The decreasing number of available industrial, retail and office spaces in Bangor have slowed economic development in the city, according to local commercial real estate brokers.
Carol Epstein, president of Epstein Commercial Real Estate in Bangor, said vacancy rates for the city’s office, retail and industrial spaces have been “in the single digits” for a few years, with industrial properties having the lowest vacancy.
“The market has tightened over the last five years,” Epstein. “When is that going to shift? I don’t know. But we’ve seen them going down, not coming up.”
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, according to Epstein Commercial Real Estate data.
The few commercial properties available limit existing businesses’ ability to expand and new companies coming to Bangor. The issue mirrors Bangor’s years-long housing shortage, which is driven by the city’s lack of available, affordable and quality housing. Together, those contribute to other challenges, including rising homelessness and a stagnant population.
Bev Uhlenhake, managing broker at Maine Commercial Realty in Bangor, said she “regularly” speaks with businesses that are interested in expanding, but there isn’t space available that meets their needs. Building is also too expensive, so businesses stay where they are.
“If small businesses want to grow, Bangor isn’t really the place where that can happen,” Uhlenhake said. “That’s something we really need to pay attention to.”
The limited number of available properties stems from the fact that commercial developers in Bangor generally build for a specific tenant or use in mind, Uhlenhake, said.
“We’re in a market that hasn’t been overbuilt,” Epstein said. “There hasn’t been a lot of speculation, so our inventory hasn’t been increasing.”
To further complicate things, Epstein said Bangor’s relatively low demand for new commercial properties means they aren’t built frequently, leading to higher prices and difficulty finding the right space.
However, Uhlenhake said that shouldn’t be a sign for developers to overbuild commercial buildings that aren’t needed and that the commercial market will likely level out with time.
“Should developers come to Bangor and do something different? Yes,” Uhlenhake said. “But it should still be thoughtful.”
While the vacancy rate for industrial, office and retail spaces has been in the single digits for the past few years, Epstein said there are outliers to this trend. The Bangor Mall, for example, is full of empty storefronts while the surrounding retail area is bustling with activity.
Nationwide, malls have been falling out of favor as retailers that would’ve once opened in enclosed malls are opting for strip mall properties, Epstein said.
In Bangor, Epstein pointed to stores such as Sleep Number and Ulta Beauty opening in strip mall developments on Stillwater Avenue rather than the Bangor Mall.
Department stores like JCPenney and Sears that once anchored malls across the country have faded in popularity, Epstein said. That’s led medium-sized businesses that relied on those stores to draw shoppers to leave, he said.
