Ten Years Later

October 1999

by Edna Tenney, Editor, Business People

A look at the businesses making news in the October 1989 issue of Business Digest

Coburn & Feeley Real Estate

In October 1989 the Greater Burlington business community was strong, vibrant and confident of a bright future. Coburn & Feeley Real Estate, the firm Rich Feeley founded in 1978, had grown to a staff of 35, housed in the beautifully restored Wells-Richardson building on College Street, Burlington, one of the nine office buildings the company owned. His partner, Tom Coburn, grew his insurance firm to more than 30 people in three locations. Coburn & Feeley owned almost 250 apartments and quite a bit of land.

Feeley remembers how quickly things changed. "That was probably the most difficult time in my business career. ... I went from being kind of a golden boy, on the cover of Business Digest and all that, to being somebody no one wanted to talk to -- in almost the blink of an eye. It went from people calling on Tuesday and asking didn't I have something I wanted to borrow money to do, to calling them back on Wednesday and they'd say, 'Rich who?'"

As tough as those times were, Feeley says, it didn't compare to 1970 when he lost a leg as the result of a freak accident while playing Rugby. "Now that was a bad day!" he says. "I don't dwell on the negative now, everyday is a gift. Even with all that was happening, I still had probably more than 99 percent of the people in the world, so if I started complaining, I should have been hit upside the head.

"I did the things you have to do, restructured debt, stopped paying myself, downsized. I had good partners, everyone hung in there. And I went back to what I was good at, focused on real estate brokerage and property management. I had gotten into doing a lot of things and thought I was good at them, but the truth is it was the good times, not me."

Through the '90s, the company survived, then prospered, while Feeley watched the changes in the business. He saw all kinds of companies either merging into larger entities or downsizing, and expected that to occur in real estate, too. Chittenden County would end up with two or three very large firms and several very small ones. "I saw myself as the surviving entity, that's what I was thinking when I bought Janes & Jacobs," he says. But when Hickok & Boardman came to him in the spring of 1998 with the idea of a merger, it made all kinds of sense to Feeley. "I had worked there almost 20 years ago. I knew them, and they had flourished over the years." It was a great place for his staff, and he could concentrate on his first love: commercial real estate.

For almost a year, Feeley, who still owned and ran Coburn & Feeley Property Management, ran that and the commercial division at Hickok & Boardman. "They were a joy to deal with as a minority owner, but I was a little too independent, I needed to be out on my own," Feeley says. A year ago, he established Feeley Commercial Real Estate -- it's just him selling Chittenden County commercial properties, and he loves it. Hickok & Boardman uses the services of his property management company -- "a win-win," he says.

Steve Bushey

Bushey Marlowe & Co.

Ten years ago the commercial real estate business was hot. A few short months later it was not. When Business Digest profiled Steve Bushey and Bob Marlowe of Bushey Marlowe & Co., they were adding people to their growing firm and looking to expand their services beyond brokerage. But when the recession hit, the overhead of people and offices was too much. "When things get tough," he says. "I can always take care of myself." So he moved his business home and worked independently.

Bob Marlowe and a couple of members of their staff went to work at Hickok & Boardman Real Estate in the commercial division. Marlowe moved on about a year later, joining Coburn & Feeley Real Estate, where he stayed through most of the '90s. "Now I'm with Pomerleau Real Estate," he says, "wonderful people. I'm still in commercial real estate." Years ago he started out in residential real estate, but quickly found that the commercial side interested him more.

Bob Marlowe

These days Bushey, under the business name Steven Bushey Co., shares an office on Williston Road, South Burlington, with his sister, Carol, and her business, Carol Gamsby Property Management. Much of his work involves real estate exchanges, an outgrowth of his 12-year membership in the Society of Exchange Counselors, a national group that meets every two months all over the country. "It's the oldest and toughest to get into, " Bushey adds. "They have always done real estate exchanges in the west; it's been done less in the east. Out west they have lots more real estate than money."

A 1996 tax bill contained changes that made exchanges more attractive. Bushey explains. "If you have a property and you sell it outright, you have to pay tax on the capital gains and pay the recapture on what you have taken for depreciation. However, if you do a real estate exchange, you can defer all capital gains and depreciation until you go to cash -- you can keep more money growing.

"For instance, I have a client who will have $1.2 million from selling commercial real estate and I'm looking at investments in Nevada, New York, Michigan and North Carolina with the idea that he can take his money and keep it growing in these other real estate investments." He puts his Vermont clients into distant properties because the returns are higher. "Real estate appreciates better out west and other places. They outperform Vermont."

Betsy Carter

Betsy Carter Property Management

In 1989 Betsy Carter's property management company was located on Ethan Allen Drive in South Burlington, where she and her administrative assistant, along with some part-time help, managed the finances and building and grounds maintenance of almost 800 residential condominium units. "We're still here and still going strong," Carter says, noting that the business is at the same location and working with Deborah Manchester, the same administrative assistant, but with a new married name.

"I feel like I've come full circle," Carter says. "We've moved twice in the last 10 years and ended up back in this location. I have clients that left me over the years, that are now back with me. And I have had as many as five full-time employees, and found that it really works better with just the two of us." Using sub-contractors instead of in-house staff, she says, gives her more flexibility. "If, for instance, a client doesn't like the snowplowing but likes our administration, I can keep the client and just change the sub," she says.

"We had some ups and downs in the early '90s, everybody did," she says. "But I had some good and loyal clients. I feel lucky I got through it." Carter has approximately 50 percent of the clients still with her that she had 10 years ago, a number she is proud of. "I'm in it for the long haul," she says. "I still love what I'm doing."

Norell Temporary Services

In the fall of 1989, Brad Worthen opened a franchise of Norell Temporary Services in Lakewood Commons, South Burlington, in the face of the oncoming recession. And survived. It turns out that the regrouping and downsizing that occurred to weather the hard times meant using temporary workers to fill out staffs during business fluctuations. After more than five years of building his Vermont location, Worthen opened a franchise in Portland, Maine, spending a lot of time there getting that office established. In 1997 he added a location in Providence, R.I. -- and recently sold it. Worthen will sell the Portland franchise next month.

Brad Worthen

"We've had some successes, some failures," Worthen says, noting that the travel gets old fast, and the success of his far-flung enterprises was a mixed bag. "We've done very well here in Burlington, and (echoing Betsy Carter) I've come full circle back to spend my full time in Burlington." He's looking forward to being able to spend more time in community activities, like his former involvement in Kwanis and the Vermont Quality Council.

And Worthen has been thinking about this 10-year anniversary. "There is some value in reaching your tenth year," he says. "You're recognized, even respected. People ask you for advice or help, and you can be selective in your clients, dealing with people you can really help and work with well."