Construction Updates

What's Nearby?

TO: All Staff
FM: Carlton Musmann
DT: December 17, 2018
RE: Important Announcement Regarding Corporate Buildings

At our last Coffee with the President, I shared with you that we have grown substantially over the past 4+ years. As a reminder, we have grown assets by $198mm, grown deposits by $191mm, and we have grown loans by $124mm (29% growth). We are growing so fast, it is impacting the credit union—we are outstripping our capital. We are trying to balance a strong capital (Net Worth Ratio) with our overall deposit/loan growth and liquidity. However, we need to do more to keep pace with our growth and continue to serve our members.

The credit union owns the two corporate buildings. A decision has been made to sell both buildings. This will provide a much needed infusion of capital. The sale of the buildings affords us the ability to provide loans to members and grow deposits and membership at our current pace. This also significantly increases the financial outlook for the credit union. Our Net Worth goes up, real estate portfolio limits open up, and concentration risks lessen. In order to sustain the rapid growth, we need this capital infusion and it puts us on a trajectory for continued growth. This strategy is used industry-wide and provides the required resources needed to maintain and grow the business.

In addition to selling the buildings, we are purchasing a new building and relocating our Corporate Headquarters to East Pasadena. We anticipate the move to take place in the next 18-24 months. We will be doubling the size of our office space—over 60,000 square feet. This will give us a lot of room for our continued growth. The 2-story building will feature state-of-the-art amenities and plenty of parking.

This decision was not taken lightly and took into account where our corporate staff reside. Approximately 48% of staff will have no change and/or a better commute.

Below is a summary:

  • 48% no change and/or better commutes
  • Less than 5 miles: 17%
  • More than 5 and less than 10 miles: 30%
  • 15+ miles: 5%

While we don’t have all the answers right now, we are looking at transportation options, including van pools, subsidizing the cost of taking the Metro/train, and a pick-up/drop-off service at a Gold Line stop in Pasadena. Going forward, we will be holding meetings in order to provide you with relevant updates (transportation options, amenities at our new location, timing, etc.)

These actions will considerably improve the financial position of the credit union and allow for continued growth for years to come. Thank you again for all you do for the credit union. I look forward to sharing updates on the sale of the buildings and the relocation.

Sincerely,

TheF01152019161424_553b3e4ecc614221bf3aa1873891fe93




Carlton Musmann
President/CEO