Southern Vancouver Island was favored by indigenous peoples, such as the Coast Salish, for its plentiful food supply and protected living sites. For the Hudson's Bay Company, which established the trading post of Fort Victoria in 1843 near the Inner Harbour, the area offered access to fur supplies, control over ocean shipping routes, and good agricultural land. These advantages were publicized by Sir James Douglas, the chief factor (administrative head) of the company's Pacific Coast operations, who founded the fort. They were in turn recognized by the British Colonial Office, which made Victoria the capital of the colony of Vancouver's Island (the old name for Vancouver Island) in 1849. The community's growing commercial importance during the Fraser River and Cariboo gold rushes of the 1850s led to its incorporation in 1862. In 1868 Victoria became the capital of the colony of British Columbia, which was made a province of Canada in 1871.
Facing little mainland competition and guarding coastal shipping routes, Victoria was Canada's most important Pacific port. In the late 19th century, local entrepreneurs managed British Columbia's import-export trade and developed sealing operations, salmon canneries, sawmills, and supporting manufactures such as machinery works. Local business was stimulated by an expanding provincial government and a military presence, with Esquimalt serving as the headquarters of Canada's Pacific fleet. In the early 20th century, investment in urban real estate became a profitable enterprise as Victoria attracted distant investors and migrants alike.
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