That Was Then, This Is Now : Bank Branch Closings Have Transformed Street Corners Across California as New--and Far Different--Businesses Move In
At what used to be a Bank of America branch in San Francisco’s Castro District, customers use the drive-up window to rent movie videos. The hottest item at the Blockbuster Video store is the sexy thriller “Fatal Attraction.”
A B of A automated teller machine still sits at its former branch on Reseda Boulevard in Northridge, but the human tellers have been replaced by sweating body builders. The structure is now Gold’s Gym.
A vault that once protected stacks of cash for Crocker National Bank will soon provide climate-controlled storage for stacks of historic documents and photographs for the Carmel public library.
Several hundred bank branches have been closed in California in recent years as banks struggle to compete in the tougher environment created by deregulation and adjust to the need for less space that accompanies the industry’s automation.
Most closings have come from the big four--Bank of America, Security Pacific, Wells Fargo and First Interstate--which had saturated California with their branches.
The trend is likely to continue, too, as the big guys try to reduce costs in preparation for the increased competition anticipated in 1991, when California opens its doors to East Coast banks.
At the same time, however, almost as many new branches have been opened in growing areas or by smaller banks moving into areas abandoned by the big institutions. So the net loss is not enormous.
From a peak of 4,838 in 1983, the number of branches in California has dropped to 4,662, according to the state Banking Department. Still, California is one of the few states with a net loss of branches in the 1980s. Nationwide, branch openings have outnumbered closings by 2 to 1.
The net loss is also cut because some buildings discarded by the big four have been returned to service by expansion-minded savings and loans and smaller banks, which may have lower overhead or better marketing for a particular area.
For instance, American International Bank bought the building that housed an unprofitable B of A branch in Alhambra and began turning a profit within months by attracting an ethnic clientele.
Number of Advantages
But a good number of former bank branches--no one knows how many--have been reincarnated in another form altogether. That’s because the sites appeal to other businesses for the same reasons they appealed to the banks: Location and visibility.
Free-standing bank buildings are almost always at heavily traveled intersections. For the most part, they are solidly built. And they usually have plenty of parking.
“Banks typically went to the major corners with their free-standing buildings,” said David C. Lachoff, a senior marketing consultant at the real estate firm of Grubb & Ellis. “You can cut the building up for other purposes or use it for many other retail functions.”
Key locations persuaded the Sharper Image to use former banks for two stores, which sell upscale gadgets and adult toys.
A San Francisco Sharper Image at Sutter and Market streets is in a distinctive round office enclosed by glass that once housed a Wells Fargo branch. Another store is in a former First National Bank branch in Chicago, where the rounded facade is also an eye-catcher.
“If there happens to be a bank that has vacated a building in the heart of a financial district, it would be logical that we would be able to put in a store that would be relatively successful,” said Craig P. Womack, a senior vice president at San Francisco-based Sharper Image.
But he said there can be disadvantages, such as extensive demolition. And in Chicago it was expensive to remove the vault left by the departing tenants.
Others have turned vaults into an asset.
A restaurant and pub near the UC Santa Barbara campus uses the vault left by former occupant B ofA as a wine cellar.
The Golden Lotus, a popular restaurant housed in a former B of A branch in Rancho Palos Verdes, uses the vault for food storage, because the thick walls provide good insulation.
Lani K. Fremier, acting librarian in Carmel, said the vault at the Crocker branch on Devendorf Park will be perfect for storing historic documents and photographs when climate controls are added.
The city bought the branch for $1 million from Wells Fargo after the bank’s acquisition of Crocker, and an additional $600,000 is being spent converting it to a site for children’s books, administrative offices and the local history collection.
Gold’s Gym spent $120,000 renovating the B of A building at 9150 Reseda Blvd. in Northridge, but the expense was worth it because of the difficulty in finding the right size space. The gym needed about 10,000 square feet, the size of the branch, and most property on the market was either too big or too small.
Jim George, regional manager in San Francisco for Blockbuster Video, said business at the drive-up window at the Church Street store has been a little slow because there isn’t a lot of auto traffic in the area. He expects better results with a drive-up window at a former Crocker branch that opens as a Blockbuster Video next month on a busy street in Sacramento.
Not every bank branch survives in any form. Sometimes the buildings represented under-utilization of a prime location, from a commercial real estate viewpoint.
According to Lachoff, the Grubb & Ellis agent, a developer recently bought a corner of Robertson and Wilshire boulevards and tore down a B of A branch to make way for a 100,000-square-foot office building. B of A plans to lease a smaller amount of space in the new building.
