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SunTrust steps up to need in Midtown

By ROBERT TRIGAUX
Published August 3, 2005

Never did the commitment of one bank branch consume so much local energy and agony.

St. Petersburg Mayor Rick Baker on Monday said SunTrust Bank will build a bank branch in a depressed area of the city called Midtown. At first glance, it might seem just another ho-hum story of yet another branch in bank-bloated Pinellas County.

Well, look again. A cadre of city and business leaders, obsessed with revitalizing a struggling, 5.5-square-mile area of St. Petersburg, has spent years cajoling and arm-twisting to create a basic shopping center.

Tangerine Plaza is to be anchored by a mainstream supermarket, a post office and, now, a branch of a major regional bank across the street at 18th Avenue S and 22nd Street.

Had a Tangerine Plaza appeared in another part of St. Petersburg, few would have noticed. The Tampa Bay area has dozens upon dozens of centers just like this one.

But this shopping center has proved a herculean task and a labor of love. It has suffered banking's bureaucracy. It has subplots worthy of soap operas. And it still has miles to go before completion.

This is a business tale of the making of one little bank branch. It is a branch long in coming to a community sorely lacking a real bank presence.

Midtown is a largely lower-income black area of the city that has missed out on much of St. Petersburg's economic renaissance. The city, with backing by Sembler Co.'s Craig Sher and other business leaders, decided a new shopping center could help jumpstart Midtown's comeback.

Sweetbay, the next generation of the Kash n' Karry supermarket chain, has committed and is starting to build. But getting a major bank to agree to a branch there has taken much longer.

Initially, Bank of America was the odds-on favorite for a Midtown branch. Area bank leaders had toured Midtown literally for years, assessing the lower-income market's potential and needs.

Local Bank of America executives were ready to commit. Mayor Baker was elated.

Then Bank of America backed out this spring. Mayor Baker was upset.

Bank of America is one of the nation's biggest financial institutions. It operates across the country and in many other nations. It uses outside experts such as the Trammell Crow real estate giant and other specialists to analyze the best locations for branches to add to the thousands it operates nationwide.

What seemed a local slam dunk soon turned sour. One corner of the Midtown intersection happens to belong in an official census tract designated "low income." That northeast corner is where Bank of America wanted a branch.

But the southwest corner of the intersection falls in a "moderate-income" census tract. When city leaders decided that corner was more practical for a bank branch site, Bank of America backed out of the deal.

Why? While Bank of America operates 56 branches in Pinellas County, none of them are in a "low-income" census tract. The bank was keen on making its 57th Pinellas branch the first.

When that became impossible, Bank of America's branch-location decision makers decided the Midtown branch was no longer worth it.

I spoke Tuesday with Bank of America's Bernie Craig, the bank's city president in St. Petersburg, to try to understand why one side of a street but not the other could become a deal killer.

The short answer: Being part of a giant bank means any proposal for a local branch must compete against all other branch proposals throughout the company.

"When you step back at the 30,000-foot view and consider where we should put new locations, there has to be a compelling reason to put Number 57 in Pinellas," she said. "A branch in a low-income census tract meant a great deal to us. We could have gotten the backing for that."

Craig is well aware this is not the answer local St. Petersburg really wants to hear. She said she is disappointed the bank could not build on the original corner in Midtown. She understands Baker is annoyed, and would love an opportunity in person to better explain her case. And she insists Bank of America wants to get more involved in helping the Midtown economy with affordable housing programs and loans and providing financial counseling services to the community.

With Bank of America out of the running for a Midtown branch, SunTrust stepped up to the plate. When the city issued an RFP this summer for a bank branch on city-owned land in Midtown, SunTrust was the one and only bank to submit a proposal.

SunTrust deserve kudos. But where were other large regional banks, Wachovia or AmSouth or BB&T, that tend to dominate in Tampa Bay's banking market?

Roy Binger, SunTrust's city president in St. Petersburg, toured Midtown with city economic development officials more than a year ago. Long before the city issued its RFP for a branch, he was well acquainted with the lower-income part of town. He had begun to note signs of economic improvement.

Binger said a lot of banks probably looked at the Midtown branch site. But he doubts they took the same time and interest as SunTrust to see the potential. Barring delays, the branch should be built and running by next summer.

A mainstream bank will make a difference, said Ron Hill, dean of the University of South Florida's College of Business in St. Petersburg and a close observer of the nearby Midtown community.

Without a nearby bank, Midtown residents are forced to rely on alternative sources such as high-interest credit cards and alternative institutions such as pawn shops.

The arrival of SunTrust means the "formal financial sector recognizes the value of the Midtown community and its residents, sending an important signal to other potential vendors," Hill said.

This time, it's a lot more than just another little bank branch.

Robert Trigaux can be reached at trigaux@sptimes.com or 727 893-8405.

[Last modified August 3, 2005, 00:35:13]