Breaking Ground
Sam Leone, President, Conifer Realty
By Darryl Hicks
12 min read
In this issue of Tax Credit Advisor, we continue our discussions with the next generation of thought leaders in the affordable housing business.
Meet Sam Leone, president of Conifer Realty. Since its founding in 1975, Conifer Realty has built a portfolio of 15,000 multifamily units across 210 properties in New York, New Jersey, Pennsylvania and Maryland – although as we will learn the company is slowly expanding its footprint southward.
Leone joined Conifer in 2007 as a project coordinator and worked his way up the food chain. He was executive vice president of development when he was promoted to president of the company in April 2022.
Before joining Conifer, Leone served as a finance officer for the New Jersey Economic Development Authority (NJEDA) where he was responsible for financing numerous community and business development projects.
TCA sat down with Leone to learn more about Conifer’s strategic direction and growth opportunities and his leadership style.
Tax Credit Advisor: You have been Conifer’s president for just over a year. What achievements are you most proud of?
Sam Leone: I am most pleased by the progress we’ve made responding to the headwinds caused by the pandemic. In 2024, we’re focused on three key areas. First, we’re going to restore our portfolio to pre-pandemic health. We spent 2023 catching up on physical needs assessments, getting back out to our sites and understanding what investments need to be made. We also need to focus on the financial health of our portfolio. We had a series of eviction moratoriums that impacted our financials, which we’re still sorting out. We need to bring our portfolio back to the way it looked, felt and ran before the pandemic hit. Second, we need to repair our portfolio without getting distracted from our current objectives and performance. To ensure this, we initiated an effort called Operation Reset. A separate team was formed to focus solely on this initiative so that our operations team can ensure that we’re prepared for 2024. Third, starting in 2018, we pivoted towards more meaningful opportunities. Historically, Conifer was a nine percent developer in four states, but that space got smaller. Instead of seeing opportunities involving 80 to 100 units, it was more like 40 to 50 units. At our scale, that was no longer a good fit, so we turned to larger, four percent transactions. Not everything needs to be big, but we want to be the firm that comes into a community and makes a meaningful impact. So, 2024 is going to be a year of ensuring that we’re focused on the right opportunities. We want to go into communities where there’s a need, where the need is recognized and where we’re welcomed. As part of this effort, we started to expand beyond our historical footprint of New York, New Jersey, Maryland and Pennsylvania into Virginia, North Carolina, South Carolina, Georgia, Florida and Massachusetts. The idea isn’t to do three times more business necessarily, but to have more choices, and to be able to have more communities that we can reach out to and try to find opportunities where we can deliver great value.
TCA: As a next-generation CEO, what changes in leadership style, corporate culture, etc. would you like to see adopted by your peers and business partners that could help improve our chances of fixing today’s housing crisis?
SL: I strive to be a servant who respects the well-being of Conifer’s employees and residents. We’re a large organization of more than 500 people, all of them incredibly dedicated. We’re a for-profit company, but we’re mission-driven and we want to see that carried through in the leadership through the rest of the executive team, senior leadership team and everyone here at Conifer. One of our core company values is personal leadership. We consider everyone at Conifer to be a leader. We can’t thrive and grow if our people don’t feel empowered to make decisions and create an environment of trust rather than blame. My focus has been on removing barriers and roadblocks and enabling solutions. I’m not looking for who was at fault, rather let’s figure out how to remove roadblocks and do better next time. We’re working to have a company where people feel like they’re part of something bigger and that there’s clear succession and personal growth and development.
TCA: NH&RA’s members have encountered quite a bit of turnover recently where Baby Boomers are retiring and being replaced by younger generations in their 20s, 30s and 40s. This next generation of leaders is bringing new and fresh ideas to the table to address the housing crisis. Are you seeing this within Conifer? Do you see this as a positive trend within the industry, or are there challenges that need to be recognized and addressed?
SL: We are seeing that, and I believe it’s a positive trend in the workforce and at Conifer. New generations always get a bad rap and are kicked around by prior generations. As a Gen Xer, I remember the comments about being called a slacker. The fact of the matter is younger generations are incredibly tech-savvy and mission-driven. I don’t like to generalize across generations like that, but the people who we’re recruiting or who are already working at Conifer are engaged, they want to see improvement in how we do things, and they challenge the status quo. They tend to be the ones who ask, “Well, why do we do it that way?” Disruption can be valuable if it’s healthy. The magic is when you have a mix of different generations, perspectives and backgrounds all coming together for a common cause to provide affordable housing opportunities for our residents.
TCA: I’d like to get your insights into how you successfully manage growth within Conifer, whether it’s new technology, personnel, capital, processes, liquidity, etc. All these factors contribute to a successful business, and I am curious if you adhere to certain best practices.
SL: When you use the word “growth,” I’ve learned firsthand that you must be careful how people interpret it. For some people, growth means more work. For others, the question becomes, how do we accommodate growth, and do we need more people? We’ve been careful not to have that word become stressful. It should be fun. Healthy organizations find new ways to do things and to grow. We use the phrase “bend, not break” a lot. We’re looking to push the envelope, but not at the expense of pressing our employees beyond their capacity. That’s not healthy for an organization. Growth is not a straight line; it’s got a lot of ebbs and flows. Every growth spurt provides an opportunity to evaluate what worked and what didn’t. A great example of this was in 2023 when we acquired 1,500 apartments. That was new to us. Historically, we developed new construction from the ground up, which tends to be slower and steadier. With an acquisition, you flip a switch and suddenly you have another 500 apartments that you’re managing. As we ramped up, the 1,500-unit number was intentional. We felt it was manageable. It’ll push the envelope, but our teams can manage this, even if they learn new things along the way. Now that we’ve completed these acquisitions, the teams are going back and saying, ‘Hey, what could we have done better? What worked? What didn’t work?’ The plan is to nail that down, so that in 2024 maybe we can acquire, or have the capacity to acquire, 2,000 or 2,500 apartments.
TCA: Your promotion to president occurred during a challenging period when the country was still in the early stages of emerging from lockdown. Are there any lessons learned during that period that still influence the executive decisions you make today?
SL: We always recognized, but it was made clearer during lockdown, that personal connection with our people, our communities and our residents is incredibly important. We found new and creative ways to do things virtually, but that shouldn’t replace personal connectivity. We’re focused on ensuring that we have a steady balance between the two. We’re not just landlords. We have an obligation to the residents in our communities to make sure that they’re doing well, that they’re happy and that they’re thriving. We’ve implemented new protocols for senior management to visit our properties, not to check up on our on-site teams, but to be present and to listen. The lockdown emphasized the adaptability that we have. It’s amazing how quickly our team showed up in 2020. We’re still thanking our site crews for recognizing that they were essential personnel who needed to continue going to the properties throughout the pandemic to ensure that repairs were being made and residents’ needs were addressed. They didn’t get to work from home, and we’re incredibly thankful for the sacrifices they made. It’s amazing how everybody adapted to figure out how to make it work. That adaptability still thrives here.
TCA: What new initiatives are you planning for 2024? Are there any new markets you’re looking to expand into, or noteworthy projects that you’re looking to announce?
SL: We all want to do more, but within that context, we want to focus on opportunities where we know that Conifer can do an excellent job, that fits our niche, has the right scale and where there’s a need, capacity and desire for affordable housing. The states I mentioned earlier that we’re expanding into—Virginia, North Carolina, South Carolina, Georgia, North Florida and Massachusetts—offer phenomenal opportunities where Conifer can provide value.
We spent 2022 and 2023 getting our name into those markets and going after and securing opportunities. Some of them were competitive through our fees or finding a partner and identifying a location where we could develop affordable housing. We spent most of those two years prepping. Now 2024 is the year where we’re going start going vertical and building out those opportunities.
TCA: What lessons have you learned over your career in terms of maximizing relationships with state housing finance agencies, local governments and other agencies to help grow your pipeline?
SL: Open communication is always critical. We need to be checking in with state, local, county and federal agencies as much as possible, but it needs to be two-way. We should be communicating what we’re up against and what we think can be done industry-wide for us to be more efficient and effective. And then we need to be listening closely to what the agencies are focused on. Across the board, we’re seeing states trying to deliver the same amount of housing production and preservation as they have in prior years, but it’s hard if the resources and total dollars are the same as they were in previous years or at least have not grown to outpace inflation. Those states are now faced with declining production at a time when we need more housing. It’s important to understand the regulatory landscape and advocate for what the industry needs, but it all must align with community objectives. While affordable housing incentives are more flexible, they still don’t always resonate with communities. NIMBYism (Not in My Backyard) and a general mistrust or misunderstanding about affordable housing persist. It’s always going to be there, so we’re careful to communicate with our communities. We’re working to help them understand what affordable housing is, and what it isn’t, and how we operate in that space. We’re hearing a lot more from communities saying, ‘Okay, we get it, and we want it, but we’d like affordable housing to look a little bit more like this.’ Understanding that local context is important and leads to more successful communities.
TCA: What factors help determine the new markets that you want to enter?
SL: It starts with market research analysis. We want to go into states, cities and demographic areas where the scarcity of affordable housing is the most obvious and where we can make the most impact. A great example of this is Jacksonville, FL. It’s growing by leaps and bounds. Every day, there are more and more job opportunities, but that will only continue if housing remains affordable. The regulatory environment also plays a huge factor. We’re finding that in some places, as much as we want to deliver affordable housing, and the community wants it, the regulatory environment is too long and arduous. It’s a business reality. If there’s no clear path, or if there is a clear path, but it’s going to take four years instead of two years to line up the financing and get all of the necessary regulatory approvals, this may sound insincere, but we have to take the opportunities where we can deliver in a predictable pace that allows us to get things done. We’ve had to exit markets that don’t have that predictability. That doesn’t mean that we won’t go after opportunities that are in a longer duration cycle. However, what we found over the years, the hard way, is that the most painful impact on our business is when we spend six years working on something that everybody wants to see get done, but due to all those regulatory challenges, we all get sucked into a situation where we’re saying, ‘well, next year it should pan out’ and before you know it, we’ve invested a huge amount of staff time and dollars. We’re careful not to continue that pattern.
