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V O L . X X I I N O. I I I F E B R UA R Y 8 , 2 0 1 6 6 B U S I N E S S M A I N E Business news from around the state Your Commercial Building Solution "The Bowman crew handled our complicated project with ease, professionalism and expertise - and gave us a beautiful building. We now have just one company on our select list of New England Builders: Bowman Constructors." - Client www.bowmanconstructors.com (207) 368-2405 MEREDA: Real estate market heating up Some observations from the Jan. 21 Maine Real Estate & Development Association's "2016 Annual Real Estate Forecast Conference," a day-long event that was held in Portland and attracted 800 people. Warehouse space scarce in Portland Beer brewers, coffee roasters and medical marijuana companies are taking over more warehouse space in Portland, driving demand and the price per square foot. Justin Lamontagne, a commercial broker at NAI The Dunham Group who specializes in industrial space, said warehouse space was already at a premium in Portland, with many traditional warehouse users look- ing to other markets for space. Lamontagne cited the city's "stunning lack of inventory" and said there's no new warehouse construction to fill the void. Some fast-growing companies — including Rising Tide Brewing, Foundation Brewing Co. and Bissell Brothers — are creating additional demand for the existing space. Add to that coffee roasters and rap- idly expanding medical marijuana concerns, and the demand for small- to mid-sized spaces is growing. Paraphrasing Gordon Gecko, he added: "Cash flow is king." In at least one case, Class A space traded at $80 a square foot. "That's the highest I've seen in my career," Lamontagne said. Industrial users are looking to Saco, Biddeford, Lewiston-Auburn and other markets for space. "Manufacturing is up," he said, adding: "You need places to make it, store it, ship it." — P e t e r V a n A l l e n Bangor waterfront sparking interest Bangor's waterfront concert venues last year hosted 283 events and 190,890 attendees — and in turn played a role in downtown redevelopment. Tanya Emery, director of community and economic development for the city of Bangor, said event-goers have created demand for downtown dining options, shopping and hotels. "They come to Bangor, they stay, they eat, they shop," she said at MEREDA. "If you're planning to attend a concert in 2016, book your hotel now." Renewed interest in Bangor has helped generate investment in the city. Emery cited the rehab of core downtown properties, including 26 State St., The Charles Inn, the former Bangor Y and the conversions of 25-27 Broad and 28 Broad. With new residences, restaurants have followed, including Geaghan Bros. Brewing Co. and an Elevation Burger planned for 461 Stillwater Ave. Medical facilities are also fueling growth, Emery said. Eastern Maine Medical Center has completed the first phase of construction on a $287 million tower project, which will be seven stories and 360,000 square feet. — P e t e r V a n A l l e n Hotel rates are up, but watch for Airbnb With more supply on the market, hotel occupancy rates are flat but rates are up, according to Matthew Arrants, managing director at Pinnacle Advisory Group. With the hotel boom in Maine over the past couple years, Maine occupancy rates last year were lower than a decade ago, dipping from 58.8% in 2005 to 56.7% in 2015, according to Smith Travel Research. But aver- age daily rate charged for a room surged from $81.74 in 2005 to $115.98 in 2014 and $119.44 in 2015. Downtown Portland's occupancy rate was 70% through November, up 3.6% from 2014 to 2015. Bangor's occupancy rate fell 7.3% to 65%, with an average room price down 1%, to $108.85. The primary reason was the impact of the weak Canadian dollar. One bright spot he cited is the Riverfront Pavilion, which is driving up demand for overnight stays. Arrants noted that, increasingly, companies are planning leisure activities into business meetings, a trend that shows they have money to spend. The business-leisure market sector, sometimes called "bleisure," is growing rapidly as baby boomers plan to travel a lot and are not as price-sensitive. They also are seeking experiential travel. Arrants also cited the impact of Airbnb, a vacation rental website. "Airbnb targets the leisure traveler, so watch for Airbnbs in Maine," he said. — L o r i va l i g r a Maine hotel occupancy rate and average daily rate S O U R C E : Pinnacle Advisory Group N O T E : 2015 numbers are forecasts 45% 50% 55% 60% 65% 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 occupancy rate average daily rate $80 $90 $100 $110 $120

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