Boutique Hotel, 4-Star Restaurant Planned for Peabody Square

If you’ve heard the rumors, they’re true. The new owners of the O’Shea Building in Peabody Square are planning to open up a hotel.

“We are planning to bring a high-end boutique hotel to Peabody Square,” said Dan Bandar of Bandar Development & Builders in a recent interview.

The Middleton firm purchased the Second O'Shea Building at 9-13 Main St., a visual landmark downtown, this past summer for $1 million.

The three-story structure was placed on the National Register of Historic Places in 1905 and sits at the corner of Main and Foster streets. The building is currently occupied by China Corner, a furniture store, barbershop and some offices, but part of it is vacant.

The new plan includes a four-star restaurant, which would be the main attraction and located on the first floor. The restaurant would take up 4,000 square feet and 64 luxury rooms would occupy the top two floors. It would be called the Peabody Essex Hotel.

The facade of the historic building will remain mostly unchanged, but the interior will be totally renovated, Bandar said. The restaurant, which will have full liquor service if all goes according to plan, will rely on local food vendors.

The immediate comparison for a boutique hotel on the North Shore is the Hawthorne Hotel in Salem, but sans the historical connection to Nathaniel Hawthorne and waterfront of the Witch City, Bandar says the Peabody Essex Hotel will be similar to the Exeter Inn up in Exeter, N.H.

That hotel is run by Hay Creek Hospitality, a New Hampshire-based company that’s pre-eminent in hotel management in the United States, according to Bandar. He said Hay Creek will run the Peabody Essex Hotel as well.

Hay Creek operates 10 hotels now, most of them in New England, and is part of a project to open up a new boutique hotel in Cambridge, the Porter Square Hotel.

Can a boutique hotel work in downtown Peabody?

One of the early obstacles, Bandar admitted, was convincing financial backers there was a need for this project in downtown Peabody, and that he could make it work. He said feasibility and investment studies, however, demonstrate just the opposite of that skepticism.

There is a need, Bandar said and implies it’s about vision. Not even his vision really, but rather believing in and building upon Mayor Ted Bettencourt’s enthusiasm and commitment to revive downtown Peabody.

“If not for the mayor’s vision and redevelopment plan for downtown, we wouldn’t be doing this,” Bandar said.

Right now, the downtown is just a drive-through with thousands of cars on the roads, he said, but he believes the area can be reshaped into a destination – both for Peabody residents and their neighbors. A four star restaurant could be a prized destination.

Is Peabody a good fit? Bandar says look at the redevelopment in Portsmouth, N.H. over the past 20 years – the city has gone from having a military base drive the local economy to becoming a thriving destination with numerous hotels and major commercial development.

Still Portsmouth has a seaside waterfront and Peabody does not. But Bandar believes the vision is there to transform the heart of the Tanner City into its own destination.

Community Development Director Karen Sawyer likewise said a boutique hotel concept could “absolutely” work downtown.

“It could provide that boost to the downtown and also have people who patronize [the hotel and restaurant] look for other services and goods,” she said.

Bandar noted steps the city has already taken, such as reconfiguring Main Street, and referred to plans to redesign the square, which include allowing and adding space for outdoor dining.

He also pointed to other new investment – local builder Norman Lee recently purchased 11 Main St. and plans to renovate the upper floors into apartments. The bottom floor houses Congressman John Tierney’s district office.

Bandar will need to apply for a special permit from the City Council for the hotel. The property is in a Central Business zone, which does mean that a restaurant with alcohol service, at least, is allowed by right.

Mayor says downtown needs a 'magnet' to attract people

Bettencourt said in a separate earlier interview he was excited about the hotel project, which is right in line with giving people a reason to patronize the downtown.

“I’m excited about this project for a number of reasons. One is just that we have an owner now who’s going to be investing in the property, putting millions of dollars…into it,” he said.

“That building represents really the cornerstone to the downtown. I want something that’s going to bring people to it, sort of a magnet to bring people to that area,” Bettencourt said, adding he believes there is great potential for a boutique hotel and restaurant.

“We want to give people a reason to stop because we do have 25,000 cars that pass through Peabody Square every day. That’s what this is all about,” he said. “We can just throw up our hands and say ‘Yes, this is a cut-through,’ but that to me is a waste of time. I want try to find solutions.”

Bettencourt also wants to build a mixed-use multi-story parking garage either in the square or nearby.

As for the hotel, it would require around 100 parking spots, according to city planners, which is an obstacle to provide on-site.

There are only a handful of spaces behind the building. There are three municipal lots right off the square, but the only non-metered lot is on Railroad Avenue and several spots are already taken in the Foster Street lot with permitted spaces.

Bandar says he’s been in talks with the city on parking and plans to have a combination of valet and shuttle service. He did not say where those cars would be stored at this point.

Next steps

In terms of a project timeline, Bandar says his firm wants to “jump on the bandwagon as soon as possible,” but there are still a few details that remain.

The next task is to acquire the city’s available all-alcohol restaurant license. The Licensing Board has received five applications (including Bandar’s) for the license and will be holding public hearings Dec. 23.

John Mastrangelo returned the license to the city this fall after he was unable to move ahead with plans to open a pub at the vacant Fire Bull Restaurant space on Central Street.

Sawyer did confirm that as of last week, plans hadn’t been submitted to the city yet to obtain a special permit. A version of the proposal, however, is on file with the Licensing Board.

“We’d love to have this up and running within twenty-four months,” Bandar said.