SOUTH PORTLAND — Outside, there were weathered wooden walls without siding and portions covered with asbestos shingles. And a steady row of icicles ringed the roof line.

Inside, there were stained suspended ceiling tiles. Water dripped from where a tile had been removed, into and around a small blue bucket sitting on a saturated tan carpet.

By many standards, the office complex at 148 Ocean St. isn’t a gem. But it is a facility that has generated interest from the city since it went on the market last November.

Four of the city’s seven councilors spent about 30 minutes inspecting the single-story office building the city manager would like the city to purchase for a potential new City Hall.

City Manager Jim Gailey has said the city could be the landlords of the building’s current tenants for the short term, while acquiring a strategic piece of land near City Hall in the Knightville-Mill Creek neighborhood for the long term.

The current City Hall at 25 Cottage Road was built in 1898. A 2009 facilities assessment indicated the walls are “full of mold and mildew,” the floors have asbestos tiles and the roof leaks.

Gailey has said buying the 7,100-square-foot neighboring building would be a strategic purchase – much like city’s purchase of the former Inness Photo building – if the city ever wants to build a new city hall.

The office building at 148 Ocean St., built in 1940, sits on about a third of an acre of land. It has an assessed value of $480,600, but the sellers are asking $499,000.

Gailey said the city’s building inspector could find no major, obvious code violations.

Councilors were mostly quiet throughout the tour, led by Joseph Porta, a real estate broker from CBRE-The Boulos Co. They mostly questioned the condition of the building’s roof and ventilation system.

Porta said the rubber roof was deemed to be in good condition when inspected by a contractor, and that the leaks in the roof are the result of inadequate flashing around the edges.

A musty smell pervaded one of the rooms used by the building’s current owner, the Riverview Foundation, a nature-based martial arts group. Water stains were discernible on many ceiling tiles.

“It certainly needs a little help,” Councilor Maxine Beecher said.

Additional water stains were visible in one of the empty offices.

“Water, water everywhere,” Councilor Alan Livingston said.

Porta said the Riverside Foundation is selling the property so it will no longer be responsible for its upkeep.

“That’s part of why they’re selling it,” Porta said. “They’re not professional landlords. They’d rather just be a tenant.”

Porta said the group would agree to stay for at least five years as a tenant, or vacate the property.

He also said the building is generating “moderate” but “genuine interest” among potential buyers.

According to real estate documents, the building, whose tenants include a State Farm insurance office and Mullen’s Driving Academy, costs about $29,000 to operate annually, but generates $40,000 in revenue.

Councilors seemed impressed with the insurance office, which was more modern, bright and clean.

Realtors estimate that another $15,500 could be generated by leasing two vacant offices totaling more than 1,500 square feet.

But Councilor Tom Blake, who owns several rental properties, questioned the profitability of the building.

“The positive cash flow did surprise me, especially in this market and with two vacancies,” Blake said.

Gailey said he would meet with the mayor to schedule another workshop on the building.

If the council is still interested, detailed negotiations would take place privately, he said.

Randy Billings can be reached at 781-3661 ext. 100 or [email protected]

City Councilor Maxine Beecher surveys water damage in an entryway of 148 Ocean St. in South Portland, while City Manager Jim Gailey investigates the leaky roof.

Sidebar Elements

The office building at 148 Ocean St. in South Portland, which is up for sale and is generating some interest from the city, which is seeking land for a potential new city hall. The existing City Hall is in the background, right.

Real estate broker Joseph Porta, left, shows City Councilor Patti Smith the exterior of 148 Ocean St. in South Portland.

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