BANGOR – The latest shuffle to affect the city’s downtown business sector will bring Eastern Maine Development Corp. and its affiliates to the Harlow Street building known as Norumbega Hall, EMDC announced Monday.

The historic three-story brick structure – tucked between Central and State streets overlooking the Kenduskeag Stream – now houses the University of Maine Museum of Art and the Hammond Street Senior Fitness Center.

Many, however, feel Norumbega Hall has been vastly underused during its 91-year history and EMDC President and Chief Executive Officer Jonathan Daniels said he hopes to change that.

“We’re starting to see a bit of a renaissance in the move back into downtown,” Daniels said recently. “We really want to create a one-stop shop for economic development in the region, and this allows us the opportunity to do that.”

EMDC has been serving small businesses in six eastern Maine counties (Hancock, Knox, Penobscot, Piscataquis, Waldo and Washington) since 1967 in areas such as project financing, marketing, manufacturing, government contracting and downtown development. Its funding comes from the federal and state level and also from private donations.

The nonprofit has been at its current location in One Cumberland Place for 15 years, but its lease there ran out in May 2004. Daniels has been looking for other options since. He said he looked at roughly a dozen buildings in Greater Bangor and even considered staying put, but the Harlow Street location proved to be the best fit.

“We didn’t necessarily want to move, but we had to look at not only our space needs but also the financial considerations associated with a potential move,” Daniels said.

The move has been the subject of rumors for some time and has been held up pending an environmental assessment conducted by the U.S. Department of Agriculture’s Rural Development office.

Concerns had surfaced over the building’s location within the city’s 100-year flood plain. The Maine Historic Preservation Office expressed reservations that planned renovations would interfere with the historic integrity of the structure.

Those concerns were laid to rest Monday when Daniels announced EMDC’s purchase of Norumbega Hall from the Couri Foundation, a Connecticut-based nonprofit that has owned the building since 2000.

Daniels did not release the sale price, but the building is assessed at $1.1 million by the city. Daniels said another $500,000 is planned for renovations, but he noted the move was still the most cost-efficient option for EMDC.

The project is being funded locally through a loan by Bar Harbor Bank & Trust that is secured through an 80 percent federal guarantee from the USDA’s Rural Development office.

Much of the cost of renovations will cover improvements to ceilings, new lighting, and electrical wiring and fire protection upgrades, all of which Daniels considered basic repairs to an aging building.

“The renovations are needed, but we still want to maintain the integrity of the space – that’s part of the charm of the structure,” he said.

When all is said and done, the overall costs won’t change dramatically for EMDC, but instead of leasing space in One Cumberland Place, the company will own Norumbega Hall. And because the building changed hands through a private sale between two nonprofit groups, the building will not be listed on the city’s tax roll, which will save EMDC even more.

“This is a nice move for EMDC, and it should also bode well for the businesses that are already there,” Bangor Code Enforcement Officer Dan Wellington said. “You’ve got a lot of employees moving to the area, many of whom have some disposable income.”

WBRC Architects & Engineers is working with EMDC, and the project is in the schematic stage. Renovations are slated to begin in mid-June. If all goes well, EMDC could be moved in by November. Daniels said the extra time should make the transition easier on his employees.

“It’s hard enough to move a family; we’re picking up and moving 50 people,” he said. “The employees really have been great amid all the speculation.”

Who’s in, who’s out

EMDC’s move is the latest of many developments that will affect the downtown, including the impending arrival of more than 100 employees of the University of Maine System to the W.T. Grant Building and the movement of Penobscot County Superior Court and 3rd District Court from Hammond Street to a lot on Exchange Street.

The University of Maine Museum of Art, which moved to downtown Bangor in 2002, is located on the first floor of Norumbega Hall, and that won’t change.

“Part of the agreement [with the museum] is that we would take on and honor the lease they signed with the Couri Foundation,” Daniels said.

The museum’s lease runs through 2006, and it will have the option to sign another five-year lease. Museum Director Wally Mason said not much will change for him, and he sees only positives with EMDC’s move.

“It’s going to affect us in the most positive ways, especially with the amount of traffic EMDC brings through the doors,” Mason said. “It’s great for us; we’re thrilled.”

EMDC will move its offices into the roughly 20,000 square feet on the second and third floors, to include the ballroom, bringing with it several groups that already share space with EMDC.

The Maine International Trade Center, the Department of Economic and Community Development, the Small Business Administration, the Greater Bangor Convention and Visitors Bureau and others are all on board for the move.

“These are all separate entities, but they will be able to continue to share our resources and clients will be able to meet with many groups that are all in the same place,” Daniels said.

Additionally, the American Folk Festival staff and Orono-based Intelligent Spatial Technologies have agreed in principle to house office space within Norumbega Hall.

The American Folk Festival sprung up a year ago on the heels of the success of the National Folk Festival’s three-year run on Bangor’s waterfront and is responsible for the now annual event that draws thousands to the banks of the Penobscot River.

Festival Director Heather McCarthy has been working out of a small office on Main Street near Sweet’s Market and said the move will give much-needed visibility to her organization.

“EMDC has been a producing partner in the Folk Festival since day one, so it made sense to offer us space,” McCarthy said. “In the big picture, we’re all looking for the same thing.”

IST, which started at the Target Technology Incubator at the University of Maine, is ready to graduate into new space. When Daniels approached IST founder Chris Frank about a possible move to downtown Bangor, Frank didn’t hesitate.

“That’s what kept me here,” said Frank, who lives in Orono with his wife and infant son. “I see so much potential in Bangor, I don’t understand why some of the buildings have been vacant for so long.”

Only one tenant, the Hammond Street Senior Fitness Center, will be displaced by EMDC’s move, and even it has no complaints.

“We are so for this,” said Kathy Bernier, executive director of the fitness center. “Truly the building has been underused, and this is ideal for downtown Bangor. The seniors are very supportive of this.”

How it went down

Norumbega Hall has deep roots in Bangor’s history since it was built in 1914 after the Great Fire of 1911 wiped out most of the city’s downtown. For many years, the building housed a bowling alley and an indoor roller-skating rink. The top floor was home to the majestic Chateau Ballroom, a popular gathering place.

In the 1930s, Sears-Roebuck Co. moved in, where it stayed until 1978, when it relocated to the Bangor Mall. Since 1978, the building has been vastly underused. Bob and Betsy Duerr bought the building in the early 1990s and began renovations, but Norumbega Hall remained largely empty.

When the Couri Foundation bought the building in 2000 and facilitated a deal to bring the University of Maine Museum of Art to Norumbega Hall in 2002, things started to change. Daniels praised John Couri for harnessing potential in the building that had gone unnoticed for years.

“One of the reasons why this move is so feasible for us is really the generosity of the Couri Foundation,” Daniels said. “[John Couri] has been active in this process, and that’s rare in this age of developers. He certainly could have got more money [for the building] than he got out of us.”

The building’s location within the city’s flood plain was a concern.

“It doesn’t necessarily mean it will flood there, but the risks are there, and they are real,” Wellington said. “There is essentially a 1 percent chance of flooding each year, or a 28 percent chance over the life of a 30-year mortgage.”

The last flood downtown was in 1987 and before that 1976. Neither caused significant damage to Norumbega Hall, but Daniels acknowledged the potential risk.

“Anytime you take on a building of this magnitude, you have to take into account the risks,” he said. “We have not had any environmental concerns yet, but anything can come up at any time.”

The Maine Historic Preservation Office also expressed concern but signed off on the project after it was convinced that renovations to Norumbega Hall would be concentrated to the building’s interior, thus preserving its history.

Now that the project has been given the green light, the project’s engineer is eager to get the ball rolling and said renovating a building with such a great history will be a good challenge.

“The building has a lot of integrity, and we want to leave as much of that exposed as possible.” Mike Pullen of WBRC Architects & Engineers said. “Things have gone pretty smoothly. … EMDC has been very thorough.”

Daniels said he’s happy to turn the rumors into reality.

“We’re excited; this is what we’re looking for,” Daniels said. “We can go anywhere where there’s a Wal-Mart or a mall, but we wanted the chance to be a part of the downtown history.”