Two years after Maine’s first Costco opened in Scarborough, a study shows the membership warehouse store is driving nearly 2 million shoppers annually to nearby businesses.
The developers of The Downs, a 577-acre mixed-use community where Costco is located, sought information about the store’s impact on regional commerce as they continue to market available and planned retail space, particularly in the project’s town center.
“There’s tremendous excitement and interest, but also a lot of questions because it’s an emerging retail center,” said Dan Bacon, development director for M&R Development. “Costco took this area of Scarborough to a new level as a retail destination.”
Using Placer.ai, a location analytics platform that mines online data to track shoppers, the developers learned that 1.8 million visits to Costco immediately followed or led to stops at nearly 1,000 different businesses in Scarborough.
The numbers were gathered during Costco’s second year at The Downs, from Nov. 1, 2024, through Oct. 31; Costco tallied 1.6 million customer visits during its first year in Maine, from November 2023 through October 2024, the developers said.
Placer.ai found that Costco customers drove an average of 40 minutes from their homes to get to the store, which regularly drew shoppers from as far away as Kittery and Brunswick. They shopped an average of 45 minutes and spent an average of $84 at the warehouse store off Payne Road, the developers said.
Other major retailers that Costco shoppers patronized before or after they visited the store included Homegoods, Marshalls, PetSmart and Lowe’s in the Scarborough Gallery, near The Maine Mall in South Portland.
Closer to The Downs, Costco shoppers also visited Sea Dog Brewing, Portland Pie and Cabela’s at The Gateway Shoppes off Payne Road and Exit 42 of the Maine Turnpike. Other local businesses visited by Costco shoppers included Oak Hill Ace Hardware, Oak Hill Beverage, The Dairy Corner, On the Vine, Len Libby, Dunstan Tap & Table and Flaherty’s Family Farm.
Costco’s perceived boost to local commerce has quelled initial concerns that it would hurt nearby businesses, Bacon said.
LOCALS NOTICE ‘INCREASED BUSINESS’
Founded 84 years ago, Flaherty’s farm store has seen an uptick in customers since Costco opened.
“We are certainly seeing a lot of new faces at the farm, which is wonderful for a family-owned business,” said Cindy Flaherty. “The upside of having new development in town is the increased business.”
It’s tough to know exactly what drives people to a business, said Jen Breneman, owner of Dunstan Tap & Table.
“One day it could be the weather and the next it could be a big game,” Breneman said. “But it is very cool that so many new people are dining with us thanks to Costco being in town.”
Beyond Scarborough, shoppers also stopped at a variety of stores, restaurants and other businesses throughout southern Maine immediately before or after visiting Costco, Placer.ai found. A broader sweep showed they engaged in recent commercial activity from Kittery to Bangor, into New Hampshire and Massachusetts, and places such as Hadlock Field, Portland International Jetport and Amtrak Downeaster train stations.
The Costco impact analysis highlights the deep connection between Maine’s large and small businesses, said Quincy Hentzel, president and CEO of the Portland Regional Chamber of Commerce.
“Small businesses make up the vast majority of our economy and workforce,” Hentzel said. “But large employers play a crucial role as well, by attracting people to a region and creating a ripple effect that benefits smaller enterprises across the community.”
The Downs developers have hired Tom Wilder, a national leasing agent and retail strategist, to curate the right mix of local, regional and national retailers in the town center. That’s where Maine’s third Market Basket is under construction and expected to open a year from now.
“Costco and Cabela’s are already attracting strong traffic,” Wilder said, “and with Market Basket set to open in 2026, there is strong momentum to continue driving millions to the region.”
BUILDING ON ‘STRONG MOMENTUM’
A 60,000-square-foot InterMed building also is going up in the town center, and the developers are in talks with prospective tenants for a 46,000-square-foot retail space next to Market Basket, Bacon said.
Since 2018, The Downs developers have built 700 housing units off Route 1, including apartments, condos and single-family homes, with about 1,100 residents. Cross Street Condominiums, 96 luxury units near the town center, are listed for $400,000 to $800,000.
The master plan for the former Scarborough Downs property calls for adding 1,300 units within a decade, including The Breakaway, a four-story building in the town center with 76 apartments above 15,000-square-feet of street-level retail.
The Innovation District at The Downs is home to 50 businesses — including IDEXX, Throttle and Mainely Tubs — that brought 1,000 jobs to Scarborough. And leading to the town center is Market Street, which is anchored by The Allagash Bungalow and several other businesses off the Haigis Parkway.
“The Downs is becoming a solid retail destination and broadening the reach of The Maine Mall area,” Bacon said.
