Camden panel lobbies for future of Knox Mill Group may seek moratorium on land use change

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CAMDEN – Concerned that the town will become a bedroom community with no year-round employment, a community task force will consider recommending that the select board adopt a moratorium on converting commercial office space into residential uses.

The task force was created this summer when business leaders approached the board. They said they were worried about the town’s losing its economic vitality.

The issue is focused on the Knox Mill and its 100,000 square feet of offices converted from a 19th century woolen mill by credit card lender MBNA in the early 1990s.

MBNA is selling the building, and others in the area, to Maine Investment Properties, a group of investors from Baltimore.

Maine Investment Properties submitted applications last month to construct 40 condos in the large building that runs along Washington Street, and 11 condos in an annex on Mechanic Street.

Last week, the task force met with MIP’s Walter Skayhan to try to persuade him instead to seek commercial users for the buildings.

Skayhan and MIP’s Brett Cohen said Thursday in a telephone interview that they told the task force market forces made it unlikely they would find commercial tenants for the mill.

Still, former Camden Town Manager Roger Moody, who now works for Camden National Bank and is chairman of the task force, said his group is worried Camden will lose its balance of jobs, tourism and residential elements. The conversion of the Knox Mill is just part of the impetus to form the task force, though the mill property is now the group’s top concern.

If Camden loses its balance, Moody said Thursday, it will become a less desirable place to live. The mill complex is worth trying to save for commercial uses, he said.

“I would resist that as long as I reasonably could,” he said. “Our commercial properties are fairly limited.”

By at least preserving the opportunity for businesses to operate in Camden, Moody said, the town has a chance to benefit from the economic multipliers that come from people earning paychecks in town.

Moody said four members of a six-member subcommittee voted – two in favor, one opposed and one abstaining – to recommend the town adopt a moratorium on converting commercial space to residential.

Moody acknowledged that the subcommittee’s vote did not necessarily represent a strong sentiment on the part of the full task force, and the group wants to consider it carefully before proceeding.

Skayhan and Cohen said the fact that the mill had been used for commercial office space is an aberration.

“In a sense, it’s a very artificial market,” Skayhan said. Had MBNA not come to Camden and converted the mill, it would likely have become what MIP is proposing – restaurants, pubs and shops on the street level, and residential units in the upper floors, they said.

And MIP has not excluded commercial users, they said.

The buildings have been vacant for two years as MBNA has tried to lease space there. Skayhan said his company has put real estate firms in Maine, Boston and New York to work trying to find tenants, without success.

“Everybody who’s looked at this said the only thing you can do is residential,” he said.

Skayhan said he told the task force the local business community should buy the upper floors as office condominiums if they were convinced there is a market for them.

“Where are these businesses that are coming that will fill this 100,000 square feet of space?” he said.

Skayhan and Cohen also believe bringing 51 housing units to town can help the local economy. Baby-boomers retiring with disposable income, even if they spend part of the winter elsewhere, will spend a significant amount of money in town, Skayhan said.

“If you look at the shops in downtown Camden, the art shops, the tall-case clock shops,” he said, “those shops are being kept open by people who have their money elsewhere.” A call center employee will not cash his paycheck and buy a $13,000 clock, Skayhan said.

The targeted residents, in their 50s and 60s, will have their children and grandchildren visit, and will put them up in area motels and take them out to eat in area restaurants, they said.

MIP plans to spend $2.5 million building the condominiums, which will be two- and three-bedroom units, most in the 1,600- to 1,800-square-feet range, the men said.

If the task force recommends a moratorium, Cohen said, the town must show that converting the space to residential use is detrimental, a threshold it will be hard-pressed to clear, he said.

Moody admitted there may little the task force or town can do to persuade MIP to pursue another plan for the mill.

Tax increment financing incentives don’t apply because they usually provide tax breaks to pay for infrastructure, and sewer, water and three-phase electricity are available at the mill, he said. Community Development Block Grants are also not appropriate, Moody said, since they are geared to low-income residents or workers.

And the state’s new Pine Tree Zone tax incentive package is also not likely to be meaningful at the mill, he said.

“I don’t think we can offer him anything. It’s a tough sell from every side,” Moody said. Converting to residential makes sense to MIP, he admitted, because “that’s where the quick return on investment is.”

The task force will meet at 7:30 a.m. Friday, Nov. 4, in the Washington Street Conference Room to consider recommending a moratorium. The planning board will take up MIP’s application at its meeting Nov. 9.