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100% retail financing solutions propels Across America Real
Estate in ever-expanding retail real estate market
Commercial Real Estate Finance
Across America Real Estate Corp.
700 17th Street Suite 1200
Denver, CO 80202
Ann L. Schmitt, President and CEO
James W. Creamer, III, Chief Financial Officer
Interview conducted by:
Lynn Fosse, Senior Editor
Published - January 18, 2007
Ann L. Schmitt
President & CEO
Ann brings more than 20 years experience in key leadership roles within the financial
services industry. Before joining Across America she was President of Aimbridge Lending,
the countrys second largest auto loan originator and processing company for small to
midsized financial institutions, serving 16 major U.S. markets. Prior to that, she led
global risk solutions and management at MasterCard International. Ms. Schmitt has also had
senior leadership positions with Citibank, US Bank, and Dove Consulting.
James W. Creamer III, CFA
Chief Financial Officer
Jim brings fifteen years of experience in both commercial and investment banking with
extensive background in institutional and retail oriented capital markets. He came to
Across America from Vectra Bank Colorado, NA where he served as Vice President of
Commercial Banking. Jim received a Bachelors of Science degree from the Arizona State University
and has earned the Chartered Financial Analyst designation.
Based in Denver, Colorado, Across America Real Estate Corp. (OTC BB:AARD.OB - News)
partners with national retailers and their developers to provide 100% financing for rapid
retail expansion. The Company operates in the niche that is small pad retail market in the
commercial real estate industry. Across America provides guidance and creates financing
solutions for increasing retail productivity and profit. Please visit us at our website
What attracted me to Across America, aside from the fact that it has a great
management team and a very strong leadership at the board level was that I was very
excited about the business prospects. I read, studied, and did all the best research
before joining Across America, to help me make an informed decision. What I was excited
about was the unique niche that this company occupied in the commercial real estate
lending market. We provide 100% financing for small box retail real estate projects. I
could not find in my research, anyone that could exactly replicate our business model, as
well as replicated it in a market that is so attractive and as growing as ours is. With
all of those factors, it looked like a great opportunity for me to make this jump as the
next step in my career.
Mr. Creamer, will you tell us about your background with the company?
Mr. Creamer: I have been with across America
just over a year, from July of 2005. My background is in investment banking; I was with
Stock House for a number of years and I moved into true investment banking. I also have
some commercial real estate lending experience. This is a job that really encompasses a
lot of my past experiences and there is an exciting opportunity here.
Will you explain the business model of 100% financing?
Ms. Schmitt: What we offer in our
business is that we work with retailers, developers, to construct and accelerate growth in
their businesses. A number of retailers nationwide are on a significant growth path and
those retailers turn to preferred developers in the industry to do their construction.
Developers may be able to, with their own financing and capital resources, do a few
projects a year, but using our financing solution, they are able to do many projects a
year and expand their reach and range for the retailer. Therefore, the way we see it is
that it is an all around win because the retailers are able to expand their footprint more
rapidly and the developers will do and complete more projects in the course of a year or
even over a few years.
Are you working with the developers as opposed to the actual retailer?
Ms. Schmitt: We are working with both
the developer and the retailer. We work with commercial brokers, developers and the
retailers, because if you unplug any one of the three out of the process, it is difficult
to get anything done. When we actually structure our financing, it is structured with the
developer. Most of the retailers that we deal with are in the sale lease back market,
which means that they are looking for someone to build the real estate, do the
construction and keep that element of it off their balance sheet. The lease back piece
means that they are willing to sign a long-term lease for the location if it is a location
that they want and feel they are able to grow and develop. However, they do not want to
hold the real estate, so they would rather have a long-term lease in place than own it.
The developer on the other hand is really a build for suit, so they are building the
locations to suit the retailer and at the end of the project, they would like to take
their exit on it and be able to move on to the next endeavor. We, through our capital
program and financing structure, allow them to do that.
You mentioned that it is a unique model; what is the typical way and how did you learn of
Mr. Creamer: The typical way is that
the developer would have to go to a traditional source of financing. They would go to a
bank where they would have to put up a percentage of equity, about 25%, and they would
have to guarantee construction. What we do since we have access to capital is we take that
away from them and free them up to not only limit their risk, but be able to do more deals
because they are utilizing our capital.
How do you choose your projects?
Ms. Schmitt: There are a number of
ways to do it. We like to partner with the larger national retailers that have good credit
and larger scale plans for national retail development. We like to establish relationships
with the brands that are expanding their retail footprint quickly. Those types of
organizations typically have developers that they have worked with a long time and these
developers specialize in building to suit projects for these particular retailers. We try
to work with established brands as well as developers that have developed expertise in the
development field for their brands. That is not to say that we do not look for emerging
brands or emerging developers. However, we are trying to expedite the construction that we
do on the project and move on. We are fortunate to have a sales organization with a lot of
relationships and opportunities that they have been able to attract. Certainly, our 100%
financing offer for the developers is a very compelling business opportunity for
Are there geographic areas where you concentrate, and if so why?
Ms. Schmitt: The areas where we have
concentrated at this point have been in the southern states up to the mid Atlantic and
then down through the south, south-central, southwest and into the Pacific Northwest. We
concentrated in those areas because they are high growth markets and continue to be
stronger growth markets in the housing area. Retail commercial construction tends to lag
housing at least for the type of projects we engage in, by one to two to three years.
Therefore, there are still some very strong growth prospects in those markets and that is
where we have focused many of our resources. With that said, if on an opportunistic basis,
there are other things in other markets or brands that want to go different places with
us, there is certainly nothing that precludes us from doing business in other
How are you sure you are working with credit-worthy people and what steps do you take to
ensure that you are not burned?
Mr. Creamer: There are a few
components that we have in place to mitigate the risk. We are not speculators and so we
always have the lease in place before we do anything. With regard to credit-worthy
tenants, we tend to stay with the name brand, recognizable, franchise-type companies. It
is fairly easy to get the financial low-down on them and see what they are selling for on
the open market.
What are you looking for two or three years down the line for the company?
Ms. Schmitt: From an overall business
perspective, we consider this a marketplace where we are in a sweet spot, particularly at
this point in time where there have been some fairly significant changes to the regulatory
environment for banks doing real estate lending. We think we are poised to be in a great
position to be able to expand our business significantly with the change because there
will be a pull back among banks, particularly the community banks and mid tier banks which
have come close to or has exceeded the recommended ratios that the regulators have put
forth. We think that our alternative means of financing in the marketplace is very
attractive and will continue to become more and more. The other thing from our business is
that we see a view for growth amongst retailers, both inside and outside their current
geographic footprint. There does not seem to be much of a pull back in terms of the retail
aside and as housing has slowed, there is a lag effect for commercial development and we
think we are poised to catch that as well. The recent numbers that have come out by the
reconstruction data, suggested that in 2007 they are forecasting $89.4 billion dollars in
commercial construction; mainly retail. Therefore, we think there is plenty of room to
grow from where we are today and we are looking forward to being able to capture those
opportunities, work with our investors to be able to cultivate and grow our
You have mentioned that you have a good sales staff; do you need to add new members to
your management or sales team or are you pretty well settled now?
Ms. Schmitt: Any company that says
that they are pretty well settled probably is not thinking in terms of the next big
opportunity that they could be addressing. We are always looking to add great people to
our team with the energy, motivation, and vision that we have to really turn this into a
market leader in this specific niche.
In terms of the interest rate environment, does it matter to you or are you just passing
along the cost?
Mr. Creamer: To a great degree, we are
able to pass along the costs, we are not very concerned about interest rates, but I think
that if there were an interest rate drop that might be an issue. However, for the most
part it is not as significant issue at this time.
What is the financial picture of the company?
Mr. Creamer: We are growing. We grew
from 2004, which was really our first full year; we did $1.8 million dollars in revenue
and we were slightly profitable. In 2005, we did almost $8 million in revenue; again, we
were slightly profitable. We made $77 thousand and this year we are continuing that. We
have $6¾ million in revenues that we announced and we just continue to grow. We cannot
guarantee profitability, but our model seems to lend us in the long-term to be
Why is this a good time for investors to be interested and what should they know that
might not jump off the page when they are first looking at the company?
Mr. Creamer: I think that with the
regulatory change that we see now, that we will have a great opportunity to capture a lot
of market here. As far as investors go, in my experience, if you can combine both growth
and profitability, you have a good combination for a positive stock valuation. Therefore,
I think the growth that we saw from 2004-2005, was just the tip of the iceberg and we
should be able to continue that substantially going forward.
What should our readers remember most about Across America?
Ms. Schmitt: If I could take three
things they would be that Across America is operating in a niche that is large and is
going to continue to grow certainly for the foreseeable future, based upon all the
available industry data. I think they should know that we are flexible, nimble and very
committed and focused to serving this market and all the constituents that are in this
market; developers, retailers and the broker community as well that participate in all the
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