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A larger footprint, burgeoning business with taxpayer-funded entities and a diversified portfolio helped Real Lease Inc. increase revenues for the last three years.
The Perinton company offers business leasing, energy leasing and municipal leasing. Its energy and municipal portfolios account for as much as 70 percent of revenues, President and CEO Robert Noonan said.
Most notably, governments and school districts increasingly are leasing small-ticket items of less than $500,000 per contract, Noonan said. The average lease of those items is $150,000.
“There’s a lot of pressure on municipalities to provide services to their constituents and a lot of pressure on property tax rates,” Noonan said. “(Municipalities) are trying to do more with less.”
Real Lease leases with businesses from throughout New York, he said. Its municipal leasing has expanded to the Mid-Atlantic region and New England. Energy leasing encompasses the eastern U.S., primarily the Northeast.
The YMCA of Greater Rochester Inc. leases fitness equipment from Real Lease and has contracted with the company for energy management equipment as well.
“We think the company is very competitive in the marketplace,” said Michael Russell, vice president of operations. “More importantly, they’re extremely responsive to anything we want and very quick to work with us. It’s very much a personalized service.”
Employment at Real Lease, 10 staffers, has not changed over the last three years.
Noonan founded Real Lease in March 1988 after moving here from Boston, where he was a marketing manager. He launched it as a car leasing agency.
“I wanted to come back to Upstate New York,” the Utica native said. “I’m an Upstate New York guy to begin with.”
Leasing cars had become popular, particularly for businesses, in large cities such as Boston and New York City, Noonan reasoned.
“The lease penetration in smaller markets like Rochester was very low,” he said. “At the same time, we started dabbling in leasing small-business equipment.
“Computers were brand-new. Fax machines were brand-new. A fax machine was $3,000. A computer and a printer was $12,000. A small-business lease would be $15,000 to $25,000, along with copiers and office furniture and that kind of thing.”
Noonan picked Rochester for his business because its economy ranked second in the state to New York City’s, with Eastman Kodak Co., Bausch & Lomb Inc. and Xerox Corp. still leading the way.
“There were a lot of businesses that worked with some of the major corporations as suppliers and things like that,” he said. “They all had needs for different kinds of equipment.”
Noonan discovered almost immediately that business leasing was more popular than auto leasing, which he abandoned by the end of the company’s first year.
By the early 1990s, Real Lease added heavy equipment, long-haul trucks, medical equipment and energy services to its leasing portfolio.
Its energy clients include Johnson Controls Inc., Siemens AG, Honeywell International Inc., Noresco LLC and Ameresco Inc., all of which have energy performance contracts with governmental agencies, Noonan said.
Real Lease has become a leader in the state in performance contract financing and leasing to states, counties, towns and school districts, Noonan said. Contracts generally start at $1 million and have reached as high as $22 million, he said.
“Although it can be to commercial enterprises, it’s generally to public entities because they have a lot of real estate and a lot of use of facilities,” Noonan said.
Municipal leasing has become increasingly popular as governments and school districts outsource services to save money.
“That would be snowplows, police cars, ambulances, 911 phone systems,” Noonan said. “We’ve even done Zambonis for ice rinks.”
The municipal market offers the greatest opportunities for future growth, he said. The greatest challenge lies in the regulatory environment.
“Our inventory is money,” he said. “The constriction of credit is a challenge, but after having done it for 25 years, you sort of know your way around a little bit, too.”
The Rochester Top 100 program is presented by the Rochester Business Alliance Inc. and KPMG LLP. Launched in 1987, it recognizes the fastest-growing private companies in Greater Rochester. This year’s Rochester Top 100 event will be held Nov. 5. For more information, go to rochesterbusinessalliance.com.
Real Lease Inc.
Provides business, energy and municipal equipment leasing
Top executive: Robert Noonan, president and CEO
2013 ranking: 7
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