The dream has been watching the modest 33-room hotel that his father bought in 1997 on Nantucket Sound evolve into a $20 million luxury resort in less than three years. McCarthy didn’t achieve this by hitting the lottery, but he found something almost as good. He met business partners (and neighbors) with deep pockets and a shared enthusiasm and vision for what the Pelham House Resort could become.
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They want to see the Mid Cape resort climb to the same echelon as places such as the highly-rated and much-loved Chatham Bars Inn, which is just 20 minutes away. To move in that direction, McCarthy has already hired the sous chef from Chatham Bars to serve as the Pelham’s executive chef. He’s also hired Chatham Bars’ pastry chef. Physically, the resort has undergone a posh renovation. McCarthy refers to the style as “simple elegance.”
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Rooms inside the Pelham House Resort were stripped to the studs and rebuilt. The once unassuming accommodations now possess an air of seaside sophistication. A 13,000-square-foot, two-story building was constructed adjacent to the hotel and opened in August 2020. It houses a restaurant with a retractable roof, a ballroom for wedding receptions, and a patio restaurant with a sushi and raw bar. At the pool area, guests can order bites such as burgers and lobster rolls. Like Chatham Bars, the Pelham House also has its own farm that will eventually supply its restaurants with all seasonal produce.
McCarthy, 44, makes it clear that he’s not trying to turn the Pelham House into the next Chatham Bars Inn, he just wants to play in the same league. Prices at his newly renovated hotel are more than double what they once were. Off-season rates can hover around $250 a night, but during the summer rooms go for $700 a night and up. Prior to the renovation, that rate would have been about $325 nightly.
Pelham House Resort
“It’s tough, I get it” McCarthy said. “But I think it’s consistent with the quality, service, and amenities you get here. We give an amazing experience. In the summertime you’ll see fire pits on the beach. We have live music by the pool every night. We’re constantly trying to come up with different events. We understand that when you grow and you charge more, you’d better deliver.”
Another key difference between the Pelham House Resort and its more formal competitors is McCarthy himself. He’s gleefully goofy, like a well-groomed dad with an iPhone and an unfettered Instagram account. By way of comparison, other luxury Cape Cod resorts fill their social media accounts with professional and genteel photos of gardens, sunsets, and professionally arranged flowers.
Even with all the recent changes, the Pelham House Resort is about to expand again. With the breathless enthusiasm of an infomercial pitchman, McCarthy explains the growth plan, which includes two new locations opening next month. It’s as if the Pelham House is building something of a Mid Cape mini-empire. McCarthy and his partners bought the Inn at Swan River in Dennis Port, gutted it, and are reopening it in April as Pelham on Main. They also purchased the Commodore Inn in Harwich. It opens in April as the Pelham on Earle.
This means Pelham House will grow from its original 33 rooms to 86 rooms across three locations. A pair of vans will shuttle guests between locations, allowing all patrons to use the beach, pool, and restaurants at the original location. The expansion means there will be more rooms for larger wedding parties (weddings are the Pelham’s bread and butter) and more price-point options. Rates at Pelham on Main and Pelham on Earle will be less expensive.
It’s a long way from the modest hotel that McCarthy’s father, Bob, purchased in 1997. When John graduated from college in 2000 he joined the family business. At the time he said the Pelham House was simple, it was seasonal, and the expansive back lawn was a popular spot for ocean-view weddings. As he became increasingly ill, Bob McCarthy sold the Pelham House to developers in 2007, who changed it from a hotel to time-shares. John stayed on to manage the property, all the while looking for a partner to help buy the Pelham back and invest in a few improvements. In the 10 years that he searched, he had no luck.
But in late 2018 the tale of the Pelham House quickly gained momentum with the help of Dennis Port neighbors Frank Hursey and his son-in-law Dennis Leary. No, not that Dennis Leary, although it would add a significant amount of star power to the story if it was the “Rescue Me” actor.
Hursey and Leary saw the untapped potential of Pelham House, and were also enamored of McCarthy’s energy. Hursey invented a popular blood clotting agent used by the military and emergency workers called QuikClot (it’s also available for civilians). Leary manages a real estate company that specializes in affordable housing in Florida. Hursey owns the house two doors down from the Pelham House, so he was already friendly with Bob and John McCarthy.
“I was up [in Dennis Port] with my wife and our seven kids and we were walking around the neighborhood,” Leary recalled. “We went down to one of the little beachfront bars, which was nothing much to look at. They had a raw bar and it was very expensive and just jam-packed. I thought to myself, ‘Why doesn’t the Pelham do something like this?’”
So, one afternoon, Leary and Hursey paid a visit to their friend. They asked McCarthy what he and his father had envisioned for the Pelham House. In a perfect world, what would it look like? Leary was excited. After talking to McCarthy, he and his father-in-law were prepared to purchase the Pelham House from the developers who had failed to successfully convert it from a hotel to time-shares.
“I don’t think John knew what to make of me,” Leary said. “I think it sounded to him like it was too good to be true. It was going to be me and my father-in-law coming over and investing a bunch of money in this place. My father-in-law agreed to be the lead investor, and it all just kind of fell into place from there.”
McCarthy, Leary, and Hursey are the three partners. There are also 11 investors behind the Pelham mini-empire. But it’s McCarthy and Leary who are clearly steering the project.
Pelham House Resort
“We didn’t have a roadmap,” McCarthy said. “We knew what we wanted to do. Dennis [Leary] has the same energy I do. So every day we’d sit down and say, ‘Let’s do this! And let’s do this! You want to put a fire pit in the pool? Yeah, let’s do it.’ ”
The initially $9 million renovation ballooned into $20 million, and that’s not counting the addition of Pelham on Earle and Pelham on Main.
According to Pinnacle Advisory Group, the average nightly rate for a Cape Cod hotel room has increased from a little over $200 a night in 2019 to over $300 a night this year. Last year, hotels on the Cape and Islands had an occupancy rate of about 50 percent, a number that is expected to increase this year as more people emerge from the pandemic.
Pelham House Resort
McCarthy isn’t sounding particularly concerned about occupancy rates for this year, despite the higher room prices. The Pelham House Resort has a wedding booked every weekend for summer 2022, and the bookings have begun for 2023. He is already talking about the next business in what is shaping up to be the Pelham conglomerate.
“We bought an old garden center that abuts our farm,” he said. “So the plan is, not next year, but the year after, to open Pelham Garden Center. It’s not going to be a garden center, but a really cool breakfast and lunch spot. At night it can be a 125-seat wedding/event venue. It’s a lot, but you know what? I’m still humbled by it all.”
Christopher Muther can be reached at firstname.lastname@example.org. Follow him on Twitter @Chris_Muther and Instagram @chris_muther.