Suburbs Say Housing Crunch isn't just Portland's Problem

March 25, 2016 in News

Author: David Harry
Publication: The Forecaster

PORTLAND — Officials from five suburban towns joined their Portland colleagues Wednesday to discuss how to expand housing in the region.

“I think the headline is the same as in any town: New development is incredibly wrenching,” Cape Elizabeth Town Planner Maureen O’Meara said during the forum at the University of Southern Maine.

The discussion, hosted by the Portland City Council Housing Committee, was also attended by officials from Scarborough, South Portland, Falmouth and Westbrook, including South Portland City Councilor Linda Cohen; Assistant City Manager and Economic Development Director Josh Reny; South Portland Housing Authority Executive Director Mike Halsey; Scarborough Senior Planner Jay Chace, and Scarborough Town Councilor Will Rowan.

Portland City Councilor Jill Duson, the committee chairwoman, organized the regional forum. It was moderated by Caroline Paras, community and economic planner at the Greater Portland Council of Governments.

The forum was opened with a presentation of local housing markets compiled by the U.S. Department of Housing and Urban Development. The analysis established that demand will continue to grow in the marketing area including Cumberland, Sagadahoc and York counties.

Meeting the projected demand for an estimated 4,000 housing units for purchase and 2,000 for rent in the next three years will be daunting; HUD estimated 850 sales units and 450 rental units were under construction in the affected areas as of Oct. 1, 2015.

Chace said Scarborough added about 8,000 housing units in the last 20 years, but almost all were single-family units. He said there is more acceptance of rental units as the town tries to develop along its highly traveled corridors and reduce reliance on vehicles.

Cohen said South Portland has keyed in on increasing population density in the areas of Mill Creek and near the Maine Mall to encourage mixed-use development that adds to the housing stock.

Increased density can also support local businesses, but Reny noted it is not a citywide approach.

“It is an issue that is place-sensitive,” he said. “What we know is, people love the city and value the neighborhoods.”

Critical to the success of adding housing is the quality of the development and how it fits into existing areas, O’Meara said.

“I’ve spent a lot of time putting design standards into Cape Elizabeth regulations, because if it doesn’t look ugly, it is easier to accept,” she said.

Officials agreed more regional forums are needed, and discussed the possibility of site walks to show what has worked in the communities, but did not schedule any new joint meetings.

Tyler Technologies Coming to Maine

March 24, 2016 in News

Author: Mainebiz
Publication: Mainebiz

Tyler Technologies looks to nearly double jobs with Yarmouth expansion

Tyler Technologies Inc., a Plano, Texas-based public sector software developer with 550 employees at three locations in Maine, is hosting a groundbreaking ceremony to mark the expansion of its ERP & School Division headquarters in Yarmouth.

The division develops enterprise resource management software for public municipalities and schools, allowing easier ways to manage finances and data. Tyler (NYSE: TYL) is the largest company in the country solely dedicated to providing software and services to the public sector.

The software company also said that it expects that the expansion will allow the company to nearly double its workforce in the area over the next decade, according to the announcement of the groundbreaking.

Forbes has named Tyler one of "America's Best Small Companies" eight times, and the company has been included six times on the Barron's 400 Index, a measure of the most promising companies in America.

The expansion, which was designed Portland-based Mark Mueller Architects, is expected to open in January 2018.

Portland Balancing Between Staying True to its Roots and Development

March 23, 2016 in News

Author: MaineBiz

Portland balancing between staying true to its roots and development

Portland's hot — a city where life is good, a place where people want to live, work and play.

That's backed up by several southern Maine forecasts at the Maine Real Estate & Development Association's annual conference last month showing the city's real estate metrics in 2015 to be exceptionally strong: downtown Class A vacancies at 4.52%, the lowest in seven years; retail, 3.6% vacancy rate compared to 12.6% nationally; multi-unit residential, 1,134 new apartments in the pipeline and 269 units under construction.

And it certainly doesn't hurt that Portland regularly gets mentioned in national "top city" rankings for its abundance of award-winning restaurants, as a great place to raise a family and for having a lively arts scene that's appealing to empty nesters and millennials.

But two high-profile projects — the $85 million Midtown mixed-use complex in the Bayside area and the proposed redevelopment of the historic Portland Co. complex at 58 Fore St. — respectively triggered a court challenge and a citywide referendum by residents objecting to their scale and impact. Although neither derailment effort succeeded, there's ample evidence Portland is experiencing some growing pains as architects, developers, municipal officials and residents struggle to find common ground on the city's growth challenges and potential solutions.

"How we change matters, lack of trust will defeat us," architect Patrick Costin, who founded Canal 5 Studio in 2011 and is the newly installed president of the Portland Society of Architecture, said in a recent talk at the Portland Museum of Art. Signaling the PSA's intent to take a proactive role in that debate, he adds: "We can follow our fears or be proactive and work together — face to face, not just on Facebook — to craft solutions that will elevate Portland to new heights as a place to live, work and raise a family."

Strong demand for housing

Brit Vitalius of Vitalius Real Estate Group, a speaker at the MEREDA conference, cited four Portland projects that will add at least 710 rental units in the next year or two:

  • Redfern Properties, with an eight-story, 139-unit apartment complex under construction at the site of the former Joe's Smoke Shop on Congress Street and a 53-apartment project in East Bayside at 89 Anderson St., 192 units total.
  • Schlotterbeck & Foss's 55-unit project using historic tax credits at 117 Preble St.
  • J.B. Brown's 63-unit El Rayo project at 101 York St.
  • Miami-based Federated Cos.' long-delayed mixed-use Midtown project with 400 or more apartment units, reported as being "back on track" last October after the developer agreed to reduce the scope of the project.

"We are attractive to the rest of the world, but it seems we've particularly got a connection with Brooklyn," Vitalius quipped. But the larger point he was making is that it's not only an influx of out-of-state young urban professionals driving the boom in Portland's multi-unit housing market, it's also retiring baby boomers and young families choosing urban life over the suburbs.

That gives Redfern Properties' co-owner Jonathan Culley some confidence the $25 million investment will pay off for his company and other investors involved in the 667 Congress St. apartment complex under construction near Longfellow Square.

"We know there's demand for apartments in Portland, that's well documented," Culley says. "The $64,000 question is, 'How deep is the market for rents of up to $2.50 per square foot' [i.e., ranging from $1,375 to $1,625 for apartments 550-to-650 square feet]? New construction is expensive. Costs have risen 10% in the last two years. We've got to get premium rents to justify the higher costs."

The answer to that rent affordability question, he readily admits, is tied to an issue highlighted by new Portland Mayor Ethan Strimling: Job creation.

In simple terms, Redfern and other market-rate apartment developers need "people to have incomes to support the rent" they'd pay to live downtown, Culley says. That's why he's keenly attuned to the increasingly tight Class A office market in Portland and what that might mean in relation to the city's goals of attracting highly paid professional jobs. "We haven't seen a new office project downtown in many, many years," he says. "I'd love to see more office growth happening downtown, with 1,000 well-paying jobs. That's one of the ways we address the housing affordability problem."

Culley, a Portland native whose resume includes a stint as a senior associate of the venture capital arm of the Boeing Co. in Seattle, returned to Maine and co-founded Redfern with his wife, Catherine, in 2005. He says they came back to Maine largely for the same lifestyle reasons he's counting on to fill his two apartment projects now under construction. By the time the 139-apartment project at 667 Congress St. is completed in the spring of 2017, he and his wife will have built or renovated 300 housing units in Portland in the last decade.

"I'd like to think we've done our part," he says, agreeing with Vitalius that the appeal of living downtown within walking distance of many amenities cuts across all generations. "There are absolutely demographic trends supporting urban development. These are real trends. That's why we are making such a big bet on urban housing. These are very healthy social trends."

City takes fresh look at growth

Jeff Levine, director of Portland's Planning and Urban Development Department, says more than 1,100 units of housing were approved by the city's planning board by the end of 2015, with Redfern Properties accounting for 192 of the 269 units now under construction.

He's been in his post for three-and-a-half years, having previously worked as director of planning and community development for a greater Boston community, and says most of his planning career has been in cities between 50,000 and 100,000 in population. "Portland is the most exciting place I've worked in so far," he says. "I think it's been 'full steam ahead' since the day I got here."

Levine says it's understandable that, as the pace and scale of projects in the Portland peninsula started picking up in recent years, it has triggered fears that the city's unique qualities were at risk of being lost. "Change worries people," he says.

It isn't just the mixed-use Midtown and Portland Co. proposals triggering such concerns. A recent proposal by retailer CVS to raze five buildings in the mid-300 block of Forest Avenue sparked a public outcry over the loss of the neighborhood's historic ambience.

The recent surge of hotel, mixed-use and multi-unit housing projects, he says, has spurred the city to take a fresh look at its comprehensive plan, a long-range, goal-setting document with some sections that are more than 20 years old. That plan set a goal of adding 15,000 residents by 2030, an almost 25% increase over the current population of 66,700. In addition to conducting an online survey of residents to gauge their views on housing densities, protecting historic properties and what the city's role should be in guiding private development, Levine says the city has been taking a closer look at specific neighborhoods, such as India Street, Forest Avenue and East Bayside.

"It's really great when you develop a plan and you are patient and you watch it unfold in time," he adds, pointing to the Ocean Gateway complex near the Maine State Pier on the eastern end and the expansion of the International Marine Terminal on the western end as projects fulfilling visions laid out in earlier city plans. Likewise, he says, the proposed mixed-use development of the Portland Co. carries forward many of the ideas spelled out in the city's 2004 Eastern Waterfront Master Plan.

"It's not carved in stone," he says, noting that every plan represents a vision tied to a particular moment in time, which can and should be tweaked if present conditions change some of the assumptions of the original plan. "It's a balancing act for us."

Finding the 'right fit'

Alan Kuniholm, a principal of PDT Architects, takes the long view when pondering Portland's growth challenges. He recalls the "huge controversy" accompanying the construction of One City Center when he arrived in Portland in 1984, noting that the 13-story office building is now an iconic financial center, home of Bank of America's Maine headquarters, and an anchor of the city's Congress Square mixed-use district.

"Look how far we've come," he says. "We're at the crossroads for so many things."

Kuniholm, who stepped down as president of Portland Society for Architecture at its Jan. 27 annual meeting, shares the view of his successor, Patrick Costin, that the nonprofit group of architects, engineers, landscape architects and design professionals can play an important role in helping the city chart its future and manage change successfully. It's why the organization invited the world-renowned Boston-based architect Moshe Safdie to deliver the keynote lecture in the public portion of its annual meeting.

"He really focuses on the relationship people have to their built environment," Kuniholm says of Safdie, whose portfolio over five decades includes the $8 billion Marina Bay Sands integrated resort in Singapore (2011) and the Crystal Bridges Museum of Art in Bentonville, Ark. (2011). "I think that's really important and lends itself to the growing pains we might be going through right now."

In an engaging slide lecture featuring a number of case studies from his wide-ranging portfolio of completed projects, Safdie told the audience at the Portland Museum of Art that questions about density, the relationship between old and new and the traditional conflict between the "market knows best" notion of development and the community's efforts to guide that growth through zoning regulations are all vitally important.

"I want my buildings to take root and look as if they've always been there," he says, explaining in his writings that the challenge is to find a way "to blend the future and the past."

Among the life lessons he conveyed both visually and in stories about some of his more challenging projects, Safdie shared key ideas he hoped would prove useful as Portland engages the challenge of growth:

  • Pay attention to the problem of scale.
  • Pay attention to the connection between a building and the larger infrastructure.
  • Preserve the roots, the essence of place, but resist forces that insist on sameness.
  • Create a space for human interaction, discover the modern equivalent of the piazza, bazaar, agora.
  • Preserve the ritual of public life. It's what enhances the identity of a community.

It boils down to "fitness," which Safdie says relates to the way all forms in nature strive to achieve a perfect fulfillment of their intended function. It's no different, he says, for architects, developers and planners responding to the changing needs of a community. Safdie says Portland's challenge going forward will be to create buildings that "resonate" both culturally and spatially to its "essential" needs and qualities.

Much Needed Makeover

March 22, 2016 in News

Publication: Mainebiz

A much needed makeover for five-way-intersection in Portland

On Monday, the Portland City Council unanimously approved an agreement that will give the busy five-way intersection of Woodfords Corner a makeover. City officials say the project will help spur residential and economic development for the off-peninsula neighborhood.

The large-scale project will see Forest Avenue north of Ocean Avenue widening to accommodate two lanes of traffic in both directions, as well as adding a number of "bump-outs" that will narrow intersections making it safer for pedestrians to cross.

The increased ease for pedestrian traffic in the neighborhood is a welcome change to residents of the neighborhood, according to the Portland Press Herald. Although the area is home to a vast array of businesses — including international markets, restaurants, antique stores and a theatre company — the crossing of four lanes of traffic on Forest Avenue is a deterrent to the residents of the neighborhood, many of whom are the highest-earning residents in the city, the newspaper reported.

The project also includes construction of a plaza in front of the nearly 120-year-old Odd Fellows Hall, with outside furniture and the elimination of a right-turn-only lane onto Woodford Street for traffic northbound on Forest Avenue.

Although some businesses in the area are worried about the loss of parking between Woodford Street and Vannah Avenue, city officials are quick to let business owners know that the city is looking for alternatives to replace lost parking.

"We can replicate a number of the spaces," transportation systems engineer Jeremiah Bartlett said. "I wouldn't say it would be a one-to-one replacement."

The beginning of construction for the project, which city officials had originally planned for last year's construction season before it was delayed to perform needed upgrades to the railroad crossing on Forest Avenue just north of Woodfords Corner, is expected to kick off during the summer.

As for the cost of the ambitious project, the $2.6 million price tag is being funded by federal, state and local money — city taxpayers will be footing $640,000 of the bill.

Mark Sandler New England Real Estate Journal

March 7, 2016 in News

Author: Mark Sandler
Publication: New England Real Estate Journal

Mark Sandler featured in the New England Real Estate Journal


The greater Portland office market continues to improve. We are seeing a slow descent in the vacancy rate. Last year’s vacancy rate was 6.52% down 1.32% from 2014. There has been a slight increase in asking rates across the market. We are starting to see more and more repositioning of office space to retail which is tightening up

the amount of available office space. Office market transactions continued to increase in 2015. We should see more of the same this spring. Some significant sales last year in the office market were; 1 & 2 Portland Square in Portland which consists of 255,000 s/f sold for $66.1 million, 100 Mid- dle St. in Portland which consists of 195,000 s/f sold for $35.3 million and 400, 500 & 600 Southborough Dr. in South Portland which consists of 111 million s/f sold for $11 million.

The greater Portland retail market is booming. Vacancy rates are at 3.6%. Clothing and food industry establishments are leading the charge. We should see more of the same

for the retail market through 2016. Lease rates continue to increase for prime locations. Though, Falmouth and Windham have not been expe- riencing as much of an increase as most other southern Maine towns. I have a significant amount of clients in the Windham area and we are be- ginning to see interest again because of the values compared to Portland. Scarborough Gallery added the much anticipated relocation of Home Goods, Marshalls, Bob’s Furniture and PetSmart,The Maine Mall contin- ues to thrive with almost no vacancy. New restaurants are opening every week such as Tilted Kilt, Guerrero Maya, Duffy’s, Ground Round and

Elevation Burger. Some significant sales last year in retail included; Shops at Long Bank in Kennebunk selling for $6.9 million and 740 Broadway Strip Center selling for $4 million.

The Southern Maine Industrial market will continue to see low va- cancy rates and slightly higher lease rates. We should see lease rates start to hit $6 NNN. Last year’s vacancy rate went down .75% to 3.38%. Small to medium sized businesses have been driving this sector. Some significant sales in this market were; 55 Hutcherson Dr. in Gorham which consists of 114,232 s/f and sold for $4.875 million, 28 Pond View Dr. in Scarborough which consists of

74,976 s/f and sold for $5.38 million and 135 Walton St. in Portland which consists of 56,127 s/f and sold for $1.745 million.

Multifamily sales continued to surge in Portland, Saco/Biddeford, Lewiston/Auburn and Westbrook markets.They had an increase of 26%, 21%, 44% and 27%, respectively in 2015. The towns and cities above will continue to see strong sales in 2016 with buyer demand exceeding supply. Rents will continue their escalation in the Portland area. Rents in other towns should increase moderately. We will continue to see more market rate development in Portland. Some notable sales last year in residential were; 309 units with three complexes that sold for $50.25 million, East End Corp. with 74 units sold for $6.97 million and 125-133 Grant St. with 74 units sold for $4.34 million.

Moving ahead, all sec- tors of the commercial market in southern Maine should remain robust. The investment market will continue to thrive, land interest and new construction will increase, lease rates will continue to move
up slightly, and vacancy rates will continue to de- crease slightly in Greater Portland.

The hospitality market is still going strong. We saw the opening of several new hotels in 2015 including The Press Hotel in downtown Port- land. Nightly rates continued to rise modestly. Occupancy on the Portland Peninsula increased 3.6%. South Portland was also a strong market adding two new hotels. Windham’s first and only hotel opened its doors in 2015. We should continue seeing an increase in rates and occupancy going into the summer, with tourism at its peak.

Moving ahead, all sectors of the commercial market in southern Maine should remain robust.The investment market will continue to thrive, land interest and new construction will increase, lease rates will continue to move up slightly, and vacancy rates will continue to decrease slightly in Greater Portland.


Mark Sandler is a broker for Cardente Real Estate, Portland, Me.

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