SKOWHEGAN — Maine Grains is still looking to expand, but plans for constructing a new production facility adjacent to its downtown grist mill are off the table, at least for now.

The Skowhegan-based company now has its sights set on other properties in town, chief among them vacant building space at the Northgate Industrial Park off North Avenue.

But the company’s need to buy rather than lease the space has prompted the quasi-municipal Skowhegan Economic Development Corp. to open up a request for proposals for any interested buyers of the entire 36,000-square-foot building.

“It’s not determined yet,” said Amber Lambke, founder and CEO of Maine Grains, of her company’s plans. “SEDC is in a process to try to be fair to other tenants. And we also have to settle on what a fair price for the building is as well.”

The request for proposals for the building, which has three current tenants and 14,500 square feet of vacant space, is open through Dec. 31. 

SEDC says its board will evaluate the applicants’ offer price, intended property use, potential impacts to existing tenants, demonstrated financial capacity, alignment with Skowhegan’s economic development goals, and any contingencies, restrictions or limiting factors.

“This RFP is intended to provide a fair and transparent process for evaluating qualified purchase offers, ensuring the best long-term outcome for SEDC, the Town of Skowhegan, and the businesses occupying the facility,” the posting says.

More information is available at skowhegan.org. 

Lambke, who opened Maine Grains in the former Somerset County Jail in 2012, said last summer her business scrapped plans for a major expansion next to its current facility at 42 Court St., the site of the former Kennebec Valley Inn, and began looking at other properties.

Lambke bought the Court Street lot in 2020 through another company, Land & Furrow LLC, after the hotel was demolished in 2018.

Plans for the site have evolved several times since then. In December 2024, Maine Grains announced plans for an 80,000-square-foot building that would house a new equipment line to produce grain-based foods and other items. The company currently sells only raw ingredients.

Site plans at the time also included a 13,000-square-foot farmers market pavilion; the local farmers market is currently held at the lot during summer months.

But the reality of financing a major construction project in a post-pandemic economy, compounded by recently imposed tariffs on products like steel, led to the recent change in course, said Lambke, who has also served on the Skowhegan select board since June 2024.

“While we hoped to build a new building on the new site, the quandary that we face in rural Maine and many other places is that our (property) valuations are so low here that a new building will cost three times as much to build as it will be valued at the day it’s built,” Lambke said. “That makes it very difficult to finance new construction in rural areas like this.”

Lambke’s predicament was featured in a 2023 Wall Street Journal story, which in its headline dubbed it as “the math problem stymieing small businesses in rural America.”

The story in one of the most widely distributed national newspapers in the country referenced an appraiser’s conclusion that a planned building, at the time, would have cost $7.4 million to construct but would be worth only $2.4 million when complete.

The idea for the Northgate site — or any other property Maine Grains pursues — is still to house the new production machinery, technically known as a precision single screw extruder. Lambke said that kind of equipment is not available on the East Coast and other businesses are interested in collaborating with Maine Grains.

When up and running, Lambke expects the new facility to employ 15 people. Maine Grains employs 20 people at the grist mill, and the associated Skowhegan restaurants, The Biergarten and The Miller’s Table, employ 42 more, according to Lambke.

The new extrusion equipment is being manufactured in Germany; Lambke said it is expected to be shipped in January.

She has told the board the cost of the equipment was $1.4 million but she anticipates a cost of about $1.6 million to fit up to the Northgate space to meet certain requirements for producing food.

Lambke said the project has been supported by several grants.

“That financing will be difficult to procure, unless we own this space,” Lambke said. “Arguably, the fit up is more expensive than what the building is valued at.”

Bryan Belliveau, Skowhegan’s director of economic and community development, said via email that SEDC only began considering a sale once Lambke made an initial offer to buy the Northgate building. The previous tenant, Douglas Dynamics, left the now-vacant space in September.

The lot with the building is assessed at $975,000, according to Belliveau. He said SEDC hired a firm to give a broker’s opinion of both market value and income-based value but declined to share the report because of the open request for proposals.

The Northgate subdivision was created in 1975, Belliveau said. The lot with the building is the only one that SEDC currently owns in the park.

The original 18,000-square-foot building was constructed shortly after the park was created, he said. An additional 18,000-square-feet was added in 1999.