Customer Owners,
As we enter August and begin the back to school process, I hope this communication finds you all doing well. I know it has been a challenging summer for our wheat growers on the Eastern Plains. I am hearing some good yield information from those that have been able to harvest. We hope the additional moisture on the plains will help the Fall crops as well.
I am sure you all know that the Federal Reserve did vote to raise the prime rate by .25 basis points in July. Farm Credit of Southern Colorado has elected to NOT raise with the Fed this time in an effort to help our borrowers utilizing variable rate loans. As a cooperative, we try to stay in step with the Federal Reserve but also weigh the impact on you, our customer owners.
We just held our July board meeting and this year, we hosted our meetings in Monte Vista and the San Luis Valley. That area of our territory is dry and we sincerely hope they begin to get some moisture soon!
Since my arrival at Farm Credit of Southern Colorado in late 2017, the board and management team here have been talking extensively about the Colorado Springs building. I have also made it a goal to be very transparent with all of you about our buildings and intentions. You may remember in past communications that I have shared that we have leased a good portion of the Colorado Springs office out. This was due to under-utilization and the desire to offset our occupancy cost in the best interest of all of you as our customer owners. Leasing the space out has been a positive decision and we continue to evaluate the need for our space and best use for the Colorado Springs market. We feel having a presence in Colorado Springs is important and has afforded us the opportunity to attract and retain talented employees. We view the Springs office as more of an administrative or head quarters location and certainly isn’t an office we tend to see many customers in. This probably doesn’t surprise you all as our customers, since there are not many of you operating in a close proximity to the city of Colorado Springs which keeps growing outward.
Because we feel it is important to keep a location in the Springs and we equally feel it is important to manage our resources well, the board and management have decided to list the Colorado Springs building for sale. We had contemplated this move when we leased out the space and have again come back to the desire to find a more fitting space that can be utilized by our existing staff while not carrying the overhead of the entire building. We will explore the sale of the building before we make any further plans but we do intend to maintain offices in the Springs and likely will chose to lease our future space versus own. If the building does not sell, we will revisit a long term plan for it, but the market seems right to place it for sale now. I wanted to highlight this key decision in my communication as we wish to remain transparent about major decision that might impact customers owners. By selling the building, we reduce our footprint even further, free up capital and can consider a lease that better accommodates our needs both now and for the future. It also will allow us to adapt the space to how we work today which is frankly much different than it looked 10 years ago. In addition, I know the Springs office building has been a topic of much discussion and I think selling and starting fresh in a more reasonable space is appropriate.
Listing a building for sale certainly does not guarantee a sale. We will monitor the market and the interest received and weigh all options carefully. I will continue to keep you all informed along the way. I just wanted to be sure you heard from me that this decision of the board and management of Farm Credit of Southern Colorado is our way of moving forward and finding a best use of association resources. I appreciate the boards support of this decision. I want to also reiterate that us selling the building is in no way a reflection of financial distress or a move away from the importance of having an office presence in the Springs. We are stronger today as an association than in any time since I arrived at Farm Credit of Southern Colorado. It is because of that strength, our fiscal responsibility and our focus on our future, that we feel this is a good business decision.
As always, I am available to discuss and welcome any questions you all may have.
Sincerely,
Farm Credit of Southern Colorado CEO
Jeremy Anderson
