History of Hotel Rehoboth in Rehoboth Beach, Delaware

Hotel Rehoboth is a family owned Rehoboth Beach hotel with long time family roots in Rehoboth Beach, Delaware. The site of the Rehoboth Beach hotel originally consisted of several single family homes one of which Bernhart and Margaret Gadow owned and lived with their son, Bernie and daughter, Peggy.

In the 1950’s Margaret (Peggy) Gadow decided to open a 24-hour diner in the lower front part of their home on Rehoboth Avenue and called it Peg’s Diner. A few years after Peg’s Diner closed its doors their daughter, Peggy and husband, Bill Martin decided to open a restaurant in the old Peg’s Diner location and named it the Homestead Restaurant. The Homestead quickly became a Rehoboth Beach hot spot. Bill and Peggy continued to grow the business and added to the buildings as well as purchasing other adjoining properties. Over time the restaurant went through many changes including several names changes from Homestead to Café on the Green and later Oscar’s. While growing up and working in the family business both son, Keith and daughter, Melinda both continued to manage and work in the business as well as daughter-in-law, Sherri.

In 1995-96 the Martin family decided to open Rehoboth Beach's first chain hotel on Rt. 1. The Comfort Inn opened its doors in 1997. As a very successful venture, the Martin’s decided to sell to partners that were brought in at the last minute and later leased the restaurant property to the Purple Parrot to allow all family members to pursue other ventures.
Over time Keith Martin now working at Merrill Lynch decided to pursue a hotel in Rehoboth Beach. Keith gathered information from work done on the Comfort Inn and sold his parents on the deal. When other properties were needed to make the project work, Keith, Bill, Peggy and Sherri worked to acquire two other homes adjoining the hotel property on Lake Avenue. As time and planning went on, Keith’s vision became the family vision. Even Keith and Sherri’s daughter, Erica played a part by choosing the exterior colors of the Rehoboth Beach hotel.

After 4 years of planning and 2 years to build, the Hotel Rehoboth is now opened for business. Our goal is to create a place where you can feel at home and relax in an upscale residential Rehoboth Beach hotel setting while letting us attend to the details. Hotel Rehoboth is a place where your soul can Relax. Renew. Think.

Thanks and enjoy your stay.

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