In tight industrial market, Auburn property sells quickly
Courtesy / Keller Williams Realty
This 75,000-square-foot industrial building at 1130 Minot Ave. in Auburn — built in 1963 on 6.5 acres — sold to Roundstone Realty Group for $2.8 million in a deal that closed on April 13.
AUBURN — The owner of an industrial building in Auburn found plenty of interest and a quick sale when he put it on the block.
1130 Minot Ave LLC sold 1130 Minot Ave. — a 75,000-square-foot industrial building built in 1963 on 6.5 acres — to Roundstone Realty Group for $2.8 million. The property was listed at $3 million.
Kevin Fletcher of Northeast Commercial Brokers/Keller Williams Realty represented the seller and Hugh O’Shea and Mark Duval of Maine Custom Realty represented the buyer in the deal, which closed April 13.
O’Shea said he and Duval are part of Roundstone Realty Group, which has four partners in all.
“This was strictly an investment, a long-term hold” with a cash flow that would generate income, said O’Shea. The tight greater Portland market made it necessary for the partnership to look elsewhere for a property that met their needs, he said — adding, “It’s a seller’s market.”
Fletcher, who has a long relationship with the seller, said the property was on the market less than 30 days before going under contract. The seller wanted to take advantage of a healthy market and move his cash into other investments.
“He’s a longstanding central Maine real estate investor who’s been investing in real estate for 20 years,” Fletcher said. “He’s owned everything from office buildings to industrial buildings throughout central Maine.”
The seller purchased the Minot Avenue property about 10 years ago. It was leased by Enefco USA Inc., which continues to occupy the property today. Enefco USA runs Enefco Footwear, producing custom-molded heel counters (a small insert that reinforces the heel cup); GlobalDie manufacturing precision cutting tools and cutting dies; and KICTeam, manufacturing cleaning programs for technical devices.
Diversified risk
The seller’s goal was to move from one single-tenant property to multiple multi-tenant properties, Fletcher said.
“He’s basically looking to diversify his holdings from a large single-tenanted building into several smaller buildings with multiple tenants,” he said. “That meets his risk tolerance. If you have a 75,000-square-foot building with one tenant and the tenant moves out, your income goes away. If you instead have four or five buildings with multiple tenants, your income is spread out.”
The property saw a fair amount of interest: “We had two or three showings in one day,” said Fletcher. “We even pulled in some out-of-state activity.”
As indicated by O’Shea, that interest was likely due to the tight industrial market in Portland, Fletcher said.
“It’s wise for people to look outside of Portland,” he said. “Parts of Maine have tremendous deals, and this was one of them.”
The Lewiston/Auburn area has a fair amount of vacant industrial space to lease, but not a lot for sale, he said.
Future opportunity abounds
Overall, Fletcher said he’s seeing tremendous opportunity for commercial real estate in the coming decade. In Portland, he’s part of the team that recently launched Northeast Commercial Brokers, at Keller Williams Realty.
“We’re really excited about the next decade in commercial real estate,” he said. “There’s a lot of opportunity, in my opinion.”
Clients today have far more information available to them and it’s more quickly obtainable, he said. Northeast’s goal, he said, is to utilize the same communication and marketing technologies the clients have available and are using to stay on top of the shifting marketplace. They aim to help clients be proactive and take advantage of shifts as they happen. Exterior factors affecting the commercial market, he said, include possible inflation and rising interest rates.
“Any type of little market shift creates opportunities,” he said.
Helping clients take advantage of those shifts includes staying on top of all aspects of their portfolios, he said.
“Everyone’s portfolio, everyone’s goals, everyone’s financial package is different,” he said. “You’ve got to look at everything as a whole.”
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