California Wine Country banking leaders look for a return to normal in 2021
Not much to say about 2020 in banking that doesn’t involve coronavirus. Economic uncertainty dominated the year. Here’s what some area banking leaders say about the prospects for recovery.
Featured in this report, alphabetically, are Todd Allen of Heritage Bank of Commerce, Jeff Clark of Live Oak Bank, Marshall Graves of Bank of Marin, Brian Kilkenny of Redwood Credit Union, Celia King of Poppy Bank, Mike Ledwich of Tri Counties Bank, Alison Martin of U.S. Bank, Brandy Lee Seppi of Summit State Bank and Paul Yeomans of Exchange Bank.
Todd Allen
Executive Vice President | North Bay Market President
Heritage Bank of Commerce
999 Fifth Ave. #100, San Rafael 94901
415-456-6000
Todd Allen has lived in Marin County for more than 20 years. He joined the Presidio banking team -- now Heritage Bank of Commerce -- as North Bay Market president.
Prior to starting his financial career, Mr. Allen graduated from the University of Nevada, Las Vegas with a Bachelor of Science in marketing.
Year you assumed this position: 2007
If there were a single takeaway from 2020 in commercial banking - what would it be?
The pandemic has undoubtable taken a real toll on local businesses. It’s been particularly painful in some specific industries like food services and hospitality. The Paycheck Protection Program was especially important for businesses in those industries.
In general, however, small and mid-sized companies across the Bay Area were impressively resilient throughout 2020. Many quickly made adjustments by moving operations online or developing alternative revenue streams to navigate this unprecedented economic environment.
Certainly, being a business owner or executive is always challenging, but succeeding throughout this pandemic is an incredible achievement and we are proud to have assisted so many resourceful business people and nonprofit organizations.
How did the interests of buyers and sellers change in 2020 as it related to the market reaction to the coronavirus driven economic disruption?
In 2020, we saw both buyers and sellers become more cautious. Building cash reserves became a priority. Buying and selling was put on the back burner as everyone waited to see when and how markets would recover from the pandemic.
In what ways do you think that economic disruption fundamentally altered the North Bay's commercial real estate market, and how permanent will those changes be?
It is too soon to fully understand the long-term ramifications for commercial real estate. Hopefully, the residual effects of the pandemic will clear as we move deeper into 2021.
With all the market experienced in 2020, what surprised you the most about the North Bay commercial market's reaction to that disruption?
We saw the market rapidly adjust to its new reality. Many landlords and tenants worked together to help businesses navigate the tumultuous conditions. That coordination and cooperation was huge in overcoming some of the pandemic related challenges. Early on, we also saw many investors quickly build up cash reserves as commercial real estate purchase activity slowed substantially.
Were deals delayed and or more contentious as the result of the market disruption?
Commercial real estate activity was simply delayed in 2020 as a result of market disruptions. Everyone seemed to take a wait and see approach. As we move into 2021, we are beginning to see more projects develop. This is particularly the case in stronger sectors such as industrial and manufacturing.
Going forward - what's next for this market and does the vaccine and the possibility the coronavirus crisis might be behind us mean rapid recovery in the second half of 2021?
It’s too early to tell at this time. Much will depend on how quickly the pandemic passes. However, given the historic strength of the North Bay economy and significant cash reserves investors have built up, we are optimistic about the future.
Jeff Clark
Senior Lender
Live Oak Bank
100 B St., Suite A, Santa Rosa, CA. 95401
707-921-1102
My wine and craft beverage lending career started in St. Helena with Napa Valley Bank. I have worked with wineries, breweries, distilleries and craft beverage producers throughout the United States. My experience spans the spectrum from small family operated businesses to publicly traded companies.
Year you assumed this position: 2014
If there were a single takeaway from 2020 in commercial banking - what would it be?
Let me begin by saying the following statements are my opinion only and not necessarily that of Live Oak Bank. My biggest take away is, Be Prepared! Business models were tested severely in 2020. No one could see this coming but it did prove the viability of a diversified business model and the need to remain agile.