Town Auto stood on High Street for decades, but it has been torn down over the past week.
City officials say three new businesses are being built at that same location.
"Whether it's downtown, along the river, along High Street, you're seeing investment," said Ellsworth City Manager, David Cole. "Properties are being upgraded and new services are coming to the community."
"Ellsworth has the highest per capita retail sales in the state," he added. "For a city it's size, it does about twice as much retail sales as you would expect."
Aspen Dental, Mattress Outlet and Auto Zone are being built on the site.
Officials say construction is expected to be finished this fall.