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Commissioners to decide on proposed Rehoboth hotel 

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330 Rehoboth Ave. was recently sold to Bette Gallo, founder and president of Gallo Realty, and Don Lockwood, owner of Milton-based Lockwood Design and Construction. They plan to build a hotel, but it has drawn concerns from some neighbors. | DBT PHOTO BY JACOB OWENS

REHOBOTH BEACH – Whether or not a parking lot is zoned residential or commercial very rarely matters, but when the plan is to build something on top of that parking lot, things can get a little tricky.

That’s the heart of the problem faced by the city of Rehoboth Beach and the developers who want to build a hotel at 300 Rehoboth Ave. at the intersection with Christopher Street. The area is also one of the places where the commercial district intersects with a residential neighborhood.

Although the Rehoboth Beach Planning Commission couldn’t bring itself to recommend changing the zoning for a proposed redevelopment of 300 Rehoboth Ave., the project may still get another bite at the apple. At the Jan. 10 mayor and commissioners meeting, the body elected to consider the application on its own.

“Even though the planning commission majority disfavored going to a rezoning it hasn’t ended there, it’s now in our hands,” Mayor Stan Mills said.

The mayor went on to explain that the commission would consider whether to conduct a full public hearing or vote to not go to a public hearing. That first decision will be made at the commission’s Jan. 21 meeting. If the commission decides to elicit comments, that’s when a date for it would be set. 

The city isn’t required to take any more comments from the public in this instance, but the mayor and some of the commissioners indicated that they were willing to hear from the residents before considering whether to approve this proposal over the planning commission’s rejection.

The notion of changing the zoning from residential to commercial has been contentious in the past. City planner Tom West said that it is common for the mayor and commissioners to take one final look at projects before they are approved or denied.

Building on the border

From the outside, it is hard to see how this parking lot remains residential. After all, it is a parking area for a commercial building, Jack Lingo Real Estate, and it appears to be in a commercial area.

The difficulty for residents is that it also is supposed to represent a line in the sand between residential or commercial.

West said the comprehensive plan encourages commercial growth in areas that don’t abut neighborhoods, and that’s where things get a little sticky for the project.

Residents aren’t just worried about traffic, according to submitted complaints, but they also worry about the scope of the project, a four-story hotel with underground parking.

Another subterranean parking lot

An aspect that appears to speak for the zoning change is the proposal to build an underground parking lot that would accommodate the hotel. Rehoboth Beach already is under tremendous pressure when it comes to parking. The emerging trend of digging down may be making developers rethink many projects.

While the city has both a floor area ratio (FAR) and a height restriction for development, there’s nothing on the books to prevent builders from going below the surface level. 

“The FAR has made people reconsider parking,” West said. “We may see more underground parking for rezoning requests.”

By adding underground parking, a builder can maximize its usable space under the FAR while still meeting parking desires or requirements.

After seeking the Federal Emergency Management Agency’s blessing, the owners of the proposed Belhaven Hotel project have been approved for an underground parking lot (although the rest of the development is still in the approval process), even though the building is in a flood zone.

For the owners of 300 Rehoboth Ave., the process isn’t nearly as difficult. The property lays outside of the flood zone.

A chicken or egg exception

As West explained it, the planning commission’s concern was less about today’s changes as about potential changes in the future. The owners still can build a hotel of similar scope without the addition and the parking lot could remain a parking lot.

Instead, the planning commission’s worries had more to do with what might come after the hotel. By changing the zoning from residential to commercial, the city technically opens itself to any kind of commercial development on the property, not necessarily the one proposed.

Buildings and properties can change hands, markets can collapse or any other number of economic or cultural changes could mean that even if the hotel is built, it could be made into something else in the future.

A developer suggested a 30-year covenant as a way to assuage fears, but 30 years didn’t seem long enough to make the planning board comfortable. Additionally, covenants can be intricate and difficult to enforce.

For example, if the covenant is based on ownership rather than on the property itself, the parcel would only be one sale away from undermining the spirit of the exemption.

The question the commission will face is whether leaving the parking lot intact best serves the long-term vision for the community. If it decides to allow the rezoning, the next question will be whether it can gain sufficient assurances that the building will go up as presented.

By Tony Russo

Contributing Writer

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