Why Bangor Isn’t Building: The Consequences of Low Vacancy Rates

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Limited Commercial Spaces Stifle Growth

The bustling city of Bangor is experiencing a significant economic challenge. Commercial real estate brokers are sounding alarms over the rapidly decreasing availability of industrial, retail, and office spaces, a predicament that has considerably hampered local economic expansion. Carol Epstein, the president of Epstein Commercial Real Estate, reveals that vacancy rates for the city's crucial spaces have been lingering "in the single digits" for the past few years, with industrial properties witnessing the sharpest decline.

"In 2023, about 6 percent of Bangor’s office and retail spaces were vacant, while the industrial market vacancy rate was less than 2 percent," said Epstein. This scarcity has been an ongoing issue, constricting the ability of existing businesses to expand and deterring new enterprises from establishing themselves in the city.

Echoes of a Broader Housing Crisis

Bangor's commercial space crunch mirrors its residential housing shortage, which has persisted for several years. The lack of available, affordable, and quality housing has contributed to other community challenges, such as rising homelessness and a stagnant population count, painting a concerning picture for the city's future.

Real Estate Dynamics: A Conservative Approach

Bev Uhlenhake, managing broker at Maine Commercial Realty, highlighted the cautious approach of local developers, which has inadvertently contributed to the shortage. "We’re in a market that hasn’t been overbuilt,” Epstein corroborated. “There hasn’t been a lot of speculation, so our inventory hasn’t been increasing.” This conservative strategy, while avoiding the pitfalls of overbuilding, has also led to a shortage of ready-to-occupy commercial spaces, creating a significant barrier for business growth and economic dynamism in Bangor.

The Mall: An Anomaly in a Thriving Scene

Interestingly, while most of Bangor thrives with low vacancy rates, the Bangor Mall stands as a stark contrast, replete with empty storefronts. This anomaly reflects a broader national trend where traditional malls have fallen out of favor. Retailers that once sought the enclosed mall environments are now choosing strip mall properties, a shift driven by changing consumer preferences and the decline of department store anchors like JCPenney and Sears.

"Stores such as Sleep Number and Ulta Beauty are opting for locations in strip mall developments on Stillwater Avenue rather than the Bangor Mall," Epstein pointed out.

Looking Ahead: A Call for Thoughtful Development

Both Epstein and Uhlenhake advocate for a thoughtful approach to commercial development in Bangor. While the immediate need for more spaces is evident, there is also a call for caution to avoid the mistakes of overbuilding seen in other cities. "Should developers come to Bangor and do something different? Yes," said Uhlenhake. "But it should still be thoughtful."

As Bangor navigates this complex landscape, the need for a strategic balance between development and conservation becomes clear. The city's economic future may well depend on its ability to adapt to these real estate dynamics while fostering an environment conducive to business growth and community well-being.

Source: Bangordailynews.com