As his portfolio of properties grows, so do the responsibilities of Thomas Masaschi, one of the Rochester area's burgeoning developers.
Masaschi co-owns the Patriot Cos. with Jeffrey Reddish, his roommate as a student at Rochester Institute of Technology. That firm, with its headquarters on Park Avenue, this month closed on a 225,000-square-foot apartment and retail structure anchored by East Avenue Commons.
The Patriot Cos. also owns Jeremiah's Tavern, with locations in Rochester and Gates.
Masaschi is managing partner of Rochester-based DHD Ventures LLC. DHD and the Patriot Cos. are preparing to transform 90,000 square feet in three downtown buildings into a Hilton Garden Inn next year.
He individually holds several properties under Residential Management Co.
Masaschi, 43, oversees more than 1 million square feet of space in properties from New England as far west as Michigan and as far south as Georgia. His companies employ some 150 full- and part-time workers, including restaurant personnel.
"He's not a glory kind of person," says Paul Adams, founder and president of Monroe Capital Inc., who has done business with Masaschi since his first purchase.
"He's doing this because this is what he likes. Money in real estate is a tool for him. At one point, when he started out, he had 300 properties in the inner city. He had to manage a lot of difficult properties, and he acquired those in a short period of time."
Masaschi credits Adams and Monroe Capital for helping to build his business.
"Without him, I would not have had the opportunities and success," Masaschi says.
Much of the Patriot Cos. holdings in the local market have come within the last seven years. Two historic buildings on East Avenue at Alexander Street were acquired in 2007. The Rochester Club building at 120 East Ave. was purchased in 2006.
"He's a very passionate investor, and he's very mindful of what it's going to take in each property, and that's not always the case," says Heidi Zimmer-Meyer, president of Rochester Downtown Development Corp.
"We've seen a handful of developers over the years buy a property and have no intention of restoring or putting any kind of value in it. Tom is not like that."
The combined price for the East Avenue properties surpasses $10 million.
"There are pros and cons," Masaschi says of the growth. "There's a lot of stress. You have good days and bad days. I've learned to recognize the mistakes and keep moving."
Those mistakes are few, Adams says.
"He knows how to buy," he says. "The kinds of mistakes he's made are minimal. The only mistakes he's had are when you get involved with doing something for emotional reasons, helping somebody out. ... He's not making mistakes on value."
Masaschi went into business for himself some 10 years ago, after four years with the Pyramid Cos. in Syracuse. A key, he says, is maintaining the proper perspective on his assets.
"There are a few more zeroes," he says. "You can't let it get to your head, because it can. It can keep you up at night. You just have to realize that it's another zero, with more responsibility.
"The hardest part is being responsible for the people who work for you. When you're working for yourself, you don't have many people working for you. Now you have a lot of people depending on your success. That's where you feel pressure, not on the economics of it."
On the field and ice
Masaschi grew up on Buzzard's Bay, on the western tip of Cape Cod in Massachusetts. He is the youngest of five children. His father was a general contractor and his mother a teacher.
"It was a very active household with that many kids," he says. "It was a special upbringing, being able to just go out on the ocean. It was incredibly unique. I was very lucky."
Masaschi was an active skier, on the water and in the snow. He played baseball in his younger years and football, hockey and lacrosse at Tabor Academy prep school. He was named to the U.S. Lacrosse All-America team in 1988.
"Lacrosse was probably one of my best sports," Masaschi says, "but it wasn't my favorite. I loved it, but it wasn't my passion. Hockey was my passion."
He had scholarship opportunities at NCAA Division I lacrosse programs, but he wanted to play hockey, too. RIT, a Division III non-scholarship athletic program at the time, became the solution.
"I was very limited as to where I could play both sports at a high level, but RIT allowed me the opportunity," he says. "They found me for both sports. I didn't know much about them, but it worked out to my benefit. It's a great school."
Masaschi became a three-time Division III All-American as a lacrosse midfielder, making the second team as a sophomore and junior and third team as a senior. He was RIT's team captain for two years.
He set a school record in 1991 by scooping up 168 ground balls to gain or retain possession for his team. He is fourth all-time at RIT with 386 grounders. He scored 80 goals and had 43 assists, leading the Tigers to the Division III national tournament in 1990.
Masaschi had 48 goals and 84 assists in 116 hockey games, serving as an assistant captain as a junior and captain as a senior. He helped RIT win the East Coast Athletic Conference title and advance to the NCAA Division III championship in 1989, where the Tigers lost to the University of Wisconsin-Stevens Point.
Masaschi was named to the All-ECAC hockey second team as a senior. He was inducted into the RIT Athletics Hall of Fame in 2008.
Masaschi's ambitions coming out of high school were much clearer athletically than academically.
"I didn't know what I wanted to do," he says. "When you go to college, you never know what you're going to be or do at that age.
"My dad was a contractor, so I was always around building and construction sites. That's something that's always been in me. That led me in the direction I ended up going."
Masaschi gets his work ethic from his parents, he says.
He started a window-cleaning business while in college. That became his first full-time job after graduating in 1992 with a bachelor of arts degree in marketing, and he also was an assistant hockey coach at RIT for two years.
He sold the business in the mid-1990s and returned to Massachusetts to join his brother in the restaurant business for 12 months.
"I worked in that for a little bit and then realized that it wasn't what I wanted to do," Masaschi says.
He joined the Pyramid Cos. in 1997.
"I saw an opportunity there, and I worked there for three or four years, for Bob Congel," Masaschi says. "It was an incredible experience. It's given me a lot of the tools I have today for real estate development."
Founded in 1970, Pyramid is among the largest private developers of shopping centers in the Northeast. It owns Destiny USA in Syracuse. It has signed a contract to redevelop the Irondequoit Mall, but work there has yet to begin.
"I can't say enough about the experience and the opportunity they provide for anybody who works for them," Masaschi says.
"It was very open, no secrets, very tough as far working a lot. You work six days a week, 5 a.m. until whenever you get home. It's very intense. At a young age, it's great. But it's not for everybody. He tells you that."
Masaschi was based in Syracuse for most of his four years at Pyramid but spent much of his time in New York City, working on a mall project.
After leaving Pyramid, he moved back to Rochester.
"I just started buying foreclosed properties, repairing and fixing them myself," Masaschi says.
His first acquisition was a two-story house on Woodlawn Street, in which he used to live and which he still owns.
"I started buying city properties, one- and two-family," he says. "I spent the next three or four years doing that, moving into some commercial and mobile home parks, and now into large commercial."
Masaschi's first purchase beyond multifamily homes was a mobile home park in Syracuse.
In the local market, his tastes evolved to include 50-unit apartment complexes, after which he set his sights on East Avenue and the formation of DHD Ventures with former Pyramid colleague Jason Teller.
"He moved to Charlotte (N.C.) and started his own partnership down there," Masaschi says. "We stayed friends, and that's how we started DHD."
A DHD partnership in Austin, Texas, is no longer active, he says.
The expansion of his business has come steadily.
"There was never really a milestone moment," Masaschi says. "It was just a progression of growing and moving to the next level. As the management team grows, the systems grow with it.
"The East End buildings transformed us into a different level that we offer because of the space, the volume and scale. Now you have to have on-site property managers. There's no more running around and looking at problems."
For that, he credits his management partners and employees.
"One thing we do have is a good team, which is a big part of our success," Masaschi says. "We don't have a lot of people in the main office. It's a select few that make a lot of the decisions.
"I love what I do. That's the most important thing."
He gets much of his acumen from reading about other businesspeople.
"I love to read autobiographies," he says. "When you're self-employed, you really don't have much to go by. You make a decision, regardless if you're right or wrong. I just try to read as many autobiographies as I can, learn from other people's mistakes and experiences.
"Sometimes I need to read it just to say, 'You know what, you didn't make the right call there.' It's OK to not know the right call. There are times in life, especially when you're running a business, when you don't know whether it's the right decision. It's just learning by what other successful people have done, and learning from their mistakes."
Masaschi's most recent high-profile buy came after he twice decided not to pursue it. The Patriot Cos. bought the foreclosed property at 101-129 East Ave. for $4.46 million after not placing a bid at two previous auctions.
"(Masaschi), more than many, is willing to take on a little harder task and a little more vision, as opposed to wanting something all set up and priced out to be done in a certain number of months," Adams says.
The mixed-use parcel includes a former hotel that is now the East Avenue Commons student apartment complex at 111 East Ave.
"Tom is a quiet investor, and we wake up one morning and find that he has become a significant property owner in the downtown area," Zimmer-Meyer says.
"He's taking on some really tough projects, like 111 East Avenue, which is a beautiful building but needs an infusion of capital and a tender redevelopment hand. I strongly believe that these guys are going to pull that off."
Masaschi plans to spend millions of dollars to upgrade the structure.
"It's tough to be patient when you want something, but it paid off for us," Masaschi says. "We're very excited about it. It's a great project for our portfolio, and it's great for the community."
Further excitement is being generated by a $15 million redevelopment that will turn three vacant properties on the south side of East Main Street into a 107-room upscale, midprice hotel next to the Hyatt Regency Rochester.
Final permits for the Main Street hotel are expected to be approved this month.
"We've had a couple of bank term sheets come in in the last couple of weeks, which is something to celebrate a little bit," Masaschi says. "Now we're just coordinating and awarding some of the building contracts.
"I think it will be fantastic for downtown Rochester. It's going to be a lot like a big-city hotel, with a lobby that's not downtown right now. I'm very excited about that. Architects are working on designs, and we're putting together contractors and bidding out the work."
That project "is a critical building block to what has to happen to recast the fortunes of that whole section, the core, of downtown," Zimmer-Meyer says.
Off the job
Masaschi limits his own construction work to home projects.
"Only when I'm building a rink in my yard," he says, when asked if he is ever tempted to pick up a hammer.
"I really work hard to be home with my boys," Masaschi says. They are Luke, 11, and Will, 7. "I coach their youth hockey teams, which is a reason travel has to be limited."
"I built a rink for my boys in the front yard," Masaschi says. "It's very famous in the neighborhood. Everybody asks when it's going up. My sons love it. It's a short period of time in their life where they're going to be able to do something like that."
The 40-foot by 80-foot rink also boasts a lighted scoreboard.
The family home straddles the Brighton-Pittsford town line. His wife, Kara, is a curator at the Seneca Park Zoo. She is a native of Auburn, Cayuga County, and they met at RIT.
They also spend much time at their cottage on Canandaigua Lake, "going skiing as much as we can," Masaschi says.
"I golf a little bit, but it's very sporadic," he adds.
Returning to the topic of his properties, Masaschi says the most challenging part of his job is talking publicly about himself and his businesses.
"I'm not very comfortable with it," he says, smiling. "I'm very private. ... There's nothing wrong with it. I just don't like doing it.
"I like what I do. I'm starting to realize that it's important to talk about some of our successes, not just for me but for my company and the people that work for me. They've worked hard in getting it to where it is."
Title: Co-owner, the Patriot Cos.; managing partner, DHD Ventures LLC.
Education: B.A. in marketing, Rochester Institute of Technology, 1992
Family: Wife Kara; sons Luke, 11, and Will, 7
Hobbies: Reading autobiographies, hockey, water skiing, golf
Quote: "It's funny. You look back to when you were casing a project and you didn't get it, and you're upset about it, and then two years later you look back and realize that some of the best deals you ever did are the ones you didn't."
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