4 Real Estate Considerations For Banks In An Online World

Law360 (February 7, 2020) As banking continues to shift from brick-and-mortar buildings to the internet, banks — many of which lease their space — are evaluating just what physical footprint is best, and lawyers say keeping a few points in mind during discussions with landlords is crucial during the process. While the move away from physical banks has similarities to the shift from retail stores to online shopping, banks have certain unique considerations, such as vaults and ATMs, that factor in heavily when questions of downsizing or repurposing are on the table, according to experts. Tony Natsis at Allen Matkins Leck Gamble Mallory & Natsis LLP said that the vault is the biggest expense for landlords that repurpose a property after a bank leaves. And depending on how the vault is integrated with the rest of the building, the change could require serious renovations, Natsis said. “You [may] have to deconstruct the structure,” Natsis said. “Repurposing is tough.” Natsis said vaults make the situation tough for both sides: It’s hard for a bank to get out of a lease with a vault on the premise, and while a landlord may want a new tenant, it’s hard for the landlord to reconfigure the space. “It’s bad news for the tenant and bad news for the landlord,” Natsis said. Read More (subscription required)