The development, which demonstrates the depth and breadth of the firm, is one of many projects Conifer has under way. Overall, the company started construction on 12 developments with 853 affordable units in 2014, making it No. 3 on the AHF 50 list of developers. Conifer also ranks No. 13 on the AHF 50 list of owners this year, with more than 13,000 affordable housing units.
Deep roots
Celebrating its 40th anniversary this year, Conifer has always focused on affordable housing.
“We’ve developed under virtually every affordable housing program that’s been available over these 40 years,” says Timothy Fournier, president and CEO. A CPA by trade, Fournier began working with Conifer as a client in 1982. He then joined the company as CFO in 1986, nine days before the LIHTC program was created.
Conifer grew to about 5,600 units, all in New York, through the end of 1995, when it merged with Rochester-based Home Properties, a public real estate investment trust and one of the nation’s largest apartment owners.
Conifer retained its name and operated as a separate division concentrating on affordable housing. By the end of 2000, its portfolio had grown to roughly 11,000 units. “The merger with the REIT allowed us to move outside of New York and start developing in New Jersey, Pennsylvania, and Maryland,” Fournier says. The firm also operates in Ohio.
That year, the partners, including Fournier and chairman Richard Crossed, took the affordable housing development division private. “As a result of a Securities and Exchange Commission change, the accounting method required for recognition of the affordable housing group’s development fees was no longer accretive to the REIT,” explains Fournier. “Home Properties decided at that point to begin the divestiture of its entire affordable housing portfolio.”
The spin-off firm began with 43 employees but had no apartments to own or manage. However, it bought the affordable housing pipeline that it had built to get started.
The team began developing projects and rebuilding the company’s portfolio. A pivotal move came in 2005, when Conifer formed a joint venture with LeChase Construction. Conifer-LeChase Construction is a full-service construction firm specializing in affordable housing.
The partnership was critical to Conifer’s 360-degree business model: What we develop, we build. What we own, we manage. The JV allows the team to control the quality, timing, and construction costs at each of its developments.
In the past 10 years, the firm has built more than a half-billion dollars’ worth of affordable housing. It currently has 22 sites in three states under construction.
“They’ve done a great job of growing their business without losing any of the quality or integrity of the company,” says Eric McClelland, president and CEO of Red Stone Equity Partners. The LIHTC syndicator has frequently teamed with Conifer to help finance the developer’s deals, including Wincoram Commons.
McClelland cites the company’s culture as one of its strengths. In real estate, there are always challenges, and Conifer executives have been very forthright in discussing any issues that may come up in a deal. “Working with them, that helps solve things,” McClelland says. “That’s what makes a great partner.”
For the past several years, Conifer has tried to maintain a pipeline of about 30 or more properties. It’s a significant financial commitment, but it has allowed the company to move quickly when new funding opportunities become available.
For example, Conifer has two properties in New York and six in New Jersey that are involved in the Hurricane Sandy recovery efforts.
