MEREDA Index Provides Dynamic Data & Perspectives of a Historic Year

Over 230 real estate insiders registered to gather virtually for the Maine Real Estate & Development Association’s (MEREDA) Spring Conference on May 20th. As part of the Conference, MEREDA released its 15th edition of the MEREDA Index, a key economic indicator for the state of Maine. While the Index saw a dip during the first half of the year as the economy began its sharp decline related to the Covid-19 pandemic, the Index shot upward in the second half of the year, resulting in an overall increase of 2.8% over the annual average of 2019. Beyond the data, the individual components of the Index—commercial, residential, and construction—help paint a fuller picture of a historic year in Maine real estate.

“To say 2020 was a year like no other is an understatement, and when we zoom in on the Maine real estate market we see a truly remarkable year,” says Josh Fifield, MEREDA President. “We have all been watching as the residential market rocketed off the charts. We all felt the impact of vacant office and retail spaces in our communities, and we saw new construction projects forge ahead with increased demand. This is the story the 2021 MEREDA Index tells,” continues Fifield.

The MEREDA Index is a measure of real estate activity designed to track changes in Maine’s real estate markets. The Index is a composite of nine seasonally adjusted measures reflecting both new development and transactions involving existing properties and it covers both the commercial and residential markets statewide. This most recent edition covers the year 2020.

The MEREDA Index was tabulated by economist Dr. Charles Colgan with commentary from Cheri Bonawitz of Malone Commercial Brokers, Joe Dasco of Reger Dasco Properties, and Drew Sigfridson of The Boulos Company.

“The MEREDA Index is one of the best baseline measures for the health of the real estate market in Maine,” says Matt Worthen of Eaton Peabody, Index underwriter. “When you combine economic analysis from an expert economist like Dr. Charles Colgan with the ‘feet on the street’ perspective of local industry leaders, you have a keystone report for MEREDA members, their thousands of employees, and for Maine’s economy at large,” Worthen continues.

This edition of the MEREDA Index was underwritten by Eaton Peabody, with support from Katahdin Trust Company, and XPress Copy.

To download a copy of the report or watch a video about the MEREDA Index, please visit www.mereda.org.

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From a Record-Breaking Residential Market to a Rebounding Commercial Market – MEREDA Spring Conference Examines the Health of Maine Real Estate

On Thursday, May 20th, the Maine Real Estate & Development Association (MEREDA) hosted its virtual Spring Conference. As we head into summer amidst record-breaking residential real estate sales, a robust construction sector, and a commercial sector poised to rebound, the MEREDA event provided an opportunity to reflect on a historic year and to look ahead at Maine’s economic future. MEREDA is committed to promoting responsible development across the state and providing forums for its members to engage and learn about opportunities in the state. As part of the conference, MEREDA unveiled its 2021 Index, hosted a panel discussion with Index contributors and Dr. Charles Colgan, and recognized its 2020 Notable Projects recipients, with Craig Young of The Boulos Company and Shannon Richards of Hay Runner acting as event hosts.

“MEREDA and its members are looking ahead as we march into the second half of 2021. Our Spring Conference gave us an occasion to reflect on 2020 – a singular year in Maine real estate – and discuss what opportunities lay ahead for our economy,” says Josh Fifield, MEREDA President. “We brought together Dr. Colgan and our Index contributors to help us bring the story of 2020 forward. Where do they see the real estate economy heading? It was an important and timely conversation for not just MEREDA members, but everyone who is interested in seeing Maine thrive.”

The conference first presented the 2021 Index data live, with economic data and analysis from Dr. Colgan, Director of Research at the Center for the Blue Economy at the Middlebury Institute of International Studies at Monterey and Professor Emeritus of Public Policy & Planning in the Muskie School of Public Service, as well as commentary on the commercial market from Cheri Bonawitz of Malone Commercial Brokers, insight into the residential market from Joe Dasco of Reger Dasco Properties, and a perspective on the construction sector from Drew Sigfridson of The Boulos Company.  

Overall, in 2020 the Maine real estate sector did well, while the economy as a whole contracted faster than during the Great Recession. Residential real estate was a headline story throughout 2020 and one of the few bright spots in the economy during the pandemic. Whereas the activity in the commercial market and construction sector painted a more complex picture and raised lots of questions on how the market will continue to develop in the years ahead. Speaking on the commercial sector Dr. Colgan commented, “Can a world in which no one goes to the office or stores still be a world where commercial real estate is sold? The answer is – yes, it can.” Despite early declines in 2020, the commercial market remained vibrant in Maine and has already shown signs of recovery. Turning to the construction market, Drew Sigfridson summed up a major uncertainty: the changing cost of materials. “When you see a 30% increase in the price of steel over three months, it’s impossible to predict costs and develop a budget,” shared Sigfridson.

Building upon the insights on 2020 that commentators shared individually, the event concluded with a panel discussion. Craig Young and Shannon Richards helped guide the conversation forward and asked the commentators to share their thoughts on how the real estate market will evolve in 2021 and beyond.  

Joe Dasco spoke on his experience developing Hobson’s Landing in Portland where the increased consumer demand for amenities drove creative and innovative uses of space. Dasco also commented on the impact of the 2020 Portland referendums, stating that his firm wouldn’t be able to make a project like Hobson’s Landing work today with the new onerous regulations in place. With those new limitations restricting Portland development, the panel were all curious to see how the surrounding communities in southern Maine would now benefit and capitalize on the increased demand for housing.  

Cheri Bonawitz offered her perspective on the future of the retail market, stating that while many people are used to ordering products online, there are still a lot of shops that people want to visit downtown, and her firm is already seeing vacant restaurant spaces in the Old Port fill back up. Dr. Colgan expanded the commercial sector discussion by adding that there is an unprecedented amount of suppressed demand for travel that will certainly create a boom in Maine’s hospitality industry in the coming years before it comes back on trend. Following the devastation of 2020, this will surely be a welcome surge of activity for hotels and restaurants across the state.

The pandemic also radically transformed the world of work and the big question of the future of the office was another topic discussed. Dr. Colgan noted that now that the technology exists and will be expanding to rural areas, the sociological question of how and where we work will continue to play out over the next decade. Sigfridson shared how his own team has returned to the office, stating, “We find collaboration and being able to be with our team makes a difference.”

To sum things up, Dr. Colgan shared his perspective on the future of the Maine economy this way: “I’m generally optimistic, but I have some really nagging questions.” It’s true that with Maine’s robust residential market, rebounding commercial market, and the increased demand for construction there is a lot to look forward to in Maine real estate. But MEREDA and its members will be here to continue to ask those nagging questions and be a part of the solutions as Maine strives to build its future in a responsible way.

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The Stupendous Six: MEREDA 2020 Notable Project Recipients

PORTLAND, Maine (May 24, 2021) The Maine Real Estate & Development Association (MEREDA), the state’s leading organization promoting responsible real estate development, honored projects from Portland to Pittsfield to Bangor, with each receiving special recognition at MEREDA’s 2021 Virtual Spring Conference on May 20th.

Each year, MEREDA recognizes some of the state’s most “noteworthy and significant” real estate projects, completed in the previous year.  The exemplary projects from across the state, completed in 2020, not only embody MEREDA’s belief in responsible real estate development, but also exemplify best practices in the industry, contributing to Maine’s economic growth by significant investment of resources and job creation statewide.

Each of the six projects was selected in part based upon criteria including: noteworthy and significant project completed* in 2020 (*Building Occupancy Permit issued by 12 31 20), environmental sustainability, economic impact, energy efficiency, social impact, uniqueness, difficulty of development and job creation. 

The recipients of MEREDA’s Top 6 Most Notable Projects of 2020 include:

  • Rock Row Phase 1 Retail Center, Waterstone Properties Group (Westbrook) for envisioning a 110-acre signature mixed-use development centered around a 400-foot wide, 300-foot-deep quarry.  As envisioned, Rock Row will attract more than 6 million guests a year from across the globe —with destination retail, chef-driven dining, inviting workspaces, modern residences, world-class healthcare, hip hotels, diverse entertainment and more.  The crown jewel of Rock Row is the 26-acre Quarry, featuring a picturesque boardwalk, connected to more than 70 miles of hiking and biking trails.
  • 82 Hanover Street, Port Property Management (Portland) for the redevelopment of the Public Works facility, restoring an existing historic structure while also helping revitalize a neighborhood. Once dominated by industrial buildings and vacant lots, this project turned a dilapidated property into a vibrant urban destination.
  • Hospice of Southern Maine, Zachau Construction / SMRT (Scarborough) forcreatinga 100% self-sustaining building to house the HSM corporate and clinical teams, as well as, a location for training simulations, grieving services, and a large community room.  Designed to reduce their energy costs by approximately 96%, over 600 donors came together to raise $6.6 Million to date, which will go towards programs and staff instead of office facility overhead.
  • Solterra, Portland Housing Authority (Portland) for designing58 Boyd Street in East Bayside, a mixed-income, six-story building featuring 23 efficiency, ten (10) one-bedroom, thirteen (13) two-bedroom and nine (9) three-bedroom apartments as well as a community space.  Solterra was designed to accommodate the local community’s social, physical and environmental needs, with accessibility, quality of life, durability and environmental sustainability as keystones to the design process.
  • One Merchants Plaza, Sky Villa Properties (Bangor) for having the visionto bring the 49-year-old, all concrete building (first of its kind in Bangor), back to life, revitalizing an area that desperately needed businesses for community growth. With an investment of approximately $2.2 million, the renovations created a space that utilized updated technology to provide tenants with a sustainable and energy efficient place for years to come.  The renovation of One Merchants Plaza has been one piece in a larger, ongoing process of revitalizing the business district in downtown Bangor.
  • Puritan Medical COVID –Building Expansion (P2), Puritan Medical Products (Pittsfield) for converting a portion of a vacant mill building into a state-of-the-art medical device manufacturing facility in less than 10 weeks. The 48,500 square feet of renovated space now produces medical grade foam-tipped swabs for COVID-19 testing.  Puritan’s greatly increased manufacturing capacity – an additional 90 million swabs per month – has enabled an exponential increase in COVID-19 testing in America and beyond.

MEREDA congratulates its 2020 Notable Project Award Recipients and thanks its Membership for their continued commitment to responsible development in Maine.  Each project will be recognized with its own article in the Maine Real Estate Insider e-newsletter published by Mainebiz, running Summer of 2021.

For further information, please contact MEREDA’s Vice President of Operations, Shelly R. Clark at info@mereda.org or visit www.mereda.org.

Top Row: Rock Row Phase 1 Retail Center, Waterstone Properties Group (Westbrook), 82 Hanover Street, Port Property Management (Portland), Hospice of Southern Maine, Zachau Construction / SMRT (Scarborough)
Bottom Row: Solterra, Portland Housing Authority (Portland), One Merchants Plaza, Sky Villa Properties (Bangor), Puritan Medical COVID –Building Expansion (P2), Puritan Medical Products (Pittsfield)
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MEREDA’s Morning Menu Virtual Event – Creating New Affordable Housing through Limited Equity Housing Cooperatives

Virtual Event
June 17, 2021
8:30 – 9:30 AM

The convergence of current Maine market conditions are driving the costs of owning near urban, or desirable communities. Co-ops, and specifically Limited Equity Housing Cooperatives, are one way to battle these conditions and create new and affordable neighborhoods and buildings.

Join us on the 17th of June to discuss another hot topic in real estate development trending across the country – Cooperative Housing (CO-OPS). We have touched on cooperative housing developments in other presentations here at MEREDA, however this is a rare opportunity to sit with the Maine developer, Brian Eng of Maine Cooperative Development Partners, to learn in real time about his approved Portland cooperative housing developments and how to finance these types of projects. He’ll discuss why Limited Equity Housing Cooperatives are both desirable and pencil out. 

Andrew Reicher, Executive Director of UHAB, (Urban Homesteading Assistance Board) – a New York CO-OP non-profit that manages 20,000 units of CO-OP housing, will offer his perspective from years of experience owning, living-in and managing CO-OPS. His insight is a valuable resource for those of us thinking about investing in this model of housing. 

Join MEREDA Vice President, Shannon Richards of Hay Runner, in a virtual conversation about developing CO-OPS in Maine with Brian Eng and Andrew Reicher.

FMI and to Register, visit www.mereda.org

If you plan to purchase tickets, please use Google ChromeTo avoid registration issues, we have found that Chrome interacts the best with our website.

TICKET PRICES:

Members:  Suggested Donations of $0, $10, $15, or $20
Non-Members: $25 pp

In addition to your confirmation email, a day before the event you will receive a separate email providing the link you will need to access the session. Please be watching for this 2nd email.

REFUND POLICY:  No refunds will be issued unless the originating stream fails and the program can’t take place. 

MEREDA’s Morning Menu Breakfast Series is Sponsored by Norway Savings Bank

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Checking the Pulse of Maine Real Estate – The 2021 MEREDA Index Unveiled and Discussed at Virtual Spring Conference

On Thursday, May 20, 2021, the Maine Real Estate & Development Association (MEREDA) hosts its Spring Conference.  The conference will include the unveiling of the 2021 MEREDA Index, a key economic indicator for Maine, as well as the recognition of the 2020 Notable Project recipients.  The MEREDA Spring Conference will also feature a panel discussion from the 2021 Index contributors, including Dr. Charles Colgan, Professor Emeritus of Public Policy & Planning at the Muskie School of Public Service; Cheri Bonawitz, CCIM, a broker from Malone Commercial Brokers; Joe Dasco, principal at Reger Dasco Properties; and Drew Sigfridson, Managing Director at The Boulos Company.  Drawing upon the insights presented in the 2021 Index, the conference will provide a forum for Index contributors to look ahead and share their perspective on the future of real estate in Maine.

“The MEREDA Index is the leading way our industry tracks changes in Maine’s real estate markets – commercial and residential, as well as construction employment.  It’s an extremely valuable report because MEREDA includes the ‘feet on the street’ perspective of our contributors as well as the economic analysis from Dr. Charles Colgan,” says Josh Fifield, President of MEREDA and a Vice President of Clark Insurance.  

“Our Spring Conference brings this experienced group of industry leaders together to discuss not just what has happened in real estate in Maine this past year, but to help us all look at the road ahead.  It’s a must-have and must-see conversation as we head into the summer,” Fifield continues.

MEREDA’s Spring Conference is geared towards builders, developers, brokers, attorneys, architects, engineers, municipal leaders, bankers, and accountants, to name a few.  Continuing Education credits are available for brokers and attorneys.  

According to Shelly R. Clark, MEREDA’s Vice President of Operations, the 2021 MEREDA Index is underwritten by Eaton Peabody. MEREDA’s Spring Conference will be produced at O’Maine Studios following strict CDC health and safety guidelines and will be streamed on May 20 from 8:30am to 11am.  Registration is available at MEREDA.org.

Conference sponsors include NBT Bank, Reger Dasco Properties, Mainebiz, Mascoma Bank, Knickerbocker Group, State 23 Media, AAA Energy Service Co., Criterium Engineers, Gorham Savings Bank, Malone Commercial Brokers, Norway Savings Bank, People’s United Bank, Pierce Atwood, Redstone, and Sevee & Maher Engineers.

Additional Index Supporters include Katahdin Trust Company and XPress Copy.

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Spotlight on Maine: News from the City of Auburn

By Liz Allen, Director of Communications & Community Engagement, City of Auburn, Maine

AUBURN COMMITS TO GROWTH, QUALITY & INVESTMENT

Exciting things are happening in Auburn. Just ask anyone on the city’s new “growth, quality and investment” team.

Liz Allen photo

In September of 2018, Auburn’s city council appointed community leaders, elected officials, and school and city staff to draft a strategic plan to develop and grow the city, enhance the quality of life of residents, and invest in the city’s future. The result was a list of strategic recommendations, built around topics such as the protection of natural resources, education, transit, infrastructure, communications, and arts, culture & recreation. The final recommendations also placed meaningful focus on defining and promoting industry cluster; focusing on Great Falls Plaza, downtown & the Androscoggin River; and supporting the rehabilitation and beautification of neighborhoods.

As a reflection of Auburn’s commitment to the plan, City Manager Phil Crowell has strategically aligned three city divisions. Together they form Auburn’s “growth, quality and investment” team. The three units include: Planning, Permitting and Code, led by Eric Cousens; Business and Community Development, led by Glen Holmes; and Economic and Community Development, led by Jay Brenchick.

Recently, Auburn launched a promotional initiative highlighting the many opportunities available in Auburn. The campaign proclaims that in Auburn, “Your next opportunity is closer than you think.” The city also created a new website dedicated to economic development, goauburn.me.

Auburn’s Mayor, Jason J. Levesque, is highly supportive of the team and thrilled by Auburn’s potential. In his recent “State of the City” address, Levesque encouraged substantial new growth, saying, “I truly believe that the best and most efficient solution is to promote growth, and to encourage and allow for more investment, specifically, the construction and sale of market rate homes. And when I say more, I mean about 2,000 more homes, over the next five to seven years. We can balance our commitment to protect our environment with our desire to grow our downtown, and our residential and industrial base.”

The mayor’s enthusiasm is based upon results. Auburn has been setting records almost monthly. In fact, Auburn is reporting over 1 million new square feet of industrial and retail development throughout the city. That means more jobs, and more opportunity for current and future residents. Auburn has also had record growth in home building and rehabilitation. “You can’t miss the transformation when you drive around town these days,” added Levesque.

Auburn’s population is approximately 24,000, spread out over nearly 70 square miles. “That is bigger than Portland, South Portland, Westbrook, and Cape Elizabeth combined,” said Levesque. “We have the space, the perfect location within the state, the infrastructure and the perfect team in place to grow this city mindfully and strategically.”

“We encourage and invite developers to connect with us,” said City Manager Phil Crowell. “Our team is eager to share the countless positive attributes and initiatives that make Auburn so appealing.” These include a recently implemented development incentive program that cuts commercial building fees in half and eliminates residential building permit fees for Veterans; state-delegated permit reviews at a fraction of the cost of usual state fees; project and permit approval in 30 days to 3 months, which is a fraction of the time it takes elsewhere; downtown Form Based Code Districts that offer developers more creativity and the opportunity to realize greater returns on investment; and more.

Auburn has also set aside $1 million to incentivize investments in downtown and has recently listed six highly desirable city-owned lots and one very historic building for sale.

Auburn’s promise to those looking to invest, according to Levesque: “Let us show you why Auburn is the perfect choice for your project. Come here with an open mind and know that you will find willing and welcoming partners at city hall and regulatory consistency within city government. Our residents will welcome you and take pride in your success.”

“Spotlight on Maine:  News from…” is a new piece dedicated to MEREDA’s member municipalities.  We invite you to submit your own 500-750 word article highlighting what’s happening in your own city or town.  Please connect with Shelly R. Clark at info@mereda.org for more details on how to submit an article for consideration. 

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Greater Portland Industrial Real Estate Market Update

By Justin Lamontagne, CCIM, SIOR, Partner | Designated Broker, NAI The Dunham Group

On January 21st Justin presented the “Industrial Market Forecast” at the Maine Real Estate & Development Association’s (MEREDA’s) 2021 Virtual Forecast Conference. Below is a modified version of the NAI The Dunham Group’s Market Survey.

Mike Tyson famously said, “everybody has a plan until they get punched in the mouth”. Well, we were all punched in the mouth in 2020 and our plans went kaput. But in a year when everything we knew as “normal” changed, the Greater Portland industrial real estate market was a welcome oasis of continuity. In spite of, and in large part because of, the historical challenges brought on by the Covid-19 pandemic, this sector had another banner year. For the 6th consecutive year, our overall vacancy rate was below 4%. In fact, when we pulled the data in December, our overall rate was a paltry 2.44%.

Beyond the statistics, during the early days of the pandemic, I had a revelation. It dawned on me just how important the industrial market is, not just to property owners and brokers, but to humanity. Many of the Phase I “essential” businesses were industrial in nature. Industries like food production, distribution, utility and manufacturing companies were open and operating, allowing the masses the luxury of staying home and quarantining safely. Thanks to many industrial businesses and workers we flattened the initial curve and some slivers of normalcy remained in our lives.

The ability of the industrial sector to adapt and prosper despite the pandemic-related changes to our world was one of the more fascinating trends to track in 2020. For example, many Maine-based industrial manufactures pivoted quickly and profitably, producing Personal Protection Equipment for front-line workers. Our beloved craft brewers created alternative purchase options (curbside pick-up is here to stay!). And several leveraged their brewing equipment and knowledge to “craft” hand sanitizers and sprays.

Most impactful, from an absorption and transactional standpoint, was the dramatic growth in local life science and laboratories that focused on Covid-19 testing and treatments. Abbot Labs, in particular, experienced a nearly 300,000 SF industrial expansion in 2020. In addition, the onshoring of manufacturing work has driven several significant expansions in that sector. So much so that there is a lot of discussion within the sector of recruiting laid-off hospitality and retail workers who probably never considered a job in manufacturing.

Restricting these advances, however, is the aforementioned inventory crunch. As a result, both owner-user and developer-led new industrial construction increased in 2020. There are a number of new industrial developments and offerings in Southern Maine, most notably the Innovation District at Scarborough Downs. This development has seen great success, with over 65% of all lots sold or under contract. And, more generally, this confirms our sense that building new is a real option for industrial users. It is no longer a last resort.

I continue to be amazed at the fiercely competitive and ever rising sales market. Virtually every industrial sale in 2021 set a record for its area. Overall, we are averaging near $80/sf, but that’s statistically deflated due to some larger SF sales. Anything under 20,000 SF is now easily in the $90-100/sf range. Premium sales are much higher. Not to mention the low-cap investment sales market. Indeed, the capital market has never been hotter. We are now regularly seeing 7% cap rates for well-located Class-A & B facilities, if not lower. And investor-appetite for risk continues to increase with shorter lease commitments, shakier tenants and expanding geographics. With larger, institutional competition discovering our market, many smaller, local investors are on the sidelines. But opportunities remain for those who are well plugged into the market. A number of the more successful investment sales of the year were off-market, local deals and that trend is likely to continue into 2021.

Of course, I hesitate to present a purely glowing overview and forecast of the industrial market. The truth is, we don’t know what we don’t know when it comes to this pandemic. This is truly unlike anything any of us has ever gone through. So, I think it is irresponsible to simply say that the industrial market is immune from all the negative effects of Covid-19. There very well may be impacts coming that we have not even considered nor imagined.

That said, all the economic indicators we track suggest a vibrant year. And the turbulent world events around us continue to foster the importance of domestic production, storing and shipping of stuff. That bodes well for the industrial market. Heck, even a Mike Tyson left hook didn’t keep this sector down in 2020…so bring it on, 2021!

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Central Maine Real Estate Weathering Pandemic, Poised For Growth

By Frank Carr, Assistant Broker, MRA

The 2020 real estate market in central Maine has faced pandemic-related challenges just like the rest of the world.  The good news: while the market faced many challenges in 2020, central Maine is in a position to come out of a tough year and make 2021 a year to remember.

Last year’s market was highlighted by low leased vacancy and low workforce occupancy. In Lewiston, for example, TD Bank and Maine Community Health Options are still paying rent, but workers are at home. The same thing is happening in Augusta with the Maine State buildings and also the Waterville Colby properties.

Driving the market are smaller users, 3,500-sq.-ft. and below. At MRA, agents are working hard to place these tenants because the bigger entities aren’t making decisions quite yet.

In central Maine, residential is really driving the market. (I call it “flight to isolation” as more and more people leave denser population areas especially in Massachusetts, New York and Connecticut.) It’s also a “flight to quality/commute” that’s changing the face of residential real estate in our state.

Look At The Data: Lewiston/Auburn

Lewiston/Auburn experienced a relatively flat office market in 2020, including the University of Southern Maine’s decision to delay their highly anticipated move to downtown.

In these two highly connected Maine cities, it’s again residential driving the market with companies like Chinberg Properties working on major projects like the Continental Mill, as well as Pineland Lumber (a 250-unit development for medical workforce housing) and more. One major goal in this area: connect the new Auburn area down to the Mill District in Lewiston, which will set the entire area up for further growth.

“Thankfully we haven’t heard any huge changes to businesses office space plans,” says Misty Parker, Lewiston’s economic development manager. “The next six months will really be telling. A lot of businesses are looking at 2021 as a planning year to come back. There’s definitely a need for smaller offices for smaller businesses. People have been cooped up for so long that having an independent, safe space to conduct business is valuable.”

L/A Forecast: Lewiston/Auburn will make a swift and speedy return. When USM resumes their search for downtown space, the market is going to escalate quickly. The entire area is looking at major office movement this year. In residential, it’s going to be important to offer a premium product to capture renters’ attention. The multiple new projects coming online in the next year will make residential absorption a little flat because there’s so much product coming online, but it will happen.

Pro Tip: Small is good. In summer 2020, MRA took a large professional office building (The Professional Building on Lisbon Street) and subdivided it to give professionals working at home a chance to get out of the house. The entire property hit full occupancy within a month of acquisition.

Look At The Data: Augusta

Due to so many readily apparent factors, vacancies are popping up in the office market, but local users remain engaged.

The good news: sales are happening, including the monster sale of space developed by FD Stonewater for Maine DHHS and PERS to Winthrop Advisors out of Boston for $39-million dollars—a clear record for 2020. Another mega transaction for central Maine, 442 Civic Center Drive for $8.7-million dollars.

“We’re coming off one of the historically biggest economic cliff drops in recorded history,” says Keith Luke, Augusta’s economic development director. “Here in Augusta, remarkably, the development picture has remained hot and there’s certainly lots of untapped development potential here.”

Augusta Forecast: There is activity in the market. Multifamily is fueling the growth in Augusta, as well, with quality developments keeping the market here on track. Slow office absorption and flat rent increases are facts on the ground that will hinge on the country and state’s ongoing response to and management of coronavirus.

Pro Tip: Even though smaller deals are happening in Augusta, there is activity. Look out for smaller buyers and renters to get a return on investment. When it comes to industrial, look at land development projects with 5,000-25,000-sq.-ft. of industrial space. Install necessities including docks and floor drains to create demand.

Look At The Data: Waterville

Don’t forget about Waterville! It’s been a year on pause with Colby College and other major players taking time to get back on track post-pandemic. As students go back to school and companies kick back into gear, Waterville is going to be just fine.

Waterville is hot right now! The industrial market is benefitting from cannabis industry growth, and residential is absolutely on fire with multifamily transactions closing at an all-time high rate.

Waterville Forecast: Look for rents across all sectors to go up in this area considerably as the inventory is reduced and existing product is leased up. Sales are happening in Waterville, though on a much smaller scale as far as space and price.

Pro Tip: Waterville is a tough market to move into, but there are opportunities in smaller developments. There are deals going through left and right, including two big projects under development, The Seton Project (68 residential units, 35,000-sq.-ft. of development–the old Maine General Hospital); and FirstPark has industrial lots available with excellent infrastructure in place.

Summing It Up

Overall, all of the players in the central Maine real estate market have been biding their time on breaking new ground while keeping existing projects on-time and -budget. Surprisingly given the pandemic, there’s a well-grounded optimism at play that speaks to the

“It’s a scary, yet promising time to be involved in central Maine,” says Parker. “Our planning department is hoping to analyze current zoning standards to see where we can support additional commercial, industrial and residential housing opportunities by encouraging density where it makes sense while not changing the character of neighborhoods”

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MEREDA’s 2021 Spring Conference is May 20th! – Unveiling of the 2021 MEREDA Index & Recognition of 2020 Notable Project Recipients

Virtual Event
May 20, 2021
8:30 – 11:00 AM

The Maine Real Estate & Development Association (MEREDA) is excited to virtually bring you its 2021 Spring Conference from 8:30 AM – 11:00 AM on May 20, 2021. Not our typical “spring conference”, this year’s virtual event will combine the unveiling of the 2021 MEREDA Index, as well as recognition of our 2020 Notable Project Recipients!

MEREDA Index: The current MEREDA Index contains a measurement and presentation of the real estate market in Maine, and its various components for all of 2020. Dr. Charles Colgan, the economist who prepares the Index, will be on hand to discuss the three sectors of the Index, followed by a panel discussion between three experts in each of those sectors.

MEREDA Celebrates Real Estate Development in Maine: MEREDA is thrilled to recognize some of the state’s most noteworthy and significant real estate projects. All not only embody MEREDA’s belief in responsible development, but also involved a significant investment of resources and job creation statewide The Top 6 Notable Projects for 2020 have been chosen and will be recognized at this event.

Registration information is at www.mereda.org
OR
https://mereda.org/event/2021-spring-conference-unveiling-of-meredas-2021-index-recognition-of-2020-notable-project-recipients/

Ticket Prices: Members: $45 pp | Non-Members: $75 pp

Early-Bird pricing: Register before May 13th for discounted pricing!

Approved for 2.00 clock hours of Broker Continuing Education Credits.  Approval for Legal Credits are pending. 

REFUND POLICY:  No refunds will be issued unless the originating stream fails and the program can’t take place. 

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Midcoast Maine Market Forecast

By Dave Holman, Broker, RE/MAX Riverside Commercial

On January 21st Dave Holman, Broker at RE/MAX Riverside Commercial, presented the “Midcoast Maine Market Forecast” at the Maine Real Estate & Development Association’s (MEREDA’s) 2021 Virtual Forecast Conference. Below is a synopsis of his presentation.


There’s something exciting happening in Maine’s Midcoast. While much of the fervor in Maine’s real estate market has focused around Portland and areas to the south like Biddeford, the markets of Brunswick, Topsham and Bath have quietly gone from a steady simmer to a rolling boil. At a glance the multifamily numbers might not impress- 43 building sales in 2016 and 40 in 2020.

However, eyebrows should raise when one realizes that prices per apartment unit have gone from averaging $63,779 in 2016 to $101,757 in 2020 with no sign of slackening. That represents a 13% annual growth rate that has only accelerated during COVID. Residential price growth averaged 9% over the same 5-year period- far surpassing state and national averages.

Why has the Midcoast got wind in its sails? There are the usual suspects like great schools, lots of scenic coastline just a short drive from Portland, and long-time employers like Bowdoin College and BIW. However, there is new energy in the Midcoast- much of it coming from Brunswick Landing- Maine’s largest business park which has grown out of the ashes of the former Naval Air base which closed in 2011. In just 9 years Brunswick landing has created over 2,300 new jobs in over 2,000,000 square feet of real estate and built over 500,000 square feet of new construction.

Brunswick Landing hosts a mix of high tech and biotech firms from Wayfair and SMCC to Savilinx and Mölnlycke which are helping in the fight against COVID. Local favorites like Wild Oats Bakery and Flight Deck Brewing have broken ground in recent years and kept workers well fed and content. Hundreds of existing housing units at Brunswick Landing have slowly filled up and now over 100 new multifamily units and 100 single family homes are under construction.   

Both the Topsham Fair Mall and Cooks Corner have seen brisk business, new construction on multiple sites and new arrivals to the area. All three towns have recently invested tens of millions into new school buildings. Located on the 295 and Route 1 highway corridors, these towns are poised for growth as Portland prices out its workforce with every new condo conversion. Additionally, Brunswick is the northern terminus of the Amtrak Downeaster that takes remote workers, students and super commuters to Boston every day.  

Up in Bath, the historic downtown has seen a boom of new building ownership as the Morse family has gracefully transitioned ownership of over a dozen buildings in the hands of their small business tenants. The Szanton company is building 50 new housing units in the downtown and there is a distinct feeling of revitalization in the air on the Kennebec River. As growth spreads up from Boston into York and Cumberland counties, Maine’s quaint Midcoast is feeling the heat and charting its own future. The growth is fueled by a higher percentage of out of state buyers and new residents coming for jobs. After all, in times when people can increasingly work from anywhere, wouldn’t you want to live and work in a great small town on the Maine coast that embodies our state motto, ‘the way life should be.’

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