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February 7, 2023 at 6:00 am · · Comments Off on MEREDA Recognizes Four Exceptional Individuals for Their Contributions to Real Estate Development and Policy in Maine

MEREDA Recognizes Four Exceptional Individuals for Their Contributions to Real Estate Development and Policy in Maine

On January 26, 2023, the Maine Real Estate and Development Association (MEREDA) recognized four exceptional individuals for their significant and lasting contributions to real estate development in the State of Maine. The awards were presented in person at this year’s Forecast Conference at the Cross Insurance Arena attended by close to 800 real estate professionals.

Click here to watch the awards ceremony.


Josh Fifield was selected for this year’s Robert B. Patterson Jr. Founder’s Award, for his extraordinary commitment and dedication to MEREDA over the years.

Fifield is a Vice President of the Business Insurance Department at Clark Insurance, where he works with business owners to identify their risks to help protect their hard work, assets, employees, and most importantly, their families. Active in the community, Fifield has coached a variety of youth sports and has been the Safety Director for Portland Little League.

In 2014, Fifield started volunteering with MEREDA as a committee member on the Marketing & Membership Committee. He then joined the Board of Directors in 2017, a year he was also recognized with MEREDA’s Volunteer of the Year Award. Over the years, Fifield has also co-chaired the Membership Committee and recently served as President from 2020-2022. It was his steady hand that guided the organization during a time of unprecedented uncertainty and upheaval. Even with those challenges, in Fifield’s tenure, MEREDA saw financial stability and growth in membership. He continues to serve on MEREDA’s Membership and Executive Committees. MEREDA is grateful for Fifield’s unwavering dedication and leadership!

The MEREDA Public Policy Award is presented each year to an individual whose efforts have made a significant impact on public policy changes that benefit responsible real estate development and ownership in Maine. This year we recognize Senator Matt Pouliot for his leadership in housing creation policy, and for his support of MEREDA’s efforts.

Senator Pouliot has been a steadfast supporter of MEREDA policy priorities, including his help in maintaining the Maine Historic Rehabilitation Tax Credit, his support for the establishment of a Commercial Property Assessed Clean Energy (CPACE) program, his vote for the 2022 Housing Act, and his sponsorship of two MEREDA priority legislation items for the 131st Legislature. Additionally, Senator Pouliot has recently risen as a leader in bipartisan discussions about smart public policy to help curb Maine’s housing crisis. Last fall, he served on the Legislature’s recent Commission to Increase Housing Opportunities in Maine by Studying Land Use Regulations and Short-term Rentals – the final report of which is the starting point for the work of the new Joint Select Committee on Housing, which Senator Pouliot was instrumental in establishing.

Senator Pouliot is also a leader in real estate sales and development in Kennebec County and beyond. Most notably, he has helped revive the historic Water St. corridor in Augusta through redevelopment of downtown properties, including the New Purington Brothers Block, which won a 2022 Maine Historic Preservation Award. His support for responsible real estate development, approach to policy making, and service as a leader both in the legislature and in his hometown of Augusta make Senator Pouliot a clear choice for this year’s Public Policy Award.

The Volunteer of the Year Award is awarded to those who generously share their time, talents, and energy with MEREDA. This year we honor the contributions of Ben Brennan.

Ben Brennan is a Senior Sales Executive for KONE Elevators, located in South Portland. Responsible for new equipment business development and project management, Brennan partners with stakeholders of new and existing real estate developments in Maine, New Hampshire, Vermont, and Massachusetts.

With MEREDA, Brennan was an active and engaged participant on DevelopME’s Committee early on, which led to him serving as co-chair from 2020 – 2022. In this role, he worked to engage membership and create professional development opportunities within the organization for the next generation of industry professionals. In 2021, Brennan started serving on MEREDA’s Board of Directors, where his can-do attitude and interest in MEREDA’s initiatives became even more evident. More recently, he joined the Local Issues Committee, and demonstrated his commitment by asking to become co-chair! Brennan is happy to lend a hand when asked and has become a great addition and vocal advocate of MEREDA. MEREDA looks forward to working with him for many years to come!

The President’s Award is given by MEREDA’s current President, Craig Young of The Boulos Company, in recognition of someone who has made significant contributions on MEREDA’s behalf. This year’s President’s Award goes to Shelly Clark, for her enduring contributions to MEREDA.

Clark started with MEREDA in January 1997. That year the Forecast Conference had only 105 people in attendance. Clark has helped grow that event and MEREDA into what it is today. Now, serving as MEREDA’s Executive Director, Clark manages all day-to-day operations, including coordinating educational programs, managing membership development, and providing support for board and committee activities. During the pandemic, Clark went beyond the call of duty. Working from home, she kept the organization going. She was there to help everyone who needed it, from planning online events to supporting membership efforts. In short, you simply cannot think of MEREDA without thinking of Shelly Clark. She is literally the heartbeat of this organization, and has been for more than 25 years.

Clark has been a vital colleague to a dozen MEREDA Presidents. As part of the award tribute, a few recent past presidents echoed Young’s praise for Clark and shared their thoughts in a brief video.

Clark is originally from Houlton and proud of her roots in The County. Always a hard worker, she recalls waking up at 4am picking potatoes at the age of 7 so she could get the “Dorothy Hamill” haircut at the Bangor mall. She now lives in Portland with her husband Alan. Clark has always said that she has the best job in the world and that if she weren’t doing this she’d be singing and touring with a band. MEREDA is so lucky to have Clark as our lead singer…she does it all, she does it well, and we simply couldn’t get along without her.

MEREDA congratulates these four exceptional members, and thanks every volunteer whose contributions of time and talent make the association’s continued success possible.

Below:  MEREDA President, Craig Young, Ben Brennan of KONE Elevators, Shelly Clark, MEREDA Executive Director, Josh Fifield, Clark Insurance, Senator Matt Pouliot.


January 31, 2023 at 6:00 am · · Comments Off on Peaks & Plateaus: MEREDA’s Forecast Conference Gives Context to Maine’s Real Estate Data

Peaks & Plateaus: MEREDA’s Forecast Conference Gives Context to Maine’s Real Estate Data

PORTLAND, Maine–On Thursday, January 26, over 800 of Maine’s real estate and development professionals gathered at the Cross Insurance Arena to learn about the latest trends and predictions for the real estate economy at the Maine Real Estate & Development Association’s (MEREDA’s) Forecast Conference and Member Showcase. MEREDA also streamed the conference for those who could not attend in-person. “Even though Sugarloaf was having an incredible powder day, there is no other place I’d rather be than the Forecast Conference,” shares MEREDA President Craig Young. “This is a day where you have great conversations and make great connections. You get to be in the room with the people who are driving responsible development in our state.”

With a dynamic lineup of industry experts presenting on the ins and outs of Maine’s real estate economy, the Forecast Conference provided an opportunity for real estate professionals to learn from each other and map out what lies ahead for their industry. The day began with a discussion of one of the most pressing issues in Maine: affordable housing. Keynote speaker Greg Payne, a Senior Advisor on Housing Policy with the Governor’s Office for Policy Innovation and the Future, said “We have got to rededicate ourselves to investing in affordable housing and working on solutions.” Payne went on to outline the ways in which Governor Mills has made a historic commitment to building more housing in Maine. “As big and frustrating as our housing challenges are, we’ve never been in a better position to do more,” Payne said, urging people to participate in the effort to ensure all Mainers have access to safe and affordable housing. Next, James Marple, a Senior Economist from TD Bank provided an economic outlook on both a national and state level, sharing an expectation for the economy’s growth to slow, the real estate boom prices to unwind, and for the labor demand challenge to continue to impact Maine’s economy.

Looking at the industrial sector, Justin Lamontagne and Sam LeGeyt of The Dunham Group reported on another healthy and competitive year that was also beginning to show signs of a plateau in the future. That said, demand continues to be there for industrial spaces, with Lamontagne wondering if there will be zoning changes to facilitate the conversion of office space into low-impact industrial use, and if speculative construction will move north where there is land to develop for new Innovation Districts.

Dava Davin of Portside Real Estate Group gave a presentation on the single family residential market in Southern Maine, an $8 billion market, succinctly summarizing, “In 2022, prices went up and sales went down.” Diving into the details, Davin put a spotlight on three “stand out” towns that were seeing incredible increases in home prices: Lewiston, Westbrook, and Cumberland. Looking at the luxury market, Davin reported that homes selling for over $1 million have tripled since 2019, and in 2022 the most expensive home sold in Maine was in Camden at $13.7 million. Predicting that housing prices will level off, there will be fewer transactions, and a return of the seasonal market, Davin sees less frenzy and more thought in 2023’s residential market. Especially since many Mainers cannot afford to buy the home they live in today, so they aren’t able to move anyplace else.

Bricks and mortar retail locations continue to create great demand in the Portland area, Peter Harrington of Malone Commercial Brokers reported. “The demand is there and it’s getting really expensive to get a retail space in downtown Portland.” With more national chains moving into the Old Port district, Harrington discussed how there is a need for a mix of retailers in the market. “It brings life; we need that at street level,” he said while recalling the old days when offices occupied prime locations and had their shades perpetually drawn. Harrington predicts that retail will continue to be a strong market with growth opportunities: its healthy demand is helping historic buildings get rehabilitated and bringing more people to shop and eat downtown.

Other presentations included Elizabeth Frazier of Pierce Atwood with an update on MEREDA’s Legislative Agenda. In the year ahead, Frazier said that MEREDA’s Public Policy Committee will be focusing efforts on reducing the barriers for housing creation and has three bills in the works for the upcoming session. Reporting on the Bangor area market, David Hughes of Epstein Commercial Real Estate cited the challenges of low inventory in the industrial and office sector, and also highlighted a few game changers for the area including downtown apartment conversions, the Maine Savings Amphitheater, and the transformation of Main Street. Brit Vitalius of Vitalius Real Estate Group provided a report on the multi-family market in Southern Maine, highlighting the incredible growth of Lewiston/Auburn in particular. In a look at the Central Maine market, Frank Carr of Maine Realty Advisors echoed the story Vitalius shared of a booming market in Lewiston/Auburn, and shared his outlook for Augusta and Waterville. Dave Holman of RE Max Riverside Commercial gave an update on the Midcoast Maine market, highlighting the renaissance that Bath is seeing, and outlined the exciting projects in the pipeline for the Brunswick area including a community recreation facility and housing for asylum seekers. Matt Arrants of The Arrants Company discussed how the return of business travel and international travel were impacting the Maine hospitality sector, predicting that Maine will continue to be a popular travel destination and lamenting the labor shortage for hotels. Nate Stevens of The Boulos Company provided a report on the Southern Maine Office Forecast, saying that there are still a lot of unknown questions post-pandemic. Outlining the difference between downtown Portland and suburban markets, Stevens sees opportunities for conversions to housing and industrial spaces, and opportunities for office tenants if they know where to look.

Overall, strong demand and limited supply continue to shape many of Maine’s real estate sectors. How that demand will continue to drive growth is one of the remaining questions. What’s clear is that MEREDA members will be working together to ensure that growth will be defined by responsible development, which must include more affordable housing for Mainers. Sponsors of the event include TD Bank, Mainebiz, The Downs managed by Maine Properties LLC, Bangor Savings Bank, FirstPark Business Park, Haley & Aldrich, Landry/French Construction, Partners Bank, and Pierce Atwood.

January 17, 2023 at 8:00 am · · Comments Off on Listen up! MEREDA Launches New Real Estate Podcast: “MEREDA Matters”

Listen up! MEREDA Launches New Real Estate Podcast: “MEREDA Matters”

Have you ever wanted to be a fly on the wall listening in on a conversation between Maine’s real estate industry leaders? Been curious about the people who have put together some of Maine’s most important development deals? Well, the Maine Real Estate & Development Association (MEREDA) has a treat for you! The organization known for bringing people together for insightful discussions on all things related to real estate and development is taking to the airwaves, or rather the podcast waves! On January 10th, MEREDA launches MEREDA Matters, a podcast that highlights the people, stories, and relationships behind the responsible development happening in Maine.

“I’ve been a part of MEREDA for years, and what has always stood out to me is the people. At every MEREDA event, I always have a great conversation with someone,” shares Craig Young, MEREDA President. “The MEREDA Matters podcast is about sharing those great, insider conversations. We rub elbows with these folks professionally, but what makes them excited to get up in the morning? What are they putting in their coffee? What matters most to them? Let’s get into it together!”

The MEREDA Matters podcast is sponsored by NBT Bank. Additional sponsors include Bangor Savings Bank, Clark Insurance, and The Boulos Company. A new episode will be released each month and each will feature a new voice from the real estate and development industry in conversation with Young and other MEREDA board members such as Vice President Shannon Richards and Board Member Paul Peck. The first guest on the podcast is Kevin French, Chairman and CEO of Landry/French. According to Shelly Clark, MEREDA’s Executive Director, eager listeners can find the MEREDA Matters podcast episodes on Apple, Spotify, or their regular podcast source. The episodes can also be found on MEREDA’s website www.mereda.org.

January 10, 2023 at 6:00 am · · Comments Off on MEREDA Kicks Off 2023 With Its Forecast Conference

MEREDA Kicks Off 2023 With Its Forecast Conference

On Thursday, January 26, 2023, leaders from across Maine’s real estate industry will gather for the Maine Real Estate & Development Association’s (MEREDA’s) Forecast Conference and Member Showcase. This annual event will take place at the Cross Insurance Arena in Portland, and can also be streamed online. Is the housing market cooling down? How has inflation impacted the retail market? Is the industrial sector still booming? Anyone curious about these questions and what industry experts see for the future of Maine’s real estate economy will find the Forecast Conference a day full of insight and thoughtful presentations.

“The Forecast Conference kicks off the year in a great way,” shares MEREDA President Craig Young. “It’s where you have meaningful conversations, learn from other professionals, and connect with the people in our state who are driving responsible development. There’s no other place to be on January 26th!”

MEREDA’s Annual Forecast Conference is geared towards builders, developers, brokers, attorneys, architects, engineers, municipal leaders, bankers, and accountants, to name a few. Continuing Education credits will be available. Along with presentations from real estate leaders across various sectors and a keynote address on housing policy from Greg Payne, a Senior Advisor at the Governor’s Office of Policy Innovation and the Future, the conference will also include a member showcase with exhibitions from local businesses. MEREDA’s mission is to promote responsible development in the state of Maine and is why they work hard to provide opportunities for people to learn and connect with other industry professionals.

According to Shelly R. Clark, MEREDA’s Executive Director, MEREDA’s Forecast Conference will be held at the Cross Insurance Arena on January 26 from 9am to 5pm. The event will also be available online. Registration is available at MEREDA.org. Event sponsors include, TD Bank, Mainebiz, The Downs managed by Maine Properties LLC, Bangor Savings Bank, FirstPark Business Park, Haley & Aldrich, Landry/French Construction, Partners Bank, and Pierce Atwood.


December 27, 2022 at 8:00 am · · Comments Off on HOW TO INCREASE THE VALUE OF YOUR COMMERCIAL PROPERTY


by Craig Young, The Boulos Co. Partner/Senior Broker

These savvy tips will help you get the most out of your investment

For those in the commercial real estate business, it is essential to find ways to continually maximize your investment. While an easy road to profit can be rent increases, in order to retain tenants, it is important to add value to justify higher costs. Short-term expenditures can reap long-term benefits as most tenants will pay increased rent if it comes with a reason or a benefit. These tips will help you increase client loyalty and your property value simultaneously:

Take a Look
When we become familiar with our property over time, we may become inured to its deficiencies. Cast a critical eye over the property to look for areas to improve: What outdoor areas need to be cleaned up, repainted or repurposed? How can you freshen the interior areas, such as the lobby, furniture or other décor? Consider sending current tenants a survey to gauge their needs and desires. Giving them a voice will go a long way to increase their overall satisfaction and lead to higher tenancy renewal rates.

Add Amenities
Look for ways to improve the quality of life for tenants. Add in a fitness center, conference room, or a daycare for young families. You may even be able to immediately recoup your investment with pay-per-use. Make life more convenient with speedy internet and strong cellular reception. All these extra benefits will raise the appeal for current tenants and attract new ones too.

Fill the Space
Get creative with extra space in and around the property. Add benches to create an outdoor area or landscape to create green space for clients to enjoy. Turn a spare room into a meeting room or extra storage for use. Make the rooftop into another space where clients can get a breath of fresh air.

December 20, 2022 at 7:00 am · · Comments Off on Deadline Extended for Nominations for 2022 Notable Project Awards

Deadline Extended for Nominations for 2022 Notable Project Awards

Nominations are still being accepted for MEREDA’s Notable Project Awards. The recipients will be recognized at our Annual Spring Conference in 2023. 

In order to be considered, all projects must be submitted via the Notable Projects Application Form, which can be downloaded here. (Clicking this link will download a Word Document to your computer.) 

The deadline has been extended to December 30, 2022.  Please submit completed forms to Shelly R. Clark at info@mereda.org

December 6, 2022 at 8:00 am · · Comments Off on Maine is readying new public-private financing tool to facilitate “green” development

Maine is readying new public-private financing tool to facilitate “green” development

Commercial property assessed clean energy (C-PACE) financing has enabled at least $2 billion of energy-saving upgrades in other states, but Maine bankers fear it will bring added risk to mortgage lenders.

Maine officials are finalizing a new statewide program that will allow commercial property owners and developers to finance energy-saving building upgrades at a lower annual cost through public-private partnerships among property owners, lenders and municipalities.

Known as commercial property assessed clean energy (C-PACE) financing, the program was authorized by Maine lawmakers in 2021 via the passage of LD 340. Rulemaking is being conducted by Efficiency Maine Trust, which will administer the C-PACE program, and that process is expected to be completed in the next few months.

C-PACE programs are designed to make it more affordable for property owners to finance energy-saving building upgrades through an innovative lending structure. Traditionally, construction and retrofitting of commercial buildings is financed with real estate loans whose repayment terms typically range from five to 10 years with a balloon payment due at the end. In contrast, C-PACE programs only cover the cost of energy-saving upgrades, offer terms of 15 to 30 years and are fully amortized with no balloon payment at the end.

At least two dozen states and the District of Columbia have active C-PACE programs in place. Those programs have resulted in more than $2 billion in private capital investment in energy-saving commercial building upgrades, according to the U.S. Department of Energy.

Connecticut was the first state to launch a C-PACE program in 2013. Since then, the state’s program has financed more than 350 green construction projects valued at over $230 million in total. Those projects have prevented an estimated 927,000 tons of carbon dioxide from being emitted, the rough equivalent of taking 185,000 cars off the road.

Some Maine developers say C-PACE will be the most significant new commercial real estate financing tool introduced in the state in decades. It can be used to finance the energy-saving features of new buildings or upgrades to existing structures. The program’s goal is to facilitate a more rapid shift toward energy-efficient buildings in Maine, where many older commercial properties such as apartments, offices and hotels lack modern energy-saving features.

Heating, cooling and lighting of buildings is responsible for 30 percent of Maine’s greenhouse gas emissions, according to the Maine Climate Council. Homes emit 19 percent, while commercial buildings account for 11 percent.

“We’re excited about the potential impact of the C-PACE program and think it’s going to help resolve significant problems in the market,” said James Neal, senior program manager of finance initiatives at Efficiency Maine.

But the C-PACE program is not without controversy. The Maine banking industry lobbied against the program’s enabling legislation and has expressed skepticism about the benefits of C-PACE financing compared with more traditional construction loans.

Under Maine’s program, a property owner’s mortgage lenders must agree to participate in any deals because C-PACE lenders get priority to collect past-due payments in a foreclosure. For that reason, it’s unclear how effective Maine’s program will be in terms of spurring green development. But developers point to banks’ acceptance of C-PACE deals in other states as cause for optimism.

Mark Stasium, director of commercial real estate lending at Camden National Bank, said the industry is still “trying to get its arms around” the potential risks and benefits of Maine’s new C-PACE program.

“As a general rule, bankers don’t like liens that have priority over our mortgages,” he said. “In a default situation, the C-PACE loan is going to have priority over the bank.”

The Maine Real Estate & Development Association (MEREDA) is hosting a breakfast panel from 7:30 to 9 a.m. Thursday, Dec. 8, at Holiday Inn By the Bay in Portland to discuss the new program. Panelists will include Michael Doty of Nuveen Green Capital, the nation’s leading C-PACE loan provider, James Neal of Efficiency Maine and Mark Stasium of Camden National Bank. The panel will be moderated by Paul Peck, founder of LWS Development and attorney at Drummond & Drummond.

Peck said Maine’s development community and property owners are thrilled the state enacted a new financing tool to help further its energy-efficiency goals.

“C-PACE will give developers and property owners another financing option, which will help get new development projects started and existing properties brought up to current energy-efficiency standards,” he said. “Given the huge spike in commercial interest rates, another financing tool is just what developers and property owners need.”

C-PACE financing is conducted through private lenders but is separate from a property’s other mortgage loans. With C-PACE financing, the responsibility for continued loan repayment is attached to the property itself and can be transferred to the property’s new owner in the event of a sale.

The building owner’s local municipality must have opted into the C-PACE program via a local ordinance, since it will be involved in attaching the debt to the property. The cities of Portland, South Portland and Westbrook already have potential C-PACE projects in the pipeline, although no local ordinances will be considered until after the rulemaking is completed.

Michael Doty, director of originations for New England at Nuveen Green Capital, said hundreds of cities and lenders in other states have come around to embracing C-PACE financing once they became more familiar with how the programs work.

He said C-PACE financing not only can help reduce Maine’s greenhouse gas emissions but also facilitate affordable housing development by making green multifamily projects feasible that otherwise wouldn’t be. Doty aims to convince more Maine lenders and municipalities to get on board.

“It can never be used in circumstances where the local bankers and municipalities aren’t comfortable with it,” he said.


November 29, 2022 at 8:00 am · · Comments Off on MEREDA Inducts Four Exceptional Individuals to Honorary Board as Directors Emeritus

MEREDA Inducts Four Exceptional Individuals to Honorary Board as Directors Emeritus

PORTLAND, Maine — On November 3, 2022, the Maine Real Estate and Development Association (MEREDA) inducted four exceptional individuals to their Honorary Board as Directors Emeritus. The MEREDA Board of Directors established the Honorary Board in 2003 as a way to recognize an exclusive group of individuals who, during their careers, have made significant contributions to MEREDA and to Maine’s commercial real estate industry. The induction ceremony took place during MEREDA’s 37th Anniversary Gala at Ocean Gateway in Portland.

MEREDA’s Board outlined the following criteria for individuals to be nominated to the title of Director Emeritus: nominees must have previously served as an officer of MEREDA or a member of its Board of Directors; they must be active and well-recognized in Maine’s commercial real estate industry; and they must have made significant contributions to MEREDA and Maine’s commercial real estate industry throughout their careers. This year’s Directors Emeritus Honorees include Drew E. Swenson, Dana Totman, Larry Wold, and Renee Lewis.

“Since 1985, MEREDA has been promoting opportunities that help our communities and our State thrive,” says MEREDA President Craig Young. “Reflecting on 37 years of MEREDA also means reflecting on 37 years of exceptional member volunteerism and engagement. Our four Directors Emeritus Honorees are outstanding examples of this kind of contribution; all have made an indelible mark on Maine’s real estate industry and have had a big impact on MEREDA and its mission to promote responsible development.”

For more information on each recipient, click here.

MEREDA’s 2022 Director Emeritus Honorees:
Larry Wold, Renee Lewis, Dana Totman, and Drew Swenson

November 22, 2022 at 6:00 am · · Comments Off on The Right Equation for Responsible Development: Spotlight on Deering Place

The Right Equation for Responsible Development: Spotlight on Deering Place

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 2021, 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 Biddeford to Bangor, with each receiving special recognition at MEREDA’s 2022 Spring Conference on May 24th.

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 2021 Top 7 recipients include:

Harold Alfond Hall, Husson University (Bangor)
Thornton Heights Commons, South Portland Housing Development Corporation (South Portland)
Harnois & Emery Apartments, Westbrook Housing, Westbrook Development Corporation, and Anew Development (Westbrook)
Riverdam Mill Complex, Port Property (Biddeford)
40 Free Street, JB Brown & Sons & Ryan Senatore Architecture, (Portland)
Deering Place, Zachau Construction & Avesta Housing, (Portland)
Children’s Museum + Theatre Maine, Zachau Construction (Portland)

Please join us this week in celebrating Deering Place.


MEREDA: Describe the building and project.

Deering Place:  Deering Place: Deering Place preserves, redevelops, and expands affordable housing in a highly desirable and accessible location within Portland, Maine. Deering Place is a 75-unit, mixed-income development that includes a major renovation of 13 existing units and the construction of two new residential buildings on lots adjacent to the existing building. Upon completion, there are 62 new units. Amenities include a new community room, laundry rooms, and indoor parking that will be accessible to residents in all buildings. There will be easily-accessible walkways and sitting areas. There is currently a community policing office onsite that will remain. Deering Place comes at a time when the need for affordable housing in Portland is greater than ever.

MEREDA: What was the impetus for this project?

Deering Place:  Deering Place: Deering Place set to preserve, redevelop, and expand affordable housing in a highly desirable and accessible location within Portland, Maine. The development site contained three contiguous lots in a highly walkable area in the historic Parkside neighborhood in downtown Portland. Deering Place is in close proximity to daily amenities and services within the downtown area, which makes it a prime location for housing. MaineHealth, Deering Oaks park, a pharmacy, bus stops, schools, grocery stores, shops and restaurants are all within a half mile.

Deering Place: Deering Place is a 75-unit, mixed-income development that included a major renovation of 13 existing units and the construction of two new residential buildings on lots adjacent to the existing building.

Deering Place comes at a time when the need for affordable housing in Portland is greater than ever.

MEREDA: That sounds like quite a process.  How long were you in the planning stages before construction started? 

Deering Place:  Deering Place: As the construction management partner on the project, we were in the planning stages with Avesta Housing for about a year and a half.

MEREDA: Tell us about the most challenging aspect of getting this project completed.

Deering Place:  Deering Place: Budget constraints required creative scope adjustments to deliver high-quality, energy-efficient buildings that meet design requirements within national historic district and performance standards from the City, MaineHousing, and HUD. The capital stack included seven sources and nine financing partners, including some entirely new to Maine. Additionally, Deering Place was a complex construction project on a tight urban site in an historic district mixing occupied rehab, adaptive reuse, and new construction.

MEREDA: Now that it’s complete, what feature of the project do you think makes it the most notable? 

Deering Place:  Deering Place: Deering Place offers affordable housing in downtown Portland, putting residents at the center of services and jobs. The desire for this level of housing is so great that Avesta Housing had over 800 applications for 75 units. This location is close to public transportation, food, services, and health care. In addition to this project being noteworthy in its ability to fill a void in downtown Portland for low-income housing, the construction of the project itself was notable in that it was an occupied rehabilitation. This tight location has 3 buildings, one of which had to meet historical renovations standards to fit in with the Parkside neighborhood.

November 8, 2022 at 6:00 am · · Comments Off on The Winners of the Inflation Reduction Act of 2022: Real Estate Developers

The Winners of the Inflation Reduction Act of 2022: Real Estate Developers

Part Two: Enhancements to Existing Incentives
By Kory Reynolds, Senior Manager, Baker Newman Noyes
October 2022

This is the second of a two-part series discussing the impact of the Inflation Reduction Act of 2022 on the real estate industry. Part one focused on entirely new incentives, while part two covers modifications to existing incentives.

In addition to the new incentives covered in part one of our series, the Inflation Reduction Act (IRA) of 2022 expanded many existing programs, with both expansions of the amount of tax credits available and of the efficiency metrics to qualify for the projects. Tax incentives expanded by the IRA include the Energy Efficient Commercial Buildings Deduction (Internal Revenue Code (IRC) Section 179D), Energy Efficient Home Credits (IRC Section 45L), Commercial Energy Property Credits (IRC Section 48), and Electric Vehicle Charging Credits (IRC 30C). The expansions roll out new tests that determine qualification for the credit or deductions, including Prevailing Wage and Apprenticeship requirements. Projects that meet these requirements are available for enhanced amounts of the credit.

The Prevailing Wages requirement requires that all employees, contractors, subcontractors, laborers and mechanics (note that this excludes management, supervisors, foreman), are compensated at a rate not less than the prevailing rate for construction, alteration, or repair as determined by the Secretary of Labor for the area where the project is located.

The apprenticeship requirement is that no less than an applicable percentage of the labor hours on the project is performed by qualified apprentices. This applicable percentage starts at 10% of the hours, and phases up to 15% of the hours by 2024. Every taxpayer or contractor who has at least 4 employees in the applicable roles is required to employ at least 1 or more qualified apprentices. There are several exceptions to the apprentice requirement – one if a good faith effort is made to obtain apprentices, but no qualified apprentices were available, and one exception if there is an agreement to instead pay a fine to the Department of Labor in the amount of $50 per hour to achieve the applicable percentage of labor hours.

Author Note: It appears that substantially more guidance will be needed in this area – record keeping requirements, ongoing tracking of qualifications for several credit programs, required certification from your contractors, or if a level of certification will be required from an independent party.

Energy Efficient Commercial Buildings Deduction (IRC 179D)
The Energy Efficient Buildings Deduction (179D Deduction) has been around for many years and is being expanded by the IRA. The 179D Deduction is a form of accelerated depreciation on the acquisition of energy efficient property for a commercial building – either a retrofit to an existing building or acquisition of a new construction building. The deduction allowed is calculated based on square footage, depending on the level of efficiency that the building is certified.

Beginning in 2023 for buildings that meet the energy reduction requirement of at least 25% on the overall building, there is an allowed tax deduction of up to $2.50 per square foot. For each additional 1% increase over 25% of efficiency the deduction is increased by $0.10 per square foot, up to a total deduction of $5 per square foot, which is up from the $1.88 maximum per square foot for the 2022 Section 179D Deduction. This measurement of efficiency improvement is on the entire building, which is in contrast to the Pre-2023 179D Deduction, which allowed for a partial deduction based on improvements to specific building systems. The energy standards for this deduction have become stricter, now based on the ASHRAE 90.1 standard affirmed no earlier than 4 years prior to the improvements going into service.
If a project does not meet prevailing wage and apprenticeship requirements, there is a significant reduction in the deduction, down to a base deduction of $0.50 per square foot for a 25% energy improvement, and an additional $0.02 per square foot for each additional 1% efficiency improvement, up to a maximum deduction of $1.00 per square foot.

Author Note: Historically these studies have been expensive to implement, making it cost prohibitive for all but the largest of new projects. With the near tripled deduction per square foot we expect that more taxpayers will find this deduction attractive.

Energy Efficient Home Credit (IRC 45L)
The Energy Efficient Home Credit under IRC Section 45L (45L Credit) is another credit that has been in place for some time, but is being expanded significantly with the IRA. This incentive is available to contractors and builders who build Energy Star Certified or Zero Energy Ready homes. The credit is equal to $2,500 for Single Family Energy Star Requirement Homes, and $5,000 for Single Family Zero Energy Ready Homes.

For multifamily properties, a similar credit is available if the Energy Star Multifamily housing requirements are met. The base credit for a multifamily project is $500 per unit for Energy Star certified projects, and $1,000 for Zero Energy Ready certified projects. This credit increases to $2,500 and $5,000 per unit respectively if prevailing wage requirements are met.

The 45L credit is also available for substantial improvements to existing properties. While this is not defined by the regulations, presumably this would apply to substantial renovations to existing properties that includes energy efficiency improvements.

Investment Tax Credit (ITC) (IRC 48)
The investment tax credit is a near mirror of a similar residential program offered for the installation of solar panels and other renewable energy technologies, including geothermal, qualified fuel cells, or small wind energy projects.

The credit as it exists currently and in earlier years provides a base amount of the credit calculated on the cost of the project. For 2022 through 2024 the credit equals 30% credit of the project costs. The IRA introduces a two tiered system with additional complications to the credit beginning in 2025 – first and foremost reducing the base amount of the credit to 6% of the qualified project cost. If prevailing wage and apprenticeship requirements are met, the credit is multiplied by 5 – giving a taxpayer up to the same 30% credit that was available in 2024 and prior tax years. The IRA also introduces a bonus amount of credit of up to 10% for projects with primarily US based production, with increasing levels of required US based production over the next 10 years. Combined with the 30% credit, this can provide a tax credit of up to 40% on a qualified project. If prevailing wage and apprenticeship requirements are not met, this bonus of 10% drops to 2% – for a total credit available of 8%.

Additional requirements have also been introduced that require the prevailing wage requirements to exist for the 5 years after the property is in service, as well as the initial installation. If these requirements are not met there would be a partial recapture of any tax credit benefits received.
Most tax credits require that a taxpayer reduce the depreciable basis of the property acquired by the amount of the credit received (to avoid double-dipping). ITC-specific rules allow the basis to be reduced only by half of that amount, allowing eligible property to receive a 30% credit applied to the property cost, while depreciating a basis of 85% of that same property cost.

A new function of the ITC is that is that a taxpayer may transfer it to another taxpayer for compensation (previously the credit was nontransferable). This allows a taxpayer who may otherwise have minimal tax liability to nevertheless benefit from the credits, a common occurrence for growing real estate developers.

Author note: For projects eligible for the entire credit the tax savings can be substantial. With a $50k installation a taxpayer could receive up to a 40% credit ($20,000), and then have a depreciable asset of $40,000. If 100% bonus depreciation is applicable in the given year, at maximum tax rates this is a tax savings of $14,800. Between the credit and tax deductions, $34,800 of the project is paid for immediately.

Electric Vehicle Charger Credit (IRC 30C)
A tax credit for installation of electric vehicle charging stations has consistently been available in the past and is being expanded by the IRA. The expanded credit is 30% of the project cost, up to a total credit of $100,000 per project. If prevailing wage and apprenticeship rules are not met, similar to the ITC, the credit is reduced to 6% of the project costs.

Author note: This could be a significant benefit to multifamily or commercial office developers looking to add EV charging to their new or rehabilitated projects.

With the Inflation Reduction Act’s explosion in new and existing green energy incentives, real estate developers and investors will have their plates full digesting the programs that are available to them for their next projects. The qualification rules are technical and complex, however, and it is highly advisable to include the party that will be certifying the project in the initial planning stages and throughout the process, to ensure the work being performed is going to be eligible for the rebates and tax credits that you are planning for. Additional guidance is expected, but planning can begin as soon as your next project is identified.