Events like the Korean War and the deepening Cold War in Europe in the early 1950s resulted in a major change in the government's plans for National Defence. The decision to increase the size of the Army beyond its divisional size meant that large training areas would be required. No existing base in Eastern Canada had sufficient room for such a force to exercise and maneuver. The existing training facilities dated from WW I and WW II thus a new facility was considered necessary to accommodate the new formation, 3 Canadian Infantry Brigade Group.
Such a training area had to be large enough for exercises on a divisional scale (up to 17,000 soldiers), the terrain had to be suitable for all types of training, the area should have a temperate climate similar to Eastern Europe, have proximity to an eastern Canadian all-weather port, and should be established with as little disturbance as possible to the civilian population. While considering the alternatives, the regional economic development planners saw an opportunity for a military base to benefit the economy of southwestern New Brunswick. Gagetown, New Brunswick was eventually selected as the site of what would become the largest military training area in the British Commonwealth and home base for 3 CIBG. The decision to construct a new training base had a major impact on the Military Engineers as it started a six year period of planning, design and construction. A new unit, 8 Works Company, was formed to manage the project and it became the largest and busiest Works Company in Eastern Command. These Military Engineers were responsible for purchasing the land, designing the buildings and utilities, integrating the housing area into the existing town of Oromocto, constructing the facilities, developing the training area, and forest management. They were assisted by Defence Construction Limited for the implementation of the construction projects.
Some statistics help to visualize the magnitude of this undertaking. Construction started in May 1954 and the new camp was officially opened only four years later on 1 July 1958. The total cost was $65 million and this included the construction of 100 permanent buildings and 2000 Married Quarters. Land acquisitions and settlements, alone, cost $13 million. Some 3,000 individuals were displaced and expropriations required 1000 legal settlements.
Camp Gagetown was the largest Public Sector employer in the province. As with other bases across the country, it became a major economic boost to the local area and the province. Not only did the new base meet the requirement for new accommodation and training, it also contributed greatly to the local economy.