Mainebiz

W W W. M A I N E B I Z . B I Z 25 JA N UA R Y 1 3 , 2 0 2 0 F O C U S 2 0 2 0 E C O N O M I C F O R E C A S T C O N S T R U C T I O N 'Cautiously optimistic' outlook for one developer B y P e t e r V a n A l l e n C hip Newell is in the process of overseeing development of NewHeight Group's third condo building in Portland. e new venture, Verdante at Lincoln Park, has half of the 30 units under contract and will open late this year. Newell was wary of last year's predictions of a coming recession. While that recession didn't arrive in in 2019, he's still cautiously optimistic when he looks to 2020. e southern Maine economy, where he is doing business, is affected by the national economy, but he also lauded Portland's growing reputation as restaurant and tourism destination. "[Last year] exceeded all projec- tions on stock market appreciation, unemployment and interest rate sta- bility. And the residential real estate market in Portland has continued to benefit from these national trends," says Newell. "But the strong residen- tial market in greater Portland has more than the national economy to thank. Our city has found itself on numerous lists of 'bests' and the strong food-based tourism market continues to introduce new people to its broad appeal." Looking ahead, Newell leans toward the year being one of continued eco- nomic growth, not contraction. "At the moment, I tend to agree with most national projections that 2020 will be a year of growth, rather than the start of a recession," he says. "While it is worrisome that a year ago many were predicting a recession and were proven dramatically wrong, the fundamentals — job growth, inflation stability, consumer sentiment and interest rates — give confidence that the inevitable slowdown will not occur this year." So far, NewHeight Group has focused on high-end condos. is year, Newell says, it plans to branch into a "broad mix" of residential and commercial offerings, including rental housing. "Irrespective of the future economy, we know that there will be continued demand for affordable housing for our neighbors most in need, as well as continued demand for 'workforce' rental units for those making 80% to 120% of area median income," he says. "We feel confident about the prospects of developments that mix those uses with higher end for-sale residential products on the peninsula, and we plan to add support services desired by the residents and neighbors alike." H E A LT H CA R E Health care in Maine may be entering a critical 'convergence' of trends B y W i l l i a m H a l l F or Maine's health care industry, a perfect storm may loom on the horizon. at's the concern of Bill Caron, CEO of MaineHealth, the largest health care system in north- ern New England. Like other fields, health care in Maine faces a grow- ing labor shortage. In 2020, there will be fewer working- age Mainers available to staff hospitals, clinics and medical offices. Caron himself is an example; he plans to retire at the end of the year. But the state's demo- graphics will create an addi- tional challenge for health care. Already the oldest in the U.S., on average, resi- dents of Maine are getting older and will need more medical help. "If you look at demand, that's going to continue to grow in 2020. e older age cohorts will require more services," says Caron, a 2019 Mainebiz Business Leader of the Year. e double whammy of increasing demand for health care and a shrinking pool of people to supply it may reach a critical phase in the year ahead. "We're almost in the middle of the two trends converging," Caron says. As a result, he sees two other trends gathering strength. Health care costs will again be on the rise, and consolidation within the industry will continue. One cost driver is the shortage of nurses in Maine. While the state's col- leges are expanding nursing education and making it more affordable, Caron notes, it may not be enough. "It'll help, but the demand is so great [for nurses] that it creates wage pressure," he says. However, the lack of labor affects every aspect of health care, "from top to bottom," Caron adds. e shortage is also one reason medical practices and other providers are teaming up with large systems like MaineHealth. Recruiting physicians, especially in rural parts of the state, is increasingly difficult, according to Caron. "e simple reality is, not enough are being trained and not enough are being attracted to Maine," he says. And while advanced practice clinicians, such as physician assistants, are a partial solution to the shortage, they too may not be enough. Increasingly, practices will turn to larger health care providers in order to gain access to physicians who can provide off-hour coverage, additional services and neces- sary "clinical scale," Caron says. "Physicians will continue to join health care systems, and the systems will continue to grow out of necessity. It's economics that's driving that." From left, Gregory Pomerleau, Erin Cooperrider, Emily McConnell, Susan Morris and Chip Newell at the groundbreaking of the Verdante at Lincoln Park, a condo development in Portland. P H O T O / C O U R T E S Y N E W H E I G H T G RO U P "At the moment I tend to agree with most national projections that 2020 will be a year of growth, rather than the start of a recession." — Chip Newell NewHeight Group If you look at demand, that's going to continue to grow in 2020. The older age cohorts will require more services. — Bill Caron MaineHealth P H O T O / T I M G R E E N WAY Bill Caron, CEO of MaineHealth, the largest health care system in northern New England, says Maine's aging population creates demand on both the workforce and service side of the business.

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