Maine’s largest catering company has signed a lease to take over the Thomas Banquet Room, which owner Louis Maietta Jr. is closing because of the worsening economy.

Maietta disclosed this week that he plans to close his 5-year-old function room at 729 Broadway and lease the space to Personal Touch Catering, run by chef-owner Kevin Fallen.

Personal Touch already operates The Roost in Buxton, but sought a Portland-area location for its wedding receptions, corporate functions and other special gatherings.

Personal Touch has been in business for 25 years and has a large customer base in Cumberland and York counties, Fallen said.

The newly reopened banquet center will be called Events on Broadway. It will open for business in January.

This “is the next stepping-stone for our company,” Fallen said.

The Thomas Banquet Room was the site for annual parties by the Cape Elizabeth Police Department, the emergency room staff of Maine Medical Center and Port Harbor Marine, among others.

But, Maietta said, the economic downturn has caused some organizations to scale back or cancel annual get-togethers. Maietta noted that Personal Touch is a well-established company that can better weather economic challenges. Clients include Prime Toyota, TD BankNorth and Idexx.

Events on Broadway will share the site with Beale Street Barbeque, which took over one half of the Thomas Room a year ago, after operating on Waterman Drive for many years.

Meanwhile, Maietta said, he will focus on opening an indoor flea market in a 9,200-square-foot building he owns next to the Thomas Banquet Room. The building, at 753 Broadway, used to house a garden center but has been vacant for a year. About 5,000 square feet of space will be used for the new flea market.

Maietta said he thinks the tough economy will make an indoor flea market a popular draw for shoppers seeking bargains. The flea market would be open on weekends and have a concession area.

Plans are to let people rent space by the day or by the month. Options for vendors will include tables, booths and entire rooms. Maietta said he is working out the final rental costs. He said he hopes to open as soon as possible.

The only hang-up is that the city lacks a business license for indoor flea markets. The most similar type of business that city workers could find is garage sales, which are temporary, Maietta said.

Maietta said he was told that the City Council could not consider a new type of business license until the end of December. The earliest that a licensing review can be considered is Dec. 22. The proposal will need to be reviewed in a workshop and then require two separate votes by the City Council, which is at least a two-month process.

Maietta is hoping the city will allow him to open before that, as it crafts the language and requirements needed for approval.

Indoor flea markets are hardly a new idea in Maine. Saco and Lewiston are among the municipalities that allow indoor flea markets where people can sell used or homemade items, as well as collectibles.

Among the vendors who have expressed interest in selling their wares are local jewelry makers and a NASCAR memorabilia collector.

Maietta said that he believes an indoor flea market will be especially popular in the tough economy. He said that the weekend flea market will not require the level of staffing and oversight that the banquet hall did.

The plans for the flea market and the closing of the Thomas Room are just the latest in a series of business changes at the east end of Broadway.

At 740 Broadway, J.P. Thornton’s just opened a larger restaurant business in a new shopping plaza. The plaza is across the street from the Thomas Room. SuperCuts and Freaky Bean also have shops there. Thornton’s used to be at Broadway and Evans.

In addition, a cabinet maker is about to open a shop behind Broadway Variety.

Gary Crosby, a commercial property owner on Broadway, is upbeat about the changes. He said the shopping center at 740 Broadway seems to be attracting customers and new businesses to open around it.

“Louis did a fabulous job with the Thomas Room and T&T Development has done a fine job with the new shopping center,” he said, referring to the shopping plaza developer.

New party for Thomas Room