Mercy Hospital redevelopment in Portland gets final approval

Courtesy / Redfern Properties, Aceto Landscape Architects A rendering shows a courtyard within the planned Mercy Hospital housing redevelopment, expected to break ground early next year.

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By Jessica Hall

The redevelopment of Northern Light Mercy Hospital’s State Street building in Portland has passed its last major hurdle, with approval from the city and a construction manager hired for the project.

After receiving a green light Aug. 24 from the Portland Planning Board, development partnership NewHeight Redfern expects to begin renovation of the hospital building in the first quarter of 2022.

“This was the final hurdle. The final site plan approval. We had received the zone change already, so this was the last major step,” Jonathan Culley, developer and managing partner of Redfern Properties, told Mainebiz.

NewHeight Redfern hired Zachau Construction of Freeport as construction manager of the redevelopment of the 1940s-era hospital building. Zachau will oversee construction and hiring of subcontractors, Culley said.

Two separate Portland-based real estate development firms — NewHeight Group and Redfern Properties — partnered together for the Mercy redevelopment project.

NewHeight Redfern bought the building in 2020 but leased the space back to Northern Light Mercy while the hospital continued to operate there and simultaneously expand its Fore River campus. The hospital aims to be out of State Street in December, so NewHeight Redfern will be able to begin renovations on the building, which will become a mixed-use facility with roughly 165 market-rate apartments, commercial retail space and self-storage units.

The 3.5-acre campus also will feature two new buildings next to the main hospital building. They are slated for roughly 95 affordable housing units developed by nonprofit partners Community Housing of Maine and the Portland Housing Authority, Culley said.

“It’s really two projects being developed together,” Culley said.

Community Housing of Maine and the Portland Housing Authority have not chosen a construction manager for their parcels yet, although Zachau has done some preliminary budgeting for them, the company said.

“We think the redevelopment of Mercy Hospital is a very important project for the city of Portland, as it is an exciting reuse of a prominent historical building. It also helps provide further housing options on the peninsula that we all know is greatly needed,” Zachau said in a statement.

The NewHeight Group is currently building the Verdante at Lincoln Park. Redfern Properties is involved in other major projects, including 201 Federal Street, which is set to be the tallest building in Maine upon completion.

Meanwhile, the two new buildings on Winter Street will feature affordable housing units and housing for adults aged 62 and older. An outdoor plaza will be part of the campus.

Community Housing of Maine and Portland Housing Authority are proposing the Equinox as a 43-unit building designed by Ryan Senatore Architecture that will serve individuals and families. Winter Landing is a 52-unit building designed by CWS Architects that will serve older adults aged 62 and over. The units will cater to residents earning less than 50% and less than 60% of the area median income.

"The Equinox and Winter Landing affordable rental housing developments will add income-restricted apartments in downtown Portland and help alleviate the severe rental housing shortage,” Community Housing of Maine said in an emailed statement.

“The projects are located in a walkable city neighborhood, and create opportunities for older Mainers to affordably age in place and for members of the Portland workforce to live and work in the city."

Community Housing of Maine and the Portland Housing Authority aim to start construction on both projects in the summer of 2022 and begin lease-up the following summer of 2023.