Continued delays on rezoning request for 330 Rehoboth Ave.

Minor subdivision for Lake Avenue properties moves to July public hearing
June 15, 2021

The owner/developers of Rehoboth Beach’s 330 Rehoboth Ave. are going to have to wait at least another month for the planning commission’s recommendation on the proposed rezoning of the property’s State Road-fronting portion.

The property is split-zoned – 23,067 square feet of C-1 commercial along Rehoboth Avenue and 19,425 square feet of R-1 residential along State Road. Under the name 330 Hospitality Group LLC, Bette Gallo, founder and president of Gallo Realty, and Don Lockwood, owner of Milton-based Lockwood Design and Construction, purchased the property from the family of J.J. Stein in January for $4.2 million.

Gallo and Lockwood have requested a rezoning of the residential portion of the property. They went before the planning commission in May, but the commission delayed a decision in favor of gathering more information. 

During a meeting June 11, commissioners voted in favor of delaying another 30 days to give the request more consideration and to provide the owners time to modify their submission with self-imposed use restrictions.

Planning Commission Chair Jeff Trunzo said it was going to be very difficult for the planning commission to recommend a rezoning without any limits. Rehoboth is too small and too built out, he said.

City Solicitor Glenn Mandalas said the planning commission cannot place a condition allowing only a particular use. However, he said, there will be an opportunity to attach conditions during a site-plan review.

Attorney David Hutt represented 330 Hospitality Group during the meeting. Without showing detailed sketches, he said the owners have reaffirmed that they want to build a hotel on the property, with parking to remain where it is now. It keeps the intense use on Rehoboth Avenue, which is consistent with how the property is used now, he said.

If the property is used for a hotel, motel or inn in the next 40 years, Hutt said the owners are willing to restrict themselves to a 10-foot rear-yard setback, which exceeds the city’s minimum requirement of 5 feet for a commercial lot abutting a residential lot. He said the vast majority of the hotel would be 15 feet from the rear boundary line.

Hutt also showed a rearrangement of the parking lot that has the drive lane along the back of the property, instead of parking spaces.

Describing the request as a big ask, Commissioner Lee Weber said he hadn’t seen a plan that balances the possible scope of changes with the benefits of the potential rezoning to the owners.

Minor subdivision of Lake Ave properties moves forward

Following the 330 Rehoboth Ave. discussion, the planning commission moved forward to set a public hearing on the proposed subdivision of 63, 65 and 67 Lake Ave. for Friday, July 9.

The three lots are zoned C-3 commercial, which means retail stores, restaurants, hotels, motels and parking lots are allowed to be built. However, the owner, Seattle, Wash.-based PNSDE-Lake LLC, would like to split the middle lot to make two large lots out of the three.

According to City Building Inspector Matt Janis, as of the meeting, no building plans had been submitted to the city.

The commission conducted a preliminary review of the application during the recent meeting. The threshold for moving to a public hearing is if the application is substantially complete. All the commissioners agreed it was.

Commissioner Mike Strange said it’s nice to see the space go from three lots to two and for the developer to not take advantage of the commercial allowances. If this happens, because of needed curb cuts, the city could add one or two parking spaces, he said.

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