Intermountain Community Bancorp, of Sandpoint, has put its headquarters building on the market, but says the region's troubled economy had nothing to do with that decision.
Even though it has been in its 90,000-square-foot new Sandpoint Center for just a year, Intermountain always had planned to sell the structure, and it delayed putting it on the market until after it had resolved a parking issue with the city of Sandpoint, Chief Financial Officer Doug Wright says.
"Our intention from inception was to develop it, construct it, and sell it," Wright says. "We feel like real estate is not a great investment opportunity for a bank particularly."
The bank, which began marketing the three-story building about three weeks ago, has been talking with interested parties for the last six or seven months about the structure, he says. It would continue to lease back from the buyer the space its Intermountain Community Bancorp bank-holding company and its Panhandle State Bank banking subsidiary occupy there.
By selling, it could recoup the cash it invested in building the structure, pay off the loans that it took out, improve its balance sheet, convert those assets into an earning asset, and improve its earnings, Wright says.
Intermountain said in its first-quarter earnings release April 29 that it was in the process of negotiating a new loan with its lenders to refinance into three longer-term amortizing loans a bank-holding company credit line it used to construct the building. It said its indebtedness on the building was $23.1 million as of April 23, and it anticipates paying off the debt within three years through the sale of the building.
"We're anticipating netting at least the $23 million," Wright says. "We may get more out of it. That's kind of what our minimum anticipation is."
The company and Panhandle State Bank moved into the building in the second quarter of 2008. Intermountain has its corporate operations, human resources, and accounting and finance offices there.
It uses about 60 percent of the space in the building now and anticipates that would continue to be the case for at least some time, Wright says.
The building has other tenants, he says.
Recently, the company reached agreement with the city of Sandpoint on a parking issue that dates back to a previous City Council, Wright says. The city had wanted Intermountain to put in a certain number of parking spaces when it developed the building or make an in-lieu payment if it put in fewer spaces. "We think we have adequate parking for the building," he says.
After the new council altered the parking requirements, the company asked if it could reduce the size of the in-lieu payment, Wright says.
At length, the company agreed to make a $50,000 economic-development donation and to finish 1,500 square feet of space in the building for a business incubator, which would use the space for five years rent free.
The company hasn't listed the building with a real estate broker, Wright says. He adds, "We have a real estate consultant who's working with us," and the company believes it has sufficient interest to sell the structure without listing it with a broker, he says.
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