The Right Equation for Responsible Development: Spotlight on Phoenix Flats (Portland)
Each year, the Maine Real Estate & Development Association (MEREDA) recognizes some of the state’s most “noteworthy and significant” real estate projects, completed in the previous year. The exemplary projects from across the state, completed in 2023, not only embody MEREDA’s belief in responsible real estate development, but also exemplify best practices in the industry, contributing to Maine’s economic growth by significant investment of resources and job creation statewide.
This year, MEREDA honored projects from Portland to Gardiner to Presque Isle, with each receiving special recognition at MEREDA’s 2024 Spring Conference on May 15th.
In a multi-part series exclusive to the Maine Real Estate Insider, we’ll provide an up-close look at the most notable commercial development projects of the past year that are helping to fuel Maine’s economy in terms of investment and job creation. MEREDA is proud to recognize responsible development based upon criteria including environmental sustainability, economic impact, energy efficiency, difficulty of the development, uniqueness, social impact and job creation.
MEREDA’s 2023 Top 7 recipients include:
University of Southern Maine Portland Commons Residence Hall and McGoldrick Center for Career & Student Success, Capstone Development Partners (Portland)
Maine Savings Amphitheater, Waterfront Concerts, LLC (Bangor)
Phoenix Flats, Community Housing of Maine (Portland)
Homeless Services Center, Developers Collaborative (Portland)
Northeastland Hotel, Haley Ward, Inc. (Presque Isle)
Johnson Hall Opera House, Johnson Hall Redevelopment, LLC (Gardiner)
The Armature at Hanover Works, Reveler Development (Portland)
Please join us this week in celebrating Phoenix Flats.
MEREDA: Describe the building and project.
Phoenix Flats is a 45-unit four-story Passive-House Certified building on the corner of Middle and Franklin. But more than that, it represents the best transformation in Portland. This is perhaps biased, but nonetheless the development of Phoenix Flats has transformed what had previously been a surface parking lot into a gorgeous building the fulfills multiple public purposes, while elevating a highly visible corner in the heart of Portland. The building’s entrance is on Franklin St., with a garage entrance on Newbury St., and the Commercial Space fronts to Middle Street. This project is a perfect example of a public private partnership. A portion of Land was donated by Donald Sussman and combined with leased land from the City of Portland, to create the space needed for the development.
MEREDA: What was the impetus for this project?
Pre-COVID, the City was compiling a list of City-owned parcels that it could use to ease the Affordable Housing crisis. When the list was released, we found a few properties that we thought could work as affordable housing. We then locked in on 83 Middle Street due to the location and what we believed could be a great opportunity to not only create sorely needed affordable housing, but have it be inclusive of housing enriched with services for populations experiencing long-term homelessness while simultaneously helping to reinvigorate the area. We presented the plan to the City and then began in earnest working through the planning, funding, and development process. Fast forward to when the housing came online – the City was experiencing the height of an unprecedented unsheltered homelessness crisis which this housing thankfully helped to address.
MEREDA: That sounds like quite a process. How long were you in the planning stages before construction started?
I began working on this deal in 2019. Then came the pandemic. I remember having public meetings in my bedroom just as the world as we know it changed practically overnight. Design development changed from in person collaboration to screen shares on Zoom, and the team didn’t miss a beat. CHOM finally closed on the construction loan in September of 2021.
MEREDA: Tell us about the most challenging aspect of getting this project completed.
Creating affordable housing is never easy – Phoenix Flats proved this. We permitted, planned, and designed this building in the midst of a global pandemic. We finalized a construction budget while costs were escalating daily, when quotes were only good for 24 hours. This deal was nearly dead multiple times as costs exploded. Costs increased so dramatically that we had to make the hard decision to eliminate an entire floor from the building in order to get the budget back under control. Once we were finally under construction there were a host of unforeseen issues that delayed the project, including contaminated soil, labor shortages, and supply chain issues. However, the most challenging, and admittedly frustrating, issue encountered is one that many developers and construction managers have faced recently: delays relating to electrical switchgear. The electrical switchgear was delayed four times, sequestered in Mexico for weeks, and then finally arrived without any forewarning. Even now when someone says electrical switchgear my heart starts beating faster.
MEREDA: Something unexpected you learned along the way was….
I realized how much I didn’t know. Regardless of experience, knowledge and comfort relating to the project at hand, and familiarity with the development process, there is always the element of unpredictability. Throughout the development process there were a myriad of things that emerged that we had to work around. I am grateful for my team of Architects, Consultants, Builders, Engineers, and Colleagues who creatively battled our way through all of the highs and lows of this project.
MEREDA: Now that it’s complete, what feature of the project do you think makes it the most notable?
Phoenix Flats is a beautiful building, the commercial space works really well with the neighborhood, and the Passive House certification is an amazing accomplishment. However, what stands out is that 21 households who had experienced long-term homelessness, including unsheltered homelessness, now have affordable, stable homes where they can live and thrive. The challenges faced pale in comparison to this accomplishment, and we would overcome each obstacle again for this result. This is at the heart of CHOM’s mission, and we are fortunate to get to play a role in these happy endings.
