Deer Streets Assoc. has a proposal pending for a 5-story hotel at 165 Deer St., a change from their original plans for multifamily housing. Image courtesy of Legat Architects

A Portsmouth Cambria luxury hotel proposed for a parcel just outside of the city’s downtown may not be going forward following an Oct. 15 vote by the city’s Zoning Board of Adjustment.

Developer Deer Street Assoc. has been working since 2016 to secure approvals for a five-parcel area along a little-used rail line immediately southwest of the city’s downtown. The area is currently a mix of office and light industrial properties, along with a public parking garage built as part of the developer’s overall Foundry Place master plan.

Deer Street had sought to re-permit a parcel at 99 Foundry Place as a hotel after having previously received approvals for a 5-story apartment building on the site, which backed onto a mixed residential and commercial neighborhood. The firm had sought a variance to build the hotel; the parcel’s zoning allows 5-story buildings only, however the proposed hotel would not have breached the 60-foot height limit in that zone.

The developer had sought the added floor to let it add an above-grade parking facility on the building’s second floor. The site is close enough to sea level that a basement garage would be below sea level, leaving it vulnerable to flooding, according to the project’s application to the ZBA.

At public hearings leading up to the vote, community members expressed concern over traffic the hotel would generate, particularly at night, and the growing number of hotels in the city. In its denial, the board stated the developer “not adequately demonstrated that the intensity of the proposed structure would not diminish the value of surrounding properties.”