AUGUSTA — A local developer sold a 51,000-square-foot medical services building to a national real estate investment firm for nearly $15 million last week, in part to concentrate on redeveloping the former MaineGeneral Medical Center hospital on East Chestnut Street, he said.
Kevin Mattson’s Lot 18 LLC company sold the MaineGeneral Musculoskeletal Center at 15 Enterprise Drive, to Montecito Medical Operating Company, one of the nation’s largest privately held real estate companies specializing in the management, acquisition and development of hospitals and medical office buildings, according to its website.
“This company is a big deal, nationally,” Mattson said. “Usually, when I sell these things, it’s to local companies, or someone within New England. This is a national buyer. It’s an indication this area has matured enough to attract institutional capital.”
MaineGeneral, the only tenant of the building constructed in 2011, has a lease until 2026, an arrangement that transfers to the new owners.
Paul Stein, chief operating officer for MaineGeneral, said officials met with the new owners, the terms of their lease will remain unchanged, the same property manager who oversees the building now will continue to do so and they don’t expect any major changes with the building.
“From our standpoint, it’s business as usual, we just send the rent checks to a different address,” Stein said. “We feel they’re an economically sound company, we’ve got no concerns on our end. Quite honestly, as a member of the community, I look at it as a positive, we’re getting out of state investment in the Kennebec Valley. And it’s fantastic for Kevin Mattson, now he can take that capital and invest it in other projects, including East Chestnut.”
The building is off Civic Center Drive in north Augusta, near the intersection of Old Belgrade Road, where MaineGeneral Medical Center opened in November.
Mattson is redeveloping the former MaineGeneral hospital building on East Chestnut Street across the river from downtown Augusta, which closed when MaineGeneral’s Alfond Center for Health hospital opened last year.
“We have this huge project across the river, it’s massive and needs a huge amount of effort and time, and we need to focus on it,” Mattson said.
His firm is working on a $25 million privately funded project to redevelop the building for new uses. Mattson said MaineGeneral will lease back some space in the 317,000 square foot building, the site of a hospital for more than a century. He is also seeking other tenants.
The deal for the two-story 15 Enterprise Drive building was brokered by CBRE The Boulos Company’s Dan Greenstein and Chris Paszyc. According to a news release from the company, it sold for $14.7 million. The property was listed in the fall and marketed locally and nationally.
“The investment offering was well-received in the national marketplace,” Greenstein said in the release.
The property, on about three and a half acres in front of Mattson-developed Central Maine Commerce Center, is assessed at $7.3 million by the city, according to a city property assessment database.
Mattson said leasing instead of owning, buildings is a growing trend nationwide for hospitals.
Stein said MaineGeneral was involved in designing the building and has found it a convenient location for patients and staff, particularly because it’s less than a mile away from the new hospital.
The MaineGeneral Musculoskeletal Center houses services including orthopaedics, outpatient rehabilitation services and sports medicine.
Keith Edwards – 621-5647 firstname.lastname@example.org