Developers Collaborative is converting the second and third floor of 509 Forest Ave., which was once an auto dealership, into 38 units of housing. Shawn Patrick Ouellette/Staff Photographer

A local housing developer is turning a decades-old building on Portland’s Forest Avenue into new housing.

Developers Collaborative has bought a commercial building at 509 Forest Ave., which dates back to 1927, and is converting it into a mix of residential housing and first-floor commercial space.

“We’ve already torn down these crazy white pillars that somebody had built in the ’60s,” Developers Collaborative founder Kevin Bunker said. “That’s why the building looks like it got hit by a bomb right now. So we’ll be restoring the old historic storefronts … and bringing it back to what it looked like between 1925 and around 1962 or ’63.”

A historic photo of 509 Forest Avenue in Portland taken in 1961. Courtesy of Art Girard

The second and third floors will have 38 long-term rental units available for lease starting in June 2025. Ten of those units will be leased at 80% of the area median income, meeting Portland’s inclusionary zoning requirements.

Developers Collaborative is receiving a historic tax credit to restore the building, which was originally an automobile dealership, to its original appearance. The building also once housed a dance hall called Ricker Gardens for part of the 1930s and ’40s and hosted performances by Ella Fitzgerald, Frank Sinatra, Duke Ellington and Glenn Miller. It most recently served as office space for MaineHealth.

“We’re building new modern uses into an old historic brick shell,” Bunker said.

The first floor, which the company is currently renovating, will remain a commercial space, part of which is still available for lease, according to John Finnegan, a broker who is helping search for a tenant.

“We’re looking to get a tenant on the first floor, left-hand space, which is, like, a 6,300 square-foot space,” Finnegan said. “It’s gonna have excellent visibility.”

A rendering of a commercial building at 509 Forest Ave. Developers Collaborative is converting what had been an auto dealership in the 1920s into 38 units of housing and retail space and restoring the building’s exterior. Rendering from Developers Collaborative, courtesy of Kevin Bunker

Developers Collaborative also bought the nearby properties at 501, 517, 525 and 533 Forest Ave., which will remain home to several active businesses, but Bunker said he has no real plans for those buildings now except to make renovations over time.

“Those will remain businesses, but we will upgrade the buildings as we have the opportunity,” he said.

Bunker thinks the restoration will add needed character to the street.

“I think one of the reasons I’m buying this property is the idea that Forest Avenue has the potential to be a great street someday,” Bunker said. “I think Forest Ave. has this bright future if people start investing money and doing projects.”