Coastal Enterprises Inc. signs options to buy Brunswick town properties, eyes consolidating operations there
BRUNSWICK, Maine — A Wiscasset-based nonprofit organization has signed an option to buy the Brunswick Town Hall and Recreation Center properties for $300,000.
Coastal Enterprises spokeswoman Liz Rogers on Tuesday said signing the option will allow CEI to continue to assess the viability of consolidating its Portland and Wiscasset offices in downtown Brunswick.
“As we move forward into the fall with this, we’ll have more information that we’ll be able to share with what we’re looking at,” Rogers said. “Our people are very excited about the possibility of bringing CEI under one roof.”
The proposed deal is structured so that the town will transfer Town Hall and the Recreation Center to Brunswick Development Corp., a nonprofit development corporation, which will handle the sale of the properties to CEI.
BDC President Larissa Darcy said she would sign the option agreement on Thursday, pending any changes to the contract and approval from the BDC board of directors.
Darcy said she is confident the deal will be consummated.
“Absolutely. That’s what we’re all working toward,” she said. “We’re very happy to do this. We understand they have to do [their due diligence]. It’s a big project.”
Darcy said she would also sign an agreement for BDC to buy the Recreation Center at 30 Federal St. from the town for $225,000.
Town Manager Gary Brown said he signed the agreement last week. Brown was authorized by the Town Council in May to sell the Recreation Center for no less than $200,000.
The sale price of the Recreation Center increased by $25,000 from its original asking price of $200,000 during negotiations, Brown said. The change happened after BDC and the town agreed to share any profits exceeding $250,000 from BDC’s sale of the two Federal Street properties.
Since CEI has agreed on an option to buy the Recreation Center and Town Hall properties for $300,000, Brown said, the town will receive $25,000 from the expected sale while BDC will pocket $275,000.
Darcy said the $300,000 sale price of the two properties is based on the consideration that CEI will incur extra costs in developing the land.
“When you look at the purchase of real estate, they’re not buying the buildings,” she said. “They’re buying the land and they’re incurring a cost to demolish those buildings. When you look at it that way, it’s going to cost several hundred thousands.”
Darcy said it is a cheaper option than what demolition would have cost the town.
Last year, for instance, it cost Brunswick nearly $140,000 to demolish the former Times Record newspaper building on Industry Road, which the town purchased for nearly $1.28 million in 2004.
The decision was made after several failed attempts to sell the building.
The town is already expecting to transfer the Town Hall at 28 Federal St. to BDC in exchange for the new Police Department property at the corner of Pleasant and Stanwood streets, under an agreement that was approved by the Town Council last fall.
BDC bought the land for the new police station on behalf of the town to expedite the development process and ease the purchase’s burden on taxpayers.
The Police Department is expected to move into the new station by Oct. 1, according to Brown.
Darcy said BDC is expected to close on the sale of the Recreation Center and Town Hall properties by April 1, 2014. That’s when the properties would transfer from the town to BDC and then to CEI, pending CEI’s final approval.
The Recreation Department is expected to move into Building 211, a former U.S. Navy fieldhouse on Brunswick Landing, by October, Brown said. The town’s preschool program is expected to begin at Building 211 in September.
The town will move its Town Hall and Council Chambers into the McLellan Building on Union Street by April — when BDC is expecting to close on the sale — pending renovation work, Brown said.
The town manager said more information about the scope and costs of renovation work on the McLellan Building is expected to emerge sometime in September.
CEI has previously said its move to Brunswick would bring about 50 employees from the Portland and Wiscasset offices, though some regional presence throughout the state will be continued.
“In terms of having the two main offices together, that’s going to be a big deal,” Rogers said. “A majority of our staff will be at those offices.”
Rogers said if CEI purchases the two Federal Street properties, it would demolish the existing Recreation Center and Town Hall building to make way for a new one. She didn’t say whether or not the building would occupy both properties, because she said the plans are still in development.
If CEI moves to Brunswick, Darcy said the town will reap several economic development benefits. For instance, she said, CEI’s employees would likely begin spending money at local businesses in the downtown area, and some would possibly move into nearby neighborhoods.
Darcy said the move would also improve the town’s reputation as a business-friendly community.
“In having a company of this size, like CEI, choose downtown Brunswick, it shows others that Brunswick is a good place for business,” she said.
CEI would also be paying taxes on properties that were previously nontaxable because of their municipal status, Darcy said.
When the town announced its intention to sell the Recreation Center in May, the plan was met with protest by some residents, who said they valued its accessible downtown location.
“My biggest concern about the move is the distance from town and how kids will get out there,” Vladimir Douhovnikoff, of Longfellow Road, said at a public hearing, where many dissenting voices were heard.
Residents also questioned the town’s process in the eventual disposal of the Recreation Center. But the town manager said intentions were clear when the Town Council made a public conveyance request for the former Navy field house in 2011.
The council also began appropriating money for the field house in the fiscal year 2012 town budget, and amended zoning laws last year to allow light commercial office use in the area.