New hotels in Rehoboth, Lewes and other Sussex beach towns: What to expect

Taylor Goebel
The Daily Times

Despite the rise of home-sharing services like Airbnb and VRBO, Sussex County could be squeezing in several hotels along its coast over the next few years. 

Lewes will gain two hotels after planning and zoning commissioners approved both applications in the same meeting last summer. Rehoboth Beach is still in the approval process for two lodging establishments but could see a new hotel as early as 2021. An old motel in Fenwick Island will be replaced by a Hilton franchise hotel. 

Those hotels would be in addition to the 89 currently registered in Sussex County, according to Southern Delaware Tourism. That's about 4,220 rooms.

The 2018 occupancy rate was close to 80 percent — down from nearly 82 percent in 2016. But executive director Scott Thomas said those numbers tend to fluctuate and don't necessarily point to a decline in business, and he doesn't believe rates will be severely impacted by the new hotels.

Here's more of what to expect in southern Delaware's resort towns.

Lewes

Home 2 Suites by Hilton 

Construction hasn't yet started but this three-story, 110-bedroom hotel off of Savannah Road and Coastal Highway will be welcoming its guests in the next year or so. Sussex County Planning and zoning unanimously approved the project on June 28. 

A standalone 1,298 square-foot management office and on-site car parking area were also approved with the Hilton franchise's site plan. 

Ocean One Plaza willl be adding a hotel to the property located off Rt. 1 in Lewes, Del.

Lewes Hotel

Also under the commission's unanimous stamp of approval during the same meeting was Lewes Hotel, a 64,226 square-foot building with 96 bedrooms that will be located off Marsh Road and Five Points Square.

Commissioners also reduced the parking space requirement from 154 to 106 spaces, a request by the applicant that would have otherwise not been code compliant.

This parcel in the Five Points Square shopping complex, behind Lewes Plaza, will be the new home to a hotel in the future in Lewes, Del.

Rehoboth Beach

Rehoboth Grand

On the corner of Rehoboth Avenue and State Road, a developer is proposing a four-story, 90-bedroom hotel on the site of the previous Ocean Atlantic Sotheby's International Realty, which has since moved its Rehoboth office to Coastal Highway. 

Limitless Development Consulting is the long-term tenant of the property and a division of Milton-based Lockwood Design & Construction.

The plan includes an indoor swimming pool on the third floor, a restaurant, retail space and spa on the ground floor entry, and underground parking with 48 spaces and 44 spaces of exterior parking, which meets the 92-space requirement. 

Rehoboth Grand, a 90-bedroom hotel proposed to be built on the main strip, could be welcoming guests as early as 2021.

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Because of the age and condition of the current space, Limitless Development proposed tearing down the building to make room for Rehoboth Grand. 

Rehoboth planning commission members heard the informal proposal during a sketch plan review, an opportunity at one or more meeting to review the applicant’s potential development before the committing substantial time and expense in preparing a formal site plan. 

One major concern is the site's split-zoning, with 23,067 square feet of C-1 Commercial along Rehoboth Avenue and 19,425 square feet of R-1 Residential along State Road. The zoning could be altered for the plan through variances or changing the residential zoning to commercial. 

Limitless Development is shooting for a 2021 opening. 

A current hotel is being proposed at the current location of Lockwood Design and Construction located at 18958 Coastal Hwy in Rehoboth Beach, Del.

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Atlantic Crown Hotel & Suite

This boutique hotel is struggling to get off the ground after its initial concept review in July 2018. 

Ronald Lankford of Lankford Properties LLC and the owner of the property, had anticipated a September start date for the Atlantic Crown project, which spans across 17, 19 and 20 Baltimore Ave. and includes 40 bedrooms and a restaurant.

The applicant's attorney, Vincent Robertson, Esq. of Parkowski Guerke & Swayze, met with the chief building inspector in August to review items the inspector ruled were not code compliant.

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After that meeting, the inspector issued a memorandum for issues that hadn't yet been worked out, which meant the project couldn't move forward during a September planning commission meeting. 

Robertson appealed the inspector's decision on Lankford's behalf and requested a variance to build a hotel more than four floors or stories above grade. The Board of Adjustment will subsequently hold a public hearing on Feb. 25 at 7 p.m. in the City Hall commissioner's room at 229 Rehoboth Ave. 

The community said good bye to the Sands Motel located in Fenwick Island, Del. on Thursday, Dec. 20, 2018. During a "Demo Party" held by the owners of the property. Anyone could come throw some rocks to break the windows before the demo began.

Fenwick Island

A Hilton hotel under Tapestry Collection franchise is in the works for Fenwick Island, where the 70-year-old Sands Motel was recently demolished for a new three-story hotel with 65 rooms — 27 more than its retro-style predecessor. 

The new hotel is set to open by summer 2020 and will be one story taller than the Sands Motel, according to a spokesperson. 

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