The Right Equation for Responsible Development: Spotlight on WEX Global Corporate Headquarters, Portland

In a multi-part series, exclusive to the Maine Real Estate Insider, we’ll provide an up-close look at the most notable commercial development projects of the past year that are helping to fuel Maine’s economy in terms of investment and job creation.  MEREDA is proud to recognize responsible development based upon criteria including environmental sustainability, economic impact, energy efficiency, difficulty of the development, uniqueness, social impact and job creation.

Our 2019 Top 7 recipients include:

62 Spring Street, Auburn, Anew Development / Auburn Housing
Founders Place Campus, Bangor, Bangor Savings Bank / CJ Developers
Cape Arundel Cottage Preserve, Arundel, Arundel-Kennebunkport Cottage Preserve, LLC
WEX Global Corporate Headquarters, Portland, Jonathan S. Cohen – 0 Hancock Street, LLC
Hannaford Center, Hampden, Good Shepherd Food Bank
Southgate, Scarborough, Avesta Housing
Station Square, Gorham, Great Falls Construction

MEREDA’s Board intended to honor the award winners at the 35th Anniversary Gala. Originally scheduled for the end of March 2020, the Gala was postponed indefinitely due to COVID-19. Though they may have their formal award delayed, these projects have only gained practical significance as they serve their communities–especially under additional strain and stress of these unprecedented times.  We look forward to formally recognizing these recipients at a future MEREDA event.

Please join us this week in celebrating WEX Global Corporate Headquarters in Portland.

MEREDA:  Describe the building and project.

Jonathan Cohen:  WEX’s new Global Corporate Headquarters building in Portland was a collaborative effort between WEX, project developer, design firms Archetype Architects (core & shell) and SMRT Architects & Engineers (interiors), construction manager Cianbro Corporation, and me as project developer. The result is a four-story, 116,000-square-foot, mixed-use facility, with a 19,000-square-foot rooftop deck, 5,000 square feet of retail space, and a mechanical penthouse.

The foundation consists of concrete piers and grade beams on steel h-piles, while the building’s exterior skin features a glass curtain wall system with metal panels. The interior includes high-end finishes such as stone tile flooring, stained oak walls and ceilings, glass walls, and a 700-gallon saltwater aquarium. The building boasts modern amenities incorporating open-office workspaces with traditional enclosed office spaces, indoor and outdoor dining and break areas, showers, and bike lockers. The rooftop patio encourages dining, recreation, and social events.

MEREDA:  What was the impetus for this project? 

Jonathan Cohen:  I had recently purchased the Ocean Gateway Garage as well as 100 Fore Street (formerly Hamilton Marine), and knew that WEX had been trying to locate in Portland for many years and reached out with the 100 Fore street site. During the process, the city lot on the corner of Hancock and Thames became available through an RFP process and WEX, Archetype, and I worked together to be the successful respondent with their design.

MEREDA:  That sounds like quite a process.  How long were you in the planning stages before construction started?

Jonathan Cohen:  The total time from design to permit was less than eight months; it was a fast track project.

MEREDA:  Tell us about the most challenging aspect of getting this project completed.

Jonathan Cohen: As with the majority of construction projects, the most challenging aspect of getting a project completed is picking the right members of your team. One of the reasons why the sign at the site during construction had every subcontractor involved in the project was to thank and recognize their valuable contribution to getting this project done as quickly and safely as we did. More than 800 construction workers in the southern Maine community worked on this project. The total time from city permit in October to occupancy 15 months late was a major challenge and a tribute to all that worked on the project.

MEREDA:  Something unexpected you learned along the way was…

Jonathan Cohen:  The positive impact that we had on the immediately surrounding area, the way that the construction team embraced the planning required, and the impact that this project has had in leading the way for other similar projects in the area. We successfully proved that it could be done in Portland. Which is why the same team is working together on the 100 Fore Street office building and parking garage right now.

MEREDA:  Now that it’s complete, what feature of the project do you think makes it the most notable? 

Jonathan Cohen:  It is hard to pick just one feature of the project. The exterior of the building is very much like the buildings of the Boston Seaport: curtain wall and Alucobond panels, the massive rooftop deck, the automated shade system, the impact on the city’s waterline and skyline; it is one of the most visible buildings when flying into Portland. I guess what I as the developer would pick as most notable would be the more than 800 jobs created during construction and the more than 400 permanent jobs sustained. WEX now greets cruise ship passengers and other visitors with a polished, professional, and modern look befitting Portland and other great cities around the world. A great place to Live and Work in Maine.

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Virtual Event – MEREDA’s Developer’s Toolkit: A Practical Guide to Gaining Public Support and Winning Approval for Development Projects

Virtual Event
Thursday, November 19, 2020
8:30 – 9:30 AM

Register at www.mereda.org 

About the Event:

Join us as we unveil the MEREDA Developer’s Toolkit! For over a year, MEREDA’s Local Issues Committee has been hard at work crafting this exciting and invaluable tool for MEREDA members. Designed to help developers of all sizes and levels of experience, the Developer’s Toolkit is a first-of-its-kind modular document that covers all public-facing aspects of a development project, including: project scoping, municipal approval processes, public communications and media relations. In addition to general advice and MEREDA Pro Tips, the Developer’s Toolkit includes examples and templates to help developers jump-start the pre-development strategic planning process and guide developers through the project approval process.

Join us for breakfast on November 19 to learn more about this exciting new tool and how it can help you achieve support for your project. Elizabeth Frazier, Associate at Pierce Atwood will introduce the Developer’s Toolkit in the context of a case study, and we’ll hear from panel of experts who will share their own experiences seeking project approval and provide additional insight and advice on topics covered in the Developer’s Toolkit.

Panelists include:

Ethan Boxer-Macomber, Principal, Anew Development

Gary D. Vogel, Attorney, Drummond Woodsum

Rick Licht,  Principal, Licht Environmental Design

Tom Schoening, Associate, Drummond & Drummond

Don’t miss this exciting unveiling of the MEREDA Developer’s Toolkit.

For more information and to register, click here

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

Please register using Google ChromeFirefox, or Microsoft Edge. Internet Explorer is not compatible with our system.

In addition to your confirmation email, you will receive a separate email the day before the program with the link you will need to access the session. Please be watching for this second email.

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

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The Right Equation for Responsible Development: Spotlight on Station Square, Gorham

In a multi-part series, exclusive to the Maine Real Estate Insider, we’ll provide an up-close look at the most notable commercial development projects of the past year that are helping to fuel Maine’s economy in terms of investment and job creation.  MEREDA is proud to recognize responsible development based upon criteria including environmental sustainability, economic impact, energy efficiency, difficulty of the development, uniqueness, social impact and job creation.

Our 2019 Top 7 recipients include:

62 Spring Street, Auburn, Anew Development / Auburn Housing
Founders Place Campus, Bangor, Bangor Savings Bank / CJ Developers
Cape Arundel Cottage Preserve, Arundel, Arundel-Kennebunkport Cottage Preserve, LLC
WEX Global Corporate Headquarters, Portland, Jonathan S. Cohen – 0 Hancock Street, LLC
Hannaford Center, Hampden, Good Shepherd Food Bank
Southgate, Scarborough, Avesta Housing
Station Square, Gorham, Great Falls Construction

MEREDA’s Board intended to honor the award winners at the 35th Anniversary Gala. Originally scheduled for the end of March 2020, the Gala was postponed indefinitely due to COVID-19. Though they may have their formal award delayed, these projects have only gained practical significance as they serve their communities–especially under additional strain and stress of these unprecedented times.  We look forward to formally recognizing these recipients at a future MEREDA event.

Please join us this week in celebrating Station Square in Gorham.

 

MEREDA:  Describe the building and project.

Great Falls Construction:  Station Square is a great representation of Great Falls’ most recent commitment to excellence and meeting diverse community needs in construction and development to best support Maine’s economy. Station Square stands as a 70,000SF, five story, thirty-three residential, six commercial unit property located in the heart of Gorham’s thriving Village. Station Square is currently home for nearly fifty-five residents as well as the new hub for Village entertainment, dining, commerce and more. The building, now at full residential capacity, nearly tripled the rental offerings in the Village prior to this development. In addition, Station Square has employed over 100+ people throughout the construction and development process and will continue to employee 150+ people through the commercial offerings. Throughout the planning and development process, this project has contracted over 75 Maine companies. These companies worked hard together to produce this project and millions of dollars were circulated through these companies to the hard-working Maine people whose hands created this.

In addition to the economic impact, Station Square includes countless thoughtfully chosen environmentally sustainable upgrades. Throughout the entirety of the project significant choices for sustainable upgrades were selected and executed upon. Some notable examples include the building’s envelope at an R value of 42, which is double the amount required by code. In short, this selected upgrade drastically reduces the consumption of heat and a/c. Should the occupants turn on their heat or a/c they use a highly efficient ducted electric heat pump. Each of the 33-residential units are equipped with an efficient heat pump system to ensure sustainable consumption by all occupants. Station Square also has a storm water treatment system on site in the form of storm tree brand filters to clean water run off on site. In addition, our upgraded choice in flooring for the numerous outdoor patios and common roof deck is a recycled tire material that allows water to pass through and run off where required. By using recycled materials, we help eliminate waste and reuse existing materials that withstand the harsh Maine climate conditions. The durability of this upgrade will ensure that they last for years to come.

Finally, from a historical and cultural perspective the building intentionally preserves Gorham’s historic identity and modernly invites the community to enjoy working, living and playing in the center of Gorham. The name and design of the space is centered on Gorham’s history as a heavily traveled train village. The building is situated at 7 Railroad Avenue atop where the old train ran from 1851 until the tracks were ultimately abandoned in 1961.

MEREDA:  What was the impetus for this project? 

Great Falls Construction:  The impetus behind Station Square was the passion to construct with a purpose. Station Square’s purpose is to gather, live, work and play in the middle of Gorham, Maine. Station Square allows for the entire community to convene and enjoy what Gorham has to offer. Promoting community, walkability, sub-urban living environments, age-friendly family fun options, and economic activity were all forces behind the execution of the project. The project is a new space that offers so much now and for the future but also represents the past by nodding to the history of Gorham as a train traveled village. The name and overall design of the project was executed by the design team to pay tribute to Gorham’s past while offering so much for the present and future. Finally, Jon and Cindy Smith, co-owners of Great Falls Construction, are just plain passionate about developing and constructing with a Purpose and this was the energy that moved the project so successfully forward.

MEREDA:  That sounds like quite a process.  How long were you in the planning stages before construction started?

Great Falls Construction:  The planning phase of the project took a few years before we formally brought the project forward then a year or so from there to complete. It was close to a five-year project duration from conception to completion because we wanted to make sure we designed and executed the project so as to give the property the best chance for success.

MEREDA:  Tell us about the most challenging aspect of getting this project completed.

Great Falls Construction:  As we embarked on the conceptual phase of the project, we quickly realized the current zoning wouldn’t support the mixed-use nature of the project. A contract zone would be required. Striking the right balance between commercial and residential uses and the right balance between number of units and number of parking spaces proved to be a laborious task. As we moved into the construction phase, we encountered some unknowns on the site such as, underground tanks, special soils, and railroad ties just below the surface. We also encountered an unknown concrete structure which was clearly important at one time. Building 70,000 sf on a village site with three businesses in another building onsite presented challenges at times. Thankfully, My-Fit24, The Gorham School of Music, and The Little Red Schoolhouse Daycare were very excited about the project and very understanding. Our other neighbors were all very understanding as well. We implemented many measures to minimize our impact on neighboring businesses and residents with the largest one being the use of our ground floor footprint as a laydown area for the project. Overall, our challenges were just more opportunities for solutions, some requiring more time than others, but none were insurmountable.

MEREDA:  Something unexpected you learned along the way was….

Great Falls Construction:  During the process the unexpected for us was the need for this type of building in our community and the overall great response. From the moment we broke ground to today when we do tours community members love the idea of the live/work environment and the accessibility to everything that Gorham has to offer. All of the apartments are currently full and from the response from the tenants they love the location and safe living that happens at Station Square.

MEREDA:  Now that it’s complete, what feature of the project do you think makes it the most notable? 

Great Falls Construction:  Station Square’s most notable feature is its ability to bring the community together. Gorham has never had somewhere to gather like Station Square and the community has made it known that it has become a quick staple for placemaking in our small Maine town. Station Square was made possible by countless talented individuals who worked their craft in order to make this community building such a large success. It will be exciting to now watch this building evolve in its role within the community. The ability to have hundreds of community members gather and socialize in a local, safe setting is the most rewarding testament to the vision and work of so many people.

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The Right Equation for Responsible Development: Spotlight on Southgate, Scarborough

In a multi-part series, exclusive to the Maine Real Estate Insider, we’ll provide an up-close look at the most notable commercial development projects of the past year that are helping to fuel Maine’s economy in terms of investment and job creation.  MEREDA is proud to recognize responsible development based upon criteria including environmental sustainability, economic impact, energy efficiency, difficulty of the development, uniqueness, social impact and job creation.

Our 2019 Top 7 recipients include:

62 Spring Street, Auburn, Anew Development / Auburn Housing
Founders Place Campus, Bangor, Bangor Savings Bank / CJ Developers
Cape Arundel Cottage Preserve, Arundel, Arundel-Kennebunkport Cottage Preserve, LLC
WEX Global Corporate Headquarters, Portland, Jonathan S. Cohen – 0 Hancock Street, LLC
Hannaford Center, Hampden, Good Shepherd Food Bank
Southgate, Scarborough, Avesta Housing
Station Square, Gorham, Great Falls Construction

MEREDA’s Board intended to honor the award winners at the 35th Anniversary Gala. Originally scheduled for the end of March 2020, the Gala was postponed indefinitely due to COVID-19. Though they may have their formal award delayed, these projects have only gained practical significance as they serve their communities–especially under additional strain and stress of these unprecedented times.  We look forward to formally recognizing these recipients at a future MEREDA event.

Please join us this week in celebrating Southgate in Scarborough.

MEREDA:  Describe the building and project.

Avesta Housing:  Southgate Apartments represents an exceptional example of historic preservation to meet the affordable housing needs of a community. Southgate is located at Dunston’s Corner in Scarborough and offers 38 much-needed affordable apartments for low-income families. The development consists of two separate buildings: a new 30-unit apartment building and the rehabilitation of a separate historic Federal Style brick farmhouse into eight apartments.

Prior to construction, the historic farmhouse was in serious disrepair. Over the past 200+ years the farmhouse had seen a variety of uses including a farm and country retreat, a restaurant and inn, and rental housing. As a result of these varied uses, the property had undergone multiple reconfigurations leading to significant deterioration rendering most of the units uninhabitable by modern building codes.

The new building is separate from this historic building. It was designed in a vocabulary that is reminiscent of an old barn to complement the historic farmhouse but with a contemporary entrance so as not to compete with the original historic structure.

Southgate’s expert development team included: Avesta Housing, developer and owner; Goduti-Thomas Architects, architect; Benchmark Construction, general contractor.

In addition to the development team, key partners included the Town of Scarborough, the Scarborough Housing Alliance, MaineHousing, the Maine State Historic Preservation Office, Boston Capital, Bangor Savings Bank, Federal Home Loan Bank of Boston, Federal Home Loan Bank of Atlanta, NeighborWorks America, and Community Housing Capital.

MEREDA:  What was the impetus for this project? 

Avesta Housing:  As gentrification continues to put pressure on local labor markets, it is vital that we provide safe, decent, and affordable housing for our workforce. For years, the Town of Scarborough has recognized the need for affordable housing in their community and has been actively encouraging new opportunities to create housing for a diverse range of incomes. Because of this project, 38 households will be able to stay in their communities, access quality schools, and be in close proximity to a variety of employment opportunities.

Avesta’s Southgate development project has breathed new life into an important Maine landmark. The original farmhouse was constructed in 1805 by Robert Southgate. It is an important part of Scarborough’s cultural heritage and one of the Town’s oldest surviving structures.  Currently listed on the National Register of Historic Places, the farmhouse offers one of the best examples of preserved Federal Style brick farmhouses in New England.

MEREDA:  That sounds like quite a process.  How long were you in the planning stages before construction started?

Avesta Housing:  After coming up short in several tax credit applications, Southgate finally received funding in 2017 (three years after purchase). During that time, construction costs rose significantly and additional layers of funding subsidies were necessary. Southgate represents a unique and lengthy mix of financial sources, including a TIF from the Town of Scarborough, a grant from the Scarborough Housing Alliance, Low Income Housing Tax Credits, Federal and State Historic Tax Credits, and AHP funding from the Federal Home Loan Bank of Boston. Southgate also received funds from the Federal Home Loan Bank of Atlanta.

MEREDA:  Tell us about the most challenging aspect of getting this project completed.

Avesta Housing:  The varying and intricate design of the historic building required high attention to detail. Given the ongoing labor shortages in the construction trades, it was often challenging to find skilled labor that could complete the work both on time and within the allotted budget. Unlike other more uniformly designed historic rehabs, such as schools and mill buildings, no two rooms were alike. While this adds to the elegance of the final product, it also presents challenges during construction.  An example of this was the replacement and refurbishment of the building’s historic windows. In total, the historic building has 44 windows comprised of 15 distinct window types.

MEREDA:  Something unexpected you learned along the way was….

Avesta Housing:  Southgate was Avesta’s first development in Scarborough. Each community we work in has different visions, resources, and challenges for creating affordable housing. Working with Town officials and the Scarborough Housing Alliance was a wonderful experience. Without their support this project would not have been possible. The Town went above and beyond to ensure that the project would meet the needs of the community while remaining proactive and flexible as issues arose. Our relationship with the Town was something we didn’t have before the start of this project but is something we look forward to continuing as we build more affordable homes in Maine.

MEREDA:  Now that it’s complete, what feature of the project do you think makes it the most notable?  

Avesta Housing:  By preserving one of the original Federal Style agricultural estates in Maine, Southgate has protected a cultural resource and connection to our past that was in jeopardy of being lost. In order to maintain the project’s feasibility during escalating construction prices, Avesta had to pursue a unique variety of funding sources. To the best of our knowledge, this project is the first in Maine to be awarded subsidy from two Federal Home Loan Banks for a single project.

In addition, 20% of Southgate apartments are preserved for households who have previously experienced or are at risk for homelessness. To help this population and our other residents succeed, Avesta is committed to provide services to foster greater financial awareness and self-sufficiency. These efforts include offering our residents free credit counseling, fraud avoidance, and homeownership courses. By supporting vulnerable populations and giving residents the tools to improve their own financial literacy, Southgate can contribute as a stabilizing force to our local economy and communities.

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Business Interruption Insurance and COVID-19

By Conor Shankman, Associate, Bernstein Shur

Few industries or aspects of business have been left untouched by COVID-19 and the resulting economic closures. Though construction was permitted to continue in most areas, the construction industry has and continues to experience substantial hurdles:

  • Subcontractor defaults and cancellation of projects,
  • Supply chain delays, or unavailability of materials,
  • Temporary project shutdowns, and
  • Slowed progress and increased costs resulting from the implementation of social distancing and other safety measures.

As economies are slowly beginning to open again, many are counting their losses and turning to business interruption insurance to help cover the gap.

Business interruption, or business loss insurance, is a type of insurance that covers the loss of income that a business suffers after a disaster. Typically, the loss must result from a physical disaster closing of the business facility or due to the rebuilding process in response to physical damage. Many businesses, the insurance industry, and the legal system are currently debating whether COVID-19 had sufficient physical impact to trigger business interruption coverage for insureds.

This debate is playing out in courtrooms across the country. In California, the French Laundry, a James Beard award winning restaurant, brought suit against Hartford Insurance requesting a declaration that business losses resulting from COVID-19 are covered by their policy. Similar suits are playing out in New Orleans and Boston, where Legal Seafoods and Oceana Grill are suing their insurers seeking coverage for their losses. While the actual claims and policies vary, the goals are the same.

The lawsuits largely argue that COVID-19 is physical in nature, which has led to the government mandated shutdown of business, and therefore coverage is triggered. In the alternative, some businesses have asserted claims that COVID-19 is a pollutant thereby triggering pollution coverage. In the months and year to come, this question will ultimately be determined by the courts, and will likely vary state-to-state and policy-to-policy. The devil is in the details.

What Should Business Owners Do?

If you have incurred a business interruption or a slowdown of business as a result of COVID-19 and you have business interruption insurance of any kind, you should submit an insurance claim to your broker in writing, requesting that your broker submit the claim to all applicable policies. To the extent you have potential coverage, your insurer requires prompt notice of any claim and you should make every effort to meet policy requirements. If you are not sure if you have business interruption insurance, you should contact your broker to review your policies and provide you with information regarding your available coverage. All correspondence with your broker should be in writing so there is a clear record of the request and the broker’s response. During this time, you should start and continue to carefully track your losses and document your damages.

Some brokers having reviewed policies are recommending that insureds not make claims based on the physical damage requirement of the policy – we recommend you make the claim even if the business interruption claim will likely to be denied. We recommend that you should then provide the denial letter and a full copy of your policy, which your broker can provide, to your attorney for review. While many have initiated lawsuits in response to denials, the prudent action for most businesses may be to submit a claim, receive their denial, and then wait for others to litigate the issue of coverage. If courts decide that business interruption policies cover COVID-19 losses, you will have preserved your claim and can renew its pursuit later (you usually have one year from date of denial to bring a coverage action against your insurer) when issues regarding coverage have already been clarified by the courts. But, this is only possible if you submit a timely claim against your policy now, and are able to document your damages later. In this case, an ounce of prevention may be worth a pound of cure.

Article originally published by Bernstein Shur on May 28, 2020, https://www.bernsteinshur.com/what/publications/the-construction-advantage-business-interruption-insurance-and-covid-19/ 

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MEREDA’s 2020 Special Fall Conference: The Chamberlain Model – Back to the Future

We are happy to announce that the new date for our rescheduled “Spring” Conference is now October 15th!  We are transitioning the event to a virtual program and reworking the content a bit.

MEREDA’s 2020 Special Fall Conference – rescheduled from May 2020

The Chamberlain Model – Back to the Future
October 15, 2020 – 8:00 a.m.- 12:00 p.m.

Virtual Event

Registration for this Event is Now Open!

Clicking the link below will take you to a new page where you can complete your registration.

MEREDA Members: $45 each | Non-Members: $75 Each

Register Here!

REFUND POLICY:  Your RSVP is requested by October 12.  Payment is expected at the time of registration.  No refunds will be granted to anyone who registered but fails to attend or who cancels after October 12.  Additionally, no refunds will be issued unless the originating stream fails and the program can’t take place. 

ABOUT THE EVENT:

Join MEREDA on October 15, 2020 for The Chamberlain Model: Back to the Future — safely presented in a virtual environment –  8:00 am – 12:00 pm

There is much to be learned by studying the rich history of Maine. How did this land mass lying so far from its neighbors achieve such recognition that it has become respected around the world? How have we arrived in this place and time where the mere mention of “Maine” speaks volumes about quality of life, work ethic, and commitment to the environment?

Maine’s favorite son, Joshua Chamberlain, laid the groundwork for Maine’s future in a speech given in 1876 to celebrate America’s Centennial. His vision resonates in today’s pandemic economy and provides stepping stones for all of us as we work to create Maine’s future.

As we face the daunting task of repairing our economy amidst the pandemic, MEREDA has invited three inspiring speakers to tie the history of this great state to the economy we face today. Mapping our path through the words and vision of Joshua Chamberlain, Senator Angus KingDr. Glenn Cummings, and historian Earle G. Shettleworth, Jr. will outline and explain Chamberlain’s model for the Maine economy. They will discuss the risks and rewards of Chamberlain’s economic outline, and start to chart the course for Maine’s next 200 years of economy.

Following our historical review, attendees will hear an update from MEREDA’s featured economist Dr. Charles Colgan (former State Economist of Maine and creator of the MEREDA Index). By reviewing the numbers that inform the MEREDA Index, Dr. Colgan will provide a clear picture of what we face.

Kim Hamilton, CEO FocusMaine, will then turn our vision to the future and outline how three globally competitive and high-growth fields are bringing new opportunity to Maine and Mainers, setting the stage for a moderated discussion about Maine’s future.

Following a short break, the conference will pivot to the future. An expert-packed lineup of speakers and future-facing panelists promise a dynamic, uplifting and informative discussion to complete the conference.

Panelists include Scott Wellman, CFO Puritan Labs; Amber Lambke, Founder & CEO Maine Grains; Seth Webber, Principal Berry Dunn; and Briana Warner, President & CEO of Atlantic Sea Farms. The panel will be moderated by Andrea Cianchette Maker, Esq. Pierce Atwood, LLP.

The format will be engaging, interactive, and conversational. There will be many opportunities for audience interface and questions with an expert panel sharing their perspectives and experiences.

CONTINUING EDUCATION CREDITS: This course has been approved for 3 hours of BROKER and LEGAL continuing education credits. Attendees seeking credits will be required to confirm their virtual attendance by completing an exam based on the material presented. The exam will be embedded on the steaming page below the video and chat window. You’ll be able to fill it out right on the stream page as you are watching or at the end of the program.  Click submit once you have completed the exam.  You must receive a score of 85% in order to receive your credits.

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The Right Equation for Responsible Development: Spotlight on Hannaford Center, Hampden

In a multi-part series, exclusive to the Maine Real Estate Insider, we’ll provide an up-close look at the most notable commercial development projects of the past year that are helping to fuel Maine’s economy in terms of investment and job creation.  MEREDA is proud to recognize responsible development based upon criteria including environmental sustainability, economic impact, energy efficiency, difficulty of the development, uniqueness, social impact and job creation.

Our 2019 Top 7 recipients include:

62 Spring Street, Auburn, Anew Development / Auburn Housing
Founders Place Campus, Bangor, Bangor Savings Bank / CJ Developers
Cape Arundel Cottage Preserve, Arundel, Arundel-Kennebunkport Cottage Preserve, LLC
WEX Global Corporate Headquarters, Portland, Jonathan S. Cohen – 0 Hancock Street, LLC
Hannaford Center, Hampden, Good Shepherd Food Bank
Southgate, Scarborough, Avesta Housing
Station Square, Gorham, Great Falls Construction

MEREDA’s Board intended to honor the award winners at the 35th Anniversary Gala. Originally scheduled for the end of March 2020, the Gala was postponed indefinitely due to COVID-19. Though they may have their formal award delayed, these projects have only gained practical significance as they serve their communities–especially under additional strain and stress of these unprecedented times.  We look forward to formally recognizing these recipients at a future MEREDA event.

Please join us this week in celebrating Hannaford Center in Hampden.

MEREDA:  Describe the building and project.

Good Shepherd Food Bank:  This project included the renovation and conversion of the old Bangor Daily News printing press building into the northern distribution center for Good Shepherd Food Bank. The 40,000 square foot Hannaford Center now houses state-of-the-art refrigeration systems, warehouse style storage for dry goods, and new loading docks for receiving and distributing goods.

Not only does the building have a mass amount of storage space for goods, it was built with the larger community in mind. The second and third floors feature meeting and pre-function space, breakout rooms, and prep kitchen areas. The Onion Room has a seating capacity of 32, the Tradewinds Markets Room seats 10, and the Freeman Ellis Family Room seats 14. Each of these rooms features smart televisions and power integrated into all the tables. Good Shepherd Food Bank envisions these rooms as a hub for the nonprofit and business community at large.

MEREDA:  What was the impetus for this project? 

Good Shepherd Food Bank:  Strategically located, the new Hampden Distribution Center, will allow Good Shepherd to purchase and distribute more food, more frequently, and more efficiently to northern, central and Downeast Maine. This facility is fundamental to achieving their bold goal: By 2025, all Mainers struggling with hunger will have access to the nutritious food they need to thrive, when and where they need it. Good Shepherd Food Bank knows that they need to provide an additional 8.5 million meals annually to meet the goal. This is on top of the 25 million meals the Food Bank already provides each year, the Hampden location will be instrumental. This project was completed under a $5 million Food For All capital campaign, which actually exceeded the target donation amount and was funded by more than 900 donors.

MEREDA:  That sounds like quite a process.  How long were you in the planning stages before construction started?

Good Shepherd Food Bank:  Good Shepherd Food Bank purchased the building in December of 2015. We dug in and started planning right away in 2016, but the construction for the project actually began a couple years later in 2018.

MEREDA:  Tell us about the most challenging aspect of getting this project completed.

Good Shepherd Food Bank:  There are many, many challenging aspects of completing this size project but one of our major challenges was running the food bank while construction was happening in the same building.

MEREDA:  Something unexpected you learned along the way was….

Good Shepherd Food Bank:  With every construction project, there will always be surprises. Ours was finding that some concrete was 10 feet thick in the area where the printing presses were located.

MEREDA:  Now that it’s complete, what feature of the project do you think makes it the most notable? 

Good Shepherd Food Bank:  This project repurposed a long vacant and unproductive building into a modern, state-of-the-art food distribution and community center. Having this location, improves the timeliness and efficiency of providing nutritious foods to meet the needs of Mainers struggling with hunger. One of the greatest obstacles to meeting the Food Bank’s long-term goals was the limited capacity of the Auburn-based distribution center and cold storage. Now, even during non-growing seasons, the Food Bank can distribute healthy produce for longer periods of time because of the new freezer and cold storage units. The increased capacity then allows Good Shepherd to invest more into Maine’s agricultural economy to help supply Mainers with the nutritious, fresh foods they need to thrive.

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The Right Equation for Responsible Development: Spotlight on Cape Arundel Cottage Preserve, Arundel

In a multi-part series, exclusive to the Maine Real Estate Insider, we’ll provide an up-close look at the most notable commercial development projects of the past year that are helping to fuel Maine’s economy in terms of investment and job creation.  MEREDA is proud to recognize responsible development based upon criteria including environmental sustainability, economic impact, energy efficiency, difficulty of the development, uniqueness, social impact and job creation.

Our 2019 Top 7 recipients include:

62 Spring Street, Auburn, Anew Development / Auburn Housing
Founders Place Campus, Bangor, Bangor Savings Bank / CJ Developers
Cape Arundel Cottage Preserve, Arundel, Arundel-Kennebunkport Cottage Preserve, LLC
WEX Global Corporate Headquarters, Portland, Jonathan S. Cohen – 0 Hancock Street, LLC
Hannaford Center, Hampden, Good Shepherd Food Bank
Southgate, Scarborough, Avesta Housing
Station Square, Gorham, Great Falls Construction

MEREDA’s Board intended to honor the award winners at the 35th Anniversary Gala. Originally scheduled for the end of March 2020, the Gala was postponed indefinitely due to COVID-19. Though they may have their formal award delayed, these projects have only gained practical significance as they serve their communities–especially under additional strain and stress of these unprecedented times.  We look forward to formally recognizing these recipients at a future MEREDA event.

Please join us this week in celebrating Cape Arundel Cottage Preserve in Arundel.

MEREDA:  Describe the building and project.

Arundel-Kennebunkport Cottage Preserve, LLC:  Cape Arundel Cottage Preserve (CACP), proud recipient of the NAHB 2018 BALA Award, is a distinctive seasonal cottage resort community near the south coast of Maine. Integrated into a landscape of bold granite outcrops, expansive Maine forests, natural wetlands and vernal pools the 300-acre project includes 263 charming cottages, community center and amenities, carefully designed into intimate neighborhoods to encourage family interaction.

MEREDA:  What was the impetus for this project? 

Arundel-Kennebunkport Cottage Preserve, LLC:   The project was envisioned to satisfy a market for seasonal homes set in a community setting in Southern Maine providing access to the natural beauty, culture and growing vibrant urban scenes within the Coastal Maine and Kennebunkport-Arundel area.

MEREDA:  That sounds like quite a process.  How long were you in the planning stages before construction started?

Arundel-Kennebunkport Cottage Preserve, LLC:  5 years

MEREDA:  Tell us about the most challenging aspect of getting this project completed.

Arundel-Kennebunkport Cottage Preserve, LLC:  In one-word Granite! This project has taken a constraint – granite and ledge throughout – and found an opportunity by integrating ledge into all aspects of the project – from flowing masonry and boulder walls to natural water features and exposed granite throughout and building veneer.  As a sustainable practice, ledge was crushed onsite to create gravels for use in construction, reducing the carbon footprint of additional trucking of materials to the site.

Additionally – protecting the natural resources – wetlands, vernal pools, streams onsite and designing a stormwater management system which respects and complements these assets.

MEREDA:  Something unexpected you learned along the way was….

Arundel-Kennebunkport Cottage Preserve, LLC:  How the natural setting and topography influenced the connection between the built and natural environment.  An example is engineering boulder walls to minimize tree cutting and satisfy grading requirements on difficult topography resulting in magnificent western sunset views from cottages.  Secondly the positive impact this project has had on the local Arundel-Kennebunkport communities – not just economically but raising the bar in creating a sense of place.

MEREDA:  Now that it’s complete, what feature of the project do you think makes it the most notable? 

Arundel-Kennebunkport Cottage Preserve, LLC:  The integration of site design, landscaping and architecture that is representative of the Maine vernacular.

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MEREDA Virtual Event – Portland’s Eastern Waterfront: Three Creative Developers and their Visions

Virtual Event
Thursday, September 24, 2020
8:30 – 9:30 AM

Due to the unprecedented circumstances of the Coronavirus pandemic, MEREDA continues its series of free forums on relevant topics to keep members informed.  While this event is free of charge, registration is required. 

Register at www.mereda.org 

About the Event:

Description:  Seasoned developers David Bateman, Ara Aftandilian, and Jonathan Cohen have transformed Portland’s Eastern Waterfront into a sparkling mix of prestigious office buildings, hotels, restaurants, and residences. Moderator David Soley will focus the discourse on what is happening in this booming region – and the vision for the future.

Moderated by David A. Soley, Partner, Bernstein Shur / East Brown Cow

Our panelists include:

David Bateman, President, Bateman Partners LLC

Ara Aftandilian, President / Managing Member, EssexNorth Portland LLC

Jonathan Cohen, President, AD&W Architectural Doors & Windows

Visit www.mereda.org to register.

This event is free of charge, but registration is required. Please register using Google Chrome, Firefox, or Microsoft Edge. Internet Explorer is not compatible with our system.

In addition to your confirmation email, you will receive a separate email the day before the program with the link you will need to access the session. Please be watching for this second email.

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What’s Happening in the Market?

Market Insights

By The Boulos Company Brokerage Team

Because of the uncertainty in the business climate, our brokers are regularly asked what is happening in the commercial real estate market, and what to expect going forward. Never have we wished so hard for a crystal ball! However, based on our experience and knowledge of the market, we do have some insight to share. We asked our brokers to contribute their thoughts and here’s what they came up with:

Samantha Marinko: When this all began, the brokerage community collectively held its breath – but particular markets have proven that a pandemic cannot and will not slow down their progress. The industrial market, which was already extremely tight prior to COVID-19, has seen a surge of users looking to break into or expand further into the Maine market, resulting in multiple offer situations and steadily climbing lease rates.

Joe Italiaander: During regular outreach to various businesses and business owners, I am noticing that the overall sentiment regarding the future is optimistic. While many business owners may be experiencing lower sales volume and activity, they are largely taking this period to ensure success for the long-term.

A popular talking point with prospects and business owners has been the ‘sale-leaseback’ – the concept does not require a business to move, expand or shrink their footprint, which is perhaps an unorthodox approach when pitching a company. Rather, the ‘sale-leaseback’ is an opportunity for a business to capitalize on their (historically illiquid) real estate asset, free up funds for future growth, and even take advantage of tax incentives down the road. I believe that this will continue to be a popular concept in the near-term.

On the flip side, it is apparent that certain business owners and segments are experiencing a sharp increase in demand, mainly in the warehousing and distribution space. It will be interesting to see how logistics and e-commerce evolve as a result of new consumer trends sparked by the pandemic.

Kent White: Office and retail have slowed considerably, but the industrial market is still strong. Available space is still limited and demand has not changed much since earlier in the year.

Greg Boulos: Depends on the market segment. In general, when people call and want a “deal” I advise they’re about 6 months too soon. There will be deals, but it will take a while for the economic hit to flush the economy.

Noah Stebbins: Although COVID-19 has negatively impacted certain asset classes (i.e. retail, hospitality), industrial properties of all sizes continue to be in high demand throughout Central Maine and the Greater Portland area. In the future, I expect many industrial companies to start reshoring their operations back to the U.S., as the virus exposed many companies who heavily rely on importing/manufacturing goods outside of the country, which will more than likely lead to even more industrial demand in the coming years.

Craig Young, CCIM: Industrial product in the Portland area remains in high demand, particularly smaller units (2000-5000 SF) or large 100,000 SF facilities with high ceilings. They were pre-COVID-19 and they remain so today. Rates for both have only escalated through the pandemic and vacancy rates are 1% or less. There are slightly higher vacancies as you drive north on I-95.

Retail is tough. It was pre-COVID and remains so today. If you are a developer and represent (i.e. control) the tenant then you control the deal. There are a few isolated deals, but most retailers are seeking rent abatement’s or are just not paying rent. The notable exception might be the quick-care medical industry which continues to expand and look for site. And with the virus still among us, I see this trend continuing.

Dan Greenstein: On a positive COVID note: In trying to put a deal together in Farmington, the seller suggested we all meet, meaning a 4-hour round trip drive for the buyer and myself. When I asked the seller where we should meet, he said, “on a zoom call, of course.” I hadn’t even considered that that would be acceptable for a “face-to-face” meeting. What a relief, and time saver!

John Finegan: Maine is in a unique position to capitalize on the market forces that are impacted by the Coronavirus – most importantly, the increase in telecommuting will provide opportunities for folks to relocate here and enjoy our great quality of life.  This will in turn make Maine even more livable and bring additional income to the state.

John Meador: I’m speaking to a lot of investors and tenants saying the following: “Find me industrial land in NH and ME that has the potential to construct meaningful density (100k + SF).”

As investors try to predict the long-term changes in office demand, Greater Portland is seen as a RELATIVELY attractive place to put capital. The demand trends that will help the office product will inevitably result in an increased consumer base, particularly of a younger demographic. Northern New England hasn’t been a region focused on in scale by e-commerce related companies until now, and that demand is expected to grow.

Tony McDonald, CCIM, SIOR: We see the next few months as an inflection point in the market cycle during which the pace may slow a bit, but once a new direction is established, things will be off and running again. The market goes up and the market goes down—that’s what makes a market.

Derek Miller: My best advice to clients is to just be patient if they can. The suddenness of the pandemic, lockdown and subsequent economic difficulties that have arisen have been unprecedented. Opinions vary as to what the recovery will look like and a lot of that depends on how we balance the reopening with keeping people safe and healthy. Business owners should take advantage of government programs that make sense for their businesses while also trying to be nimble in terms of how they work with customers and clients (such as investing in new technology or e-commerce initiatives). The real estate business always bounces back, and by working with landlords and lenders, folks can hopefully avoid making rash decisions that will have adverse long-term effects.

Jessica Estes: Downtown Class A office space had less than 1% vacancy prior to the pandemic, and we haven’t seen speculative construction in the market so we’re not overbuilt. Because we started from such a strong place, and we don’t rely on public transportation (which is a barrier for sending folks back to the office in other places), we expect Portland’s office market to fare better than many other northeastern cities over the next 24 months.

Nate Stevens: In many conversations I’ve had with office occupiers in the Greater Portland region, many have reported that while they have seen some success with employees working from home, they still see value in a physical office location for collaboration, efficient communications, and boosting office moral and comradeship. While almost all of our office occupier clients have some employees working from home now and for the foreseeable future, this doesn’t necessarily mean reducing their office footprint but utilizing spaces differently as adjustments to office space programs are needed in this time. Over the last several years, there was a trend for less square feet per employee and we will likely see a reverse in this movement as companies try to give employees more room. Taking the long view with their current office square footage, companies may opt to not downsize and keep the ability to increase employees to pre-COVID numbers at some point in the future.

Article originally published June 30, 2020, https://boulos.com/whats-happening-in-the-market/

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