Beachfront Outlook

Do Hotels Have a Future on Hampton Beach?

Two Prominent Landowners Place Big Bets Amid Condo Boom


Even though Hampton Beach has lost around 60 hotel rooms per year for the last five years to condominium developments, two major landowners think the village’s hotel market is underserved. Photo courtesy of VanGugi / CC BY 2.0

Despite the recent closure of a slew of hotels in Hampton Beach, a handful of prominent businessmen are betting that what the famed resort community needs is … more hotels. 

Al Fleury, owner of a number of bars and restaurants at Hampton Beach and elsewhere in the state, has already started the complete gutting of the old Colonial Motel at 46 Ashworth Ave., after purchasing the rundown beachfront motel earlier this year at auction for $930,000.  

If all goes well, Fleury hopes to re-open the “completely new look” Colonial next summer, with the same number of rooms, or 47 units, along with more modern amenities, possibly including a new swimming pool. 

Meanwhile, Sal Lupoli, owner of the Hampton Beach Casino, says he’s putting the finishing touches on plans for a “major redevelopment” of the oncegrand property, located at the very heart of the beachfront area, into a mixed-used complex that would include a refurbished entertainment venue, retail and restaurant space, new offices, apartments, condominiums and hotel rooms. 

Lupoli, a major developer in both New Hampshire and Massachusetts and founder of the Sal’s Pizza chain, said he hopes to unveil plans for the 500,000 to 700,000-square-foot redevelopment project within the next 12 months, if not sooner. 

Eight Closed in a Decade 

Others are seeing the value of restoring and modernizing some of Hampton Beach’s older loding facilities – as well as other commercial properties – as early-stage gentrification appears to be hitting Hampton Beach. Among them: Hampton Beach investor Terry Daidone, who recently bought the Mari-Anne Motel at 2 Ocean Blvd. and plans to renovate and expand the facility, according to published reports. 

The recent moves by Fleury, Lupoli and Daidone come at a time when a number of old Hampton Beach hotels and drive-up motels – many of them built in the first half of last century and allowed to deteriorate over the years – have been closed, torn down and replaced by condos, parking lots and occasionally by new commercial facilities.  

No figures are available on the number of old hotels that have closed in recent years, after once thriving during Hampton Beach’s honky-tonk heyday in the 1940s, 50s and 60s. Some put the number of closed hotels and motels at about eight or more over the past decade, alone. 

Attracting major employers and office workers to the beachfront area will help create year-round business for area restaurants, shops and hotels. New owner Sal Lupoli wouldn’t say how many hotel rooms a revamped Hampton Beach Casino might have, but he envisions attracting both business and vacation travelers.

Most agree the biggest challenge for hotels and drive-up motels on Hampton Beach is the fact the area is only a seasonal destination for many travelers, with a five-month window of business during the late spring, summer and early fall.  

Another challenge is that recently built condos, even though they’ve replaced many old hotels and motels, are nevertheless regularly rented out during the summer season. Meanwhile, the advent of Airbnb has meant even more seasonal rentals coming on the market in the Hampton Beach area. 

And some even go back further to explain the demise of smaller hotels that were once a mainstay of the Hampton Beach scene. They note that the deregulation of the airline industry in the late 1970s allowed more working-class and middle-class vacationers – long the demographic backbone of Hampton Beach – to regularly travel afar by plane. 

Offices for Hampton Beach? 

Whatever the reasons, what do Fleury, Lupoli and Daidone see that others don’t see when it comes to investing in hotels? 

Fleury, who estimates Hampton Beach has lost lodging accommodations at the rate of about 60 rooms a year over the past five years or so, says he believes the industry pendulum has simply swung too far: There are now not enough hotel rooms for short-term travelers, and that’s been hurting his restaurant and bar business. 

“It will be good for everyone’s business, not just mine,” he said of his efforts to revamp and re-open the Colonial.  

He agrees that many of the old hotels/motels that have been torn down of late were in rough shape, often looking like relics from a bygone era. But what many of them really needed were modern upgrades, not tear downs. 

“As long as they’re safe and clean, people will stay in them,” he said. 

Like Fleury, Lupoli thinks the seasonal nature of the Hampton Beach scene has taken its slow toll on the local hotel industry. More year-round activities are needed, he saidand that’s why he’s wants to include office space in his redeveloped Hampton Beach Casino complex. 

The rationale: Attracting major employers and office workers to the beachfront area will help create year-round business for area restaurants, shops and hotels. He wouldn’t say how many hotel rooms a revamped Hampton Beach Casino might have, but he envisions attracting both business and vacation travelers. 

“I want to incentivize families and others to come back again and again to Hampton Beach,” Lupoli said. 

In the last 10 years, developers have turned many dilapidated Hampton Beach hotels and motels into new condominium developments, but local real estate watchers say the buildings function almost like hotels, thanks to Airbnb.

Market for Condos Still Strong 

Earlier this decade, David Hartnett and his wife Kara bucked the hotel trend on Hampton Beach, purchasing a struggling hotel at 40 Ashworth Ave. and investing nearly $1 million into it. Today, business at the Main Sail Motel & Cottages  which comprises three hotel buildings and 19 cottage units – is booming, at least during the summer season. 

“We’re virtually sold out for the summer by Memorial Day,” he said. 

Hartnett agrees that part of the hotel/motel problem at Hampton Beach has been that too many of the older and smaller facilities were simply not keeping up with the times.  

Some places still advertised ‘wall-to-wall carpeting and color TVs,’” he said. “That tells you something about their condition.” 

But Hartnett is not sure whether Hampton Beach needs many more new hotels and motels. A seasonal resort area is still a seasonal resort area, he said, and the economics are difficult to overcome. 

Over the years, Tom McGuirk, a broker at McGuirk Properties, has helped sell older Hampton Beach hotels and motels that have fallen on hard times. Many were in “awful” shape and the rooms simply too small, he said. 

Many of the poorquality motels have been torn down and are being replaced by higher-end condos that are then rented out,” he says of the recent hotels-to-condos tradeoff at Hampton Beach.  

The trend has been going on since the 1970s, he said, not just the past few years. 

John Nyhan, president of the Hampton Area Chamber of Commerce, sees the hotel-knockdown trend continuing, noting the recent demolition of the old Kentville on the Ocean hotel, next to the Ashworth Hotel, to make way for dozens of new condos.  

Indeed, the median sale price of Hampton condos sold through September of this year – $295,000 – is up 48 percent over the median price of all condos sold in town in 2010 – $199,000. And, that figure is up 19 percent compared to the 2014 yearly median sale price of $247,700 according to The Warren Group, publisher of The Registry Review. 

But Nyhan said there’s still a “considerable amount of need for more hotel rooms” on Hampton Beach, as long as they’re clean, modern and affordable 

“We’re seeing a change in tourism, with people coming for three to five days, and we need hotels,” he said. “The market is changing.”