July 14, 2000
JANE GEORGE
Nunatsiaq News
RESOLUTE BAY — They’re not dukeing it out yet, but, as the summer tourist season moves into full swing, hotel managers in Resolute Bay are butting each other over their share of the tourist trade.
Some 1,000-1,500 visitors stay in Resolute every year, bringing in close to $300,000 a year in revenues. For 20 years, visitors had only two hotels to chose from, but for the past two years, they’re had their pick of three.
This new competition is good for tourists who now pay less and get more for their money, but for the hotels, this competition has had a negative impact, cutting down on their income.
The competition is even more intense because at the same as competition for tourist dollars increases, there is less economic activity, fewer flights in and out, less government money for construction, and the threat of the nearby Polaris mine closing down in two years.
Tourism, many residents say, is what will save their economy, but it may not be strong enough to support three hotels.
"We’ve had to downsize," says Dan O’Neill of the Narwhal Hotel, who is now its sole employee, serving as both manager and chef.
Not so long ago, O’Neill was one of five employees at the Narwhal.
"If business will pick up, we’ll hire more people," O’Neill said.
For now, most of Narwhal’s clients are workers involved in Narwhal’s own slimmed-down construction projects in Resolute.
All Inuit-owned
O’Neill said the Narwhal never really chased after the tourist trade, so it doesn’t miss that – but now its official traffic, once a good portion of the clientele, has also dried up.
O’Neill speculated that those in charge of planning VIP visits may not want to come to Resolute anymore because putting dignitaries up for the night now involves making politically impossible choices between the three hotels — all of which have Inuit-owned status.
This upset in Resolute’s hotel market goes back to July, 1998 when local entrepreneur Aziz Kaheraj, and his common-law wife, Aleeasuk Idlout, opened South Camp Inn, which has since grown from nine rooms to 13 rooms, and will soon grow to 25 rooms.
A new wing, now undergoing the final touches before its opening, features executive suites with kitchens, private rooms with Jacu i baths, and computer hook-ups in every room.
Kaheraj has invested in his own server to provide 24-hour-a-day Internet access. He’s also thrown in other perks, such as exercise equipment, a large-screen television set, and free vehicles for guests.
Kaheraj says he’s been able to offer all this at rates that are more than 40 per cent lower than the competition.
Since the Narwhal has unofficially stopped pursuing tourists, his main competitor is the Qausuittuq co-op hotel, part of the Arctic Co-ops’ Inns North chain.
It opened three years ago after Terry Jesudason sold the cozy guest house she and her late husband Bezal had run for 20 years to the co-op. After it was sold, Terry Jesudason stayed on as manager for the co-op, which has since added a new $1.2 million-dollar wing featuring plush single rooms and private baths.
Dirty fighting?
The co-op has apparently run up a $2.8 million debt it would like to recover through hotel business, but as a result of the competition, Jesudason has also had to offer such incentives as free vehicles to keep up with the South Camp Inn.
Due to the pressure to fill beds, the rivalry between the two hotel managers is said to be less than cordial.
"I wouldn’t call it friendly and amiable," Jesudason said.
Occasionally, it’s even taken a nasty turn.
Recently a group who had already checked into the Narwhal were reportedly visited by the manager of another hotel who strongly urged them to check out and move to that hotel — which, in fact, they did.
Kaheraj filed a defamation suit against the local co-op association over a letter it sent in September, 1998 that was circulated around various government offices. Kaheraj said this letter alleged that his business practices were "underhanded."
Kaheraj said he’s still fighting the case in court.
"I fight for my business," Kaheraj said. "Everything here is sweat and blood."
It’s not the first time the Tanzanian-born businessman has locked horns with a co-op. In 1993 Kaheraj attempted to expand Kaheraj Enterprises, his flourishing construction business, into Pond Inlet, but, two years later, he sold out to the co-op.
This time, Kaheraj said he doesn’t intend to give in.
"We’re living in North America where competition is good for the market," Kaheraj said. "As soon as you have competition, the fat is trimmed off, and everybody goes where they want."