REHOBOTH BEACH — With rising sea levels in mind, Alex Papajohn, who is seeking to build a four-story hotel at 2 Rehoboth Ave., is hearing from multiple state agencies cautioning against its construction.

During a virtual meeting Wednesday, various state offices were given the opportunity to review several land-use proposals before they are submitted to their respective municipalities.

Included was the site plan for the 116,926-square-foot Belhaven Hotel — spread across 1.1 acres along the Rehoboth Beach boardwalk and Rehoboth and Wilmington avenues — along with an underground garage at the hotel and an off-site parking lot on Baltimore Avenue.

The Belhaven’s proposed location is where Candy Kitchen and Grotto Pizza are currently located on Rehoboth Avenue and along the south boardwalk, respectively. The hotel, in an S shape, would run down the first block of Rehoboth Avenue with some beach-facing property and extend back to Wilmington Avenue.

The off-site, aboveground parking lot would be located on Baltimore Avenue.

The hotel’s anticipated location is on the opposite corner of the former Dolle’s Candyland, which sits on the north side of the intersection of Rehoboth Avenue and the boardwalk.

In December 2020, Dolle’s announced that it would be moving to a storefront further west on Rehoboth Avenue, citing a rent increase and unfavorable lease terms. In February, Grotto Pizza announced that it would be purchasing the former Dolle’s oceanfront property, which still displays the store’s iconic orange sign. At the time, Grotto ownership said it would close its North Boardwalk location and rebuild on the corner of Rehoboth Avenue and the boardwalk.

On the opposite corner, if the Belhaven is approved, Mr. Papajohn said his current tenants along Rehoboth Avenue — from the T-Shirt Factory east to Candy Kitchen — would be made to close during construction of the hotel, with the option to reopen on the first floor once the building is completed. The same goes for Grotto Pizza’s South Boardwalk location, which currently sits just south of Candy Kitchen.

Additionally, three apartment buildings on Wilmington Avenue would be demolished.

“Every stakeholder that we have heard from want those stores to come back,” Mr. Papajohn said. “We want to have them back, and I think the tourists, public and, really, all the stakeholders — we all want those stores back.”

Grotto Pizza had no comment on the Belhaven Hotel and possible closure of its South Boardwalk location “at this time,” a representative said Thursday.

Given that the proposed hotel would be new construction at the foot of the beach, several state agencies shared concerns Wednesday that the building would be affected by rising sea levels.

“I just wanted to express concerns, and it’s largely over sea level rise. We all know that the water is coming up,” said Beth Krumrine, principal planner with the Delaware Department of Natural Resources and Environmental Control. “We have to start changing the way that we’re building and the way that we’re developing.”

Claire Quinlan, another representative of DNREC, also spoke against the hotel’s construction, saying the site on which it would be built is subject to “permanent sea level rise.”

The area has a 1% chance of experiencing flooding or other hazards associated with storms, according to Phillip Cane, a planner with the Delaware Emergency Management Agency.

However, that percentage goes up incrementally to 26% over the expected 30-year lifespan of the hotel. The northeast portion of the hotel also could be subject to waves from storms.

In addition, both Ms. Quinlan and Mr. Cane said the southern portion of the property is in an “AE Zone,” according to the Federal Emergency Management Agency’s flood insurance rate map. Buildings in this zoning have a higher risk of flooding.

Mr. Cane recommended the hotel be constructed with flooding in mind. He cautioned against an underground garage, but said that if it is built, it should incorporate protection from floods.

“Concerns we definitely have would be parking underground or having anything that’s underground,” Mr. Cane said. “We would strongly encourage that the facility itself, if it is being constructed, be constructed with flood-resistant infrastructure.”

Mr. Cane advised that no hotel rooms be on the first floor, so sleeping patrons wouldn’t be taken by surprise if there is a flood at night.

If an underground garage is constructed, Mr. Cane said that DEMA suggests posting signage to warn users of the flood risk.

In response to concerns from DNREC and DEMA, Dave Kuklish, an engineer with Bohler Engineering and the hotel’s project designer, said it has received approval from FEMA for a revision to the location’s flood designation. The AE zoning, he said, has been changed to “AO,” which permits underground parking.

Although Mr. Papajohn did not respond to any of the agencies’ concerns in the Wednesday meeting, on Thursday, he said the zoning revision was driven by “technical data.” He said the Papajohn family retained the services of Bohler Engineering to “request a letter of map revision” from FEMA.

“That request has to be supported by a lot of technical data and modeling,” Mr. Papajohn said. “Bohler did that modeling and put together all the technical data necessary to support our request, and FEMA agreed with us that the change was appropriate.”

Despite this, Ms. Krumrine noted that she would still like DNREC’s official written comments to be that the agency is “not in support of this project.”

Another suggestion for the hotel was lifted utilities, HVAC and hot-water heaters.

But Duane T. Fox, assistant chief of technical services with the Delaware State Fire Marshal for Kent and Sussex counties, said lifting utilities like fire pumps could make it difficult for people to exit rooms in an emergency.

He said any fire rescue access to the hotel is already limited on Rehoboth and Wilmington avenues. He added that fire marshal officials and the city would need to discuss with Mr. Papajohn “how we’re going to gain access to this building and get the amount of coverage necessary.”

“A four-story hotel building would need at least 50% fire lanes, and I don’t see you getting 50% of your perimeter,” Mr. Fox said. “There’s probably going to be some discussions, and I would venture to think that’s going to take an alternative through our office, through the fire marshal, to approve any kind of limited access.”

Mr. Cane said DEMA also “strongly encourages” using environmentally friendly infrastructure like plant-covered roofs or solar panels.

Given the hotel’s proposed location, developers also would need a letter of approval from the state Division of Watershed Stewardship.

Tom West, Rehoboth Beach’s city planner, said the city is aiming to balance revitalization with maintaining the character of the area. He said Rehoboth Beach also is taking into account environmental concerns, like rising sea levels.

“There’s a lot to consider here and balance with the city’s plan,” Mr. West said. “We’re still gathering information.”

He said a conceptual plan of the hotel will likely be up for review by the city’s Planning Commission during an Oct. 8 meeting. Meanwhile, comments from the concerned state agencies will be gathered and presented to city leaders and to the developers within 20 working days.

According to the city’s website, during a presentation of the hotel proposal at a June 12 Planning Commission meeting, the general consensus of members was that, though the proposal was code-compliant, it was inconsistent with the “objectives and intentions” set forth by the city’s 2020 comprehensive development plan. Also, planning commissioners said the plan had “little harmony with the existing structures at such an iconic location.”