Inspired by Stone Harbor’s success, Avalon has a plan to encourage ‘boutique’ hotels. But it faces local pushback.

In the Cape May County beach community of Avalon, cottages are regularly uprooted to make way for new development, and construction sites seem as ubiquitous as dune grass. But visitors won’t find any new (or old) hotels in the business district or on the boardwalk.

The borough’s master plan confines hotels to a zone two miles south of Avalon’s commercial core. Redevelopment has long been a sensitive issue in town; in 2016 the borough zoning board denied an application by a well-known local businessman, Anthony Zurawski, to build a 21-room boutique hotel in the business district.

Now, hotel proponents may be feeling a sea breeze in the air.

On Aug. 9, the Avalon planning board voted to amend the master plan to allow for boutique hotels, with conditions, in the business district. And if the amendment is approved by the borough council, Zurawski may have another shot.

“There should be a couple of boutique hotels along Dune Drive,” said Zurawski, who would like to build one himself on a vacant parcel next to the Princeton Grill and other businesses his family owns in Avalon.

But an informal group of residents who keep a watchful eye on development-related matters already are organizing a “No Hotel Zoning Changes” campaign, with a Facebook page titled Preserve Avalon a Family Town.

Zurawski has not yet submitted any plans and said sharing a sketch would be “premature.” But he said he hopes to secure approval to build a hotel with a minimum of 50 rooms, a couple of restaurants, a bar, a swimming pool, event space, and on-site parking, at 21st and Dune.

The splashy success of a hotel in neighboring Stone Harbor has inspired Zurawski. The Reeds at Shelter Haven opened in 2013 and has since been expanded. An overnight stay in the Bay View Suite Corner starts at $1,595, and the property has been lauded by numerous travel magazines and organizations.

“Everyone knows the positive impact of the Reeds,” Zurawski said. “The boutique hotel zone isn’t about me. It’s about making Avalon a better place.”

Some locals also would like Avalon to have its own version of Stone Harbor’s destination resort; the two towns have long been friendly rivals. But other Avalon residents are concerned that boutique hotel developers may buy up large properties along Dune and Ocean Drives, displace mom-and-pop businesses, add to traffic congestion, and make street parking — which is free everywhere in the borough — less readily available.

They also worry that ”Cooler by a Mile” Avalon and its low-rise, low-density, laid-back brand are already being eroded by a streetscape-shifting proliferation of massive houses and mixed-use developments. The loss of family-owned landmarks — including Tonio’s Pizza and Sylvester’s Seafood, both of which folded last fall — has added to a sense that the Avalon beloved by many older residents is slipping away, block by block.

“We’ve been averaging 65 teardowns a year, and in 2021 there were 78,” said Martha Wright, whose longtime bayside home is more than a mile from the proposed boutique hotel zone.

Teardowns are often replaced by enormous, elaborate houses, she said. “We certainly don’t need any more oversize homes, or even one boutique hotel.”

Paul Baldini is counsel to the borough’s planning and zoning board.

He said he expects the planning board “will review the potential for a new ordinance to allow boutique hotels in the business zone and decide whether to make a recommendation to the borough council” to enact the measure by amending Avalon’s land use ordinance.

“We are going through this in a methodical way,” Baldini said. “And we are working hard to make sure people have a fair opportunity to be heard.”

Marie Cocco, who has been visiting Avalon for 30 years and has owned her house there for seven, is among those with questions.

She said supporters of amending the master plan “are selling boutique hotels as some kind of savior or boon to the downtown. But they have presented no evidence that the downtown needs help, or that boutique hotels would drive offseason business.

“The entire community is being asked to accept a wholesale redesign of the town for the explicit purpose of aiding the business sector,” Cocco said.

Founded in 1892, Avalon — with about 1,400 year-round residents in its four square miles — had historically been a low-key, middle-class family resort rather than a party town, despite its brush with celebrity when Tonight show announcer Ed (”heeere’s Johnny”) McMahon built a summer house there in the 1960s.

Although McMahon once described Avalon as “one of the friendliest places on earth,” the borough’s luxury real estate evolution can be contentious: Some residents act as watchdogs, while others point fingers at “the NIMBYs.”

After a six-hour meeting in January 2021, the zoning board rejected a proposed boardwalk restaurant with a rooftop deck overlooking the dunes after some residents assailed it as too big, too tall, and bound to create parking problems.

“Some of the people against the boutique hotels say they want to preserve Avalon as a family town,” Zurawski said. “Since when has a five-star hotel come into a neighborhood and ruined it? People who stay in hotels have families, too. I have a family.”

Despite threats posed by climate change, the demand for Jersey Shore real estate is such that Avalon has lost many of the single-story cottages and funky Victorians that traditionally provided relatively inexpensive short-term rentals to college kids and young families.

Of the four hotels that were once in the borough’s existing hotel zone, just two are still operating; the other two were converted into condos.

In 2017 the borough even saw a hyper-opulent mansion nicknamed the “Little Marble House” torn down, just two decades after it was built. And in 2018 one of Avalon’s oldest houses was carefully disassembled and put in storage to make way for construction of a yet another mansion.

Permits for 102 residential units were issued in 2021, and the number so far this year is 62, borough officials said. Meanwhile, the median list price of Avalon homes for sale stands at $3.1 million, according to Realtor.com; the Paragon MLS service reports the median asking price for single-family homes in the borough is $3.9 million, with the median selling price at $3.4 million during the last 12 months.

“Avalon has always wanted to be Stone Harbor, but the quietude and peace one finds in Avalon are what you don’t find in other Shore areas,” said longtime resident Elaine Scattergood, known locally for the Virginia creeper vines the borough unsuccessfully tried to force her to cut down on her beach block home in 2020.

Doug Macauley has lived in Avalon for decades and is also a fierce critic of the boutique hotel zone. “When I ask people why they invest or vacation in Avalon, they always talk about the quality of life, the safety, and the fact that it isn’t congested,” he said. “Why risk that quality of life by increasing the density in the borough?”

Critics also contend that borough officials have not fully addressed questions about how boutique hotels are defined, what their benefits would be, and whether any such benefits would extend beyond businesses and into the entire community.

Setting up a boutique hotel zone “represents a philosophical change, a radical change, for Avalon, and it has not been communicated effectively,” said Wright.

In an interview, Avalon Mayor Martin Pagliughi called the proposed zone “just a concept” that has been “blown out of proportion” by opponents who dislike any sort of change.

“They’re acting as if there are going to be 100 hotels up and down Dune Drive,” he said. “There are probably only three or four properties where [boutique hotels] could be built.”

Pagliughi, who has been mayor since 1991, also said the amendment complements the existing master plan’s provisions to sustain retail downtown.

Borough council president Sam Wierman, who sits on the planning and zoning board, said the boutique hotel issue has been and will continue to be carefully vetted.

If the zone were implemented, “we don’t want any five-story hotels,” said Wierman.

“Whatever ends up being approved would have to be consistent with Avalon.”