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June 25, 2018

Optimism over Waterville's direction spurs purchase of historic Main Street block

Courtesy / CBRE | The Boulos Co.
Courtesy / CBRE | The Boulos Co.
Brother and sister Thomas Nale and Tracy Nale Sewall, who grew up in Waterville and went to Colby College, purchased The Arnold Block in downtown Waterville for $430,000 this spring. The outline delineates The Arnold Block and associated parking included in the purchase.
Courtesy / Tracy Nale
Thomas Nale and his sister Tracy stand in front of the Arnold Block, a property in downtown Waterville that they purchased for $430,000.

WATERVILLE — The purchase of a historic building known as the Arnold Block, on Main Street in Waterville, was inspired by the optimism that comes from revitalization projects underway in the downtown.

Sister and brother Tracy Nale Sewall and Thomas Nale purchased 103-109 Main St. from the Willard B. Arnold Estate for $430,000. Chris Paszyc and Nick Lucas of CBRE|The Boulos Co. and Jennifer Nale of Porta & Co. brokered the deal, which closed April 30.

Street-level tenants include Loyal Biscuit Co., Jorgensen's Cafe, the furnishings and home goods store Modern Underground, Lebanese Bakery and EntrapME Escape Rooms.

The 21,627-square-foot retail building on 0.45 acre was built in 1886. According to its marketing brochure, it's a rare example of Queen Anne style commercial architecture, characterized by distinctive second- and third-floor brick work with arched and triangular roof pediments. The architect may have been John Calvin Stevens of Portland, who worked in Waterville with his former partner Francis Fassett on the Coburn Classical Institute and the Plaisted Block in 1883.

The building had been in the Arnold family since it was built, the sellers' representative, Chris Paszyc said in an email. The family decided that now was a good time to sell because of the redevelopment taking place on Main Street. The property was on the market for only a little over a week.

"There was a tremendous amount of interest in the building," Paszyc wrote. "Main Street Waterville is extremely desirable right now. We showed it numerous times and received multiple offers." Several investors from around the state looked at the building.

The purchase price, at $18 per square foot, was on the lower end of what can be expected in downtown Waterville, he said.

"Older buildings in the downtown area that have not received much in the way of updating have been selling for $20 per square foot to as much as $50 per square foot, depending on condition, tenancy and location," he wrote.

While the street level of the building is in fairly good condition, the upper floors are vacant and will need substantial investment, he added.

Hot chocolate at Jorgensen's

The current tenants plan on staying, he wrote. The building also comes with 39 parking spaces; some are rented out to neighboring tenants.

Buyers' representative Jennifer Nale, who is also the buyers' sister, said she and her siblings were born and raised in Waterville and all went to Colby College. She recalled going to Jorgensen's with their father before school every morning.

"He'd get coffee and I'd get hot chocolate and a bagel," she said.

Nale noted the importance of the parking associated with the building.

"The newest Colby dorm was built on what used to be a significant number of parking spaces for the downtown area," she wrote by email. "With the influx of development in the area and the removal of those parking spaces, the 39 parking spots at the Arnold Block are as significant a part of the deal as any of the office space."

The property is located downtown amidst the revitalization efforts of the Alfond Foundation, The city of Waterville and Colby College's redevelopment plans, and is in close proximity to the new 200-student Colby residence hall and the Head of Falls Riverwalk project.

The buyers own Nale & Nale Law Offices. They own and manage 10 other Waterville buildings, including the one that houses their law office, but the other properties are mostly residential.

"We have 40 residential units that we rent out around Waterville, in more or less the downtown area," said Tom Nale. "This is our first venture into a more substantial commercial endeavor."

Tracy Nale said she's long found the building attractive, and was inspired to put in an offer because of Colby's investment in the community.

The Colby bump

Courtesy / CBRE | The Boulos Co.
Courtesy / CBRE | The Boulos Co.
The third-floor interior will need finish work.

"A lot of Colby's focus is on Main Street, and that's encouraged other local investors," she said. "Tom and I grew up in Waterville, we went to Colby College and we work here in Waterville. We wanted to be part of this really positive change for our city. That, as well as the influx of funds that Colby is putting into the real estate on Main Street, I felt would have a positive effect on the property values."

The building long housed the W.B. Arnold Co. hardware store. The fourth generation to enter the business was Willard Bailey Arnold III, who died in February 2017, according to his obituary. The store's retail division closed in 1962.

It appears, the Nales said, that the third floor and a good portion of the second floor haven't been used for many decades, or perhaps only for storage. The third floor has lots of shelving and some of it is labeled. "So you can tell it held a lot of inventory," Tom Nale said.

Tom Nale said plans are in the works for improvements to the second and third floors.

"What type of work needs to be done depends on who we partner with from a lease standpoint," he said. "Whoever comes in, we'll work on exactly how they want to utilize the space."

The second floor is finished but dated, he said. The third floor is unfinished. "But as you get up there, you can see at one point it was a finished space, almost like it might have been a dance hall or something like that," he said. "There's crown molding and wallpaper, and a section where a chandelier hung down. And on the outer portions there's a lot of exposed brick that's really attractive."

Structurally, the building is in good shape.

"The second and third floors are going to be transformed," he said. "It's just a matter of who we partner with and how it needs to fit for them. We've had interest from a variety of individuals and/or entities."

The space could potentially be residential, too, he said.

"That's one of the things that's interesting about this space," he said. "There's an elevator shaft already in there. So the idea is that we could do residential on one floor, commercial on the other, or residential or commercial on both. We have lot of flexibility, and we have ingress and egress on both the Main Street and Temple Street sides."

Numerous suitors

Courtesy / CBRE | The Boulos Co.
Courtesy / CBRE | The Boulos Co.
The Arnold Block is central to considerable revitalization work underway in downtown Waterville.

Colby-spurred development is pushing real estate demand, the two agreed.

"The level of optimism that is surrounding Waterville right now is unlike anything we've ever experienced," Tom Nale said. "People are really excited about being downtown. Not just in our space, but interest in Main Street in general is really high."

Their initial thought, said Tracy Nale, was to buy the building, then wait until there was demand. "We were thinking it would be a matter of years before there would be the type of demand to start to develop the property," she said. "To our pleasant surprise, it's going to be a short-term project."

They've field numerous calls from potential suitors who are talking not just about leasing office space but an entire floor or potentially both floors.

The building has a plaque that says it's on the National Register of Historic Places. The two haven't been able to confirm the architect.

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