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Coffee Talk

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  • | 6:00 p.m. December 27, 2005
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Coffee Talk

Floating into 2006

An expanding Pinellas Park thrift has announced a stock split to help investors who want to get their hands on more shares.

First Community Bank Corporation of America, the holding company for $310 million-asset First Community Bank of America, will award three shares for every two held by stockholders of record as of Jan. 10.

Kenneth P. Cherven, president and CEO of the holding company, says the split is designed to increase the "float" on the stock, which trades on the Nasdaq SmallCap Market under the ticker symbol FCFL.

Cherven says bank executives have received pleas from investors who cannot find enough shares on the open market. After the split, First Community Bank will have about 3.4 million common shares outstanding.

The stock was down a penny at $27.24 a share on the morning after the Dec. 20 announcement. Cherven wouldn't be surprised if the price descends further into the upper teens or low 20s, before heading the other way.

The stock will go back up because Cherven thinks First Community Bank will continue to prosper in 2006. The thrift has experienced 30% asset growth in each of the past five years, he says.

"I'm cautiously optimistic," Cherven tells Coffee Talk.

His caution is due to the proliferation of speculative condominium development in the Tampa Bay area. High-rise units on both sides of the bay are being offered for seven figures.

Cherven says his institution is shying away from financing construction or sales of these condos. But he fears a glut of unsold units could depress other residential values in the area.

"I honestly don't understand it," says Cherven, who doubts there are suddenly that many high-end buyers in the area.

As for his optimism, Cherven says the thrift was able to enlarge margins in 2005 while opening two new offices in Hillsborough County, including one earlier this month in South Tampa. For the first nine months of the year, net interest income was $8.6 million, 44% better than the 2004 period.

Cherven hopes to replicate that feat next year as First Community Bank builds another office in Port Charlotte.

Where will PF Chang land?

When John Simon announced a few probable tenants for the Isaac Group Holdings' Pineapple Square project in downtown Sarasota, one name piqued our interest: PF Chang's China Bistro Inc.

Earlier this year, Brett Hutchens and his Casto Lifestyle Properties announced they had a letter of intent from PF Chang's to occupy space in Sarasota Bayside, on the site of the Sarasota Quay. So, Coffee Talk asked Hutchens, who or what led PF Chang's move to Pineapple Square?

Hutchens says he did.

After long negotiations with PF Chang's, Hutchens says: "It became clear that PF Chang's might not be right for the site. Chang's is developing another concept that is less intensive on parking and has a higher price point."

PF Chang's was looking at a site near University Parkway and Interstate 75, but Hutchens suggested Pineapple Square.

Hutchens says that too much emphasis is put on the retail competition among downtown, Sarasota Bayside and St. Armands Circle.

"From a retailer perspective, there just isn't that much difference," he says.

Next up: the kitchen sink

Neal Communities Inc. has taken another step toward creating a one-stop shop.

The Bradenton real estate company has joined with SunTrust Mortgage Inc. to form a new mortgage company called Sun Partners LLC.

Neal Communities President Pat Neal says the big advantage for his business is that it will be able to control the mortgage production process. "The big focus is creating a system so we can get the house started on time," Neal says.

Similarly, it allows the Neal's company to offer one more important service to its customers in-house.

The two companies have had an informal relationship since October. Since then, roughly 80% of Neal's customers have used SunTrust Mortgage.

"It's really neutral from a financial perspective," Neal says. Neal Communities owns 49% of the new company. SunTrust owns the remainder.

Sharon Farlinger has been selected as the loan officer for the new joint venture.

How to create affordable housing: citrus canker

Add citrus canker to the reasons why development is moving away from Florida's coasts and into rural inland counties.

Citrus farmers who find canker in their groves face devastating losses and years of lost production, says Richard Woodruff, senior vice president with WilsonMiller, a Naples-based engineering firm. With land prices surging, why not sell to eager residential developers?

Here's the devastating math: one canker-infected tree means a farmer must cut down 30,130 citrus trees around it to contain the airborne disease. Then, no citrus trees can be planted on the land for two years and, when they are planted, trees take five years to bear enough fruit for a harvest. That means it takes seven years for a citrus farmer to begin recovering his losses.

By his calculations, Woodruff says citrus farmers have lost 22,519 acres in Southwest Florida to canker since August 2004. That represents more than 2.5 million citrus trees and 13% of the citrus land.


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