Your "real estate" would then be 43' X 87', or one boxcar X two boxcars.
The floor of the sawmill would be approximately 40' X 100' at the smallest believable size.
The space you have would best accomodate a team track, with the lumber product trucked in, and loaded on a waiting flat, or in a waiting boxcar.
An industry needs to be just large enough to be "that industry". A shipbuilder's "shed" would be considerably larger than a boatbuilders shed. Then, there needs to be access space. Rail access, employee access, building maintenance access, etc. Some of this, can be off layout, or backdrop, and all you need is "a hint" that it is there, like a sign, "employee parking" with an arrow pointing off the layout.
http://forum.zealot.com/t111767/ shows a small brewery project. You can see the sidewalk across the front, and the hint of alleyways to the left and right. Rail access comes in behind the building. Only two egdes of the diorama needs to be continued into the layout, the sidewalk could be at the front of the layout, and the loading platform alleyway could be around the corner, with the rail access going into a backdrop, and the lefthand alleyway, bordering the other scenery/city structures.
A sawmill, small enough to fit in the space available, would be too small to be served by rail, so, the suggestion of a team track.