During the first quarter of 2014, I have had an opportunity to review the commercial real estate (CRE) activity in the Midcoast during 2013. The Mid-coast market does not have the transaction volume of other markets such as the Greater Portland area, Southern or Central Maine in terms of commercial real estate, however, there is certainly plenty of activity worth noting in the area and the trends are positive overall.

In this column, I have reviewed some of the bigger sale and lease transactions of 2013 and pointed out some of the trends that may carry over into 2014.

In order to identify and make sense of as much of the commercial activity in the market,

I collaborated significantly with Don Spann of ReMax Riverside Commercial, one of the larger players in the Mid-coast CRE market. In fact, Don and I had a great time discussing the market together and we could have spent an entire day going over the market. I think it is safe to say, there will definitely be more articles resulting from our conversations.

The rest of this article takes a look at CRE from two different angles, the actual movement of commercial property and the effect of other market factors such as residential real estate. I started off with the residential information because it paints of picture of the overall appeal of the Mid-coast market.

The CRE transactions that follow indicate trends in the market, but not all transactions within the Mid-coast area were presented.

What the Mid-coast offers?

Let’s first take a look at some of the characteristics of the Mid-coast region that make it an attractive market for commercial real estate activity.

— Route 196 at the Interstate-295 interchange is a very active area. There was more traffic on state Route 196 than on Maine Mall Road near the mall.

— The Topsham-Brunswick region is seen more and more as the center of commerce for several Maine markets, including the northern Mid-coast communities and the Greater Augusta region. For instance, sales volume at the Ruby Tuesdays in the Topsham Fair Mall area are reportedly higher than the Ruby Tuesdays in the Maine Mall area. This may be a small indicator, but it is significant.

— Bowdoin College continues to be an active participant and draw in the market area.

— Significant redevelopment efforts under way at Brunswick Landing have drawn some attention to the Mid-coast market with the addition of aviation services to the area.

— The Brunswick Station (formerly Maine Street Station) development has settled in and is considered to add significant appeal to market so far.

As a measure of the desirability in the Mid-coast market, it is useful to take a look at the trends in the residential market. There is more volume in the region with the resurgence of multiple offers on houses as the inventory of residential properties starts to dwindle. There appears to be more activity in Topsham and Brunswick than the coastal area, though those areas are still relatively stable. This activity is good news for the retail sector, which itself is seeing more activity. I analyzed a couple of key statistics for the towns of Brunswick, Topsham, Freeport, Wiscasset and Woolwich. I intentionally left out some of the coastal towns as the waterfront draw of those communities can sometimes skew the results.

— There were 540 sales of residential properties in 2013 in the towns reviewed. This compared to 484 sales in 2012, an increase of 11.50 percent.

— The median sale price for single-family homes in 2013, $204,250, was just over 9 percent above that of 2012 at $187,000.

— A new residential subdivision — Mallett Woods — was developed off of the Topsham Fair Mall subdivision and already has sales.

— A new phase of condominium development — Oak Hill — has begun in Topsham.

— The average “days on market” statistic — the number of days that properties were listed before they sold — was 92. This is down from 2012 by a whopping 37 days. This is significant when buyers are needing to sell the house they are moving out of in order to close on the house that they are moving into.

The increased activity in the residential sector is a measure of the desirability and focus in the market, which have an effect on commercial real estate.

This activity suggests a move away from the doldrums of the recession, though not completely by any means. Additionally, the Mid-coast region is proving itself well positioned as economic activity starts to do better.

The CRE factor

Another reason I think the region is well positioned is due to the available properties in the area. There is plenty of room for industry to grow in places like Brunswick Landing. There are also other favorable factors for developing properties such as record low interest rates that still seem to be lingering.

In terms of commercial real estate (CRE) — my focus — we’ve seen an increased amount of consolidation of properties, leading to more available office space. And there has also been an emphasis on new office space, resulting in even more empty existing office space.

Let’s take a look at some of the more significant commercial real estate sales in the region:

Sales

— Priority Group and George Schott invested significantly in various Brunswick Landing properties.

— Nonprofit, Seeds of Independence, purchased and renovated Building 24 at Brunswick Landing.

— 6 Main St., Topsham — $340,000 — location of Top Spice Thai Cuisine.

— 19 Main St., Topsham — $122,000 — formerly Darrell’s Second Hand Store.

— Topsham Commissary, Topsham — $292,500 — the site is being renovated for a 25,000-square-foot facility for Wicked Joe Coffee and space for the Maine Harvest Co.

— 2 and 4 Industry Road, Brunswick — $310,000 — building sold to The Gelato Fiasco and will serve as the company’s headquarters and location for expansion efforts.

— 11 Park St., Bath — $799,000 — former Mid Coast Center for Higher Learning.

— Captain Daniel Stone Inn, Brunswick — $1,450,000.

Significant leases in the region have been signed by Five Guys, Athena the Greek, Aki Japanese Cuisine and Mechanic Savings Bank.

Leases

— Five Guys leased the former Friendly’s facility.

— Athena the Greek opened a sister store on Maine Street in Brunswick.

— Aki, a hibachi/sushi restaurant, leased 6,000 square feet in the Lincoln Block building on Maine Street.

— Mechanic Savings Bank leased a bank branch facility within the Brunswick Station development.

— Wicked Joe leased space in the Topsham Commerce Park.

— Tempus Jets has occupied space in Hangar 6 at Brunswick Landing.

— RollEase has occupied 11,000 square feet of space at Brunswick Landing.

— Coastal Orthopedics has occupied a 20,000- square-foot built-to-suit facility on Thomas Point Road in the Cook’s Corner area constructed by Priority Real Estate Group.

— Greater Brunswick Physical Therapy leased a portion of the second story of the Red Mill in Topsham.

— A built-to-suit facility for Mid Coast Hospital began within The Highlands development.

There has also been a reasonable amount of development in the region, another sign of the increase in desirability in the market. Below is a list of some of the developments in the region in 2013.

Developments

— Mattress Firm, Topsham Fair Mall

— Firehouse Subs, Topsham Fair Mall

— Panera Bread, Topsham Fair Mall

— Coastal Ortho, Cook’s Corner

— Agren’s, near Topsham Fair Mall

— Renovation of the Navy Lodge for Providence School

— Seeds of Independence renovated Building 24 within Brunswick Landing

Again, this is only a partial list of activity, but it does indicated a decent bit of economic activity. The trends apparent from the activity in the Mid-coast market in 2013 hold a fair amount of promise moving forward into 2014. I am looking forward to see how some of the projects currently in the works unfold this year. Stay tuned for more information on Commercial Real Estate activity in the Midcoast market as there is more to come.

TOM SIEGEL is a commercial real estate appraiser and the owner of C-Prime Valuation Group, LLC, a Maine-based commercial real estate appraisal valuation and consultancy firm. C-Prime Valuation Group, LLC focuses on in-depth market analysis and expert appraisal/valuation services. Mr. Siegel can be reached at tom@cprimegroup.com.

Residential highlights

I ANALYZED SOME key statistics for the towns of Brunswick, Topsham, Freeport, Wiscasset and Woolwich.

— There were 540 sales of residential properties in 2013 in the towns reviewed. This compared to 484 sales in 2012, an increase of 11.50 percent.

— The median sale price for single-family homes in 2013, $204,250, was just over 9 percent above that of 2012 at $187,000.