Bank Remains Committed to San Diego Real Estate.

Nearly two years ago, Zions Ban-corporation of Utah concluded a merger of its two California subsidiaries, Sumitomo Bank and Grossmont Bank. That merger created California Bank & Trust, the fifth largest commercial bank in California with over $6.5 billion in total assets. A major organizational component of the new bank was the formation of the Real Estate Finance Division headed by Managing Director David Blackford. This group was formed to service the wholesale segment of the California real estate industry, the sector comprised of developers of larger commercial, industrial, retail, and multi-family properties, and public and private merchant home builders.

Prior to the formation of CB&T, Grossmont Bank was the largest locally-based financial institution in San Diego County. For years, Grossmont had been an active lender to smaller and mid-sized developers and private real estate investors, and some in the local business communities bemoaned the loss of another premier community bank. Many of San Diego's real estate professionals who witnessed the succession of banking mergers and acquisitions of the 1990s experienced disruption in their banking relationships and a reduction in available financing for local real estate ventures. It often seemed that real estate lending to local entrepreneurs was curtailed when community banks were gobbled up by large regional holding companies, particularly those headquartered outside California.

California Bank & Trust decided to buck that trend. As a complement to the wholesale activity of the Real Estate Finance Division, CB&T empowered branch offices of its San Diego division to continue construction and permanent lending to the middle-market sector of our local real estate industry. Indeed, CB&T's construction and permanent financing to San Diego-based developers and investors during the past two years, both in number of transactions and total dollar volume, has surpassed that of former Grossmont Bank over a similar period. This is due partly to the impressive growth in the San Diego economy, and partly to CB&T's greater lending capacity and regional structure that permits local decision-making for local clients. But mostly, to CB&T, it's just smart business.

The stock market boom of the last four years notwithstanding, real estate still comprises a sizeable portion of the total assets of local companies and individuals. During the recent period of economic recovery in San Diego County, historically low interest rates and high employment have turned many renters into homeowners. Expanding companies have purchased or built their own facilities. New companies have competed aggressively to lease once-vacant office space. Rehabilitation of existing properties has begun to make economic sense again. And the sudden shortage of affordable housing has turned urban infill and community redevelopment into economic and social imperatives. California Bank & Trust, through both its San Diego Division and Real Estate Finance Division, will continue to play an integral role in this process.

Executive Vice President Chris L. Skillern leads the San Diego Division, a network of 25 full-service offices in San Diego and Riverside Counties. Skillern stresses "attentive, quality customer service" with a strong emphasis on relationship banking. Skillern and other senior bank officers place the highest priority on real estate borrowers with the willingness to utilize CB&T's vast array of other financial products, particularly depository services.

The chief proponent of CB&T's focus on successful real estate lending is Chairman and Chief Executive Officer Robert G. Sarver, a San Diego County resident and an active participant in the solicitation and review of new real estate credits. Other key real estate personnel include Senior Vice President Walter Strangman, manager of the San Diego office of the Real Estate Finance Division, and Executive Vice President and Real Estate Chief Credit Officer Michael Permenter.

California Bank & Trust invites principals and agents of good quality, economically feasible real estate ventures to come in and discuss their financing needs.

Author Mark Tagwerker is a vice president and real estate credit administrator in the San Diego division of California Bank & Trust.