CN buys Blue Crescent Hotel in Rivers

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This article was published 04/01/2024 (664 days ago), so information in it may no longer be current.

The ownership group of the Blue Crescent Hotel in Rivers closed and sold the facility last month to the Canadian National Railway Company after operating the business for three years.

The sale, which was confirmed by its former general manager. Tracy Mansell, occurred after the ownership group re-evaluated the hotel’s viability, particularly without CN’s use of the rooms.

CN Railway told the Sun via email that Rivers is a pivotal location within its network. “The purchase of the hotel supports our ongoing operations in Western Manitoba,” it said.

Blue Crescent Hotels chain co-owner Trevor Rempel told the Sun the ownership group of the Rivers hotel property notified Blue Crescent Hotels about its sale to an entity no longer operating it as a public hotel.

“They requested the termination of the brand licensing agreement,” Rempel said. “The hotel is independently owned and operated and was part of the network of independent hotels that operate using the Blue Crescent Hotels brand.”

Rempel said the hotel chain enjoyed working with the local staff and management over the last number of years and enjoyed being a part of the local community, wishing them all the best after this transition.

The hotel in Rivers was sold to CN as part of the company’s plans to build a new bunkhouse, thus eliminating a significant portion of the hotel’s occupancy space.

Rempel highlighted the critical aspect of sustaining profitability in the hotel industry and the necessity of consistent room sales even during seasonal downturns to maintain cash flow. Without the CN occupancy, he said, the local demand alone could not ensure sufficient profitability to sustain operations.

“We’re exploring possibilities to address the demand vacuum left by the sale,” he said. “We’re contemplating a smaller, more affordable, motel-style facility with modern designs, possibly around 20 rooms, tailored to meet Rivers’s needs. Yet, determining the financial viability for such a project remains a key challenge.”

Regarding concerns about rising Airbnb popularity impacting the hotel industry, Rempel expressed confidence in the demand for hotels in rural communities. He noted the consistent occupancy from trades, community events, weddings and other gatherings, adding that Airbnb accommodations are unlikely to significantly affect these segments.

While discussing Blue Crescent’s broader plans, Rempel cited ongoing hotel construction in Arborg and future investments in Deacons Corner and Evansville. Despite the setback from the Rivers sale reducing the brand’s network to one hotel in Carman, Rempel affirmed ambitious expansion plans, including multiple potential hotel projects set to elevate the brand’s presence across the region.

“Niverville is scheduled to commence and complete construction this year, aiming to open by year-end as another Blue Crescent brand,” he said. “There are prospects of initiating construction for two potential hotels this year, with an anticipated opening in 2025, likely to be affiliated with Blue Crescent. We are also exploring various projects in Alberta, expected to commence in early 2025. Over the next five years, significant brand expansion is anticipated.”

The hotel in Rivers marked the initial endeavour under the Blue Crescent name by Steel Creek Developers, a family-owned company operating in Manitoba and Saskatchewan.

Opened in January 2020, the Blue Crescent Hotel in Rivers has consistently maintained an impressive 90 to 100 per cent occupancy for several months, according to Mansell.

This high occupancy rate stems from a partnership with CN Rail, allowing conductors and engineers to lodge at the hotel when the local bunkhouse faced limitations due to social distancing guidelines. This collaboration commenced in March 2020, coinciding with uncertainties surrounding the hotel’s operation during the pandemic.

“We haven’t pursued grants or other aids offered by the Manitoba Hotel Association,” Mansell told the Sun in March 2021. “We’re going above and beyond what (business) most hotels are doing right now.”

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