PORTLAND, Maine — Portland’s landmark Time and Temperature Building has changed hands after the previous owner failed to find enough tenants to meet mortgage terms, amid the city’s relatively crowded commercial real estate market.
Tenants were notified in a letter April 22 that the building’s new Maryland-based owners had hired NAI Hunneman of Boston to manage the building.
The Portland Press Herald reported that loan servicer records it obtained from a New York research firm showed that the building’s occupancy rate had fallen to around 60 percent, which violated terms of the mortgage by not meeting certain occupancy rates.
That brought mortgage holder Wells Fargo to foreclose on the property and set a public auction for March 25, according to property records.
The property records note that the bank took possession of the property “for breach of the conditions of [the] mortgage.” The mortgage, taken out by the previous owner in 2006, required leases covering at least 65 percent of the total rentable space.
That’s in a market where about 92 percent of the city’s 4.3 million square feet of downtown office space was occupied as of January, according to the most recent market forecast presented before the Maine Real Estate and Development Association.
The Time and Temperature building had more than 63,000 square feet of vacant Class B office space as of the MEREDA report in January.
The office space vacancy rate in downtown Portland dropped to about 7.7 percent in 2015, from 10 percent in 2014.
While those rates are lower than some other New England cities, like Providence and Hartford, they remained stubbornly higher than a number of neighboring communities, like Falmouth, Scarborough and most of South Portland.
The building’s most notable feature for Portlanders and passersby on I-295 is the electronic sign at the top, which cycles between displaying the current time and temperature and messages from nonprofits or the law firm of Joe Bornstein, reading “Call” and then “Joe.”
Nate Bergeron, the contact for booking space on the sign, was not available for comment about whether the new management have any changes in store for that particular landmark. The property manager from NAI Hunneman was not immediately available for comment Thursday morning.
Chris Roberts, owner and hair stylist at High & Tight, said he’s been told his lease, which extends to 2022, has been transferred to the new owners and he has no concerns about problems for his business. He said he hopes the new owners will invest in the property.
“There’s a lot of great space here, but there’s stuff that needs to be addressed,” Roberts said.
Property records show the new owner is 477-481 Congress Street Holdings, LLC, a company incorporated in Maryland in January.
Roberts also said he had difficulty in the past getting a response or assistance from the building’s previous owners, such as when he recently sought to move from an internal location to one with an exterior door on Preble Street.
He said he waited roughly three months to hear back from the property owners about that request and had to foot the bulk of the costs to move, but he’s appreciative of the new space, which allows him to stay open later without having to meet clients at the front door after it automatically locks at 6 p.m.
Roberts said he thinks some of the building’s potential perhaps lies in opening back up the historic arcade that spanned the building’s first and second floors, which are capped with skylights.
The skylights that used to shine down two floors are now separate from the corridor in the building’s main entryway on Congress Street.
“There’s a lot of stuff that could be done if someone has a vision for it,” Roberts said. “And the money, of course.”
BDN writer Seth Koenig contributed to this report.