Estevan鈥� Over five years ago, Bryant Ko saw a newspaper story about how things were happening in the Bakken and that Estevan was the place to be. Having done well in his business of providing tutoring to Asian-Canadian families who sought to send their children to the best Ivy League schools, he was looking for a place to invest his money. He decided to buy the Derrick Motor Hotel, a long-time fixture in the Estevan accommodations and bar scene.
Along with the hotel came the new, nearly-complete Smitty鈥檚 restaurant, but one which was tied up in city hall red tape and would not open for a year until after the purchase.
Now the hotel, along with its bar, are closing. Smitty鈥檚 will remain in operation.
鈥淲e鈥檙e closing down the hotel and bar Feb. 13,鈥� said Grant Kim, general manager of the hotel, bar and restaurant. He has rotated back and forth from Vancouver to Estevan for those five years, but spent most of his time in Estevan since last summer, filling in for the reduced staff.
鈥淲e cannot incur any more debt. It鈥檚 been very slow since the oil shock,鈥� he said. That slow period has now been almost one-and-a-half years, during which time the owners have been injecting capital into the operation.
鈥淲e can鈥檛 be doing that anymore,鈥� Kim said on Jan. 21.
The 鈥渇or sale鈥� sign went up in early January.
Asked if it鈥檚 been a struggle, Kim replied, 鈥淏ig time.
鈥淚鈥檓 sure the other hotels are not happy about the situation.
鈥淚鈥檝e been working the front desk myself.鈥�
In a way the owner dodge a metaphorical bullet, as there had been plans in place to expand the hotel.
Kim said, 鈥淲e were just about to start expanding. We were finalizing the drawings.鈥�
He鈥檚 glad they didn鈥檛 go ahead with the project. 鈥淚t would have only made it worse,鈥� he said.
In the bar, a long-time popular haunt in Estevan, sales were reduced a bit.
鈥淚f it was separate, alone, we wouldn鈥檛 have to shut it down. But it鈥檚 the same building,鈥� Kim said.
If the bar was detached, it would be kept open.
Smitty鈥檚, too, has been affected. For instance, the Derrick鈥檚 website lists free hot breakfast at Smitty鈥檚 during your stay at the hotel, likely a response to other hotels in Estevan including breakfast with your stay.
鈥淚t鈥檚 a dead town now, pretty much,鈥� Kim said. 鈥淥n the weekends, there鈥檚 hardly any traffic.鈥�
There鈥檚 also a lot more competition. Since the Bakken boom took hold in 2008, Motel 6, Best Western, Microtel, Suburban Extended Stay (and a subsequent expansion), Atco Lodge (now closed), Civeo Boundary Lodge (formerly PTI) and Western Star Signature Hotel have all opened. A foundation was poured for a Holiday Inn that was never completed. That鈥檚 in addition to the existing hotels, like the Derrick, that had been in place for decades.
With the completion of the Boundary Dam Integrated Carbon Capture Project, then the oil shock, demand for accommodations has dissipated.
鈥淭he demand is reduced but the supply has increased. Everyone鈥檚 lowering their prices like crazy. There鈥檚 no workers. What can you do?鈥� Kim said.
鈥淚 had to lay off 23 employees, and some casual people. It鈥檚 totally beyond our control,鈥� he concluded.
