Grotto Pizza takes over Dolle's on Rehoboth Beach boardwalk

The iconic corner of Rehoboth Avenue long graced by the orange script Dolle’s sign could soon be the home of Grotto Pizza and a 60-room hotel.

Almost a year after the Dolle’s sign came down, Grotto Pizza and its partner Onix Group now control the oceanfront block between Rehoboth and Baltimore avenues from Dolle’s to Grotto Pizza’s north boardwalk location.

Their proposed four-story hotel would stretch across the entire property. Renderings show a tan-and-brown building with balconies facing the ocean above retail space along the boardwalk. Grotto Pizza would relocate to the corner of the former Dolle’s.

According to the plans, the project would have two levels of underground parking. Above the ground-floor retail on the second floor, there would be 16 hotel rooms, a gym, an outdoor pool and a breakfast room. The remaining 44 hotel rooms would be on the upper floors.

Grotto Pizza has partnered with Onix Group, a Kennett Square, Pennsylvania, company that helped develop the Wilmington Riverfront Hyatt Place and event space among other properties in southern Delaware and southeastern Pennsylvania. After purchasing the Dolle’s property at the beginning of 2021 for $6 million, they together control all of the properties along the boardwalk between Rehoboth and Baltimore avenues, including the closed Sirroco Motel, the former Nick’s Luncheonette, Zelky’s Beach Arcade and the former Dolle’s building.

Their plan also encompasses the Kohr Bros. storefront next to the former Dolle’s.

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The Rehoboth Beach Planning Commission offered a preliminary review of the plans Monday afternoon. The project will return to the Planning Commission at a later date for a public hearing before a vote for approval.

The project requires a variance for the property to be developed at a greater floor-area ratio than permitted by city code. Rehoboth Beach city code limits projects to a FAR of 2.0, meaning the total size of the building can’t exceed two times the size of the lot it is constructed on.

As proposed, the Grotto Pizza project calls for a FAR of 2.76. It meets all other standards of city code.

The FAR variance is the same variance the Papajohn family sought for its hotel project at the opposite corner of Rehoboth Avenue. Their proposal calls for a four-story luxury hotel in the image of the former Bellhaven Hotel with 116 rooms, balconies, a zero-edge pool, a conference center, an exercise room and underground parking.

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The Rehoboth Beach Board of Adjustment approved the variance request late last year.

More than 100 Rehoboth Beach residents signed a letter opposing the variance, arguing the hotel would have an “adverse impact” on the town because its size goes against Rehoboth Beach’s character and would “open the flood gates” for further expansion in commercial areas and increased hotel density.

Rehoboth Beach resident Francis Markert filed a lawsuit challenging the variance approval. A Superior Court judge in September ruled in the Board of Adjustment’s favor, upholding the variance. The project must still go through the city’s site plan review process, starting with a hearing before the Planning Commission, before construction can begin.

Markert joined the Rehoboth Beach Board of Commissioners in June.

A Rehoboth Beach institution for almost 100 years, Dolle’s Candyland left its coveted corner at the end of January 2021. Owner Tom Ibach moved Dolle’s a few doors west, merging it with his other storefront Ibach’s Candy by the Sea.

Ibach is the third generation of his family to run the saltwater taffy, popcorn and candy business. He said he decided to move when his landlord asked for double the current rent at the expiration of his lease.

Co-founders Thomas Pachides and Rudolph Dolle in 1927 bought what was then an old YMCA building at Rehoboth Avenue and the boardwalk for $30,000, according to Dolle’s website. The orange sign was placed atop the Dolle’s building when it was rebuilt following the Storm of 1962.

The Rehoboth Beach Museum mounted the Dolle’s sign on the side of its building near the start of the avenue this summer.

Vincent Robertson, a lawyer representing the developers, said in an ideal scenario the companies aim to begin construction of the hotel and restaurant in September 2023. They are planning to coordinate construction with the city’s new lifeguard station, which will be next to where Grotto Pizza is currently located.

PREVIOUS REPORTING:Grotto Pizza’s super-secret dough recipe; 10 more fun facts about Delaware’s best known pizza

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Grotto Pizza takes over Dolle’s on Rehoboth Beach boardwalk

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