Tuesday, December 10, 2013
PORTLAND — The ground floor of the former Cumberland Cold Storage building on Merrill's Wharf remains mostly empty nine months after Pierce Atwood and its staff of 135 lawyers moved into the upper floors.
The Merrill’s Wharf building is among those on the Portland waterfront that are in need of tenants. The city’s new waterfront zoning rules allow up to 45 percent of the ground floor to be occupied by non-marine users.
Gregory Rec/Staff Photographer
The ground floor of the Merrill’s Wharf building on the Portland waterfront remains largely empty nine months after Pierce Atwood moved into the upper floors of the building.
Gregory Rec/Staff Photographer
The owners of the renovated building have yet to find any marine tenants. Even though the city's new waterfront zoning rules allow up to 45 percent of the ground floor for non-marine users, there are only two non-marine tenants, a yoga studio and a small law firm, which combined take up less than 10 percent of the 18,000 square feet available.
The situation at the building occupied by Pierce Atwood mirrors the lack of activity on the rest of the city's waterfront, which has yet to experience any significant non-marine development since the City Council decision in December 2010 to loosen the zoning rules.
Before the zoning change, only marine businesses were allowed on ground floors in an effort to preserve Portland's working waterfront.
City officials and pier and wharf owners blame the recession for the lack of interest.
"The economy has been so bad, I don't think anybody has been really able to take advantage of it yet," said Ken McGowan, who owns Custom House Wharf.
"Everything is the same. Nothing has happened," said Pete McAleney, who owns New Meadows Lobster and a portion of Portland Pier.
Indeed, there has not been a single site plan application to the city for what's known as the central waterfront zone, an area that stretches from the Maine State Pier to the International Marine Terminal. It includes outer sections of wharves and piers that are at least 150 feet away from Commercial Street.
The two biggest projects in the zone have both involved new sheds to store bait. Pierce Atwood's new headquarters was built prior to the zoning change.
In 2010, pier and wharf owners lobbied the city for the new zoning, arguing that they needed more non-marine tenants to boost revenues and have enough money to fix their piers, which are expensive to maintain.
Because the groundfishing industry has struggled for more than a decade, there is less demand for marine uses.
The pier owners may have overestimated the attraction of a pier location for non-marine users. The lack of activity there is in sharp contrast to the Old Port district, which does not have much vacant retail and office space, according to commercial broker Roxane Cole. One reason: Space on the piers is removed from business activity on Commercial Street, she said.
Still, she said, the greater flexibility in zoning eventually will yield results. "This sort of thing will take time to mature," she said.
Drew Sigfridson, the broker working for Waterfront Maine, the owner of the building occupied by Pierce Atwood, said he has been marketing the ground floor of the building for a year.
"The tough part of our building is that it's off Commercial Street," he said. "Retailers like to be right on Commercial Street."
Because demand is low for marine uses, he said, the rent is going to be much lower for those uses.
The asking price is $21.50 per square foot for non-marine users and $12 per square foot for marine users.
Another issue is compatibility. Marine uses shouldn't be disruptive to office workers in the upper floors, so a bait processing company wouldn't work, he said. Ideally, the best fit would be a marine research lab or office space, he said.
According to a city survey completed last year, the central waterfront zone had 375,000 square feet of ground floor space, two-thirds of which was occupied by marine uses. For those buildings available for marine use, the vacancy rate was 9 percent.
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