Harvey Hanna acquires Rehoboth motel for $4M

REHOBOTH BEACH — Harvey Hanna & Associates bought a second hotel just steps from Rehoboth Beach’s boardwalk earlier this year, expanding its presence in Delaware’s major resort town. 

The 23-room Crosswinds Motel on Rehoboth Avenue next door to Dogfish Head’s two restaurants was sold for $4 million to a HHA subsidiary on Feb. 16, according to Sussex County land records. The commercial development firm also manages 16 hotels in Delaware, Maryland and Pennsylvania through its hotel management arm, TKo Hospitality.

The $4 million sale equates to a per unit rate of more than $173,910.

“We are thrilled to add Crosswinds to our growing portfolio of hospitality destinations,” HHA President and CEO Thomas Hanna said in a prepared statement. “This charming beach resort property holds a special place in the hearts of locals and visitors alike.”

Dale Lomas opened the Crosswinds Motel at 312 Rehoboth Avenue in 1998. The motel’s location made it a popular place for visitors because it is within a mile of the beach and the boardwalk, or a 10-minute walk. The site also offers on-site parking, a rarity for downtown Rehoboth Beach.

His professional career began at Delaware’s beaches when he worked at Dolle’s Candyland through his college years and a few years afterwards. Over time, Lomas got connected with local entrepreneur Dave Potts, who opened Atlantic Liquors. Eventually, Lomas was brought in as a partner to what became “the Greatest Liquor Store In The World” in the late 1980s.

Representatives of HHA, a Newport-based commercial real estate firm, said it plans to “enhance and rejuvenate this iconic establishment.” HHA did not clarify the extent of renovations planned for the Crosswinds Motel.

HHA is a commercial real estate developer with 3.5 million square feet of industrial, office and hospitality real estate in the Mid-Atlantic region. One of its biggest projects was redeveloping the long-dormant General Motors plant in Newport, which later became one of Amazon’s largest facilities to date.

Nine years ago, HHA announced a strategic move to focus on the restaurant and hospitality sector with TKo Hospitality. Top names at TKo include former Meyer Jabara Hotels executive Kostas Kolgeropouls as CEO and president, hotel management veteran Vince DiFonzo as chief operating officer and E. Thomas Harvey III as chairman.

“We are proud to work with Harvey, Hanna & Associates and continue expanding our hotel portfolio throughout the Delmarva peninsula,” DiFonzo said in a press statement. “This is a great property with a positive reputation in the marketplace. Adding a customized operations strategy to this property will create an unforgettable experience that celebrates the essence of Rehoboth Beach while offering modern comforts and conveniences.” 

Among other assets TKo manages is Hyatt brands in Dewey Beach, Newark, Ocean City, Md., and Allentown and Chadds Ford, Pa. Other assets include Dewey Beach’s The Lighthouse restaurant and bar, Lighthouse Cove event center, Surf Club Oceanfront Hotel and more.

In 2021, HHA bought the Sandcastle Motel corner of Rehoboth Avenue and Second Street for $13 million. Since then, the company invested 18 months of time to transform it into the Coast Rehoboth Beach, a hotel that falls under Hilton’s Tapestry Collection.

HHA representatives declined to make any additional comments to the Delaware Business Times at this time.