ROCKLAND, Maine — The Rockland lodging industry is seeing its most significant change in a generation.
Two separate hotels are in the planning stages while the two largest Rockland motels are undergoing a reduction in the number of rooms as the space is converted to either time share units or residential condominiums.
The changes come as the lodging industry statewide saw one of its best years on record in 2013.
Maine lodging businesses reported sales of $721 million for the first 10 months of 2013, according to the Maine Bureau of Revenue Services. November and December figures were not yet available. The 2013 figures are on pace to break the lodging sales record set in 2012 of $737 million across the state.
In the Rockland-area market — defined as much of Knox County except Camden, Rockport, Hope and Appleton — lodging businesses reported sales of $10.2 million in the first 10 months of 2013. This is also on pace to break the 2012 record of $10.4 million.
Greg Dugal, executive director of the Maine Innkeepers Association, said last year was a strong one for lodging places. He said, however, that a survey done in January of association members found that 40 percent of inns had not returned to the prerecession level of 2007. Seventy lodging places responded to the survey. Dugal said most of the inns that had not yet returned to 2007 profit levels were from the midcoast and Down East.
He stressed that while income has increased, costs also have increased.
Dugal said there has been a building boom for lodging places in metropolitan areas of Maine such as Portland and Bangor.
Rockland is seeing a potential boom. This would be the greatest growth in rooms in more than 40 years.
Stuart and Marianne Smith, two successful local business owners, have proposed constructing a 65-room luxury hotel on the waterfront in Rockland’s South End.
Stuart Smith said they saw the need for more quality hotel rooms in Rockland.
“We want to re-create the look of the old classic New England hotels,” Stuart Smith said earlier this month.
The Smiths have played a role in the creation of many projects in Knox County including the Maine Sport Outfitters in Rockport, the Lord Camden Inn in Camden, the Grand Harbor Inn in Camden and Bayview Landing in Camden. They were also principals in the conversion of the Breakwater Marketplace in Rockland to offices and retail space.
Smith presented his $6.5 million hotel plan Tuesday night to the Rockland Planning Board in a preapplication meeting and it was well received by the board. Two residents in the city’s South End asked the board to consider the impact of the project on the water views of neighbors.
At the same time, the Lyman Morse boatbuilding firm in Thomaston, through its company ADZ Partnership, has proposed building a five-story, high-end boutique hotel with about 26 rooms at 250 Main St. within view of the planned Smith hotel.
The Lyman Morse project, however, faces an obstacle — a lack of parking. There is no parking at the site. But about 900 feet west on Pleasant Street ADZ owns property where it had wanted to obtain a zone change to have a valet parking lot for its guests.
The parking plan was met earlier this week at the city planning board meeting by considerable opposition from residents who live near the proposed parking area. The residents said it was an unreasonable commercial intrusion into a residential zone. The city is working with the company on trying to obtain the right to use some of the land owned by the state at the nearby train station for parking for the proposed hotel.
Dugal said he has talked with a lot of people about the Rockland market and there is agreement that there is demand for more high quality hotel rooms in the region in addition to what is offered at the Samoset Resort in neighboring Rockport.
At the same time that more hotel rooms are being proposed, the owner of the two largest motels in Rockland is converting more rooms to other uses.
Robert Liberty, who owns the 138-room Trade Winds Motor Inn in Rockland and the 72-room Navigator Motor Inn, said he is converting some rooms to condominiums or time share units because the demand for hotel rooms in the winter has fallen significantly since the recession struck in 2008.
The Trade Winds opened in May 1965 and the Navigator opened in 1972.
He said before the recession many of the hotel rooms were rented in the winter by construction workers who were working on various local projects.
Liberty said there has also been a decline in non-summer bus tours.
Sales figures from the state revenue services bureau confirm that disparity between summer and winter business in the Rockland market. The busiest months for lodging businesses in the state and Rockland market is August but the variation between the slow months and the busy months is much greater in tourist-dependent places like Rockland.
In August 2013, lodging sales set a monthly record of slightly more than $2.4 million in the Rockland market. In January of last year, however, lodging sales in the Rockland market were less than $200,000.
Since 2008, Liberty has created 16 time share units out of rooms in the Trade Winds. On Tuesday night, the Rockland Planning Board approved the creation of three more units.
And Liberty is also marketing the Navigator as residential condominiums. He said this past week that one condo has been sold. More space at the Navigator will be converted to condos as they are sold, he said.