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W W W. M A I N E B I Z . B I Z 27 A P R I L 1 5 , 2 0 1 9 F O C U S R E A L E S TAT E / C O N S T R U C T I O N / D E S I G N And then there are those bids in Bayside for a seven-story, 46,000-square- foot mixed-use project, with 55 rental units and ground-floor retail. "All of them have been heavily affected by the rise in construction costs," Szanton says. While higher costs have not forced Szanton to scrap any projects, "it has squeezed us," he says. When costs come in too high, developers do "value engineering" — making adjustments to things like type of carpeting, or insulation. "We do what we can do to save money," he says. But it's possible bids can come in too high for that to make a difference. "Once the bids come in, we assess," Szanton says. "If it's 5% too high, we can value engineer. If they're 15% too high, that's a major problem. at's more than you can value engineer." He says it's possible to go to financ- ing sources to tweak the budget, but that also has its limits. e most likely scenario? "e project would probably not go for- ward," he says. Because the rents for the afford- able housing are pre-determined, rents can't be increased to cover higher costs. "We're boxed in," he says. The historic building redeveloper Developer Kevin Mattson of Dirigo Capital Advisors said the rising cost of construction hit home for him last year, when he had to buy 25 apart- ments worth of kitchen cabinets for 25 units in the Saco Mill Complex in Saco. He was told that he should agree to a fixed price, because in the months it would take to get the cabinets, the price would increase by more than half. Serving Maine and New England Since 1974. 207-725- 4304 P O U L I N C O N S T R U C T I O N M E . C O M C O N V E N I E N C E S T O R E S R E S TA U R A N T C O M M E R C I A L / P U B L I C R E TA I L K E N T U C K Y F R I E D C H I C K E N S P R I N G F I E L D , M A FAST access to project funding. CONFIDENCE to meet deadlines. RELATIONSHIP you and your clients can count on. Rehab & Renovation Real Estate Development Construction Loans Maine Capital Group provides single-source lending and strategic advisory services for small to mid-sized financing opportunities in the residential and commercial real estate markets. www.mainecapitalgroup.com Mike Lyden: 207.329.2177 / mlyden@mainecapitalgroup.com Russ Oakes: 207.352.5609 / roakes@mainecapitalgroup.com 4 C I T Y C E N T E R , 3 R D F LO O R , P O R T L A N D " Maine Capital Group is the project funding solution I have been hoping to find for years: fast, professional, reliable. I feel like they are a part of my team!" KM — Developer 48 Hampshire will be a 53-unit housing development in Auburn. The developer is Szanton Co. Hartley Block, a redvelopment by Szanton Co., will have 4,000 square feet of retail and 63 residential units. If you're doing a project in Caribou, that's going to cost 20% more. — Kevin Mattson Dirigo Capital Advisors R E N D E R I N G / C O U R T E S Y O F T H E S Z A N T O N C O. P H O T O / M A U R E E N M I L L I K E N

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