A Land Office Business

by Mary Landon

Chris Brown sees his job as situating people to take advantage of the coming wave

photo Chris Brown was a general contractor when, in 2003, he learned about an IRS tax strategy known as the 1031 Exchange. It became one of the primary tools in his Richmond advisory business, Chris Brown, Real Estate Advisor Inc.

Chris Brown, the owner of Chris Brown, Real Estate Advisor LLC. in Richmond, says he has spent most of his life fascinated by home construction and the real estate business.

Brown grew up in Los Altos, near San Francisco. His childhood memories revolve around the outdoor activities he and his family enjoyed together. Brown’s paper route earnings were typically used to buy equipment for skiing, a passion he still pursues. He was also intrigued by the properties he saw being built around Lake Tahoe during family trips. Brown liked both the building aspect and the business side of real estate.

When it came time to leave for college, he chose Colby College in Maine, a school that he says gave him the experience of being somewhere completely new. He majored in government, with the intent to attend law school.

After graduation, Brown migrated to Jackson Hole, Wyo., to pursue his love of skiing and to work in home construction. After staying a couple of years, he returned to San Francisco to work in the sales department of the mutual fund company GT Global for Mike Dougherty, a close friend of his parents whom he had known since childhood.

This experience gave Brown a strong financial background and a license to sell securities to add to his skills in the building trade. It was during these years that he also reconnected with a college friend, Rebecca Winokur. When she headed to Vermont to attend the University of Vermont College of Medicine in 1995, Brown followed.

By then, although he had taken his law school admission exam, he had changed his mind and become interested in pursuing his real estate ambitions. A career epiphany a couple of years later fed that desire.

He had been working for a custom home builder in Stowe. On one particularly cold day — “March 4, 1997, my birthday,” says Brown — he found himself in a snowbank, digging old shingles out of the snow. He decided on the spot that he could do much more, and be his own boss. He soon opened his first venture, Brown Builders, as a general contractor. He also began to seriously invest on his own.

In 2003, Brown had a pivotal conversation with Dougherty, his former boss at GT Global, during which he was introduced to the IRS tax strategy known as the 1031 Exchange. It would become one of the primary tools in Brown’s future advisory business.

In 1921, the IRS enacted a regulation called a 1031 Exchange, which allows deferment from capital gains tax after the sale of one qualified property, as long as the property owner purchases another qualifying property within a specific time frame — exchange of property held for commercial, business, or investment use.

photo Brown’s headquarters is in Richmond, but he occasionally uses a space in the Burlington offices of Encore Redevelopment, owned by colleague Chad Farrell. Colin Ackerman (left) an employee of Encore, talks with Brown.

TIC (Tenant in Common) and DST (Delaware Statutory Trust) are more recent IRS regulations that facilitate real estate ownership for groups of two or more people, each of whom owns a proportionate share of the real estate in common. Brown says, “You can be an owner, and receive all the benefits of real estate without taking on the burden of property management.”

With his background in building and his experience selling mutual funds, Brown was well prepared to venture out on his own. His career as a real estate investment adviser officially began in 2004. He works primarily with clients in the Northeast.

Brown points out that real estate has maintained its value, over time, as a tangible asset. Commercial real estate investments in a portfolio can potentially generate income, offer tax benefits, add diversity, and be a source of capital appreciation, he says.

His association with the Regent Capital Group, based in Los Angeles, allows him access to a registered broker-dealer. “We conference-call with other reps like me. New offerings come available all the time, all over the country, so we talk them over and try to decide on the best ones for our clients. There are real estate sponsors nationwide who locate the properties. We are basically raising the money for their deals, while they maintain a role as the management.”

At age 40, Brown is optimistic about his business. “It made sense for investors to pull back over the last year or two, when the economy had its dramatic downturn. For those who can look forward, this is a smart time to enter into this type of investment.

“Real estate is a vital component of a portfolio. Vermont in particular has a unique sales point and attractive lifestyle. There is a quality of life here that is enticing. Northern New England and northwestern Vermont are attractive markets. People will want to live here.”

Brown’s professional colleague, Chad Farrell, founder of Encore Redevelopment LLC in Burlington, where Brown occasionally uses an office, hopes to combine forces with Brown in the real estate development arena.

“Chris has been a great friend and confidant over the years,” says Farrell. “In more recent times, he has provided me with a wealth of insight on business and the often complicated deals in which we get involved. Chris’s level-headed approach and thoughtful, creative perspectives often help me to visualize opportunities with greater clarity and understanding.”

Becoming a real estate investment adviser demands many skills and talents, once a person has the proper credentials. Since starting his business, Brown says, he has seen a range of economic conditions that have necessitated flexibility and faith. He sees these last five years as a definite learning experience.

“Deep in my heart I love the real estate business. Long-term, there is a great opportunity for me to succeed. It’s about building relationships, and building the trust factor.

“And it’s all about the numbers. In the next 40 years, the U.S. population will rise by 100 million. The children of the baby boomers are moving out into the world. They are tech-savvy, green-savvy; and they are moving into the work force. They need places to work, shop, live, and play. If you own rental units or multi-family housing, you will have a huge demand.”

Low interest rates, the real estate slump, the weak dollar, and the credit crunch that we currently see also preceded the growth of the late ’90s. According to Brown, “What’s going on in the world right now can be compared to what happened in the late ’80s-early ’90s.

“History seems to be repeating itself. Had you been an investor in ’92-’93-’94, you would have made a significant return. It’s the same story now.

“First we had the Internet boom, and now it’s the alternative energy, green-building boom, and tech growth boom that are leading us into the next 10 years. My job is to get people situated to take advantage of this wave. My target audience is working professionals; I also have older clients who look to their investments to provide cash flow and to be estate planning tools.”

Maintaining an active family life is important to Brown and Winokur, whom he married in May of 2000. “Our son, Chase, really enjoys drumming. He’s 3 and a half, and he loves to go to African dance class with Rebecca in Burlington. Chase watches the other drummers, and sometimes he joins in.”

Chase was adopted from Ethiopia, an experience that stands out in Brown’s list of special life events. “What I remember about the country is the vibrancy and the joy and the accepting love of the people. Many of them are in a tough situation, but they seem happy. Everywhere you look it’s alive. I would like to go back and explore the country with my wife and son.”

Winokur works in South Burlington at Allscripts, an electronic medical records company that develops content for electronic notes used in medical offices. She also works one day a week at the walk-in care clinic on the Fanny Allen Campus of Fletcher Allen Health Care in Colchester, to keep active in medical practice and maintain a patient connection.

Brown teaches skiing at Stowe, and manages plenty of recreational skiing as well. He’s also involved with the Fellowship of the Wheel, a mountain biking group and organization that holds races and builds bike trails in Chittenden County.

“My wife and I moved into a real rough old house that we gutted and have renovated over the years. We work in the yard, building rock walls and gardens and making it into a special place. We have long lists of projects that are finally getting a little shorter!”

Brown’s goal is to be the “go-to guy” for people who are looking to add real estate to their portfolios. “This is my little niche and I’m going to know everything I can about it. I myself invest in these properties. Over time, I also hope to expand the development side of my business.”

“My desire, as a younger man, was to be a sponsored skier and mountain biker. When I got older and became more realistic, I realized that probably wasn’t going to happen.” Brown smiles at the thought.

“I’ve decided, instead, that I am going to sponsor myself. It’s about identifying what’s important to you, and then setting out to make those dreams come true.” •