In this episode, Greg talks with Maine developer David Bateman. David explains his entry into commercial real estate and discusses his various development projects, including Fisherman's Wharf and Newbury Street in Portland. We learn what David thinks should be the future of Portland's development.
We'd like to welcome our listeners to the Boulos Beat podcast. I'm your host, Greg Boulos. The Boulos Company is Northern New England's largest commercial real estate services firm with offices in Portland, Maine and Portsmouth, New Hampshire. We've been selling and leasing real estate in Maine and New Hampshire since 1975. This is a series providing insight into Maine’s real estate movers and shakers.
I'd like to introduce David Bateman. David is a below-the-radar prolific developer here in Maine and has been doing development deals for a number of decades. He's also president of Bateman Partners LLC. Since 1979, he has been responsible for the acquisition, development and management of real estate projects with the combined development cost of more than $210 million. Probably more by now. David was the first recipient of Maine Preservations Earl G. Shettleworth, Jr. Preservation Champion Honor Award in 2015 for his achievements in historic preservation. He's a trained architect with extensive experience in the field of design and construction. David's personal goal has always been to provide Maine with innovative projects that improve the quality of life and economic opportunities for the people who live here. Whether creating public/private partnerships with communities or traditional commercial, residential and resort developments, he’s well known for never compromising his basic commitment to quality of life. David is in business with his two sons, Nathan and Aaron who I know are as business savvy as their father. Welcome, David.
David, your company is based here in Portland. How did you end up in Maine as a developer with an architectural background? Weren’t you in the military?
David: I was. I was one of those individuals who were lucky enough or fortunate enough to have a very low draft number back in in 69, 70.
Greg: And those were Vietnam War era.
David: Yes. And decided that perhaps four years in the United States Coast Guard was a place that would be more welcoming than others.
Greg: And so you were in the military. Then what happened after that?
David: Actually, before I before I enlisted in the Coast Guard, I was actually at the School of the Museum of Fine Arts in Boston for painting and sculpture. However, at that time, there were no draft deferments for art students, which is why I wound up in the in the service. Following the service, I had a wife and a child and a need to support ourselves. And because I could paint, draw, architecture seemed like a great profession to pursue, which I did at the Boston Architectural Center. But that had a unique and still does unique facets to it, in which it's one of the only schools left for architecture where students must have a full-time, must be employed on a full-time basis in an architectural firm. So I worked all day starting as a draftsman in Portsmouth, New Hampshire, with Wright Pierce Whitmore, a Maine firm, and then traveled down to Boston for the classes, which didn't start until six o'clock at night. So by one in the morning I got back in the bed and I did that four days a week for a number of years.
Greg: You must've been exhausted.
David: I was fine. I don't think my wife enjoyed it that much.
Greg: Because she was taking care of the baby.
David: Yes. And we didn't see each other a lot. The transition into development was one, I think, out of economic realities at the time. In the late 70s, interest rates were 12, 13, sometimes 18 percent. And working in an architectural firm, the only way that you really obtained work was you had to really foster relationships with clients. One of the things that I had learned at the architectural center is I really specialized in real estate development. So being able to facilitate financing, local approvals., kind of gave our firm an edge when it came to the selection process. After a number of years—several—I was offered an opportunity because I was very prolific in the field of obtaining financing, getting projects moving—really looking at the economic analysis behind them, not only the design, but the realities of making them come to fruition. I was offered an opportunity through two main contractors, Dick Dobson and Paul Tarbox, who really offered me an opportunity to come in as a as a full one-third partner. And I said, well, guys, I'd love to do it, but I really don't have any resources. And they looked at me like I had two heads and they said, Yeah, you do. Look at what you do every day. This is your sweat equity you're bringing to this partnership. And Paul and I have been partners for over 40 years. Dick passed away a number of years ago, but it's been a relationship that really transformed my life and offered me opportunities that I wouldn't have had otherwise.
Greg: And you came to Maine because because of that, they were both.
David: They were both, their businesses were located just outside of Portland. And if I wanted to be a full partner, I was going to be a Maine resident. So I moved my residence from Portsmouth, New Hampshire, to Eliot, Maine, right across the border and never looked back.
Greg: One of the few people who I know who've gone from a tax-free income state to the state of Maine, where you have to pay income taxes.
David: Well, you know, Mainers are always proud to be poor.
Greg: I love it. David, I know you've developed housing, medical office and urban office buildings. What are some of the more notable projects you own and developed that our listeners may be familiar with?
David: I think one project that I've been involved with for over 30 years now. Probably the one that's closest and dearest to my heart is Great Diamond Island.
Greg: Right here in Casco Bay.
David: Yes. Was the former Fort McKinley. Again, I had a natural penchant for historic renovation and when I first set foot on the property, I think back in 1981, all I could see is this incredible municipality that somehow it’d magically been lifted off the face of the earth and dropped on an island in Casco Bay—brick buildings, granite foundation, slate roofs, over 300,000 square feet of magnificent architecture that was just laying waste.
Greg: It was a military installation.
David: It was, it was built back in the period of the Spanish-American War and had a construction period of about 12 years in its final build up, but it’s over 200 acres.
Greg: So over the years you renovated those buildings out there, sold them off as houses, condominiums and more recently put up a hotel out there.
David: That's a simplistic way to look at it. What we really did was take an abandoned city and breathed new life into it.
And to do that, we had to figure out—I had to figure out—how do you create an urban center in a remote location that is going to provide the vibrancy for people to not only live and invest in, but so close to Portland and with its transportation issues being on an island kind of overcome those issues of: yeah, it's beautiful a few months out of the year, but what's it like in the winter?
And with that, you know, over the years, whether it was the Diamond’s Edge Restaurant, which was one of the first commercial facilities we did, to the townhomes which were renovated in these beautiful, you know, military buildings and then eventually single family homes: Marina. And as you just mentioned of five years ago now, we opened the doors on the Inn at Diamond Cove, which is a 44-room, boutique inn that runs on a seasonal basis. But again, all of those constituents are things that today you look at them and say, well, what a wonderful idea. Turn the clock back to 1981 and it was a nightmare for most people. No approvals. We actually, I thought, I had every environmental group on the East Coast that were trying to block the project. We created our own wastewater discharge system. We brought underwater power from Cousins Island and negotiated with Casco Bay Lines for year-round ferry service. All of those things that you don't think about, but we're absolutely critical to making it a success.
Greg: A lot of vision on your part.
David: Some people would call it insanity.
Greg: I was trying to be nice.
David: Trust me, my wife’s never nice about that.
Greg: Well, it's a beautiful project. What about the MEMIC building? That was an old Hannaford Brothers warehouse right down in Portland on Commercial Street.
David: that building was the original Hannaford Brothers warehouse. And when we had the opportunity to purchase that property, it was called the motor supply building. And that's what it was. It was six stories of automobile parts. I think it was nominated as the ugliest building in the city of Portland at one time. But it had great bones. It was very, very, very similar to a number of industrial buildings that were built in Portland in the 30s and 40s. So it actually could have been rated as a nuclear fallout shelter. We took a look at the building and basically reskinned it—took out all of the non-bearing partitions on the exterior, turned it into a glass box.
And we leased that building before we ever finished construction to EC Jordan, the engineering company.
Greg: That’s right.
David: And Jim Vamvakias took one look at it—it was floor to ceiling glass—and realized that his engineers were gonna be extremely happy in a building that was just flooded with light. And I think it took him a half an hour to make up his mind to the lease the entire building.
Greg: And then they stayed there a number of years, left, and then MEMIC came along. I think we brought MEMIC to you.
David: Yeah. They initially took I think it was three or four floors and John Leonard and I became friends over a number of years. He was the president at the time. And he decided that there was a great place to grow the company.
And over the course of their tenancy there, they actually brought in an incredible amount of infrastructure in terms of cabling communication systems. They went paperless and then at one point, John really, really wanted to just own the building and he made me the typical offer that you couldn't refuse.
Greg: And what was that?
David: Well, either sell him the building or he was going to move to a new location.
Greg: So you could either have an empty building or cash in your pocket.
David: That’s right. And John paid us handsomely for the building. It wasn't it wasn't that type of pressure because he really, really felt it was the location that was appropriate for them. They'd grown into it. So we carved that building out of the larger site. It’s one of the few properties I've ever sold.
Greg: And talking about the larger site, the larger site there, consists also of a parking garage in a hotel, Portland Harbor Hotel. How did that come into fruition? I remember for years was just a parking deck down there.
David: Well, it's interesting. A lot of what I do and have done over the years is master planning projects so that there's always more than one piece. Whether it be financially or of a financial standalone piece in or it's a separate structure, separate uses.
The way I looked at it initially back in the early 80s was it was a toe in the water down on Commercial Street. Commercial Street was not what it is today. We took the first major bite of the apple, if you will, in that in that neighborhood and bought 80 percent of that block. We knew it needed parking. So we re-skinned the Hannaford building and we built a parking garage. But the profit that we had made from the building and rental income we put right back on the ground in terms of additional foundations and pilings for the garage with the idea that eventually we would do a structure over the garage. And in fact, legally, when we set it up, we condominiumized it—I called it the layer cake effect. We ground-leased the property to a new development entity, which we controlled, did an office structure, did a separate free-standing financed parking garage. And then we carved out the air rights above that garage, which we later, 20 years later did the Portland Harbor Hotel. So a little bit of forethought and a lot of patience waiting for the market to turn for the right use. That's how the Portland Harbor Hotel came into existence.
Greg: And you can really you can finance those different layers with different banks, right?
David: That's correct.
Greg: So ground lease could be financed with one bank and the parking garage with another and the hotel with a third.
David: Correct.
Greg: So you spread out your risk.
David: Yeah.
Greg: That’s great, genius. David, the current economic expansion has been going on for about 10 years. You've known to be a very successful developer and some of our younger listeners may not fully appreciate that the real estate market doesn't always go up. You've been through three or four economic downturns. Any horror stories you feel like sharing?
David: I think the one in the late 80s was probably the worst because in reality we had two major banks in the city of Portland. It was People's Heritage and Maine Savings.
Greg: And People's Heritage has morphed into TD Bank.
David: That's correct. Yeah. Yeah. And the FDIC basically flipped a coin to pick which one they were going to close. Closing either one of them, we thought was a horrible mistake, but they did in their infinite wisdom. And what resulted was a horrible catastrophe to many of my contemporaries and others, because what happened in reality was not in the benefit of the taxpayers.It created an environment that projects which were cash flowing, were totally solvent, were thrown into a pot with an entity called Recall Management.
And that entity was charged by the FDIC of liquidating assets because there was within that pot, there were good assets and they were bad assets. But the environment that also followed that was one you couldn't borrow money. And even if you were a developer that had good assets and bad assets, you couldn't find financing to actually buy back your own assets. And they were sold off at pennies on the dollar. Huge, huge losses for the stakeholders and Maine Savings. It was a tragedy and it really set the, you know, the city of Portland and southern Maine really backwards for a number of years.
The only ones that benefited were insiders in Recall Management and out-of-state investors. It was not a fun time to be a real estate developer in the state of Maine, particularly in southern Maine.
Greg: And they would oftentimes put you in default, not just you, but developers in default based on a technical default.
David: Absolutely. There were other banks that really felt the pinch and were forced—they had merged with out-of-state banks—and all of a sudden were calling in lines of credit, were not renewing lines of credit. So credit tightened up. Those were the first signs of some real trouble. And once again, it was very short-sighted. The interstate banking regulations had been released and had been relaxed to a degree. And you had a number of Massachusetts banks that had come in, bought up local lending institutions, did not have relationships locally and frankly didn't care.All of that together. It was a perfect financial storm. And just a handful of us ever survived it.
Greg: And those who did survive came out stronger.
David: We did. And one of the things when people ask me how did I ever manage, you know, three and a half to four years of one litigation after another and dealing with the FDIC and the federal government, so was very simple one word: it's called honesty.
And I found very quickly that if you were honest with them, you develop their trust, and if you had their trust, they were willing to work with you. In my case, actually bent over backwards and that's how we survived. It wasn't outside money. It wasn't luck. It was a lot of hard work and honesty. And that was that. That's just the way it was.
Greg: I believe you or your son, Nathan, told me once that if you read about us in the newspaper, you know we've done something wrong. What's the philosophy behind that?
David: Well, we try to do things and facilitate things that, I'm not gonna say behind the scenes, but below the radar anyways. We don't like a lot of publicity.
That's usually never good for our business. I would rather our publicity be our names mentioned in a positive way at town councils and being chosen as one of a select group of people that receive requests for proposals, that people want to do business with us. We've never advertised and I feel really good about that because people who seek our help are usually people that we have common boundaries and interests in. We would like to say, look, this there's three things that really make projects successful.
One: they have to be socially rewarding at some level. In other words, you have to bring something to the table, usually that's through communities, public/private partnerships. But something has to be a part,a constituency of the project that's more than just a construction project. The second thing is they have to be financially solvent. They've got to have a cash flow. They can't be based on quick sales or turnovers. It has to have a long-term financial plan. And the most important and the third is they got to be fun because in this business, you win some, you lose some. And sometimes your only payday is the wonderful people that you've had the fortune to be associated with, with the project and the time that you had, the positive experience you had with the project—sometimes that’s your only pay day.
Greg: You know, David, I've heard the expression: partners are for dancing when it comes to real estate. But you've actually had good luck with partners.
David: I think that I would have to credit that with Eric Chianchette. And I understand why Eric feels that way. And I had one of my initial partners in the early years felt that way. I never have. And in fact, I think the hardest thing is finding partners that share your share your vision and are willing to be there, not the just in the good times. That's easy. But where are they when the clock turns economically? And how long are they going to be there and stand side-by-side with those cash calls, which do happen. That's the other side of our business. I call it risk sharing. And one of the things that's allowed us to do the number of projects and the diversity of projects is we've been able to align ourselves with people that are willing to come in on a partnership basis, share the risk with us. And I think economically, it makes projects much, much stronger and quite frankly, much easier to finance.
Greg: And they share in the upside as well.
David: They share in the upside and, knock on wood, we share in the upside more than we have to make those calls and say this month it's not so good.
Greg: You know, I always found that you can tell how good a partner is when there is a cash call. Do they return your call? Better yet, do they send you the check they promised they’d send you?
David: And how quickly the check arrives? Yeah, I will say we've been very, very fortunate. I have another partner from David Hart in the hospitality business and his father's a great person and has some wonderful sayings. And you know, one of one of Bill Hart's sayings that I never forget is, you know, you just don't drive down the street and find a partner standing on the side of the corner and pick them up.
Greg: Although I did pick you up this morning and brought you over here.
David: That's true. That's true.
Greg: Although we're not technically partners.
David: Well, maybe partners in crime.
Greg: Partners in crime. David, in a previous podcast, we interviewed Fred Forsley. I think you've heard of him. I know you, he, and others have partnered on the Fisherman's Wharf project located in front of Chandler's Wharf Condominiums on Commercial Street in Portland. It's currently a parking lot in a prime, prime location. What's your vision for Fisherman's Wharf?
David: Actually, Fisherman's Wharf is, I think, the fifth or the sixth project that we've done through Bateman Partners with Fred, and actually Fred came to us several years ago and said, hey, I've got another assignment for you. And with Fred, you never know what that might be. The Fisherman's Wharf project was one that as Fred said, it sat here for a number of years. It's time that you do what you do best, which is unlock equity and create something that's beneficial for the city.
And it had been the center of controversy many years before. Actually, the centerpiece of a referendum on the waterfront, which sparked a lot of controversy. And some people had said, David, don't touch that project with a 10-foot pole. And unfortunately, those are not words that usually dissuade me. And in fact, I'm rather attracted to them because there's always reasons why things haven't happened. And I've learned very quickly that in looking at the property and the attributes it had, it was actually ground zero in terms of the tourist industry in the city, particularly on the waterfront.
And unfortunately, it's a parking lot and yet there could be so much more. And the architect in me and the planner looked at it another way and said, you know, we have the charter boat and tour boat industry, which is centered here. And if you walk past the street any time during that four and a half month high season in Portland, there isn't enough room on the sidewalk for people. And the Long Wharf is lined with Port-o-Potties that by the middle of August are something that you want to hold your nose and walk by. Other words, no public facilities. But it's still a Mecca for people. People coming off of cruise ships, people coming and visiting the city, which is only been increasing over the last 5 to 10 years. And I looked at it and said this is a wonderful opportunity to create a really wonderful public space by linking the docks together, Long Wharf and Fisherman's Pier. Approached Steve DiMillo who immediately latched on to it, recognizing the same things that I did in terms of interaction with the public. And the practical piece was it has to be paid for and one of the only ways that would generate enough income to be able to pay for the infrastructure improvements, which were required by zoning regulations, and the public improvements, which would be part of the project, was a hotel.
Hospitality is an industry that we're very familiar with and that's how the hotel became an integral piece. The other piece is something that is very much needed and drives Commercial Street, particularly in that area, and that's parking. Majority of the buildings across the street, the upper floors have been converted into offices and they depend very heavily on the surface parking that is now at Fisherman’s. So again, I have great relations with my neighbors up and down Commercial Street--didn't want to displace them, so a structured parking garage was a natural answer to that. So to answer your question, Greg, it's a multi-faceted project which took a step back, took a look at what were the missing constituents in that area of Commercial Street, in other words, if we were going to develop something on a flat vacant piece of property, how could we do it in a way that benefited everybody? And that, in a nutshell, is the Fisherman's Wharf proposal.
Greg: You mentioned to me a while back personality zoning. Can you explain what that is?
David: It's a term we've recently coined. The city has been engaged with a group of local fishermen in a working waterfront group that has been meeting for the past several months.
And from our perspective, I think that they've missed a golden opportunity. The initial emphasis was to be take a look at Commercial Street, take a look at the waterfront, and see if we could come together with terms that could really address some of the problems that the working waterfront is experiencing.The main issues there that, in a number of public meetings have always come to the forefront, is traffic, particularly pedestrian traffic, new signalization, and a better monitoring of both of them. But instead, they've really focused on our property and want to change zoning in a very radical way that basically takes away our property values and our rights and in a way that doesn't affect the surrounding properties. And the “personality zoning” really came from a comment made in one of those meetings from one of the fishermen. When I asked why are they looking at the Fisherman's Wharf property very differently than, say, the property to the left and the right. And that was simply: all animals are not created equal.
Greg: That was the answer.
David: That was the answer. So unfortunately, rather than focusing on real underlying issues, people are looking at personalities and people in specific. And it's a terrible way to have a city not grow, it’s a terrible way to take a look at zoning issues. And you should never reduce things down to, in this case, developers versus fishermen, because they both can co-exist and really need to co-exist together in a very meaningful way and certainly not be poised as adversaries.
Greg: well, good luck with that. I know you're in the middle of it. David, your son, Nathan, you, and I got to know each other as I was representing—and still do—Vets First Choice, which is now known as Covetrus, in their search for new office space in downtown Portland. You were one of the developers we approached who responded to an RFP. You won the RFP and are now in the process of constructing 170,000 square feet of office space on the site of the Shipyard Group brewery facility on Newbury Street. Can you discuss the advantages or challenges in turning that particular site into world class headquarters for Covetrus? And also, I understand there's a housing hotel and a garage component also planned. It's truly a mixed-use development. So maybe just expand upon what you're doing down there.
David: Sure. Actually, the conversation would go right back to one of our initial projects with the Hannaford Brother warehouse where we took exactly that same game plan, executed in a different way, but that same thought process of taking a piece of property and dividing it up in a way that had a number of different uses, all complimentary, and all having the ability, because we condominiumized it, to create very, very different—not only uses—but financial platforms to actually be able to construct the projects up. This project has a number of different constituents to it. Number one, the ground or the fee underneath is master leased, ground leased to the original owners of the property, Fred Forsley, and he brought in another partner, a childhood friend of Fred's. And the office tower (170,000 square feet) is both combination new construction and about, of that, about 30,000 square feet is the existing brewery building. This will be a technical pharmacy. That piece of the project is very interesting because on one site, within, existing zoning, we have an industrial manufacturing pharmacy, we have a major distribution center, which is at the very first level that exits off on Fore Street. And then we have a glass tower that sits on top of it, which is now the world headquarters for Covetrus, which are basically their corporate offices. So you have three functionally very different uses that all come together in combined in one cohesive structure within existing zoning, which is like finding a needle in a haystack. And at a location that the upper floors for those C-suites, you know, they have views from Peaks Island all the way to Cape Elizabeth. So they're pretty stunning.
Greg: It's going can be magnificent.
David: Now, that's just a piece of it. Wrapped around it is a 400-plus car parking garage that will never be seen by anybody because it's hidden within the envelope of the 170,000 square foot building. And on top of the garage, the air rights were carved out for another use, which we are building a 105-room, choice hotel. It's a Cambria Suites, and that is the final piece of the project. Now, if you can imagine, how do all these pieces go together, be constructed at one point in time? That's a whole other story. But I can tell you is that the garage comes first and it's all manufactured. It's sitting in pieces up in Canada right now. Stresscon is the manufacturer. The foundations as we speak are being completed. So within another two months, the erector set, if you will, which is a precast parking garage will start to come out of the ground. And at the same time, the office towers are being built around the garage. And when that's completed, the hotel will then be topped off on top of the parking garage. So about a two and a half year process,
Greg: The parking garage acts as a pedestal.
David: That's correct.
Greg: For the office building. For the hotel.
David: Yeah.
Greg: Speaking hotels, I get asked this, it must be once a day when I go grab a coffee or get outside of the office. People say, do we need another hotel in Portland? And what do you think?
David: Well, it's not that we need another hotel. But if you're in the hospitality industry, you understand that it's all driven by demand and what we haven't seen yet in the city is the impact of the volume of new employees that are coming as a result of Wex, they're building is now occupied. They're starting to relocate people from the West Coast. Covetrus hasn't even been completed yet.
But between those two projects alone, you're looking at over 1,200 new employees. And that's the tip of the iceberg. When you look at the star reports, which are the indicators of occupancy, average daily rate, and what the temperature is in terms of the financial health of hotels across the city, the statistics speak for themselves. Everyone's doing fine. And with the rates and occupancies that are in, you know, in the high 80s and 90s, in some cases, those are the indicators that you have excess capacity. Other words, a need for new. This is not taking into consideration the new staffing and the new opportunities that are coming to the peninsula. Portland is going through a renaissance like it hasn't seen in many, many years. And the issue really is, is how do we how do we want to take advantage of that in the long term? You don't want to overbuild, but at the same time, it's almost a chicken or the egg. If you don't have the facilities, then people aren't willing to relocate and make Portland a center for corporate headquarters. Despite our tax rate, despite our political situation within the city and the barriers to entry. Despite all of that, it's amazing. They still want to come in.
Greg: Tourism is a big driver, obviously, of the occupancy that the hotels enjoy and that every year I've seen a graph. Every year, the tourism numbers keep increasing. It's almost like a perfect graph that I've seen over the last 10 years. What happens when that flattens out or goes down in terms of the hotels?
David: Well, you know, the tourism is something that you can't, you know, total. It's like putting all your eggs in one basket. Is it a piece of the market? Absolutely. What others, what myself and others are really concentrating on is how do we bring additional corporate investment that bring those corporate travelers, the Monday through Thursday—you can always you can always fill a hotel up Friday, Saturday and usually on a Sunday. And when you're talking about January, February and March, those are our red months. Everyone's bleeding. Those are the months you really have to be concerned with in terms of where's your corporate clientele coming in? What decisions are they making? Who are they going to? Obviously, the more that we have, the better. One of the things that would really help, as an insurance policy, for instance, would be if we really had a major convention center in the city. That alone drives occupancy rates not only for tourism and you know, the traveler with discretionary income, but it also drives the marketplace in terms of those events which, without those facilities, would not be coming to Portland. You have to create a destination. I think if you were to ask me what is the city missing right now, I think we need to take a real hard look at how do we as a city evolve. And is that evolution really tied to, again, utilizing the spotlight that we have right now, because that's fleeting and really cement our future for the long term. And one of those things is not only bringing in the corporate structures, bringing in people that would not have invested otherwise in Maine and specifically in Portland, and then giving them a reason, whether it be additional hotels, whether it be a convention center, whether it be, you know, the public improvements that are down on the waterfront. I mean, a lot of people don't realize the city of Portland owns 84 percent of the undeveloped waterfront. To me, that's tragic. It's not that we don't have the land. We need the money to finance the improvements to really bring this to a world-class destination. And I think that can happen if we take advantage of the development boom that we're having right now. We do have a TIFF district along Commercial Street. Maybe we need more, but it's a great way to be able to set aside money for those types of public improvements that are directly paid for by additional development.
Greg: You said the city owns 84 percent of the undeveloped waterfront.
David: That's correct.
Greg: And that's a bad thing because they don't make the investment into the properties that the private sector would.
David: I'm only saying that it's a tragedy because it hasn't been further developed and we know why it hasn't. It's a lack of resources. You know, the city has trouble balancing its own budget and then to find the millions of dollars to take, you know the area very well, Greg. You know, down where the old grain elevators were. I mean, it has the most exquisite view of Casco Bay. It has the access to the waterfront, whether it be for, you know, additional private boating or just the ability for the residents and visitors to the city to really have a connection, you know, to Casco Bay, not just walking down a pier, but a real park. Those are those are assets that the city has and hand-in-hand in partnership with proper development, the resources to pay for that are here, they're right in front of us. They're just not being utilized.
Greg: David, I think everybody knows there's a parking shortage in Portland. I think that's fair to say. How will that affect development going forward and how do you or we overcome that challenge?
David: You know, we're on the cusp of an era where, you know, some on one side say parking is going to become obsolete. We need mass transportation. You know, we're going to we're going to wind up with cities that have these parking garages that need to be converted. I don't happen to be one of those believers. I think that particularly in a state like Maine, where people are very independent, I think private vehicles are going to remain a mainstay. But what can we do to alleviate some of the traffic problems? And I think it's a combination of both. I know we're looking at some sites right now that are on the periphery of the city to provide structured parking that then could be hand-in-hand aligned with, you know, a city-funded transportation system. And I'm not talking about a bus, I'm talking about shuttles that run every 15 minutes down to the peninsula. That's the biggest stumbling block right now with structured parking and getting people into the city parking. I mean, buses, the way that they run right now are great for a certain population segment. But those are stops that could take you 45 minutes to an hour to get to a final destination. We need some structured parking with relationships with some of the bigger developments like the two I've just mentioned that could help fund in conjunction with the city, you know, a shuttle service that would not require the vehicles to come to the peninsula, which is exactly where some of the larger office buildings and potential for additional development really lie. So I think it's really paring it back a second and saying, what could we do? That's kind of not thinking a little bit more out of the box and again, working to a greater degree hand-in-hand with developers and developments rather than through zoning restrictions, but through meaningful dialogue, you know, in the planning process. That's how I see-
Greg: A more collaborative approach.
David: Absolutely. I mean, we see this. We've done this in a number of communities from, you know, the Berwicks, you know, all the way up through Bethel, Maine, you know, working with local communities. All of a sudden when you create those dialogues, you find out maybe there's more resources on the table than what you would thought initially. And maybe there's more tools in your toolkit to financially make, you know, a better vision realized.
[00:46:43] Greg: Read in the paper the other day, there's a big brouhaha with the folks out on Peaks Island not having enough parking and they were displaced out of one of the parking garages because of previous commitments. At least that’s what the paper said. What are those people do in terms of parking in the summer?
[00:47:01] David: Well, I also understand that the city is opening up. You know, the former parking lot right on the waterfront that was formerly used by the by the ferry, by the Scotia Prince, and then more recently, the Cat. You know, I know there's pushback on from some that there shouldn't be any more parking structures on that side of Commercial Street. On the other hand, you need to put parking where parking is needed, which is one of the reasons, you know, for a parking garage, again, circling back to Fisherman's Wharf. One of the things that we had offered was to take a percentage of the parking at Fisherman's Wharf and set them aside at below market rates specifically for island residents. Those are the kind of innovative things that people should be thinking about and talking about instead of changing zoning. Let's talk about how do we work with existing zoning and maybe it's time for the city to start to help sponsor another parking garage, just like they did at the Casco Bay Lines.
[00:48:13] Greg: David, looking into your crystal ball for the next 10 to 20 years, what do you see happening to commercial real estate here in Maine, in Portland in particular?
[00:48:24] David: Well, you're probably you know, I'm the wrong person to ask. That being I am one who is always like my glass is always half full rather than half empty. So, looking back from my brief time here, which is let's call it 1976 to the present,I can only see tremendous opportunity here. I think we've barely scratched the surface. I think if you look at the waterfront, it's more dynamic now in terms of diversification of uses. You only have to look at what Phinny Sprague has done down on the western side to all the way up through Commercial Street. It's never been this diverse in decades and profitable, not just buildings. I was looking at some photographs of Commercial Street, even back into the 80s and the number of vacant buildings was astonishing. It's not that way now. That's only a part of the city. I think that Bayside, you know, is this untapped resource. And I think that it offers not only a gateway to the city because it's so visible from 295.
[00:49:52] Greg: And that's the area between Congress Street and Marginal Way.
[00:49:54] David: That's correct. And you know, again, the city's had a hand in that, helping to provide a structure, but to date there hasn't been a significant development that's again, a big enough bite out of the apple to make an impact there. But it's there and it's, you know, whether it's additional office company—if you ask me a vision, I would see something that is more of a collaborative neighborhood that offers solutions to peninsula parking, offers solutions to housing. And I'm not just with affordable housing, but workforce housing for the folks that are coming here in those jobs, we're looking at job levels that, you know, started sixty five to eighty five thousand and up. We haven't seen that in decades, perhaps ever, ever in these numbers that are coming. And if we don't provide the housing, gentrification happens and people get pushed out of housing into areas where they can afford it. So I think there's a proper balance. And where can you do that? You need land and Bayside offers that land. What we need is a real vision in which there's been several that have been placed on the table. None have been acted on. Now is the time.
[00:51:28] Greg: David, thank you for being our special guest today for the Boulos Beat, a Boulos Company podcast. www.batemanpartnersllc.com. I'd like to thank you for listening today. And if you'd like to learn more about the Boulos Company, please be sure to visit us at www.boulos.com. You can find us at The Boulos Company on Facebook and LinkedIn and @theboulosco on Instagram and Twitter. And lastly, if you want to know the secret to owning real estate. It's pretty simple. Just be sure to outlive your debt.