Local Bankers Say Fuel Prices Helped County Economy

(See a related story in he Business and Real Estate section of the Herald Web Site)
SWAINTON — Advice for Cape May County businesses from a panel of local bankers: Talk to us before things get difficult.
They addressed a packed room of Cape May County Chamber of Commerce members at Sand Barrens Golf Club at the Dec. 4 Business and Economic Development Forum.
Panelists included Herbert Hornsby, Cape Bank, Jeff Gott, Crest Savings Bank, Kim Davidson, Ocean City Home Bank, Jerry Reeves, Sturdy Savings Bank, Larry Schmidt, 1st Bank of Sea Isle City and Scott Campbell, TD Bank.
None of the participants’ institutions took part in the federal Troubled Asset Reduction Program (TARP). All said they were conservative in granting loans, and did not participate in the questionable practices that led to economic collapse of many large banks.
While fuel costs affected many industries state and nationwide, Reeves said those were not factors that troubled the local tourism industry.
“The fuel prices turned out to help our economy. It turned people back to tourism. Fuel prices that were so devastating to many businesses played into our hands in the tourism economy,” Reeves added.
He said many business people told him that visitors from the Delaware Valley and northern Jersey and New York arrived in county on a tank of gas.
“That helped our economy,” he said.
Reeves said that the real estate market, which “has seen significant softness is beginning to “see an up tick.”
“Second home owners are still looking to secure their place along the shore,” said Reeves.
Sturdy has “significant exposure to the commercial fishing business folks who tend to be very steady,” said Reeves. “Their business is more weather and product availability related,” he continued.
“I run two offices (Ocean City and Court House),” said Campbell. “I work with community lenders. We are advising folks to come in and chat with use. We are more interested in helping you restructure a loan program and get the right product for you at this time.”
Concerning Crest Saving’s lending criteria, Gott said, “We never have given away money if we could not verify income. Yes, the money is out there. All solid basic lenders do need income. Collateral does not pay back a loan.”
Gott said the “5 percent down and limited documentation should be banished completely anywhere in the nation.”
“Banks in our region are interested to support those small businesses. If you are uncertain and thinking about a project, call one of the banks. Find out what is available,” Reeves urged.
“Call your banker and discuss where you want to go. What is the money going to be used for?” said Schmidt.
Schmidt also urged business owners to consider the “trading down concept.”
Essentially, he said that means consumers will still buy, but may opt for a “middle tier” restaurant instead of a gourmet type.
They will buy a $15 bottle of wine, not a $25 bottle. They will drink domestic beer, not imported.
“The rental market is still there. However, they won’t go beachfront. They will walk a few blocks. Think about that concept when you are looking to expand,” said Schmidt.
Davidson said the ever-increasing cost of airlines, which may add $150 to handle luggage in addition to airfare, might help local tourism.
“People are not going to do this (pay those extra charges) in addition to air fare,” she said.
“People are looking for packages. They are going into their savings. That’s all good for us,” she said.
“We need to keep in mind we are isolated,” she said, adding, “It is quite different in North Jersey. As grim as things may seem, they are worse another parts of New Jersey. Stay confident,” she urged.
“This is not a year to cut back on advertising,” Reeves said.
He urged that businesses take advantage of the travel shows that the chamber sends representatives to attend.
“Every person in a motel room has to eat, but they might go fishing or to an eco-tourism event. This is a challenging environment, but it’s better to promote our product and use the channels that are open to us,” he added.
“I would stress shop locally. It does go a long way,” said Campbell.
He added that his bank had worked with credit card processors to allow merchants to have funding available to them in nine hours, aiding their cash flow.
Chamber marketing director John Kelly said he had, within the past month, gotten many calls from members asking where they could get lines of credit.
Information and contacts from the panel may be placed on the chamber’s Web site to enable members to contact bankers to get them pertinent financial information.
“With almost 1,000 members, that is potentially 1,000 customers to local banks,” concluded Joanne DelVessio, chair of the (Tourism and Economic Development) Committee.
Contact Campbell at (609) 886-8600 ext 28 or at: al.c@cmcherald.com