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October 12, 2020

Small business COVID-19 incentive program facilitates inn transactions

Courtesy / The Swan Agency Sotheby's International Realty The original portion of the Inn at Bath dates back to 1810. Listed for $725,000, it was scooped up by a Massachusetts buyer seeking to swap corporate life for innkeeping.

A U.S. Small Business Administration business purchase incentive program made it possible for the separate buyers of two Maine inns to close on the transactions.

Jacqueline Pierce bought the Inn at Bath, at 969 Washington St., Bath, from Elizabeth Knowlton for an undisclosed price in a deal that closed Sept. 23. The list price was $725,000.

Nicole and Matt Irwin bought Acadia Bay Inn, at 12 Miramar Ave. in Sullivan, from Todd and Angela Vafiades for an undisclosed price in a deal that closed Sept. 25. The list price was $1.375 million.

Dana Moos of Swan Agency Sotheby's International Realty brokered both transactions.

Loan guarantees

The transactions were initially stymied by the challenge of finding a bank willing to lend during the pandemic, Moos said. 

Of her usual list of a half-dozen or so hospitality lenders, “Machias Savings Bank was the only one at the time who wanted to make it work,” she said.

As the lender for both deals, Machias Savings’ loans were made in combination with an SBA program that responded to economic disruptions small businesses are facing due to the pandemic. The program, which expired in late September, was designed to incentivize lenders by offering loan guarantees and to provide small businesses with relief from payments of certain SBA loans for six months.

Moos learned of the program in August. Typically, commercial hospitality deals take 80 to 100 days to close, she explained. So with the September deadline quickly coming up, Machias Savings, as an SBA preferred lender, fast-tracked the deals.

“Despite COVID, they made it work,” Moos said. “Both buyers felt pretty confident in the future.”

Inn at Bath

The Inn at Bath comprises 5,205 square feet of space, including eight guest rooms with en suite baths and an owner's unit, on a third of an acre on historic, tree-lined downtown Washington Street, with a small view of the Kennebec River. 

Courtesy / The Swan Agency Sotheby's International Realty
Tall, arched windows and classic woodwork were part of the attractions for the buyer of the Inn at Bath.

Built in 1810 with subsequent additions, the Greek Revival structure was a private residence until the previous innkeeper purchased the property in 1989 and converted it into a bed-and-breakfast, according to its website.

The seller had owned the inn for 16 years and was ready to retire, Moos said.

The property is in very good condition, particularly for its age, she added. The year-round inn has been open through the pandemic.

The buyer, Jacqueline Pierce, had been looking to purchase an inn in midcoast Maine for about three years.

“The Inn at Bath met my requirements,” Pierce said. 

That included location.

“I love Bath,” she continued. “It’s a cool little city. I’m interested in being in a community where there’s a strong food ethic, and I find that here.

"The inn is in walking distance to town, which was really important to me. And it’s a beautiful building, which was also to important to me.”

‘Accidental retirement’

Pierce grew up in upstate New York and lived in Massachusetts for about 45 years.

“But I’ve spent every summer in South Bristol for about 25 years now,” she said.

In the Boston area, she worked in the corporate world as a marketing executive, mainly for internet companies.

Why the transition to innkeeping? 

“In the 1980s, I had this idea that, somewhere around retirement, I would open a bed-and-breakfast,” she said. “Then in 2017, I was laid off from a job in Boston. I like to say that I ‘accidentally retired.’”

That’s when she started looking at inn properties, from Bar Harbor to Virginia and the Finger Lakes region in upstate New York.

She also considered projects to convert an old building into an inn.

“I love old houses and I love renovations,” she said.

She honed in on a potential option, but t it fell through.

“I decided to take a break and I went to Italy, where I went to a cooking school,” she said. “Then COVID came.”

She returned home and realized the time was no longer right to take on a renovation for a start-up business.

With Moos’s help, she identified the Inn at Bath.

“It’s got some unique and beautiful old features,” she said.

That includes large, tall windows, classic wood trim, and wood floors. 

Pierce is painting nod redecorating, and plans to add a dining deck outside the dining room at some point in the near future. Otherwise, no significant changes are planned until she lives there for a year and gets a feel for the place.

The seller was taking limited bookings through the pandemic, explained Pierce. The seller also took reservations by telephone, rather than through the inn’s website, in order to screen potential customers and explain what it takes to be safe in an inn during the pandemic. Pierce is continuing both practices.

Acadia Bay Inn 

Acadia Bay Inn is a Victorian shingle structure built in 1888. It has 5,200 square feet of space that includes seven guest rooms/suites with en suite baths and an owner's suite. Points of interest include a center stone fireplace with a three-story-high chimney and a “great room” with coffered beadboard wood ceiling. 

Courtesy / The Swan Agency Sotheby's International Realty
Acadia Bay Inn in Sullivan, built in 1888 on waterfront acreage, sold after nine months on the market.

It sits on 1.1 acres on the waterfront, with pebble beach area in Sullivan Harbor on Frenchman Bay.

The sellers had listed the property with the idea that it might be on the market for three to five years before finding a buyer, said Moos.

“They wanted to be prepared mentally to be on market longer, so they wanted to list before they were truly ready,” she said. 

Instead, it sold within nine months of listing.

The seasonal  inn wasn’t open this year. The buyer plans to leverage the waterfront view by ramping up the events side of the business, Moos added.

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