certainty that he would soon be a millionaire, the while lamenting that he had, during the past week, allowed several splendid opportunities to slip past unheeded. As soon as he regretted the neglecting of past opportunities it was all up with him, for within twenty-four hours he might be seen rushing about, his pockets overflowing with plans of town sites and sub-divisions of river lots, while his bank account rose and fell with alarming regularity and, in fact, he had caught the contagion, and was one of the worst cases of insanity the city could produce.

Before the boom. A view of Winnipeg in 1875, taken from the roof of the courthouse, looking toward the East Ward.
Source: City of Winnipeg Archives.

Blocks

In August, numerous blocks were advertised for sale, the attraction being that they could be cut up into 25-foot lots and sold to mechanics to hold until they had made enough to build their own houses. And so it went on, day after day, until the autumn of 1881. The Hudson’s Bay Company sold their lots along Assiniboine Avenue in July, at prices varying from $1,400 to $5,000, according to location and the value of the buildings on them. A month later they sold the lots between Ellice and Notre Dame Streets. A large loan company advertised 100,000 acres of wild lands, and Wolf rattled off 15,000 acres at about the same date. Wild lands began to attract more attention, and those persons who had located large tracts of good land by the use of half breed scrip, which had been purchased, in cases, at from ten to twenty cents on the dollar, began to reap a harvest in return from their investments. A large immigration had flowed steadily into the province during the summer, and everything at the close of 1881 appeared bight and prosperous.

During the winter of 1881-1882 Winnipeg was filled to overflowing with a floating population. The hotels were crowded to such an extent that cots were placed at night in the corridors and offices, and many a sleepy individual sat in a billiard room awaiting the closing of “a last game,” to claim, with another, the privilege of reposing on the hard slate bed of the billiard table. New hotels were opened almost daily and, to meet the demand for accommodation, many of the proprietors rented hastily constructed buildings, to be used entirely for lodging purposes, while the guests stood in lines at the dining-room doors during meal hours, awaiting their turn for entrance. The dining room doorkeeper, in those days, equalled even the gentleman who, hid behind a solid cluster of diamonds, graciously and loftily allowed a guest to record his name in the hotel register. The doorman was freely ‘tipped’ by the knowing ones, “time being money.” Syndicate men had no time to waste in hanging about waiting for their meals. In the spring of 1882 it was estimated that fully four thousand persons, of both sexes, were living in tents, being unable to obtain dwelling-houses, though the sound of the hammer resounded throughout the city, and whole streets were lined with frame houses in a single week. The district west of Main Street, and north of Notre Dame Street West, was the scene of activity, visited daily by the new arrivals, for here houses went up by the hundred. People began to realize that it would be well to put money into buildings on lots, for there was such a demand for residences that a good profit was secured on both lot and house, in selling to newcomers who intended to reside permanently.

The Matrimony Market

One of the greatest troubles incident to housekeeping during the boom was the difficulty of keeping domestics engaged. The proportion of females to males was small and the most humble laborer was amassing wealth at a wonderful rate, and in consequence the demand for marriageable females was perfectly wild. The domestics handed over their funds to their employers for investment, and in many cases reaped large returns so that, with the additional advantage of being able to pick and choose from amongst a host of admirers, the best of them obtained good husbands and well-furnished homes of their own.

eastern papers were filled with extracts from private letters written by speculators here to their friends, telling of marvelous fortunes lost by a five minutes’ delay of a telegram giving a bank credit. It was reported of one young and promising youth who had been started out of Toronto by a considerate father with $400 to make his fortune in Winnipeg, that on arriving in the city with $300 he went on a long spree and one evening brought up at a prominent real estate office. The excitement was at its height, and when he found the people about him shouting out bids for properties put up for sale, he took a turn at it himself and purchased a lot on which he had to make a deposit of $200. On awakening next morning he was sober enough to examine into the state of his finances, and to his dismay found that a single ten dollar bill was all that remained of his cash. A fit of repentance came upon him and he “swore off.” With considerable inward trepidation, though with an outward appearance of unconcern, he visited the hotel office to find out the amount of his bill, and was overjoyed when he learned that he had settled up the day before and paid a week’s board in advance. He wandered about for a week in great despondency, and at last made up his mind to go to the telegraph office to wire his father asking for money to pay for his passage back home. As the resources of the telegraph line were taxed to their utmost, it was no small undertaking to get off a message, and on entering the office he stood in the line awaiting his turn, revolving in his mind just what he would embody in his message. A wild-eyed, haggard-looking individual entered the office and rushed up to him, exclaiming, “You own lot so-and-so!” It suddenly flashed across the memory of the young fellow that he had in his pocket-book a slip of paper covered with a few hieroglyphics, amongst which lot — were discernable. This he produced and handed to the wild-eyed man, who glanced over it and said. “That’s all right; what will you take for it?” The young man asked what he would give, and to his astonishment was told $10,000 for his claim on the property. Hastily abandoning the idea of telegraphing his father he dickered with several men and finally secured $28,000 for the privilege of withdrawing his original deposit of $300 and surrender of the deposit receipt. Being a wise young man, and concluding that one experience was enough for him, he left for Toronto with a bank certificate in his pocket, and was received into the open arms of his delighted parent.

Deals, deals, deals. A poster advertised the auction of lots on the former estate of James Ross.
Source: Archives of Manitoba, Advertising 70, N11762, Ross Papers 539.

The Post Office

To give an idea of the volume of correspondence out of the country, it is only necessary to state that in the month of December 1881, postage stamps to the value of $30,000 were sold at the Winnipeg post-office. The post office building was utterly inadequate to contain the crowd which each evening awaited the distribution of the day’s mail. It was found necessary to lock the doors, and I have seen a crowd of not less than six hundred or seven hundred persons standing about the entrance and out into the middle of Main Street, completely blocking the sidewalk to passengers. All manner of skylarking was indulged in by the crowd to pass away the time before the doors opened, and policemen were detailed to keep order as far as was possible under the circumstances. When the doors opened the scene baffles description, the mass surging forward, carrying the policemen with it, the foremost individuals frequently receiving injuries by being dashed or pressed against the woodwork of the building. Once in, it was even more difficult to get out, and the windows on occasions were thrown open and served as exits. Those who were lucky enough to own locked boxes (and they were in a great minority), hurriedly secured their mail matter and disappeared through the windows, while the majority had to fall in line and patiently await their turn. Even in the day time an individual receiving his letters from the general delivery would have to take his place at the tail end of a procession reaching out of the building to the sidewalk.

The most absurd and crazy act committed by any single person during the whole period of the boom was the taking of a bath in champagne, by a lunatic who had realized a hundred thousand dollars by selling his farm, which adjoined a town site placed on the market by the CPR.

In February and March 1882, there was a steady sale of real estate in the city. As an example of the prices realized, it may be mentioned that twenty lots in Fort Rouge, situated opposite to Armstrong’s Point, sold for $1,000 each. Wolf sold in two days 669 lots in Brandon, for $65,279, the prices varying from $50 to $150 per lot. A syndicate composed of men from Perth, Ontario, purchased 1500 lots in the village of Selkirk for $50,000. In one week the north four chains of lot 9 St. Boniface West changed hands three times and the seller in each case cleared $6,000. A real estate firm sold in one day property to the amount of $60,000 and followed it on the next day by sales aggregating $200,000 in value. A lot on the north side of the CP track, which in the early part of the boom had been purchased for $500, was now sold for $13,000 and afterwards mortgaged to the city sinking fund for $11,000. It was estimated that at one time the deposits in the city banks reached to the enormous sum of $6,000,000.

In the early spring of 1882 there were sales of Main Street property at high figures, both sellers and buyers being business men. The purchases were principally of good business sites and substantial buildings were at once erected. The Board of Works of the city had expended $49,202 on street improvements and sewers, so that it is seen the civic authorities were keeping pace with the times, but it was simply impossible to lay down sidewalks as quickly as new streets were built up, for what was bare prairie would in a fortnight be covered by a row of dwellings, and that likely at some distance from the nearest point reached by the sidewalk system.

In April 1882, came a rush of emigration to Manitoba. Large parties arrived of three hundred to five hundred persons, completely supplied with the necessary stock and equipment to begin farming operations on their arrival at the lands which representatives had secured for them during the previous summer. The spring was an unusually wet one, a great deal of snow having fallen in March, and a thaw setting in rapidly covered the prairies with water, which, in the then undrained state of the country in many districts, could not escape to the rivers as it formed. This caused great discomfort to the settlers, and to a greater extent to the new arrivals, who viewed with dismay the prospect of a wet and muddy trip to their chosen locations from the points on the CPR where they took to their wagons. The reports from these people had the effect of rather depressing the values of real estate in Winnipeg, as well as in the town sites scattered throughout the province. Then ensued what was virtually a panic in the real estate market, and one cause after another helped to increase the trouble.

Flood & Fires

One of these causes was the overflowing of the waters of the Red River over its banks, and the interruption to passenger and freight traffic from the south. While the Pembina branch of the CPR was in the main all right and passable, the St. Paul, Minneapolis & Manitoba track for some distance south of Emerson was completely under water and both freight and passengers were for some time transferred between the railroads by steamers that sailed up from the Red River at St. Vincent and across the prairie to the St. P., M. & M. track, where the loaded cars were run into the water alongside the light draught steamers and unloaded directly on to their decks. Hundreds of emigrants en route to Manitoba were delayed at St. Paul, and were there exposed to the full force of the wiles of the American emigration agents and to the tricks and games of a horde of sharpers and confidence men, who gathered there like vultures, scenting their prey. This state of affairs, it may easily be imagined, was duly reported in eastern Canada, and that with many additions to the truth. Then came a strong demand from eastern investors in Manitoba real estate to their agents to sell immediately and the panic was increased. The Red River ice poured down the swollen stream, damaging the bridge at Emerson and making a wreck of the handsome bridge which spanned the river at Winnipeg, from the foot of Broadway to St. Boniface.

In addition to all this, the water from the prairie northwest of the city was kept back by the railway embankments until it accumulated in such masses that in places it was two and three feet deeper on one side than the other, which soon resulted in numerous extensive washouts, and the liberated waters rushed down the drains through the city, completely submerging the “villa lots” and suburban properties that had been boomed during the previous year as high dry building sites. Though this only continued for a day or two, the effect on the real estate market was sudden and far reaching. Everybody now wished to sell, especially their outside properties, but purchasers could not be found.

Soon followed this a succession of disastrous fires in the city, several of the finest buildings being entirely or partially destroyed. The circumstances surrounding the apparent cause of these fires suggested incendiarism, and when it was discovered that several attempts had been made simultaneously in different parts of the city to burn down buildings, the public mind was considerably excited. One fire bug was arrested as he came from a building, which shortly after his departure was discovered to be on fire, and steps were immediately taken to guard, as far as was possible, against further attempts of like nature. A meeting of the citizens was held, and thirty-eight special constables sworn in to patrol the streets at night; but, the excitement increasing, this force was increased the next night to 150 men, a reward of $2,000 being offered for the apprehension of anybody found attempting to set fire to property.

About this time also some real estate agents travelling in Ontario selling lots in the boom towns of Manitoba were arrested for misrepresenting the position and character of the lots, but they were discharged from custody after trial, and immediately entered suits for damages against the persons who had caused them to be arrested.

The Collapse of the Boom

Altogether, with the reaction ensuing after the Edmonton sales, the floods, fires, arrests in Ontario, and eagerness of eastern people to throw blocks of property on the market, real estate matters were in a very shaky condition within a fortnight after the Edmonton sale, and from this date forward to the close of the year. While good properties were still held at stationary figures, few important transactions took place. Little or no suburban real estate changed hands, buyers being entirely lacking, while the sellers were offering at greatly reduced prices. Second and third payments of the original purchase money fell due, and while fairly well met, it was recognized that unless confidence was soon restored, many large operators must go to the wall, as only too many held extensively on margins. The next year following saw the market more depressed, and many persons unable to make further payments. The end had come, the boom had burst. Real estate advertisements quietly disappeared and the host of boomers struck their tents and silently flitted away to more congenial climes.

Though the real estate boom collapsed in the early summer of 1882, there was a wonderful amount of building done by the actual residents of Winnipeg. The total value of the buildings erected, as ascertained by a direct canvas of the city, amounted to $1,710,850. When it is borne in mind that Toronto, the same year, showed but $500,000 invested in new buildings, an idea may be had of the commercial activity that prevailed. There were but 28 failures in the province in 1882, the liability being $290,900 and the estimated assets $222,800.

The population of the city was fully 25,000. The Dominion Government showed a disposal of wild lands, homesteads, preemptions and by sales of 2,699,145 acres. The Hudson’s Bay Company sold 272,219 acres at a value of $2,059,506; the CPR sold in Manitoba 729,400 acres and in the Northwest Territories 5,538,880 acres, which included the sale to the Canadian Northwest Land Company of 5,000,000 acres. To these extensive sales by the Government, and large corporations, must be added the large amount of wild lands sold by private individuals who held them prior to 1882.

The boom had burst and Winnipeg people settled down to business, while the floating population slowly disappeared. There is no doubt that the boom did a great deal of injury to Manitoba; but every effort has since been made to repair it, and everything now points to a period of prosperity for the future. With additional railroad facilities to the south, connecting us with the American system, business will be stimulated, and this year’s immigration is already growing to large proportions.

Page revised: 27 June 2012