Bank is seeking to further U.S. 40 revitalization

Below-market-rate loan program is among latest efforts to refurbish Ellicott City corridor

April 27, 2005|BY A SUN STAFF WRITER

For most of the morning, Glenn L. Wilson barely alters his solemn demeanor while sitting in his fourth-floor office and discussing prime rates, credit-worthy customers and assets.

Suddenly, the slightest hint of a smile creases the banker's face as he alludes to the chaotic state of the U.S. 40 commercial strip in Ellicott City, where Citizens National Bank has authorized $25 million in below-market-rate loans for revitalization.

"It took a long time to get it into the state it is now," says Wilson, president and chief executive officer of the Laurel-based bank. "It's going to take a long time to get it out of the state it is in."

Citizens' loan initiative is among the latest efforts to refurbish the seven-mile stretch of U.S. 40 that cuts through Ellicott City, a key economic corridor for Howard County.

Over the years, critics say, U.S. 40 developed with no vision. Today, it has a hodgepodge of offerings - from boutiques to sprawling shopping centers and car dealerships. It is traffic-clogged and not particularly appealing to the eye.

A county-appointed citizens commission spent the better part of last year examining ways to beautify and unclog U.S. 40 while still promoting development.

The Department of Planning and Zoning had hoped to put the final touches and receive public comment this spring on a design manual to govern revitalization efforts.

But some of the U.S. 40 initiatives are on hold while a group of residents tries to put the county's omnibus rezoning bill on the ballot in next year's general election.

County officials hope the combination of rezoning and financial incentives will encourage businesses to begin sprucing up the area, in some cases creating mixed-use centers, with retail space on the first floors and housing on the others.

Since most of the businesses along U.S. 40 are small to medium-size, they lack the capital to make meaningful improvements. Citizens Bank is trying to remove that obstacle by offering businesses along the corridor loans at half a percentage point below market rate.

The program is not limited to the most creditworthy businesses, which typically would be charged the prime rate, currently 5.75 percent.

"There are a lot of people who wouldn't get that rate," says John B. Boyle III, vice present of the bank and the person overseeing the loan program. "But we try to offer as competitive a rate as we can for the typical customer.

"It requires that partnership. ... If the banks don't support what the county and the borrowers want to do, then it's not going to get off the ground."

On a $1 million loan, Wilson said, the savings to businesses in interest payments would be about $5,000 annually.

This is not the first time Citizens Bank has supported county revitalization efforts. Three years ago, it set aside $10 million for below-market rate loans to assist U.S. 1. It later boosted that to $25 million. Thus far, it has made $13 million in loans for projects along that corridor.

The practice is also good business. The firms that tap into Citizens' loan program typically bring all of their banking business with them.

"Now, is it a requirement? No," Wilson said. "But generally, people move all their business to us when that [loan] happens. ... Part of it is that we're talking about smaller to small-medium businesses, and generally it's too complicated for them to have multiple bank relationships. It's easier to them to have one-stop banking."

Wilson acknowledges that neither U.S. 40 nor U.S. 1 will be transformed overnight.

"It's a property here and a property there," he says. "They can't look back [now] and say look how different the corridor is. ... It'll take a decade to see meaningful change.

"But it will always be worth it. If we did one loan, it's worth it. If we help one property, it's worth it. If we have a good loan and it helped revitalize one property, and it wouldn't have happened otherwise, then it's a success."

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