WEX, a financial technology services company that is the second-largest public company in Maine, plans to pull up stakes in South Portland by 2022.
The $1.7 billion company, which has 1,000 employees in six buildings in South Portland and 4,900 workers worldwide, said Thursday that it plans to relocate its remaining South Portland operations to a 200,000-square-foot employment center at The Downs in Scarborough by spring 2022.
The company last year moved its headquarters to downtown Portland, and plans to move more employees to a second location behind that building this September, a company spokesman said. Those two buildings can accommodate a total of 1,000 employees.
The new Scarborough location can hold 1,200 workers. WEX plans to break ground in 2020 with employees expected to move in by the spring of 2022.
That will leave South Portland without one of its largest businesses and with six empty buildings to fill. WEX leases all of its space.
South Portland also is home to large companies including ON Semiconductor, Texas Instruments and Dead River Co.
“We would have liked to have kept WEX in South Portland,” said William Mann, South Portland’s economic development director. “We know there were a couple of developers who made proposals to do that. WEX looked in a number of communities and with a number of developers. They chose Scarborough for their own business reasons. We’re thankful they’re staying in the region.”
One large employer leaving a city with a population of 25,000 can make a big difference.
Mann said that while the commercial office vacancy rate in South Portland is low at about 5 percent, it had been less than 1 percent before WEX moved its headquarters to Portland last year.
He said South Portland officials are working with WEX and the landlords of the buildings to find new tenants, and they’ve had interest.
“We’re optimistic we’ll fill them relatively soon,” he said. “We’ve had inquiries.”
WEX spokesman Robert Gould said he expects the landlords will have no problem leasing the buildings when WEX moves.
“A primary reason for the new Scarborough building is to give us room to continue to grow,” Gould said. “We are regularly adding new call center and service center positions and this is likely to continue.”
He said it is not clear how many employees will move to Scarborough initially when the building is completed in the spring of 2022 nor how many may be hired.
The Downs in Scarborough, where the new center will be located, is the site of the Scarborough Downs horse-racing track. Scarborough Downs had struggled financially before its owner sold it in January 2018 to Crossroads Holdings LLC, a Scarborough-based development company.
WEX CEO Melissa Smith said she wants to grow the company with a consolidated work environment and modern collaborative spaces.
“This will be a place we can more seamlessly expand our workforce in Maine as the company continues to grow,” she said.
Roccy Risbara, principal at Crossroads, said the WEX move will have a positive effect on the local economy.
The 525-acre Downs development project is a mixed-use community in the geographic center of Scarborough. The property will have new businesses, housing, recreation and entertainment venues and a walkable town center. The master plan also preserves 200 acres of greenspace and creates 10 miles of new recreational trails.
The Downs was one of several communities vying for WEX to locate there, said Safet Cobaj, WEX’s vice president of global real estate. The company issued a regional request for proposals. Applicants were considered in three major categories: an accessible location near major highways, a campus setting with on-site amenities and expandability for future planned growth.
“The Downs surpassed all criteria and we were quite impressed with the master plan and offerings,” Cobaj said. “This location will be an asset for WEX when attracting a strong and talented workforce.”