Build, Manage, Invest with Peerless Companies

It was November 2020, and business owner Mike Scuola had just made a childhood dream come true.

He’d officially opened the Lake Avenue office for his real-estate management and investment business, Peerless Companies. In any normal year, this would have been an accomplishment in and of itself. But after over six months of COVID-related shutdowns and economic turmoil, it was a major victory for Scuola. In the face of such tall odds, it proved to be a pivotal moment that assured the company’s future.

During the tumultuous year, Scuola saw an opportunity to not only grow the company, but to help people get back on their feet with a business model that places an emphasis on people— without forgetting the math. Scuola’s multifaceted housing company could have shared the same fate as other new businesses who opened and closed within the same breath in 2020, but instead he chose to innovate his way out of the problem. 

With Peerless Companies, Scuola realized they had an opportunity to explore the property management side of the industry. “Looking at a single-use apartment owner who may be tired, and seeing what kind of value Peerless Companies can bring to the table,” Scuola said.

As the pandemic raged on and the economy skidded to an anti-climactic halt, renters rejoiced when they realized that rent moratoriums would prevent their worst fear from coming true: eviction.

“It was a blanket excuse for a lot of people to not pay their rent. Your average owner-operator didn’t know how to navigate that. ‘They don’t have to pay, what am I going to do?’ The owners of the buildings still had to pay their mortgage. There was no relief for them. We were able to come in and work with the residents,” Scuola explained.

The state of New York is a judicial foreclosure state, which automatically allows borrowers to challenge foreclosures. While that doesn’t guarantee complete immunity, it gives homeowners more time to save their property.

Scuola said that Peerless also met with their new tenants to figure out how they could create more cash flow and start paying at least some rent. He has a simple business model: “The numbers don’t lie.”

The housing market still faces challenges exacerbated by the pandemic, but compared to the rest of the nation, the Capital Region’s market is on far steadier ground.

The moratorium expired by the end of the summer of 2021. By the first quarter of 2022, apartment rents in Saratoga County averaged $1,494. That was up more than 10% from a year earlier, according to the 2022 Comprehensive Housing Marketing Analysis from the Department of Housing and Urban Development (HUD). 

The Beginning

The first iteration of Peerless Companies focused on building maintenance. While working during the day for his father’s dry cleaning business, Saratoga Cleaners, Scuola would finish around 7:00 p.m. and begin his second shift doing what he really wanted to do. Staying awake well past midnight, he learned all about fixing up homes—basic maintenance, electrical, etc.—to then eventually flip homes for a profit. This was around 10 years ago when his brother was still involved, who also helped pick the company’s name: “Peerless.” 

For Scuola, “The dry cleaning business was always a stepping stone,” until he could truly launch his own venture. But true to his nature, he is quick to show appreciation and often thinks about his former clients in a very positive light. He added how meaningful those connections still are to him, and how he’d like to continue to keep in touch with his former clients.

Now, 10 years later, Scuola’s role is more sophisticated as the company has expanded its functions. “As it grew from a management company into more of an investment real-estate firm, we do all aspects now. We still do management – we have a building company. We do from ground up construction now as well,” Scuola said.

Investing in Something Real

The conversation surrounding the pandemic raises bigger questions – should we invest in something that’s technically not real?

“We’re also taking in investment from people. It’s an alternative to the stock market. People are able to invest in us, a physical asset. There are so many different ways to structure a deal, and people talk to us because we’ve got our finger on the pulse of the market.”

According to Scuola, real-estate is valuable because land is limited, and because you can see it and touch it. “They’re not making any more land. So if you look at Saratoga, there are only so many places the market can grow. Saratoga is a booming market, but look at some land in the country somewhere, and it may cost the same as it did some number of years ago.”

Supply vs. Demand

The larger hurdle in the current real estate market is that there’s more demand for housing than there is supply. 

Data from HUD demonstrates this huge swing in leverage from buyers to sellers. In the 12-month period beginning March 2020, the average new and existing home price increased by 12%. Then, in the following 12-month period, the price would increase by another 13% to $280,900. Two straight years of double-digit increases is a clear sign of an imbalance in the housing market. However, that’s another area where Peerless can provide value.

“I’ve heard stories of people paying 100 to 200,000 dollars over listing price,” Scuola commented, adding that his company’s guidance protects buyers from those kinds of unnecessary overages.

Currently, Peerless manages over 130 residential units. Their building projects range from multi-family structures to luxury home renovations. Some of their recent projects include 10-unit multi-family homes in Glens Falls, in collaboration with Habitat for Humanity and the WAIT House.

For more information, visit their website at peerlessco.us.