WATERVILLE — The company that owns Hathaway Creative Center on Water Street has bought the two adjacent former mill buildings for $1.5 million and plans to develop them with commercial and retail uses on the first two floors and living spaces on upper floors.

North River Company announced its purchase of the former Lockwood mill buildings Tuesday in a press release.

“The bustling redevelopment activity in downtown Waterville created an opportune environment in which to leverage our investments in Hathaway Creative Center to realize the potential of putting the entire Lockwood Mills complex back together,” Christopher Flagg, president of North River, said in the release. “We are excited to breathe new life into these historic buildings and welcome residents and visitors to shop, eat, work, recreate and live alongside the beautiful Kennebec River in downtown Waterville.”

Construction to redevelop the buildings is expected to start in the fall of 2020. The Waterville Planning Board will consider preliminary plans for the project on July 1, next month.

The northernmost mill building, owned by Hathaway Holdings III LLC, was used by Marden’s Surplus & Salvage after the C.F. Hathaway & Co. shirt factory closed. The middle building, owned by Hathaway Holdings II LLC, was used by Central Maine Power Co. Paul Boghossian, who owned both Hathaway Holding companies, also previously owned the Hathaway Creative Center.

Waterville City Manager Michael Roy, who credits Boghossian for launching the start of downtown revitalization with his redevelopment of the Hathaway building, said Tuesday that the purchase of the two additional mills represents a significant investment.

“One of the things that has meant so much to me in my time in the city is being able to drive past the Hathaway building at night and see the lights on,” Roy said. “And so now, I have hope that in the not-too-distant-future, we’ll be able to see the same thing with CMP and Marden’s — that those two buildings will come back into use, maybe a different use than they once had but, eventually, a use that is going to complement what is going on not only in downtown but in the city as a whole.”

Boghossian said in a phone interview Monday that he is excited about North River’s purchase.

Tuesday it was announced that the two former Lockwood Mill buildings in Waterville, beside the Hathaway Center at far right, have been sold and will be renovated into commercial and residential properties. Morning Sentinel photo by David Leaming

“It’s been a really nice run in Waterville. I feel real good about where the city is right now and where it was when we started,” Boghossian said. “Things are really, really looking up, and I think this group will do a really good job with the buildings. The Hathaway’s full, and this is the next step.”

Boghossian, who divides his time between Rhode Island, Florida and Maine, said that when he decided to redevelop the Hathaway building, many people did not think there was a market for nice apartments in Waterville, but that proved not to be the case.

“The market was completely underestimated, and we’ve shown that if there’s a nice product, people will buy it,” he said.

The two recently-purchased buildings contain about 182,000 square feet of space in total and sit on about 3.27 acres. The entire mill complex, including Hathaway Creative Center, is 412,000 square feet and overlooks the Kennebec River.

North River bought the Hathaway Creative Center from Boghossian in 2017 for $20 million. Investments by Colby College and other entities in the last few years downtown represent a total of $100 million.

Garvan Donegan, director of planning and economic development for the Central Maine Growth Council, has been working closely with North River on the project. He says the future mix of retail, commercial and residential space in the newly-acquired buildings will be similar to that of the Hathaway Creative Center. Such a mix is key to strategic economic development, he said.

“This is going to have such a real, profound effect for downtown and the city and region,” Donegan said Monday in a phone conversation. “It’s very exciting, and the team is the right one to develop it.”

“The Hathaway Creative Center plays an important role in Waterville’s emergence as a health care, technology and knowledge-based hub,” according to the news release, developed by North River and the Central Maine Growth Council and issued by the Growth Council.

“The initial home of CGI, a global information technology firm now located at 173 Main St. in Waterville, Hathaway Creative Center currently houses MaineGeneral Health, the biotechnology laboratory of GenoTyping Center of America, as well as BricksCoworking & Innovation Space, a shared workspace with technology-related programming including Central Maine Tech Night, Central Maine Programmers Group, and Summer Startup. The purchase of the additional Lockwood Mills buildings further positions the city for downtown growth.”

The release says that, “as illustrated by the spectacular success with the redevelopment of Hathaway Creative Center, the North River Company team is highly adept at identifying, attracting and meeting the needs of high-growth industries, which will sustain high-skilled jobs and further revitalize the downtown district and the mid-Maine economy.

“Alongside the opportunities for industry growth, the purchase of the Lockwood Mills buildings represents the reinvigoration of Waterville’s riverside assets as the city returns to the river to enhance its quality of life. Joining projects including the $9.2-million BUILD initiative and award from the United States Department of Transportation to further support the revitalization by funding improvements of roadways, sidewalks, intersections and public green spaces, RiverWalk at Head of Falls, and the Head of Falls request for qualifications (RFQ), the redevelopment of the mill complex will enhance access to Waterville’s natural beauty and provides culinary, recreational, residential and retail amenities to enjoy alongside the river.”

Drew Sigfridson, managing director and partner for The Boulos Company, said a key component to the success of the redevelopment effort will be the attraction of commercial companies and retail uses to occupy the first two floors of the two mill buildings.

“We want to more fully integrate the commercial district of downtown Waterville with the riverfront mills and look forward to marketing these facilities to attract the right tenant mix into this area,” Sigfridson said. “The Boulos Company is pleased to have assisted North River with the acquisition of properties in Waterville and Portland, Maine, over the years and looks forward to playing a part in the transformation of these historic mills in downtown Waterville.”

North River Hathaway is part of Waterfront Maine, a New York-based real estate development firm which bought the Hathaway Creative Center from Hathaway Mill PO LLC in February 2017 for $20 million. North River owns the Brunswick mill, known as the Fort Andross Mill, as well as other mills in Portland, Boston and New York. Fort Andross Mill formerly was known as Cabot Mill.

The former C.F. Hathaway & Co. shirt factory was renovated by Boghossian several years ago and transformed into retail offices with 67 high-end apartments on the upper floors.

In the late 1800s, the mill manufactured cotton, and starting in 1881, Hathaway made shirts in the building. The business closed in 2003. Boghossian later redeveloped the building for about $30 million.

The northernmost mill building has been somewhat of an eyesore the last few years, with broken and boarded up windows and birds flying inside.