“Thurston Highlands, one of the largest proposed mixed-use developments in the state, has emerged as the biggest example of how the economic crisis has had a corrosive effect on development.
Through its trustee, the projects primary lender, Frontier Bank, has started foreclosure proceedings on the 1,250-acre property after saying a loan was in default. The trustee is scheduled to auction the property to the highest bidder on the Thurston County Courthouse steps June 5, ” quoting The Olympian on May 15, 2009.
The auction was postponed twice (June 5 & August 7) and the properties still have not changed hands, according to a search of Thurston County Auditor’s records.
Now, comes this last Friday from Bloomberg News about Frontier Bank,
“The number of U.S. lenders that cant collect on at least 20 percent of their loans hit an 18-year high, signaling that more bank failures and losses could slow an economic recovery.
Units of Frontier Financial Corp.,Towne Bancorp Inc. and Steel Partners Holdings LP are among 26 firms with more than one-fifth of their loans 90 days overdue or not accruing interest as of June 30 — a level of distress almost five times the national average — according to Federal Deposit Insurance Corp. data compiled for Bloomberg News by SNL Financial, a bank research firm. Three reported almost half of their loans werent being paid.
While regulators may not force firms on the list to close, requiring them to raise capital and curb loans may impede recovery in Florida, Illinois and seven other states. The banks are among the most vulnerable of a larger group of lenders whose failures the FDIC said could cost $100 billion by 2013….
Firms range in size from Frontier Bank in Everett, Washington, with $3.98 billion in assets…
‘While these arent your giant banks, they are the guys your local strip mall and commercial real estate investors get their funds from,’ said Joseph Mason, a Louisiana State University banking professor and visiting scholar at the FDIC…
Frontier Bank, owned by Frontier Financial, reported a sixfold rise in overdue loans to $764.6 million in the quarter ended June 30 from a year earlier, or 22 percent, according to FDIC data. More than 43 percent of the banks delinquent loans were in construction and development, FDIC data show. The bank has 51 branches in northwestern Oregon and western Washington…
Frontier was a well-run organization for the majority of its history, said Jeffrey Rulis, a banking analyst at D.A. Davidson & Co. in Lake Oswego, Oregon. The offer by SP Acquisition is probably not what current shareholders envisioned a couple of years ago. The companys stock has dropped 92 percent in the last 12 months, and the bank posted an $84 million loss in the first half.
Patrick Fahey, Frontiers CEO, said the transaction will resolve the banks credit issues. He declined to elaborate while a shareholder vote is pending.”
Now, another bank in Washington State with Yelm connections making national news for a declining portfolio [Venture Bank failed last month, the 92nd in 2009 in the USA, its assets & deposits seized by the FDIC and given to a North Carolina Bank, and parent Venture Financial Group a total loss to stockholders, as reported here.]
UPDATE: October 29, 2009
From the Business Examiner:
“Frontier Financial shows Q3 loss”