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Record number of Maine real estate leaders gather to sort through mixed signals; MEREDA Index unveiled

Annual conference drew more than 650 from Maine's real estate, construction, finance, architecture, legal, engineering, tourism, and economic development communities

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PORTLAND, Maine (January 24, 2013) – The Maine Real Estate & Development Association (MEREDA) hosted its annual Real Estate Forecast Conference and Member Showcase today in Portland.  The crowd was standing room only and broke attendance records, with more than 650 professionals from Maine’s real estate industry attending, included brokers, architects, developers, engineers, bankers, and economic development professionals.  The day-long event featured nine presentations, many of which provided a forecast of a particular segment of the industry, plus the unveiling of the “MEREDA Index,” and a keynote from a representative from Maine’s Department of Economic and Community Development (DECD).

PORTLAND, Maine (January 24, 2013) – The Maine Real Estate & Development Association (MEREDA) hosted its annual Real Estate Forecast Conference and Member Showcase today in Portland.  The crowd was standing room only and broke attendance records, with more than 650 professionals from Maine’s real estate industry attending, included brokers, architects, developers, engineers, bankers, and economic development professionals.  The day-long event featured nine presentations, many of which provided a forecast of a particular segment of the industry, plus the unveiling of the “MEREDA Index,” and a keynote from a representative from Maine’s Department of Economic and Community Development (DECD).

MEREDA’s board president, Drew Sigfridson of CBRE | The Boulos Company, welcomed attendees, the vast majority of whom expressed optimism about Maine’s real estate economy in an informal show of hands.  In fact, throughout the day, realtors, lenders, developers, and others chatted informally with one another, sharing anecdotes about how business for them has been on the uptick.  But, there are “confusing messages out there as to whether Maine is headed to a real estate rebound or not,” noted Sigfridson.  “That is why, today, we are unveiling the MEREDA Index, which will be an important indicator of Maine’s real estate economy, and an important barometer of confidence in the market,” he said.

As a new addition for this annual event, MEREDA partnered with Dr. Charles Colgan, a well-known Maine economist from USM’s Edmund S. Muskie School of Public Service.  Today, Colgan unveiled what has been coined the “MEREDA Index,” a new metric Colgan developed to illustrate the statistical changes and measure the pulse of the real estate industry in Maine, including sale and lease activity, construction starts and other data – aggregated into one figure as an indicator of this important sector of Maine’s economy.

“The MEREDA Index shows that the real estate industry has already hit bottom, and has leveled out,” noted Sigfridson.

Colgan spoke with caution, noting that current benchmark figures which would typically indicate growth in the real estate economy are on the rise, but still at lows compared to height of the 2006 economy.  This includes construction employment, housing permit applications, median home prices, sales of existing homes, and commercial sales.  “Housing sales are increasing, but barely,” said Colgan.

“We have definitely seen more activity and more people interested in doing something,” noted Sigfridson.  “The MEREDA Index notes a steady uptick in activity from the bottom of the recession, which would indicate that now is the time to get into the market if possible.”

Brian Whitney of DECD joined the conversation, serving as event keynote.  He acknowledged the importance of the real estate industry in Maine, and offered DECD’s assistance to all of those in attendance, as they work to put together deals and/or navigate the bureaucracy.

Also stepping to the podium were leading experts from across Maine, who offered forecasts of what lies ahead for particular segments of Maine’s real estate economy, including projections by region and key market sectors, including office, retail, industrial, residential, and multi-family properties.  Many of these industry-insiders seemed to agree with the MEREDA Index’s assessment: the real estate economy is improving, slowly.

“The savvy investor is taking advantage of the here and now,” said Harper Lee Collins of RE-MAX Heritage.  Collins noted that the last three months ending in November saw an 18.64% uptick in single-family sales as compared to 2011 and a median price increase by about 4%, with particular gains in price in Sagadahoc and Lincoln counties, and in the municipalities of Auburn and Bath, with losses in Knox, Kennebec, and Cumberland counties, and the municipalities of Brunswick and Bethel.  “It’s time for folks to get off the fence,” noted Collins, pointing out low interest rates and low pricing. 

In his forecast of multi-family properties, Brit Vitalius of Vitalius Real Estate Group noted that “low interest rates and strong rents attract buyers to the Portland area,” but that “inventory is down in all markets” as the buyer pool increases substantially, especially as young, owner occupants compete with one another to scoop up two-, three-, and four-unit properties.

It was perhaps Mark Malone who said it best, noting that it has been a “year of mixed signals and messages” for their industry.  He reported that commercial vacancy rates have slowly decreased from the highs of 2009.  Malone noted that, in the grocery market, competition between Market Basket, Super WalMart, various dollar stores, Shaw’s (under new ownership), and smaller boutique markets has heated up.  Additionally, Malone pointed out the increased development of gyms and other fitness facilities, and projected “slow but steady new construction gains in prime markets.” 

Attendees at today’s MEREDA event seemed optimistic, continually noting great financing options and competitive pricing, both in residential and commercial real estate.  “The future is now,” said Malone.  And, based on anecdotal trends and the small statistical upticks as displayed in the MEREDA Index, he might be right.

About the Maine Real Estate & Development Association

The Maine Real Estate & Development Association (MEREDA) is a nonprofit entity whose members banded together in 1985 to present the views of the state’s real estate industry to lawmakers in Augusta. MEREDA’s mission is the same today as it was at its founding: to promote fair and responsible development and ownership of real estate throughout the State of Maine. MEREDA’s more than 200 members firms employ thousands of Maine citizens and drive a huge percentage of Maine’s economic activity. 

The Forecast Conference & Member Showcase

MEREDA’s annual Forecast Conference is a unique Maine event.  In 2013, more than 645 of the state’s developers, brokers, architects, bankers, attorneys, accountants, builders, managers, engineers, consultants, appraisers, suppliers, community development advocates, housing authorities, municipal officials, and other industry professionals have gathered to learn more about the future of Maine’s real estate industry.

The MEREDA Index

New in 2013, MEREDA partnered with renowned Maine economist Dr. Charles Colgan of USM’s Edmund S. Muskie School of Public Service.  Today, Colgan unveiled the new “MEREDA Index,” a metric which will illustrate the statistical changes and measure the pulse of the commercial real estate industry in Maine, including sale and lease activity, construction starts and other data – for the first time ever, aggregated into one figure as an indicator of this important sector of Maine’s economy.  

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