Timothy Fournier was 10 when he got his start in housing development and 12 when he made his first investment.
At that time, he and his siblings were helping their parents purchase and develop apartment units in their northeastern Vermont neighborhood.
His first project was a duplex his folks bought for $10,000; he chipped in $500 of his newspaper route money to help them pay in cash. Four of the six Fournier children—two of them were too small—also invested their savings in the budding family business.
Today at 46, Fournier is still at it, only now with a staff of 400 and a portfolio of some 8,000 apartment units at Conifer Realty LLC, where he is president and CEO. Conifer develops, owns and operates real estate, primarily affordable-housing communities.
It was shortly after his parents bought their first duplex, Fournier says, that they discovered the concept of leveraging.
"We realized we could have bought five duplexes with $10,000 and leveraged the balance with bank financing," Fournier says.
His parents went on to own and manage properties for another 30 years. Five years ago they sold their portfolio and today are retired.
Fournier has kept an unusually steady eye on real estate through college in New Hampshire, where he helped his brother fix up apartments for rent through his years as a CPA at Coopers & Lybrand, where he specialized in real estate development, to his 25-year love affair with Conifer, where he oversees the development and operation of affordable housing across a five-state area.
At New Hampshire College, now called Southern New Hampshire University, Fournier says, "I really enjoyed real estate, but I wanted to be a CPA with a concentration in real estate."
He graduated in 1982 with an accounting degree, moved to Rochester in 1982 and joined Coopers & Lybrand, whose office had a significant concentration in real estate clients, including Conifer Development. He has stayed at Conifer since.
Friend and longtime associate Richard Brienzi met Fournier more than 25 years ago at Coopers & Lybrand, where both CPAs worked on the Conifer account.
Brienzi is executive vice president and chief financial officer at LeChase Construction Services LLC, which in 2005 formed a joint venture with Conifer Realty LLC, in part, to construct Conifer’s affordable-housing developments.
Their long relationship, Brienzi says, has been renewed and cemented many times over with the trust he has in Fournier as a business partner and friend.
"I trust Tim’s advice on a variety of things," Brienzi says. "I know I can talk to him about any business situation, and I know I’m going to get a straight answer. It may not be the answer I want to hear, but he’s going to be fair and honest.
"Over the years, Tim and I have become really close friends. I was the best man in his wedding, we’ve been on golf trips, but from a business point of view, in the various stops I’ve made, we’ve always done various projects together."
A joint venture
The two men worked together while Brienzi was at DiMarco Constructors LLC and building projects for Conifer. Later, Brienzi was at Essex Investment Group Inc., an investment and brokerage firm, which provided capital to tax credit programs for Conifer’s affordable housing. The two men joined up again through the Conifer-LeChase Construction, the joint venture between LeChase and Conifer.
Conifer-LeChase now rakes in $40 million in annual revenues, Fournier reports.
Fournier did not disclose Conifer’s total revenues but said the average annual rate of growth is approximately 40 percent.
Conifer-LeChase is a 50-50 joint venture designed to improve margins through volume purchases for construction items, such as carpeting, kitchen cabinets, windows and appliances.
Plus, the company leverages the combined expertise of its parent companies.
"Conifer brings the work to the joint venture, including not only Conifer work but third-party work, and the LeChase team utilizes its 60-plus years of construction experience to do the physical construction of the development," Fournier says.
Conifer-LeChase is run independently from its parent companies yet is integrated within them, he says.
"It’s run independently in that there are probably 10 to 12 direct employees, and then the company leverages off the systems: estimating, accounting and the labor pool of LeChase construction. While on the other side, the marketing of new business is brought by the Conifer development team," Fournier explains.
The venture is performing well, which is what its founders anticipated.
Despite the challenges of real estate development, such as the rising costs of land purchases, building materials and workers’ compensation, Conifer has succeeded because it sticks to its niche: affordable-housing development. Conifer associates say that is a business Fournier knows inside and out.
He is skilled at developing complex transactions, but a deeper advantage is his unmatched understanding of the challenges to affordable-housing development, colleagues say.
Gaining tax credit approval for affordable-housing developments is one example, but another challenge is educating the surrounding communities about the seamlessness affordable and market rate housing can achieve.
"It takes time to educate the mayor, supervisors, councils, people, neighbors, what is affordable housing and what does Conifer represent, and help them understand that we’re not only there to build a high-quality product, but we’re there to be good neighbors," he says.
Fournier remembers two projects that tested the company’s resolve to communicate that vision.
"In the Baltimore-Washington market, we encountered two significant projects that we undertook to develop and construct simultaneously in a market where we did not have significant experience," Fournier says.
They were mixed-income projects, half affordable housing and half market rate housing.
"That combination of income strata presented significant challenges during the rent-up and lease-up process, and as a result it took us much longer to lease up these properties. We learned some new things about our industry," he says.
Today, those two projects are the most valuable properties in the company’s portfolio.
"Ultimately the markets realized that there wasn’t a problem mixing market rate and affordable seniors together in one housing development. We also had the benefit of getting into those markets at the right time. Now values in the area have risen so dramatically, they’ve also driven the rents higher, thus adding to the economic value of the properties themselves," Fournier says.
Fournier says land costs in markets such as Long Island, New Jersey, Baltimore, Maryland and Washington D.C., have risen considerably in recent years.
"The land costs are creating a situation where it’s prohibitive to the amounts of rents that we can charge, because our rates are affordable rents and therefore are dictated by certain indexes—how much that we can actually charge," Fournier says.
That does not mean, however, that the company plans to scale back development in those areas. Instead, Fournier says, the process requires better due diligence and more patience to find the right parcel.
Building its footprint
Steadily, the company has assembled a footprint of affordable housing across New York, New Jersey, Maryland, Pennsylvania and eastern Ohio, with future plans to expand to Connecticut. But by and large, Fournier says, the job is to focus on new developments within that established footprint.
Approximately 25 percent of Conifer’s properties are in Upstate New York.
Its total portfolio is roughly one-third urban and two-thirds suburban and rural markets.
Across those markets, Fournier said he has seen a trend reversal in the flight to the suburbs. In Rochester, Fournier says, developing that emerging trend is going to rely on the traction of Renaissance Square, the $200 million city center project.
"The Renaissance Square project is so important to accelerate development opportunities in the downtown area. The risk to a private local developer is so significant presently that it’s hard to justify housing ventures in the city without a significant project like Renaissance occurring and finding the right solution to the Sibley Building and Midtown," Fournier says.
Rochester, he says, has demonstrated its resilience against corporate layoffs, and its leadership in higher education is a major key to the area’s revival, but the city’s success he says also will depend on the collaboration between county and city governments to launch Renaissance Square.
"It is important that we get it started, and that we start to create the enthusiasm and opportunities for Rochesterians to feel good about Rochester, and for private development to see the opportunities to take the risk to develop projects in the city," he says.
Downtown residential developments such as Sagamore on East, Corn Hill Landing and Buckingham Commons are signs of downtown’s revival, but for future development, Fournier says, downtown needs to prove itself to the community.
"We will only be able to develop housing down here if it becomes an attractive, safe place for people to live. And until we can demonstrate that as a community, there will never be, I believe, more than a trickle of people wanting to live in the city," Fournier says.
One good way to do that is through Renaissance Square, but for it to have an effect, the project needs momentum.
"At a minimum, just acquire the properties that need to be acquired and commence the demolition," Fournier says. "That itself would create a buzz and optimism in the community, and it’s time for us to do that."
Fournier remains confident in Rochester, and with someone so measured, that is saying a lot.
Confidence does not come easy for Fournier. Instead it is acquired over time, slowly and with experience.
Creating the firm
Confidence in their combined expertise is what he says has driven Conifer’s partners for the last seven years—since the company was bought out from Home Properties Inc., a real estate investment trust that acquired Conifer five years after Fournier began working with the firm as a CPA at Coopers & Lybrand.
Conifer was founded in 1975, merged with Home Properties in 1996 and under a $16 million management-led buyout, separated from the company in late 2000.
The Conifer division at Home Properties contributed roughly $2.5 million in net income. Home Properties spun off its affordable-housing unit to focus solely on market rate communities.
At the time, Conifer had 40 employees and many years of experience.
So while going out on their own was daunting, Fournier says he never had a doubt about their ability to succeed. Although, the partners did underestimate Conifer’s potential.
Upon the buyout from Home Properties, Conifer’s pro forma predicted an employee base of 250 and a portfolio of 5,000 units by now; the company has exceeded those expectations with 400 employees and a portfolio of 8,000 units, 700 under construction and another 600 in the pipeline.
Conifer’s partners are Richard Crossed, the company’s co-founder; Terence Butwid, executive vice president of Conifer and president of Conifer’s property management division; and Fournier, who last year took over the company’s helm from Crossed, now chairman and managing partner.
Fournier, Crossed and Butwid all worked for the Conifer division at Home Properties before buying it.
"The initial financial commitments were daunting. At times, initially, I felt that we were operating in more of a survival mode than in a growth mode," Fournier said.
But, he emphasized, "We never doubted that we had the abilities to build a successful company."
"The question is not why, but why not," Crossed says. "Conifer was always a leader in the affordable-housing industry for the past 30 years. We hired the best and the brightest, and were good mentors. The company was successful before Home Properties, with Home Properties, therefore it is only logical that it could continue to be successful."
Timothy Flaherty, managing partner who heads the real estate practice at accounting firm Salmin, Celona, Wehrle & Flaherty LLP, is a longtime friend, who shares Fournier’s unusually early start in real estate.
"I think we had pretty similar family and schooling backgrounds. Middle-class family, many siblings, very hardworking parents who in addition to their full-time day jobs, invested and operated rental housing apartments. I think both of our parents had accumulated, and operated, approximately 50 to 60 rental units over time—Tim’s family in Vermont and mine in Rochester," Flaherty said.
He and Fournier get their love of real estate from their parents, Flaherty says. "We both bought our first houses at age 22 or 23. Both of us also bought some rental properties in our 20s—but nothing to the extent of our parents."
The two men worked together at Coopers & Lybrand in the 1980s.
"We really had a great group of people at the time at Coopers & Lybrand. I think our motto in those days was that we work hard but we play hard too. And we did. You were spending 90 percent of your waking hours with these people. While hard work, it was a great environment to really see people’s strengths and weaknesses as well as who was a team player and who was out for themselves," Flaherty says.
"Tim was, and remains, one of those people that is always looking out for the other guy."
And that translates to his family life and community service, Flaherty adds, citing Ronald McDonald House Charities of Rochester, New York Inc., where Fournier serves on the Council of Presidents. Fournier also is a board member of the Golisano Children’s Hospital at Strong Memorial Hospital, Nazareth College of Rochester and Rochester Downtown Development Corp.
Putting family first is something else Fournier learned from his parents. He married his wife when he was 36. He met Susan on a blind date and this year celebrates his 10-year wedding anniversary with her.
The couple has an 8-year-old daughter, Gabriella, and 6-year-old son, Timmy.
The family likes to ski and travel and with their friends the couple enjoys wine collecting, a hobby Fournier developed with his brothers several years ago.
At work, Fournier says he has been working on developing his leadership skills, which is a challenge he enjoys and one at which his friend Flaherty has seen him excel.
"Conifer and our accounting firm also do a considerable amount of work together. Conifer is one of the firm’s largest clients," and as such, Flaherty says, he has had ample opportunity to watch Fournier’s development as a leader.
He shows vision, strategy, fairness and patience, Flaherty says.
"He is not one of those high-pressure personalities, always making one feel like they have to get something done for the boss," Flaherty explains.
Instead, he says, Fournier gets input from others before he sets expectations and provides the coaching and tools necessary for the team to get there.
"He is a highly capable individual who works exceedingly hard and (is) dedicated to motivating and mentoring employees," Crossed adds.
He calls Fournier a person of high integrity and someone who strives.
"He makes people ‘want to do’ versus feeling like they ‘have to do’ something," Flaherty says.
That does not mean he is a pushover, he adds.
"Real estate development and construction require strength and toughness. You have to be tough, or else you will be run over—and taken advantage of," Flaherty says. "Tim is firm but fair."
After all, Flaherty says, employees want him to lead them; they want someone they can trust.
"A good approach or style is useless if it lacks a strong compass," Flaherty says. "Tim’s success is testimony to his compass."
Title: President and CEO, Conifer Realty LLC
Education: B.S. in accounting, New Hampshire College, now Southern New Hampshire University, Manchester, N.H., 1982
Family: Wife, Susan; daughter, Gabriella, 8; son, Timothy Jr., 6
Hobbies: Traveling, skiing, golfing, wine collecting
Quote: "We stay here because Rochester has become home for us. It’s a great place to raise a family. We’ve been able to assemble a great work force here. Conifer has established a very successful track record over the last 30 years in this region, so we will continue to focus some of our efforts here."
3/16/2007 (C) Rochester Business Journal o obtain permission to reprint this article, call 585-546-8303 or e-mail email@example.com.