March 13, 2010

City firm buys Public Market for office space Firm buys city Public Market for office space Public Market sold to PowerPayCONTINUED FROM THE FRONT PAGEThis is a 6-60-1 dummy headyne yyyyy

By TUX TURKEL Staff Writer

— By TUX TURKEL

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John Patriquin/ Staff Photographer: Thursday. June, 7, 2007. Portland Public Market building on the corner of Preble st. and Cumberland ave. in Portland.

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Staff Photo by Shawn Patrick Ouellette, Tuesday, February 17, 2004: The Waterview group headed by time-and-temp building owner Jeffrey Cohen, wants to build a 12-story, 118 unit condo or apartment building on this block located on Cumberland ave, Forest St. and Mechanic St. in Portland.

Staff Writer

A fast-growing local business has purchased the former Portland Public Market building and wants to convert it into office space for up to 200 workers, the firm's chief executive officer said Tuesday.

PowerPay LLC, which processes transactions for other businesses, currently leases space in a downtown Portland office building that houses Bangor Savings Bank, but wanted to own its headquarters, CEO Stephen Goodrich told the Portland Press Herald/Maine Sunday Telegram. He said he envisions a ''progressive'' office environment that will capitalize on the building's natural light and soaring ceilings. He wants to retain the open feel, while making the structure more energy-efficient and perhaps extending the mezzanine.

''We hope to grow into the space,'' he said, adding that the expansive market building appealed to him.

The project represents a new chapter for the high-profile Portland Public Market building, which was launched in 1998 by the nonprofit Libra Foundation to help farmers and small businesses by extending economic development into the city's Bayside neighborhood. The market closed in 2006, after Libra decided the building had achieved its goals for Bayside and that the strong real estate market made it a good time to sell properties in Portland.

On Tuesday, PowerPay put a key piece of its plan for reusing the building in place. It was the top bidder at an auction involving two nearby lots for a failed condominium project. Goodrich said he plans to use the vacant parcel at 409 Cumberland Ave. as interim parking for workers as he redevelops the empty market building for his company.

Goodrich's winning bid of $340,000 officially ends attempts to turn that half-acre piece of downtown property into a 12-story condominium. The softening real estate market last year and other factors killed the $31 million venture, called Waterview. Contractor liens finally forced a court-ordered sale.

Eyeing the economic downturn, many local real estate brokers determined that the 409 Cumberland Ave. site had little hope of imminent development. They saw it as a long-term investment and predicted that the parcel would sell for much less than the $1.3 million or more worth of liens against the project. They were right.

But what wasn't widely anticipated was that a buyer would emerge who wanted to use the lots to support a nearby redevelopment, as Goodrich is proposing.

Goodrich's involvement with the former market is even more surprising because, earlier this year, the empty building was sold for $1.9 million to Atlantic National Holdings. Atlantic's parent company had done extensive office construction in the adjacent Bayside neighborhood.

At the time, city officials were hopeful that the purchase would bring new life to the high-profile market building, which has languished for more than two years.

But Atlantic changed its plans and put the building up for sale this summer. Goodrich said he paid more than $2 million and closed in October.

Goodrich heads PowerPay, a company ranked this year as one of America's 500 fastest-growing private companies by Inc. magazine.

PowerPay provides payment processing for retailers and other businesses. It was founded in 2003, with six employees. It now has 125 workers, and Goodrich said he plans to have up to 200 within the next 18 months. PowerPay has 35,000 customers and continues to grow, despite the recession. It processed more than $4 billion worth of credit card payments this year, Goodrich said.

Goodrich himself has some experience with challenging redevelopment projects. In 1996, he restored the 142-year-old Tracy-Causer Building, near Center and Danforth streets. The historic brick building was a crumbling shell.

That difficult project gives Goodrich credibility and a track record, according to Morris Fisher, president of Boulos Property Management. Fisher originally managed the public market building.

''I'd love to see some activity in that building,'' he said.

Goodrich has met with city officials about his plans for the market building, he said, and he'd like to secure tax incentives to make the redevelopment more affordable.

It's too early to say whether Portland would extend tax increment financing or other incentives, according to Pat Finnigan, the assistant city manager. The two parties have just begun talking, she said, and a final decision rests with the City Council. But Goodrich's project seems to meet the standards for investment and job creation, she said, and the city is supportive of any effort to bring new jobs to that section of downtown.

Goodrich said he bought the Waterview parcel as surface parking for 30 or so employees cars.

However, it's a few blocks up Cumberland Avenue from the market building, and Goodrich has other parking options closer to the former market. But the lots will be a good investment in the future, he said, as ''the vitality gap'' between downtown and Bayside narrows.

''We paid a little more than we wanted to,'' he said. ''But as the gap closes, the property will appreciate in value.''

For now, though, the parcel doesn't seem to have much value beyond parking, as bidders made clear at the auction.

More than 30 local real estate agents, investors and business people crowded into a small office at Tranzon Auction Properties in Portland. Tom Saturley, the company's president, started the bidding at $75,000. He had to work hard to bring the bidding up, taking breaks to let bidders regroup.

In the end, Goodrich and another bidder were matching each other, as Saturley inched up the price in increments of $10,000 or so. When the other bidder declined to move to $350,000, Goodrich was declared the winner.

After the auction, Saturley acknowledged the impact of the down economy. For tax purposes, the city had assessed the parcel at $470,200.

''In these times,'' he said, ''we're all looking for bargains.''

Staff writer Tux Turkel can be contacted at 791-6462 or

tturkel@pressherald.com

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