Bangor’s retail picture shows opportunity for slow growth as economy recovers, industry officials say

Posted April 24, 2013, at 7:12 p.m.
A sign directing people arriving at the Bangor Mall.
A sign directing people arriving at the Bangor Mall. Buy Photo
Businesses at the Bangor Mall area.
Businesses at the Bangor Mall area. Buy Photo
The site work has started on a development that will also be the home to Buffalo Wild Wings, Hobby Lobby and possibly two other businesses at the Bangor Mall area.
The site work has started on a development that will also be the home to Buffalo Wild Wings, Hobby Lobby and possibly two other businesses at the Bangor Mall area. Buy Photo
People walk around downtown Bangor.
People walk around downtown Bangor. Buy Photo

BANGOR, Maine — As the U.S. dusts itself off after the worst economic downturn since the Great Depression, national retailers are beginning to look at growth opportunities, but Bangor faces challenges in attracting them, retail leaders said Wednesday.

James Gerety, Bangor Mall general manager, George Kinghorn, president of Downtown Bangor Partnership, and Bev Uhlenhake of Epstein Commercial Real Estate outlined the condition of the city’s retail industry during a Wednesday morning breakfast with members of the Bangor Region Chamber of Commerce .

In spite of typically strong performance by retailers in Bangor, some large national stores overlook the city completely because of its population, roughly 33,000, as well as other factors, such as driving distance from other population centers and income demographics, according to Uhlenhake. Bangor’s median household income in 2011 was $40,669, about $6,600 less than the statewide median income and $10,000 less than the national.

Each large retailer has its own “formula,” which it uses to mathematically calculate the retail sale viability of a potential store in the city. Plugging Bangor’s population and income statistics into those formulas typically doesn’t yield encouraging results, Uhlenhake and Gerety said.

“I can’t tell you the number of retailers I’ve called that never returned the call,” Uhlenhake said.

Developers have been cautious in the wake of the economic downturn. Borders, Circuit City, Linens ‘n Things and other national chains closed stores in the aftermath of the recession, but those shutterings were caused by financial struggles nationally rather than locally, according to Uhlenhake.

Gerety said the recession caused a lot of deals with potential developers in the mall area to “dry up” from 2007-2009. In late 2010 and 2011, some of those were “dusted off” and today the mall has no vacancies.

“Every single space has a lease on it, including all our storage spaces,” Gerety said. Some previously vacant store spaces are still shuttered, but new leaseholders are preparing them for opening.”

Elsewhere in the mall area, Five Guys opened a burger joint a month ago — with lines still long at the national chain. Books-A-Million replaced Borders. On Stillwater Avenue, a development that will bring Buffalo Wild Wings, Hobby Lobby and one or two other unnamed businesses to Bangor is under construction.

“We’re seeing some modest demand, and I think we’ll continue to grow,” Uhlenhake said. “We’re not shrinking and we won’t be shrinking.”

State consumer retail sales statistics reflect what happened in the national economy during the past five years. In 2009, consumer retail sales fell from the previous year in every economic statistical district in the state.

Across the state, those numbers have crept back up and, for the most part, have recovered to or surpassed pre-recession levels.

Bangor businesses brought in about $1.44 billion in retail sales in 2008. A year later, when Maine communities felt the brunt of the recession, Bangor brought in about $71 million less. The numbers rebounded slowly during the next three years, and Bangor saw about the same amount of consumer retail sales in 2012 as it did prior to 2008.

In Portland, the only Economic Statistical District in Maine that brings in more consumer retail sales than Bangor, the annual total fell from nearly $2.2 billion in 2007 to $1.97 billion by 2009 before beginning a gradual recovery that, by 2012, left it about $30 million shy of its 2007 total.

The turnaround is a promising sign for the future of retail in Bangor, but there’s also no reason to expect that business development will “skyrocket,” the speakers said at Wednesday’s breakfast.

To attract developers, the city needs to ramp up branding efforts and convince large retailers to look beyond their formulas by stressing assets developers don’t glean from the city’s population and income statistics.

For example, Bangor Mall is seeing more and more traffic from Canadian customers, who come in by the busload for weekend shopping trips. Last summer, Canada relaxed tariff restrictions, allowing Canadians returning from the U.S. to bring up to $200 in purchased goods if they were in the country for one day or $400 if they were there for two days. The previous limits were $50 and $200, respectively. Gerety said that change has been a boon for the mall.

The city’s rapid growth as an entertainment venue also will play a part in attracting new business, especially in the downtown area, according to Kinghorn.

“We see that there’s just raw potential for a lot more growth downtown,” he said, adding that some vacant storefronts could be filled by businesses hoping to draw from the thousands of visitors to the American Folk Festival, Waterfront Concerts and Cross Insurance Center, which is poised to open later this year.

Development along the Main Street Corridor, which connects the waterfront area to downtown, could be a significant catalyst for downtown businesses. Proposals for hotels, restaurants and other venues along the underdeveloped stretch of road have fallen through over the years, but Uhlenhake said having a new arena and convention center could attract and help nail down new opportunities.

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