AUGUSTA — A large $10 million, four-story building about to go up at the Central Maine Commerce Center will be the new leased home to Maine Revenue Services and the state Office of Information Technology.
When complete in about a year, the new building is expected to bring an additional 700 state workers to the growing north Augusta area. Now, the two state agencies are in leased space in two Edison Drive buildings.
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Developers say it is one of the largest office building under construction in Maine this year.
Some 1,100 people already work at the Central Maine Commerce Center site. The commerce center site was previously home to the SCI computer plant before it closed its 317,000-square-foot building off Civic Center Drive in 2003.
Kevin Mattson, of commerce center owner Mattson Development, said when his firm bought the SCI plant the entire property was valued, for property tax purposes, at about $10 million.
Work on the project started last week. The building is being built and will be owned by an affiliate of Opechee Construction and the total taxable value of the commerce center is expected to reach $50 million, according to Mattson.
“It’s going to be great for the city of Augusta, another huge addition to the tax base,” Mattson said. “When the old SCI building was first purchased, people were worried its $10 million valuation would go away. Well, now we’re at five times that level.”
The consolidation of the two state agencies will also bring more traffic to an already heavily traveled area.
The additional commuters will require the developer, in order to get a traffic permit from the state, to install a traffic signal at the entrance to the commerce center complex. Auburn Concrete, which recently put in a new concrete plant right across the street from the commerce center, will share the expense of adding a traffic signal and other improvements to the road.
Michael Duguay, development director for the city, said he’s glad to see the commerce site thrive. But when workers are being consolidated to a new location there is some concern, too, for the part of the city they are leaving, Duguay said.
“When SCI was leaving there were some dire consequences that could have come, so we’re happy and excited to see what (Mattson) has been able to do there — that’s an incredible engine of growth,” Duguay said. “But in the back of your mind, you have to think, at some level, if we start to lose the employment centers in the core of the city, it does come with some cost. It’s a balance. You hate to lose the lifeblood of the core of your community, should they relocate to the outskirts of the city.”
Yet the city does benefit from having a new building contributing new taxes, with workers who may spend money in the area, Duguay said.
William Leet, director of leased space for the state, said the state negotiated with its current landlord for the two agencies to remain at their current homes at 14 and 26 Edison Drive, but was not successful in reaching an agreement.
So, instead, the project went out to bid and a deal was struck to consolidate the two agencies in the 110,000-square-foot brick building to be built in front of the existing commerce center.
The state will pay $17.36 per square foot and Leet anticipates they will occupy the building entirely. That would result in yearly payment of some $1.9 million.
Leet said the per-foot cost includes most building-related expenses, other than internal lighting and electricity costs.
Leet said the lease terms include many items not included in the state’s current lease of $15 per square foot, such as fuel and janitorial costs. He said when all those expenses are included, the state pays about $23 per square foot for its current space.
He said an analysis of whether it would be cheaper for the state to buy or lease office space indicated it is cheaper to lease if the per foot cost is $21 or less.
The state also looked into renovating space, but Leet said renovating a structure like the Stone building on the former Augusta Mental Health Institute campus was too expensive.
Leet said the agencies will be using less space than they are now.
He said the state will reuse as much furniture and other items in the new building as possible, including modular furniture and some of the security system from the current location. He said the new office space will be primarily open space, as opposed to closed-off individual offices.
Mark Woglom, president of New Hampshire-based Opechee, said the building will be owned by an affiliate of Opechee, which is also building a Hampton Inn behind Margaritas restaurant on Western Avenue, and also built the Fairfield Inn on Anthony Avenue in the Augusta Business Park.
Woglom said that, during the peak of construction, between 70 and 80 people will be working on the project.
Keith Edwards — 621-5647
kedwards@centralmaine.com
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