The slow rollout of a hotel moratorium in Maine’s largest city undercut its aim of slowing new development.
Portland city councilors voted 6-2 to impose a six-month moratorium on new hotel construction in the city last November to prioritize housing projects, but the ordinance didn’t garner enough votes for it to be passed as an emergency order with immediate effect. That meant the policy wasn’t put in place for another 30 days.
In that window, two hotel developers submitted projects for approval, according to city records. One proposal was for the conversion of Portland’s iconic Time and Temperature Building into a 181-room hotel. The other, a new construction project in the Old Port, proposes a 31-story, 360-foot tall hotel with 130 rooms and 52 condos. Only nine hotel projects have been approved for development in Portland since 2019.
Though their application was already in progress prior to learning about the ordinance, the moratorium was, in part, behind the timing of that Old Port project’s submission, said Jessica James, a spokesperson for East Brown Cow, the developer behind the Old Port project.
“It was one of the factors we had to take into consideration in the final planning ahead of submission,” James wrote in an email.
Chris Rhoades, the developer behind the Time and Temperature Building project, declined to comment for this story. But the sentiment within the wider development community is that the purpose of the moratorium was undermined by that month-long implementation period, Jim Brady, president and co-founder of the hotel and housing developer Fathom Companies, said.
“Everybody that had something coming up in 180 days got their application in,” he said.
That was frustrating for city councilors who championed the moratorium and wanted to see it pass with immediate effect.
“I was disappointed,” Kate Sykes, a Portland city councilor, said.
The rationale behind the moratorium, Sykes said, was to ensure that for 180 days Portland’s planning board could focus on permitting as much new housing as possible. While new hotels bring more jobs, more tax revenue and more tourism to a city, Sykes said they also increase the need for more workers who will typically earn below 60 percent of the area median income.
“And we have a real shortage of workforce and affordable housing,” Sykes said. “So not only does it not build housing when we build hotels, but it also increases the need for housing. It’s this exacerbating force in a housing crisis.”
Despite the two hotel projects being submitted after the moratorium was announced — and therefore commanding the time and attention of the planning board — Sykes said the ordinance will still achieve its aim of clearing the pathway for more housing proposals.
The council will also use these six months to examine Portland’s inclusionary zoning policy around hotels, she said, and might choose to do away with the city’s “opt-out fee” that developers can pay per unit in lieu of building affordable housing units for the city. In the five years since that policy was enacted, each hotel developer has opted to pay the fee instead of building housing.
“They all just choose to opt out, and we’d rather have them build it, because that actually creates the housing. [The fee] doesn’t really go that far,” she said.
