Proposed Ocean City Boardwalk hotel falls through

The developer of a proposed $150 million luxury resort hotel on the Ocean City Boardwalk, on the site of the former Wonderland Pier amusement park, said the project is dead after suffering a huge setback Thursday night during a vote by City Council.

Eustace Mita, the owner of the upscale ICONA brand of resort properties at the Jersey Shore, wanted Ocean City to declare the old Wonderland site “in need of rehabilitation” to fast track development of what would have been a 252-room hotel.

Instead, Council voted down a resolution that would have asked the city’s planning board for its recommendation on whether the Wonderland site should be designated as an area in need of rehabilitation. The vote was 6-1, with Council Vice President Pete Madden the only member of the governing body to support the resolution.

If Council had approved the resolution, it would have been a crucial first step in a process that could have ultimately led to Mita developing his luxury resort in an area of the Boardwalk that currently allows only retail shops, restaurants and amusements – not hotels.

Council’s vote against the resolution capped an emotional 2½-hour meeting that drew impassioned pleas from both supporters and opponents of the hotel. More than 40 members of the public spoke among the standing-room-only audience in the Council chambers.

The project has bitterly divided the community since Mita unveiled his plans for the hotel last year. Those divisions were clearly on display at the Council meeting when opponents and supporters spoke for about two hours.

Afterward, a disappointed Mita said he will not move forward with the hotel and plans to put the Wonderland property, at Sixth Street and the Boardwalk, immediately up for sale for $25 million, the appraised value.

“It’s over,” Mita told reporters while declaring the project dead.

    Hotel developer Eustace Mita addresses City Council.
  

Mita bought the Wonderland property in 2021 to save it from a sheriff’s sale after the then-owner, Mayor Jay Gillian, had defaulted on an $8 million mortgage.

Gillian, whose family had operated Wonderland since 1965, continued to run the iconic amusement park under Mita’s ownership, but closed it for good in October 2024 following years of financial difficulties.

Mita said he paid $14 million to buy Wonderland Pier and spent about $1.2 million annually in “carrying costs” under his ownership for the past four years. He put his total investment in the property at $20 million.

He had hoped to revive the site by developing an “ICONA in Wonderland” luxury hotel that would have incorporated the amusement park’s signature rides, including the 140-foot-tall Ferris wheel and the historic carousel, in the designs.

“I feel bad for the city, because they had an opportunity to do what I think is in the best interest of the city,” Mita said of the Council vote.

Mita estimated it would take at least five years to develop the hotel without having the site declared in need of rehabilitation. He said he simply does not want to wait that long.

“That will be the end of it as far as ICONA is concerned. We will immediately put it up for sale,” he said in an interview.

    City Council votes 6-1 against a resolution to consider declaring the Wonderland site "in need of rehabilitation."
  

Mita said he was surprised by the vote. During the meeting, he publicly lashed out at some of the hotel’s most prominent critics, claiming they had “fear-mongered and bullied people” into opposing the project.

“I don’t understand the anger, and I don’t appreciate deception,” he said.

At times during his public remarks at the meeting, Mita was interrupted by shouts or derision from hotel opponents seated in the audience. One woman called him a “liar.”

Council President Terry Crowley Jr. and Mayor Gillian pleaded with the audience to be respectful.

“I just hope everyone is honorable and does the right thing,” Gillian said.

Instead of declaring the Wonderland site in need of rehabilitation, some of the Council members said they would prefer to have the community vote on the hotel project during a nonbinding public referendum at Ocean City’s municipal election next May.

Other Council members want to make the Wonderland site part of a broader review of the Boardwalk in the city’s master plan.

    From left, Councilmen Dave Winslow, Jody Levchuk and Keith Hartzell speak about the hotel project.
  

Councilmen Dave Winslow and Sean Barnes said the master plan process would enable the city to take “a global look” or “holistic approach” at the Boardwalk’s development.

“It has to be responsible change. It has to be responsible development,” Barnes said.

Councilman Jody Levchuk, whose family owns the Jilly’s brand of shops on the Boardwalk, said a master plan review would be the fairest way of studying the Boardwalk’s zoning laws and how they apply to all of the Boardwalk businesses.

Councilman Keith Hartzell said he didn’t believe that the Wonderland site fit the legal criteria for being declared in need of rehabilitation.

Crowley and Councilman Tony Polcini also said they preferred to study the redevelopment of the Wonderland site in the master plan review process.

Madden, while speaking in favor of declaring the Wonderland site in need of rehabilitation, said he thought it was a mistake for Council to vote against the resolution.

“I think we’re a little shortsighted,” Madden said.

Madden said that by declaring the Wonderland property in need of rehabilitation, it would move the possible redevelopment process along. He added that Council could always reject the hotel at a later time if it felt the project wasn’t a good idea.

    Children whirl around on the Wonderland Pier swing ride while the amusement park was still open.
  

Designation of the Wonderland site as an area in need of rehabilitation, if granted, would allow Ocean City to negotiate directly with Mita for a redevelopment agreement. Council would have to approve an ordinance for a formal redevelopment plan and an agreement with Mita to move the project along.

Mita has been methodically lining up support for his proposed hotel from Ocean City’s business community, including the Ocean City Regional Chamber of Commerce, the Boardwalk Merchants Association and the Downtown Business Association.

Caitlin Quirk, president of the Downtown Merchants Association, and Wes Kazmarck, president of the Boardwalk Merchants Association, were among the supporters of the project who urged City Council at Thursday’s meeting to declare the Wonderland site in need of rehabilitation.

Echoing the remarks of other hotel supporters who spoke during the meeting, Quirk and Kazmarck said the project would bring new business and revenue to Ocean City.

“This is a local developer who wants to build in his hometown,” Kazmarck said of Mita, a longtime Ocean City resident.

Hotel supporters also maintained that the Wonderland site should be declared in need of rehabilitation because the pier’s concrete substructure and its amusement rides have become deteriorated.

“This is an area in need of rehabilitation, 100 percent. No doubt about it,” local businessman Bill Nicoletti told Council, after his wife, Liz, also spoke in favor of the hotel.

    The former Wonderland Pier facade overlooks the Boardwalk at Sixth Street.  

Mita’s attorney, Keith Davis, wrote in an Aug. 13 letter to Council that the Wonderland site has become badly deteriorated due to its exposure to the elements at its seaside location and “a prolonged period of deferred maintenance.”

“This deterioration affects not only the pier structure itself, but also its underlying structural support and the remnants of the former amusement rides,” Davis wrote while urging Council to declare the Wonderland site in need of rehabilitation.

Davis noted that it would take an estimated $7.5 million to $10 million to repair the pier’s structure and rides and bring them into good shape.

Hotel opponents, though, argued that it was unwarranted for the pier to be declared in need of rehabilitation. One of them, Dave Hayes, an Ocean City resident, said the rehabilitation designation would be a “Golden Lottery Ticket” allowing Mita to speed the project along.

“This is not a long pattern of continued deterioration as required by New Jersey law. Instead, in purchasing the property from Mayor Gillian, and declining to repair the support structure, Mita made a calculated decision to game the system, betting that he would win the Golden Lottery Ticket of Redevelopment and grease the skids for his Boardwalk high-rise hotel,” said Hayes, whose wife, Marie, also spoke out against the project.

Judith Schalk, another local resident, contended that Ocean City needs more family entertainment attractions instead of “fancy big hotels, too big for this small town.”

    Wonderland Pier's landmark Ferris wheel remains idle now while tucked behind a closed gate.
  

Other opponents said the hotel would overwhelm the surrounding neighborhoods and would not fit in with the Boardwalk’s family-friendly atmosphere.

“This proposed high-rise will sit directly next to our beach community, robbing us of sunshine, crushing us with traffic, and erasing the culture we hold dear. It would also hurt the Boardwalk economy and set a precedent that invites more high-rises to follow,” said Howie Atkinson, a member of Ocean City 2050, a community group that has been one of Mita’s most outspoken opponents.

Jim Kelly, another leader of Ocean City 2050, warned Council that if it had declared the Wonderland site in need of rehabilitation it would likely face lawsuits that could delay development of any kind for years.

Ocean City 2050 has proposed a competing plan, called “Wonderland Commons,” that would feature a smaller, more compact amusement park, a digital entertainment center, public attractions such as a band shell for live music, and a low-rise boutique hotel.