WILDWOOD – An out-of-town investor is betting about $17 million that Wildwood is ready for an upscale hotel that will bring a new level of luxury to the city’s famous boardwalk. After working through a hiccup, the city’s Planning and Zoning Board threw its support behind the project, between Maple and Glenwood avenues.
After two hours and 18 minutes of testimony at Wildwood City Hall Nov. 7, the 75-room project, which will renovate and expand a dilapidated apartment building above a strip of boardwalk stores, adding additional floors, was approved unanimously by the board. The approval came with a key contingency - the developer needs to come up with 24 more off-street parking spaces. They can be anywhere in town.
Sunil Nayak, the developer, told the board he was drawn to Wildwood because it boasts the highest volume of tourists along the Jersey Shore, but “has much fewer properties than what the city deserves, in terms of classy hotels.”
His proposal includes a rooftop bar and swimming pool, 12 oceanfront rooms with private balcony pools, a lobby with a café opening onto the boardwalk, an oceanfront indoor/outdoor fitness area and other amenities.
Construction of the hotel cannot begin until Nayak’s company, Wildwood Hospitality Group, LLC, gets Department of Environmental Protection (DEP) approval. A Coastal Area Facilities Review Act (CAFRA) application was submitted to the DEP, the developer said, but is still pending.
The Planning and Zoning Board decided not to gamble that the DEP would take care of the parking requirement, as the developer proposed, instead saying it will not issue a certificate of occupancy, a requirement to rent rooms, before the developer proves it has at least one parking space for every hotel room, a requirement for new hotel development in the city.
The submitted plan accounted for 54 spaces and asked the board to grandfather in the existing 21 units, which currently include no parking, but have not been occupied since Hurricane Sandy. It was somewhat of a gray area how the DEP would consider the request to grandfather no parking for those existing units.
The applicant’s attorney, Ron Gelzunas Jr., expressed concern that denying the application over the parking shortage may put nearby property owners in a position where they could demand much more than market value to sell their lots.
“Hopefully it will be approved tonight, so those adjoining properties don’t feel they have you over a barrel, so to speak, in your negotiation,” Gelzunas told Nayak on the record.
But board members said that isn’t their problem and it is their obligation to make sure there are enough spaces, so it is not a disruption in the neighborhood.
Board member George Clark said without enough parking, cars will be left in the middle of the street, disrupting traffic and inconveniencing neighbors.
“It is a big issue. I know for a fact because it happens. We live here. We see it. So to say, if we vote the wrong way you’re going to have bidding issues [when acquiring parking], that’s really not on us. On us is to keep the parking adequate,” Clark retorted.
A nearby property owner said the applicant’s insinuation was insulting.
“We know what our properties are worth and when you come knocking on somebody’s door and ask to give them pennies for their property, it’s an insult. Nobody’s trying to extort anybody,” said neighbor Theresa Aquilino. “Everybody wants fair market value for their property.”
“I’m all for beautifying the neighborhood. Believe me. I’ve been there for a very long time. But they have to do it the right way and not to the detriment of the residents,” Aquilino added.
After back and forth with the board continued to focus on members’ uneasiness with the lack of parking, Nayak and Gelzunas deliberated off the record and agreed to a proposed contingency to make finding more off-street spaces a requirement to open for business.
“I do see where the board is coming from with the parking issues in the area,” Nayak said in an interview after the meeting. “For my guest service also, we had always thought we may look for more parking. It was not something I had not thought of before.”
Nayak said he remains 100% committed to the project. He is CEO of InnZen Hospitality of Monmouth Junction, in Central Jersey. He formed Wildwood Hospitality Group for the job on the boardwalk and also has ties to a number of Boston area hotels under a different LLC.
The development would be his first foray into Cape May County, after he previously tried to buy the Singapore Motel, in Wildwood Crest, but said he bailed before closing after discovering structural issues.
InnZen’s website boasts of 25 years in hotel acquisitions, management and operations. The company currently operates four hotels in New Jersey and Pennsylvania, including a Hampton Inn, a Comfort Suites, a Fairfield Inn by Marriott, and the Beach Walk in Sea Bright, Monmouth County, their website says.
It was the Beach Walk project that inspired Nayak to invest along the Jersey Shore, according to his testimony before the board. He acquired the property in Wildwood for $6.2 million in April 2022, according to the Herald’s property transfers section.
Nayak told the Herald he will spend another $10-11 million for construction, furniture, fixtures and equipment, and other soft costs like permit fees, design and engineering expenses, and insurance. He said he cannot go to lenders for the financing until he has all approvals but has never had a green-lit project he couldn’t get financing for. Nayak said he mostly works with banks as lenders.
The proposed hotel would renovate the existing space and add two new floors of rooms, which architect Ben Horten told the board was the application’s main objective. The hotel would be in the same footprint as what exists, besides two new elevator shafts that will be added.
Other variances were requested and approved for stacked parking (requiring an attendant to jockey cars in and out), maximum building height, multiple setbacks, signage, a buffer of plantings around parking areas, minimum square footage requirements for some units, and lot coverage, although the lot coverage variance did not exacerbate the existing condition.
“This is something Wildwood needs more of. There are no perfect applications. Sometimes, these are tough with parking situations…. I think they really came up to reason on them needing the parking spaces. I thank them for that,” said board member Phil Swetsky. “As far as investment goes in town, you can’t best something like this. Wildwood needs more like this. We need more people like you. So, thank you for your investment.”
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