Green power lures tenants

Portland Press Herald
January 4, 2008

Businesses wanting to practice what they preach lease an
environmentally friendly home.

By MATT WICKENHEISER, Staff Writer

YARMOUTH — The Sparhawk Mill is attractive in many obvious
ways: The 150-plus-year-old building is classic red-brick New
England, boasts well-worn wooden architecture inside and is
framed by the picturesque Royal River.

But the factor that appeals to many tenants of the refurbished
mill lies in the building's bowels. The river's power has been
harnessed and drives turbines, generating environmentally
friendly electricity for tenants, with excess power sold to the
regional grid.

This aspect of the building has been an attraction to businesses
and individuals who care about reducing their environmental
impact. The building has eight tenants, including a glass-
blowing studio, marketing and telemarketing businesses, a
medical acupuncturist's office and a workout studio.

While operational paper mills generate their own power through
hydro systems, it's unusual for a renovated mill to use the
technology.

The owners of Sparhawk, which is not yet profitable, hope that
their ability to offer green power continues to build interest in
the mill at a time when there is growing focus on energy
conservation and environmental concerns in general. LEED-
certified buildings are becoming more common, and businesses
and even municipalities around the state are exploring
alternative power generation, often in the form of wind power.

Sparhawk was a good fit for Steve Darnley, owner of Tugboat
Creative, a firm that does marketing and branding for socially
and environmentally responsible businesses.

"All the infrastructure was here in the mill -- they already had
water running under the building," said Darnley. "Just to be able
to work into a space that was turnkey green power was an no-
brainer."

For Darnley and other tenants, the environmental nature of the
building they inhabit speaks to the type of business they're in.

"To me, it sort of underscores, it strengthens, what clients and
the public already know about my brand," said Darnley, who
bought carbon offsets when his move from Portland to
Yarmouth increased his commute. "It was a logical step in the
growth of my business to be able to do things that are more
sustainable, to walk the walk."

The mill also made sense for Dr. Lisa Belisle, who practices
medical acupuncture and integrative health. Belisle said she
works with patients to try to find joy in their lives and to practice
sustainablity.

In her office at Sparhawk, the sound of the Royal River is
everywhere, creating a peaceful atmosphere. Belisle, who also
writes on sustainablity issues, also sees her tenancy in the
green-powered mill as an unobtrusive example to other people.

"I was looking for a way to practice what I preach," she said.

Darnley said that although the green aspect of the building is
cool, he's careful not to over-leverage it with potential clients.
Going green is a very popular thing right now and can be over-
hyped, he said.

"I would have had green power if it was trendy or not," said
Darnley. "Myself, my clients, we're all doing it because it's the
right thing to do first ... and then it's really cool and there's an
economic savings."

Sparhawk Mill Associates LLC bought the 2.5-acre property in
July 2006 for $1.5 million, according to Daniel Coyne of Coyne
Commercial Brokers, who is one of three partners in the
Sparhawk.

When Coyne and his partners considered buying the property,
the power-generation aspect was a positive, he said.

"We felt it's really important to people now, more and more,"
said Coyne. "We're leaving really a negative footprint."

There are three 100-horsepower turbines that have a capacity of
270 kilowatts apiece. Most years, the turbines can run for all but
about eight weeks, due to low flow.

The annual typical output is 850,000 kilowatt hours. A bit more
than half goes to the grid, the remaining to the tenants.

Coyne said he's taken some prospective tenants down to see the
turbines, a bone-chilling space where water pours out of three
pipes to reconnect with the Royal River.

"They love it -- they just think it's very interesting," said Coyne.
"They don't want to have their offices down here ... "

The mill is warmed with electrical heat -- something that would
be prohibitively expensive in many buildings.

"Where we're running our own power, it makes sense," said
Coyne.

The space in the mill goes for $8 to $16 a square foot, and the
tenants don't have to worry about electric or heat costs.

Justin Lamontagne, an assistant broker with CB Richard Ellis/The
Boulos Co., said Sparhawk's lease figures appear to be
competitive when compared with similar properties, such as The
Lafayette Center in Kennebunk, Fort Andross in Brunswick and
Saco Island in Saco.

Each was a manufacturing mill that was converted into office and
retail space, and their lease rates range from $10 to $18 a
square foot, depending on the size, location and condition of
the space.

But the power and heat-generation aspect of Sparhawk is a big
factor as well, Lamontagne noted, "and not just because of the
potential savings in utility costs."

"More and more, potential tenants are attracted to 'green'
buildings and office spaces, so any environmentally friendly
resource that conserves energy and reduces waste is a fantastic
perk," said Lamontagne. "Many new, progressive tenants would
find the Sparhawk Mill's hydroelectricity capability extremely
appealing."

Coyne said 14,000 square feet of the 24,000-square-foot mill is
occupied. Sparhawk is in talks with several potential tenants,
and if they move in, the property will be profitable for Coyne and
his partners.

Coyne said Sparhawk Associates would like to add a residential
component to the mill, possibly converting the top floor to
condos, or even adding a new building to the property. But the
site is zoned commercial, so a change would have to be made
through the town.

One of the biggest tenants at Sparhawk is GrowSmart Maine, a
group that seeks to build sustainable prosperity through better
land use and more efficient government. They business has been
there for four years, according to founder Alan Caron.

"We're committed to rebuilding downtowns, reusing buildings,"
said Caron. "It was perfect for us."

Caron said a legislative push to increase the historic tax credits
for redevelopment might help the reuse of more buildings like
the Sparhawk mill.

Beth Nagusky, GrowSmart's energy and climate director and the
former director of Maine's Office of Energy Independence and
Security, said she saw growing interest among individuals and
businesses "to produce their own renewable energy or to buy
renewable energy, or offsets to reduce their carbon footprints."

"I think it's going to lead to a policy discussion at the
Legislature," she said.

In particular, she said there is a push afoot to change laws so
that smaller power producers, such as homeowners with solar
panels or a windmill, get paid for the excess energy they put on
the grid. That would speed up the financial recovery of
investment in renewable energy technology and hopefully spur
more interest.

Nagusky noted that many of Maine's towns grew around mills
situated on rivers for power.

"This is going back to the future, with hydro, solar, wind and
hopefully tidal," she said.

Staff Writer Matt Wickenheiser can be contacted at 791-6316 or
at:

mwickenheiser@pressherald.com

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