Both Eagle Bank and the Ronald D. Paul Cos. are guided by similar principles — Paul said he steers toward smaller properties (the average Eagle Bank loan is for $1.7 million and most of his real estate holdings are spaces smaller than 75,000-square-feet) and makes an effort to invest in the immediate community.
But Paul said he never uses loans from Eagle Bank to finance his commercial real estate projects. Instead, he relies on loans from other community banks in the area.
“I am very, very strict about separating my real estate business and my banking business,” he said. “I have two separate offices, and I really do keep a brick wall between them.”
Thanks to a career straddling building and banking, Paul said both ventures have fared comparatively well in recent years despite the shaky economic recovery.
Eagle Bank’s real estate portfolio has dipped an average 8 basis points — or .08 of a percentage point — in the past three years, at a point when many banks are weathering much larger losses. Paul would not disclose revenue figures or other financial data for his real estate company, but said that occupancy rates are up this year, to an average of 94 percent, which he attributes to small- and mid-size tenants.
“You have government contractors cutting back, which will create problems for the much larger deals, but we’re putting our money back into small real estate deals — restaurants, hardware stores,” he said. “That’s our focus, and that’s always been our focus.”
Along the way, Paul said he’s found ways to incorporate his real estate knowledge into banking, and vice versa.
For example, he said Eagle Bank’s increasing presence in Northern Virginia has exposed him to parts of the region he’d never dealt with before.
The bank has “gotten very active in Northern Virginia — none of my real estate deals have been there, so far,” he said, adding that a commercial development in the area may soon follow.
“We’ve stayed close in D.C. [in both businesses],” Paul said. “We don’t do deals in areas we don’t know or understand. It just doesn’t feel comfortable.”