Posted: 03/25/2010 06:00:00 AM PDT
Updated: 03/25/2010 06:03:54 AM PDT
First National Bank will close its Eureka Square branch Friday, June 25, after failing to successfully negotiate acceptable lease terms with the property manager.
"It was much more than we could afford for the size of the branch. With the increase in rent and our increase in health benefits costs, it didn't pencil out," he said. "We have a whole series of processes we have to do to get notifications to our regulators and customers in advance. When the offer appeared to be etched in stone, we went before the board and we decided that the most prudent thing to do was to find another place in the north end of town."
After a search yielded nothing acceptable, McGraw said the board decided to consolidate bank services in the newly remodeled and expanded Linda Mar branch, where the bank was able to successfully negotiate a favorable lease.
First National is, however, working with Biagini to lease a location in Eureka Square for a full service ATM in an access-controlled room.
"Mr. Biagini was probably willing to rethink his offer but we had put the wheels in motion and it would not have been practical for us to grind to a halt," McGraw said.
Tom Biagini, president of Biagini Properties, said he offered the bank a new lease at the same rent it had been paying.
"The bank is not vacating because of the change in the rent. It is just downsizing. They decided they didn't need a whole branch in the north end," Biagini said.
But McGraw said bank officials tried very hard to accommodate its north-end customers, some of whom would prefer not to travel to the south end of town. He said he expects to work out a favorable lease for the ATM.
Posted by Steve Sinai