St. Petersburg is succeeding at getting the message out that it’s a great place to do business.
While that’s exciting, said Chad Loar, chair of the St. Petersburg Area Economic Development Corp., it’s also brought challenges, including a lack of office space.
“Pinellas County is the densest county in Florida. There’s no sprawling opportunities. You’ve got to go up. We need more vertical development,” said Loar, regional president for west and central Florida for PNC Bank.
Loar talked about banking and economic development in a wide-ranging interview with the St. Pete Catalyst, including how he would balance the critics who say high-rise buildings take away from St. Pete’s unique atmosphere.
“It goes back to the Grow Smarter strategy,” he said, referring to an economic development strategy that focuses on five major industries: marine and life sciences, data analytics, specialized manufacturing, creative arts and design, and financial services.
“It’s going out and targeting those we have to grow it, not going outside of what we don’t have and try to bring something different or new here. If we’re going to grow with what we have, we feel like we can keep that culture,” Loar said.
He also co-chairs the Tampa Bay Partnership’s Transportation Working Group, which is backing a 41-mile, $455 million, 41-mile bus rapid transit system (BRT) that would connect Wesley Chapel to downtown St. Pete.
“We are very bullish on making sure the BRT from downtown St. Pete to St. Pete Beach moves forward,” Loar said.
PNC Bank is participating in the growth that’s occurring in St. Pete and around the Tampa Bay area.
“You see cranes downtown, in Carillon, across the bay,” Loar said. “We’re part of that, funding new towers and buildings, whether industrial or office or condos, we’re still very active in that.”
Loar, who lives in Treasure Island, is a veteran banker who’s worked in the Tampa Bay market for 18 years, including earlier stints at Bank of America and SunTrust. He was named to his current job as regional president in July 2016. The market encompasses the west coast of Florida, from Tallahassee to Naples, and all of central Florida, and includes 86 retail branches and 925 employees.
Banks historically have been among the leaders in economic development initiatives, although industry consolidation that has cost the area many of its locally headquartered banks has diminished that role to some extent. Not all bank market leaders are focused on developing local relationships, Loar said.
The bank’s parent company, PNC Financial Services Group (NYSE: PNC), is based in Pittsburgh, but has maintained a local decision-making structure that allows Loar to play active roles in the EDC and the Partnership, he said.
“We are one of the last big banks left to have local decision-making approach,” Loar said. “It allows us to get engaged in the community much more than I’ve seen in my prior banks that are more centralized.”
For example, Loar last year worked with J.P. DuBuque, St. Pete EDC president, to create an investor relations committee that recruited 17 new EDC members. “PNC’s model allowed me to do that. To bring in new members, to help understand what we’re trying to do and that’s relocate companies here, retain our companies here and expand our companies here.”
PNC Bank entered the Tampa Bay market in 2011 with the purchase of BankAtlantic branch offices. It’s now the 11th largest retail bank in the Tampa-St. Petersburg-Clearwater metro area, with 20 offices and $1.1 billion in deposits as of June 30, the most recent date for which information is available from the Federal Deposit Insurance Corp.
The bank has a total of 37 markets in its footprint.
“We finished No. 1 in 2017 and No. 2 in 2018 with our three-year compounded annual growth revenue amongst the 37 other markets in the bank,” Loar said. In retail banking, “We finished tied for No. 1 last year in year over year revenue growth, 18 percent revenue growth year over year.”
Loar said there were a few reasons for the success. The bank took a qualitative, rather than quantitative, approach to who it would serve. He kept teams lean and hired great talent.
“I’ve seen other banks come into the market and last 10 or 15 years. I’ve seen their hiring philosophy and how they went about it. I try to do something different. Typically, they come in and over-hire and do it very quickly. Then within a year or two, they’ll realize they didn’t get the right talent and it sets them back three to five years by doing that,” he said.
“When I came on board, I said I want to keep the teams lean, hire the best talent and keep the teams lean, and we’ll do two to three times the throughput because we’ll call on the right types of names. Before I ever started hiring, we did a qualitative assessment on what we wanted to go for, and that helped me understand how many folks I needed to bring on.”
Initially, PNC had to tell its story repeatedly to potential customers. Loar used to do sales campaigns such as “let’s go for no.”
“No one is good enough to get yes the first time. Go for no and by the time you get your third or fourth no, you’ll start getting yesses, if you stay consistent and persistent on the same names and industries and types of business we want,” he said.
In early 2018, PNC started putting out a quarterly newsletter for all of its 925 employees in the west and central Florida market. Loar enhanced that effort late last year, adding a “state of the region” Skype call to provide an overview of how the bank and the market were performing, followed the next morning by the digital newsletter.
Notes from the most recent quarterly call show he highlighted how PNC was doing as an enterprise, provided a Florida snapshot, discussed leadership promotions and recognized top performers. He also focused on community engagement and economic benchmarks in the Tampa and Orlando areas.
“I’m a fanatic about transparency,” Loar said. “You get more employee engagement. Some of the best companies I’ve worked with are ones where the C-level execs have brought transparency from the top down.”