In the words of David Clark, general manager of the Atlantica Hotel, Sukhdev Toor doesn’t put lipstick on his buildings.
Toor owns Manga Hotels, which has eight properties in Halifax, and a dozen or so in other cities. He’s in midst of a year-long renovation of the Atlantica that will come to about $15-million.
“He’s pretty confident in Halifax, though with things the way they are it’s going to be a challenge for at least a year, I’d say,” said Clark. “Unfortunately, it’s a good time to do renovations.”
Clark is also the past president of the Hotel Association of Nova Scotia, and says the city is running at less than 30 per cent occupancy.
“It’s just not sustainable,” said Clark, who estimates half the hotels in the city were closed temporarily at the height of COVID. “Normally, August is one of our busiest months and most of the city would be running 90-plus per cent and now we’re down to 25, 29 per cent. Along with that, rates are much softer because there’s so much availability. Rates are almost 50 per cent in a lot of cases.”
Things are not as grim at the Atlantica, which didn’t get hit as hard on occupancy as most hotels because of its location next to a hospital.
“And we worked with government and some of their agencies to help at-risk people for a few months,” said Clark, referring to guests who came to the hotels from shelters. “Those guys were here for quite some time and we were running 75 to 90 rooms a night during that time, where everybody else was doing ten rooms or seven rooms or nothing.
“Sometimes we had challenging groups and we’d put them in the older rooms, and if there was any specific damage we were going to renovate them anyway, so we just shut them down and let the renovation guys go to it.”
The hotel was built in the mid-70s and when renos are finished, it will have rooms with bunk beds for families, two private dining rooms, a new boardroom and a CAA rating that Clark expects to go to four stars from three. The number of guest rooms will increase from 231to 238.
“We had a number of suites in the hotel but we’ve converted some of those suites to two separate rooms. The owner is very good at generating revenue and we’ve always found that with suites, you end up giving them away or upgrading, you weren’t really making any money on them.”
Much of the building was gutted, and some of the more expensive line items include $300,000 for new mattresses and $2-million for a sprinkler system.
“When this hotel was built, they didn’t have to put sprinklers up on the floors, believe it or not. There were sprinklers here on the main level, but not on the guest floors,” Clark said. “Of course with a building this age, when you start opening up walls you find issues that you didn’t account for and there’s extra costs associated with that.”
The project was originally budgeted for $12-million. There had been speculation the property would be rebranded as a Hilton, but at least for now, the name will stay the same.
Brand potential
“Mr. Toor is a fan of brands, but this hotel does quite well in terms of the bottom line,” said Clark. “And, you know, when you work with a brand you’ve got to pay a lot of fees and franchise fees and percentages of revenue. He’s setting the building up so that if he needed to brand it he could, but he’s pretty happy with its own brand.”
There are people staying at Atlantica right now, though the GM described it as a limited service property at this stage. A staff of 15-18 is keeping the place open 24 hours a day.
“We laid off almost everybody. In the beginning I had eight people working, a small group of managers working seven days a week, 14 hours a day, and of course that’s not sustainable,” said Clark. “Everybody’s doing jobs. I’m mopping floors and changing garbage cans. My accounting guy is working front desk and doing deliveries and cleaning rooms.”
When the Atlantica is fully operational again, employment will be back to about 120. Clark said he’s most excited about the hotel’s new bar and restaurant, still a couple of months away.
And there was some good news this week. A company looking to book a Christmas party was in to do a site inspection.
