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Lost icon?

Local residents decry decline of Hotel Saranac; owner says community is against him

August 27, 2011
By CHRIS KNIGHT - Senior Staff Writer ( , Adirondack Daily Enterprise

SARANAC LAKE - Margaret Backus stepped into the lobby of the Hotel Saranac on Tuesday hoping to take a trip down memory lane. Instead, she walked out surprised and disappointed.

Backus, who was born in Saranac Lake and spent part of her childhood here, now lives in Lisbon, in St. Lawrence County. She visited the village Tuesday with family from Colorado because she wanted to show them the town where she and her sister were born.

"We were interested in coming to the Hotel Saranac," she told the Enterprise while standing on the sidewalk outside the hotel. "We always came for dinner. The place was always full of people - a bustling place with things going on. Now, that's not here. It looks like it's closed up and going."

Article Photos

The Hotel Saranac and its iconic rooftop sign tower over downtown Saranac Lake, as seen from Broadway on Tuesday.
(Enterprise photo — Chris Knight)

Backus' impression of the hotel during her brief visit is just a snapshot of what this community has witnessed over the past four years. Once an economic anchor of the downtown and the social hub of Saranac Lake, many locals now see the Hotel Saranac as a lost icon.

Its restaurant and bar and pub are now closed. Curtains cover the large picture windows that used to look in on the hotel's main dining room. The hotel's large parking lot is empty of vehicles most days. Downtown merchants who used to draw customers from the hotel's guests say that business has disappeared.

Local residents pin the demise of the hotel on the Arora family - Sewa Arora and his daughters Sarena and Sabena - which purchased the property from Paul Smith's College in 2007. Before they came, the hotel appeared to be thriving, said Saranac Lake resident and author Caperton Tissot.

"I think it was something that residents felt part of and felt proud of, and felt that it belonged to the community," she said. "And now that's been lost."

People aren't just upset about losing a centerpiece of the downtown business district. There's a deep-seated animosity now between Sewa Arora, who manages the hotel, and the community in general, and that's putting it politely.

"His attitude with the community has gone a long way toward making that place fail," Tissot said.

During an interview with the Enterprise this week, Arora acknowledged that the bad blood between himself and the community has driven away business. But he firmly defended the business decisions he's made since taking over the hotel, even though they've turned many local people against him.

"I understand it's an icon; I'd like to keep it an icon," Arora said. "But there was no way for me to run the place the same way Paul Smith's College was running it. If I did that, I'd be losing money."



The shortcomings of a particular business are usually fodder for local gossip, not a story in the local newspaper.

But the Hotel Saranac is different. Built in 1927, it's the last remaining grand hotel in the village, the rest of which were lost to fire or demolished. Its name, spelled out in large block letters on the building's roof, in a sign created in the 1940s, has become symbolic for Saranac Lake and the Adirondacks.

More significant than that is the place the hotel occupies in the hearts of many Saranac Lake residents.

Janis Beatty said she and her husband might not have moved to Saranac Lake more than 15 years ago if not for the Hotel Saranac.

"My husband got a job at Sunmount (in Tupper Lake), and we were trying to decide where to live," she said. "We had breakfast in the hotel, and we were sitting there by the window, and it just had a certain cosmopolitan feel to it. It just felt good that there was this great hotel in this little town. It was one of the factors that made us move there."

The hotel was the social and cultural center of town for decades, said author, historian and former village mayor Howard Riley.

"You always had a nice place to take people for dinner if guests came to town," Riley said. "Every big social event in town was held at the Hotel Saranac. No one would think of going any place else."

The hotel was always the center of activity during the village's biggest event, the annual Saranac Lake Winter Carnival, according to Winter Carnival Committee Chairman Jeff Dickson.

"There's no question that if you go back historically, the Hotel Saranac was a focal point of Winter Carnival events for generations," Dickson said. "If you look at the old photos, you'll see the Grand Marshal dinner was always held there, with women in long gowns and men in coats and ties. It was a pretty elegant occasion."


The college

Most people's warm memories of the hotel come from the period when it was owned by Paul Smith's College. The college bought the hotel in 1962 and used it as the practicum or training facility for students in its culinary and hospitality management programs.

To people in the community, the hotel seemed to be thriving. But it was actually bleeding money, according to college officials and the hotel's former manager.

"The hotel consistently lost money under our ownership," PSC spokesman Ken Aaron said in a prepared statement. "Paul Smith's ran the hotel as a teaching institution, not as a business, which means our goals were not to maximize profit but rather educational value."

"We were asked to make money; it just didn't happen, partly because of the educational component," said Peter Ordway, who was the hotel's operations manager for 14 years. "Labor was an expense we couldn't avoid. The students needed to have a full body of people working at the hotel so they could shadow us and train."

At the time, college officials said the opportunity presented by moving the college's practicum to the Crowne Plaza Resort in Lake Placid, where it only lasted a year, was the impetus for selling the hotel. But the consistent financial losses were also a big factor in the decision.

"It was important for the college's long-term financial health that we sell the hotel and we are stronger financially today partly as a result of that decision," Aaron said.



Aaron said the college had been quietly searching for a potential buyer for the hotel for years before it agreed to sell the property to the Arora family. News of the sale went public on Oct. 13, 2006. Needless to say, no one saw it coming.

"I was as surprised as anybody in the community," said Tom Michael, who was village mayor at the time. "I was disappointed to hear it had been sold. But I was hopeful at the time that a private owner would reinvigorate the hotel and increase business."

The hotel's employees were just as surprised.

"There was a state of shock in the whole operation," Ordway recalled. "People were afraid of what would happen, and lo and behold, some of the things they feared, happened."

By the time the sale closed in January for $775,000, well below its assessed value, the hotel's employees were in an uproar, and some had already quit. Arora had required them to reapply for their jobs and reassigned some to different duties. He also told them he couldn't afford to pay their health insurance benefits.

Joanne Austin, who managed the Boathouse Lounge for 10 years, said Arora told her he might reassign her as a waitress. She quit the day after he took over.

"Very few hung on. A lot of us left," Austin said. "It was like breaking up a family. It still bothers me. It hurts me. I enjoyed my job there. I enjoyed the customers and my students."


Losing the community

People who had been patrons of the hotel under the college's ownership say they continued to go there for a few months.

"After a while, when people went there for lunch, there was this friction, and all the old-time employees had left," Riley said. "It was unpleasant. It was just the atmosphere created by the ownership that drove the local people away"

At one point, Riley said he offered to do some free public relations work for Arora, but the owner never took him up on it.

"Unfortunately, it turned into a tug of war," Michael said. "The hotel business is the hospitality business. If the owner doesn't operate in a way that the customers like, they're not going to go there, whether they're from town or out of town."

As business slipped, the Aroras eventually closed the hotel's bar and its two restaurants. People told their visiting family and friends not to stay there. Groups and organizations that used to meet and hold events at the hotel, like the Winter Carnival Committee, took their business elsewhere. Bad reviews started showing up on


Economic loss

It wasn't just the community's pride that was hurt by the changes at the hotel. It also took an economic toll on downtown businesses.

Mark Kurtz, who owns a photography gallery downtown, said he used to get a lot of business from the hotel, in part because he had several panoramic landscape photos hung just outside its ballroom. When the hotel changed owners, Kurtz said the Aroras showed no interest in having them there anymore, so he took them down.

"So I don't get anybody who walks in and says 'I was in the Hotel Saranac and saw your photos,' or 'Somebody said to come down here,'" Kurtz said. "I haven't heard that in years. It definitely has had an effect on my business, and everybody I've chatted with has noticed a change in their own business as well."

Tom Finnigan, owner of T.F. Finnigan's men's clothing store, said he used to get a lot of foot traffic from the hotel.

"That's all disappeared," he said. "There seems to be a lack of people coming out of the hotel, and we just don't do the business from there that we used to."


What happened?

Sewa Arora agreed to sit down with the Enterprise this week for an interview in his office that lasted 90 minutes.

Arora said he had to make changes to how the hotel was being run - cutting personnel costs, closing the bar and the two restaurants - in order to make it profitable. He was already in a financial hole, he said, because the only bank that would offer him financing for the purchase of the hotel required a 45 percent down payment. Before that, five banks said no, Arora said.

"We had to trim the fat," he said. "If the fat remained as it was, regarding staffing, then we will be in the same boat the college was. The staff working here were used to a certain way of doing it, and that way of doing it was losing money. The changes were drastic. It had to be drastic."

Arora gave two explanations when asked why many local people no longer frequent the hotel.

"We're from downstate," he said. "In this area, you have to be a native to be accepted. So people were not coming. They were not patronizing it. They were upset."

Arora also said disgruntled employees and an article in the Enterprise about how the hotel's workers were upset with the new ownership impacted his relationship with the community.

"Some people got upset," he said. "Some people were working, but their mind and heart was not here. They had an attitude towards us, and people didn't like us because we were not natives."

Asked why organizations that used to meet or hold events in the hotel stopped coming, Arora said it's because he had to, in some cases, charge them more than the college was charging them to make the event profitable for him. He also said he gave up on trying to book weddings two years ago because of people's attitudes against the hotel. Familes would book it, then cancel under pressure from relatives here.

"People say, 'The hotel is going down the hill,' 'What did you do to the hotel,'" Arora said. "I say 'Listen, I'm sorry you feel that way, if you want me to run the hotel the way Paul Smith's College ran it, you'll have to give me $300,000 and that will make you happy.'"


Some support

Arora has made a few friends in the business community during his tenure in Saranac Lake, some of whom sympathize with him, to a degree.

"If you're buying a business that's losing half a million bucks a year, you can't continue losing a half million bucks a year," said Adirondack Motel owner Fred Mueller. "So he had to make decisions to pare down the expenses to make a buck. It's his business. He bought it and he's on the hook for it. People can't will it to be something it was in the good old days."

Still, Mueller acknowledged that Arora is a "difficult man, and not the easiest person to get along with."

Dickson also said he understands that things at the hotel had to be done differently under a private owner.

"But those kind of things can be done well, and they can be done poorly," he said. "And, in this instance, they were done monumentally badly. If you wanted to antagonize the community, you could not have done a better job."

Village officials have tried to rebuild the community's connection to the hotel. Mayor Clyde Rabideau befriended Arora last year, attended his daughter Serena's wedding and hosted the village's first Walk of Fame induction ceremony, for Olympian Bill Demong, at the hotel this spring. The response from people was lukewarm, he said.

"Being in the great hallway for the Walk of Fame reception brought back a lot of fond memories to many of the Saranac Lakers that were present," he said. "Yet there was sadness in their hearts because they saw what was now something not anywhere near what it was."

Rabideau said he hears a comment at least once a week from someone who'd like to see the hotel restored to its former grandeur.

"For the most part I agree that it isn't what it was, but I remind them that it's privately owned," he said. "I want to see all our business thrive and reach their full potential. That's what I tell people, that the potential still remains there."

Many people in the community think it will now take a new owner to reinvigorate the hotel.

"My feeling is that the current relationship with the community and the traveling public is so poisoned, that it would be extremely difficult (for the Aroras) to turn that around," Michael said.


Future plans

When he first bought the hotel, Arora said he had big plans. He had an architect draw up blueprints for a sports bar on the first floor, much larger than the Boathouse Lounge, and a rooftop restaurant with a revolving bar that he planned to call "The 47th Peak," a reference to the 46 Adirondack High Peaks.

"These were my plans," Arora said. "But when I got the reception I got, I said to myself, 'Am I crazy?' My children said, 'You must be crazy.'"

Arora said he has invested $300,000 in upgrades to the hotel since he bought it. That includes chandeliers and drapes in the grand ballroom, new Jacuzzi suites and upgrades to each of the hotels' rooms. The hotel's boilers were shut down three years ago and replaced with individual air conditioning and heating units in each of the room's windows, a move that Arora said saved him money and is environmentally friendly.

Despite that, the 84-year-old, seven story, brick building is showing signs of its age. An inspection of the building earlier this year by the village's code enforcement officer turned up a long list of violations, including missing or exposed wiring.

Signs recently went up in the front windows of the hotel saying space in the first and second floor of the hotel is available for lease. Arora said he's open to any offers and has had some inquiries.

But he also revealed that the entire hotel, which is assessed at $1.9 million, is for sale, although he hasn't advertised it. He decided to sell it in April 2010, after he had bypass surgery.

"Of course I'll sell the place, but at the right price," Arora said. "Not because of the locals or anything like that, but because of my health reasons."

Arora refused to characterize the hotel's occupancy rates, but he said he is making a profit. Asked how long he can be profitable without having a solid base of community support, he said "a very, very long time."



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