Boost Your Profits: Proven Techniques in Commercial Construction

Brett McCollum (00:01.138)
All right, guys, welcome back to the show. I’m your host, Brett McCollum, and I’m here today with Tye Shumway. And today we’re going to be talking about commercial construction. Before we do, guys, at Investor Fuel, we help real estate investors, service providers and real estate entrepreneurs to 2 to 5x their businesses to allow them to build the businesses they’ve always wanted and live the lives they’ve always dreamed of. Without further ado, Tye, how are you,

Tye Shumway (00:26.636)
I’m good, dude. I am good. How you doing?

Brett McCollum (00:29.97)
Man doing good. Thanks for we got to know each other a little bit there before the show started. We were working through some kinks, but man, we made it. We’re here. Yeah, man. Well, hey, let’s before we get into everything, I mean, I’m excited to talk about some of the things you’re working on that sort of thing. But like before we do, let’s back up a little bit, give the people some history, some context. Who are you? Who’s Tye Shumway?

Tye Shumway (00:37.845)
Now we did.

Tye Shumway (00:54.462)
dude, you don’t know what you’re going to be asking for, but I’ll give it to you here. Tye Shumway. I don’t know. I am just a general contractor, commercial general contractor by trade. I’ve been in construction my whole life. I grew up working with my dad as a plumber when I was a kid. Go live with him in the summer times. And then I figured, I better get get a career. And I went and construction management and

Brett McCollum (00:59.814)
Yeah.

Tye Shumway (01:23.374)
Thought I was gonna roll with the corporate ladder and did that for a number of years until all of a sudden the corporation’s like, hey, we don’t got a job for you anymore. You better go figure something else out. And I was like, what? No way. So I actually had uprooted my family out of my hometown, went and worked for a guy or for a company. And 11 months later, they decided not to open the office that I had uprooted my family for.

And I thought I was going to open their office, run their office. I was climbing that corporate ladder. And then that’s job security 101 right there, right? And not so much. So here I was, wife, three kids in a town that we had no family in, no relatives, no nothing. Didn’t know anybody. And 11 months later, all of I didn’t have a job. So my…

Brett McCollum (02:03.504)
Yeah.

Tye Shumway (02:18.614)
all my income, no income, anything else. We had some savings and we had to figure our life out. And so I was like, man, what am I gonna do? So it really kind of opened up my eyes. That’s where my, I wanna say the seed almost kind of planted with real estate and trying to figure out other streams of income. It took me a bit. had to kind of pull myself back up. actually had, was a bit of a crazy life. had…

trying to figure everything out. we decided, we figured it out. I went and got another job, wasn’t too bad. I was only at a job for about a month in all reality. But I thought the world had fallen apart for that first two weeks where I had no idea what was going on. But went and got another job, but it made me realize like, okay, I need to figure out some other streams of income. And that’s when I started looking at real estate. I’m a builder, I’ve always been in real estate per se because you’re…

You’re a contractor, you’re always dealing with building stuff, to building with real estate. So I decided to start doing that and start figuring out investing. That was back in 2013 is when that all happened. And so my family, once we got a new job, we ended up moving to another city up in Salt Lake, Utah, and working for a contractor for a while. I decided to start, so we bought a house and fixed it up and did some kind of like house hacking where we fixed it up and did a…

Did that and then the company I was working for moved me down to Moab, Utah for a nine month project for them. So I started running that nine month project and 10 years later, they said, all right, we’re done. But I did multiple projects for them. It ended up turning into 10 years. I worked for them down there. I built office buildings, hotels, all different kinds of things. But in meantime, while I was doing that for them,

me and my wife decided we better start investing. So we bought this little 900 square foot home on this piece of property right behind a hotel I built. I literally had my office trailer that I had set in was in the backyard. I had leased this spot of land from this lady and she ended up selling us her house because she ended up wanting to get rid of it. So we bought her house, added a bathroom to it, turned this 900 square foot.

Tye Shumway (04:47.054)
house into two-bedroom two bath Once the hotel was done I moved my trailer off it turned where my office trailer is into a triplex Added like value added that built that in rented that out long term. We converted the detached garage into a unit. So I got five units there And that’s where it kind of took off like okay, this is gonna work And that’s same kind of year I ended up doing

I was 2015, 2017 went and had lunch with a dude that I had never met before who was in a CrossFit class with me. He’s like, hey, you like real estate? I’m like, I do. You like real estate? Yeah, let’s go have breakfast. So we went and had breakfast together. And he’s like, hey, I want to show you this warehouse. I’m like, OK. So we’ll go look at this warehouse. And he’s like, yeah, we should buy it. I’m like, OK. And.

He calls me an hour later, okay, we got it under contract and we’re buying it. I’m like, wait, dude, what? Anyways, I had never done creative finance at that time. Didn’t know what it was, but we had owner-sell, owner-finance deal where we just had to pay the realtor fees and the guy owner-financed the warehouse for us, half a million dollar purchase. And so I kind of started to hustle. We found tenants to go into the warehouse and did really good with that.

and it was cash flowing well. And then ever since then, I’m like, hey, I really like this real estate. Started buying, partnering up with some other people, have a good buddy of mine. We partnered up and bought an old bed and breakfast that was a 10 bedroom, bed and breakfast that had a main house on it and then five bedrooms. And then the house had a bunch of bedrooms, but we bought it, changed it from a bed and breakfast to a, what we would call pad split now, but it’s before plaids.

pad split was big. We added four bathrooms and four bedrooms to it and kind of split up the rooms in the house a little bit. And master bedroom, we split up a couple bedrooms, but we turned that into a 14 bedroom, 10 bath, got a corporate client in there that uses it for employee housing. Because in Moab, Utah, it’s hard for housing to find housing.

Tye Shumway (07:08.398)
and housing for your employees. So we’ve had that for the last three years. We’ve been cash flowing great.

kind of thing. And then me and another buddy found a piece of land and we decided to become developers. And so I said, all right, let’s figure it out. We, we ended up developing a little couple acres in downtown Moab into a 47 unit condo complex. Ended up going through all that. Had a few things here and there struggle. We did that. We broke ground, literally. Well, or we signed our construction loan in

March of 2020, I want to say. Yeah, March of 2020 when the world shut down. Or maybe 20, it was a little bit after that, but we had signed that and they’re shutting everything down, but we worked through it. The minute we closed on construction on our house or our lumber package doubled in cost. The day or actually two days after we signed what our budget was going to be and everything. And so we had to figure out that challenge, but we figured it out. We got through it. We ended up.

Brett McCollum (07:52.082)
Good timing.

Tye Shumway (08:16.494)
pre-selling quite a few of the condos, went after a little niche market. We knew our real estate market really well. We knew what was needed, what people needed. we built a bunch of these one bedroom, two bedroom, one bath condos that could really service what the need was for Moab, Utah at the time. Did that, finished that up. Two years later, it took us to get through and get it done. And let’s see, that puts me into 2022. I’ve got…

Tye Shumway (08:48.165)
Done a couple of little fix and holds outside of Moab when I ventured into Price, Utah. Did a little fix and hold. Lost my shorts because it was out of my realm a little bit. I set my crew up there. It cost me a lot more travel, a lot more hotel. So it’s not all home run hits and everything’s great. We did lose some money on it, but we’re able to pay off our private money lenders on there, refinance it, get our cash out.

tenants in there turned a little single-family home into a triplex like a downstairs apartment, upstairs apartment, then a detached garage into an apartment and it’s cash flowing not too bad now but it ended up going over budget by quite a bit just with everything right there. Brings me in up to date this year. Last year we bought five lots that we were doing nightly rentals on custom made nightly rentals for our market.

Brett McCollum (09:28.123)
Yeah.

Tye Shumway (09:45.198)
They are larger for larger groups, because there’s a lot of small Airbnbs in our area, but there’s not anything that can handle 10, 15 people, 20 people at a time. So that was another niche that we found. have four of the five homes that are under construction right now. Two of them are about 60 days out. And two more are probably about 120 to 150 days out before they’re finished and ready to be on the market.

Me and my partner want to try to figure out how to hold them because these Airbnbs do great in our little tourist town like Moab, Utah. don’t know if most people know about it, but we are a great tourist community. We have two national parks just right outside our doorsteps, 15 minutes away. You can be Arches National Park, Grand Canyons National Park. Plus we have three or four state parks. It’s just southern Utah. It’s just a beautiful place. And we’d love people to come visit and check it out.

where I’ve done all my vesting in is really there. I’ve ventured out a little bit here and there, but Southern Utah, I love it. And it’s worked out well for me. So it’s made it to where I can invest in real estate. also, my construction company, also when I buy something, it builds it for me. And so I kind of repay back my construction or my construction repays back me in real estate. it’s kind of a great symbiotic relationship that I have with it right now and getting really lucky and just have that skill set.

Brett McCollum (11:05.605)
Yep, exactly.

Tye Shumway (11:13.422)
where things are pretty good. I could complain, but no one was going to listen. No one would care anyways. So I say let’s just enjoy it and see what we can do.

Brett McCollum (11:24.892)
day that’s incredible man we got a lot to kind of unpack a little bit let me see if we can make some so let’s back up a bit so you grew up in construction that’s what you’ve known your whole life is that fair to say yeah

Tye Shumway (11:35.5)
Yep. Yeah, definitely school was not me. Like I was that classic kid that did not want to go to school, did not do good in school. I got three forms of dyslexia. So it just me and schoolwork did not work. But I can look and figure out how something comes apart and how it gets put together. I do understand that and enjoy it. that’s

Brett McCollum (11:50.545)
Yeah.

Brett McCollum (11:57.754)
Yeah, and enjoy, that’s key. Yeah, so I wanted to kind of, where I really wanted to kind of go back to is that moment when you lose that job, you moved, your family, you like you moved, where were you moving from and where did you go to? Like, how far, like was it like states across? it like, what was that like?

Tye Shumway (12:19.47)
it, it, well, it was from our hometown. I’ll give you a little bit more of the, of the story there is, I had been married a couple of years, got my degree and we were living just outside of Salt Lake in my hometown, Blanding, Utah. a boss, my boss hired me. He’s like, Hey, I hear you like construction. Come back to your hometown. I’ll hire you. You can take over the construction company.

Brett McCollum (12:31.09)
Thank

Tye Shumway (12:47.534)
kind of got me all these like, yeah, dude, come back. We’ll do it. My wife, me and my wife grew up together. We’re high school sweethearts, met in seventh grade. So it was like the classic like, yeah, let’s go and do that. So to fast forward, we did that for about six years. I saw the writing on the wall that my boss’s son was showing interest in the company and it probably was not going to be my company. So, so we took advantage of an opportunity of another company that moved us to Vernal, Utah. That’s about

six hours, seven hour drive away. Still in Utah, but it’s kind of in the opposite corner. We have to do a long way around to get to it. Had no family, no friends there, no nothing. up, we uprooted the family, had three kids. And we said, all right, we’ll do this. Went and opened up a office for that company. They were like, yeah, we want to make a big presence here. We want it. We have plenty of projects. We’re to start going. Said, all right, let’s do it. This would be great.

Brett McCollum (13:25.937)
Right.

Tye Shumway (13:45.814)
Yeah, I could run your office. I’ll just self-sufficient make it happen climb the corporate ladder and About 11 months later the big boss who said you know what? No, we don’t want to have an office there anymore So thank you, but no thanks. We we’re not gonna open off the office there anymore and found myself without a job like

Brett McCollum (14:06.332)
Yeah. And with no community to support, you know, around you at that point either. Yeah, that’s tough, man. Yeah. I get like, there’s a lot to be said for having community. Not, I’m not talking about just like people. I’m talking about your people, your family, your friends, your community, right? and all too often we see that, you know, or it’s like somebody, I have friends that job opportunities and you get it. You understand why people do it.

Tye Shumway (14:11.361)
Yeah, correct.

Brett McCollum (14:33.874)
And then sometimes it doesn’t work out. like, you’re just, you grieve cause like, you can’t be there to help them. You can’t really do that. I can pick up the phone, but like, you’re not there, you know? And that was tough. I’m sure that was tough times, man. Like, uh, yeah.

Tye Shumway (14:46.4)
It was, it was, and it gets a little bit tougher and I’ve been bane of where to share this or not, but one of the harder things, other than losing a job is, 10 days after I lost my job, we ended up losing our youngest child, in an accident at home. He ended up drowning in our tub. Just this much water turned our back for five minutes and he’s gone.

Brett McCollum (14:56.666)
Ahem.

Tye Shumway (15:16.046)
So it was a pretty low time in our lives.

Brett McCollum (15:16.444)
cheese

Brett McCollum (15:20.412)
How long ago was that?

Tye Shumway (15:21.934)
I was back in 2013 when that happened, so just 12 years ago.

Brett McCollum (15:28.978)
And I can, I have four kids and I can, yeah, mean, I’ve, God blessed me to be able to rescue my kid out of a pool situation once. And, but I mean, it happens two seconds, you know, and my heart goes to you, Tye, I’m so sorry, man. But that’s real, you know.

Tye Shumway (15:31.98)
Right?

Tye Shumway (15:50.029)
Yeah, yeah, I didn’t mean to get real for y’all on the podcast here, but

Brett McCollum (15:55.044)
No, I mean, this is what we do. know, this is a part of it. Like, you know, we’re going to talk about the business. We’re going to talk about all that. You know, of course we’re going to get there. Right. But like, you know, you persevered in the in a moment where you probably didn’t think you could.

Tye Shumway (16:11.022)
No, no, I’ve never been that low in my life. I’ll tell you that. It was one of those things where you just like, life likes to kick you when you’re down and to keep you there. But I don’t know, I always have that quote with Rocky when he tells his son, it’s not how hard you can get hit, but that’s how hard you can get hit and just keep going. And nobody wants to go through a situation like that. I don’t wish that upon anyone in the-

in their whole entire life. Because you never, you don’t want to go through it. If you have the choice, you don’t. Not a day I’d wish it would gone any other way. But it’s happened and luckily I have a wonderful, beautiful wife that supported me. support each other. We grew stronger together. And we’ve been able to come through the hard times and make it a lot better. And we don’t take life for granted now.

Like every moment we try to capture together, we have two beautiful daughters that are our world and we do everything for them and they are just amazing. Sometimes we need to kick them in the butt a little bit, you know? one’s 18 and the other one turns 15 today, actually.

Brett McCollum (17:19.962)
Yeah, that what are they?

Brett McCollum (17:28.048)
Wow, happy birthday. Man, are in the, so mine are young, you know, 11, eight, six, and two. Yeah. Yeah, I did that right, almost three. I am, the more people I talk to, like we’re gonna transition after this and we’ll ask you a question first. I’ve got two daughters also. got boys and then girls in the middle. And my eight year old is just now showing signs of like, guys, you’re too young to be showing these kinds of signs already, right?

Tye Shumway (17:34.934)
Okay, right.

Tye Shumway (17:39.127)
You

Tye Shumway (17:45.87)
Okay.

Brett McCollum (17:57.202)
of just like that teenage girl like sass thing. Yeah, she’s eight. And I’m like, I will karate kick you man. How are you handling? I’m like, I’m like, this is for me sometimes like, hey, I need some advice, Tye, like, what am I supposed to do? Like, this is rough.

Tye Shumway (18:04.334)
Yeah.

Tye Shumway (18:16.181)
Dude, no matter Mount of Vives, you just gotta hold on, dude. They’ll take you for the wildest rides and you come home and everyone’s crying. You’re like, why are we crying? I don’t know.

Brett McCollum (18:27.186)
part. That part. I don’t know. Like you’re crying. Why are you crying? I don’t know. Okay, what am I supposed to do with this? Yeah, it’s so crazy. All right, let’s bring this thing back into the real estate conversation. So you’ve got these properties now you’re working, you’ve got a business that’s, like you mentioned, that’s kind of feeding it feeding each other.

Tye Shumway (18:32.813)
Yeah.

Tye Shumway (18:36.824)
Yeah, dude, it’s hard. So it’s a good lot.

Brett McCollum (18:53.574)
Was that by intent or was that by like, snap, I just created something cool here. Like catch me up on that.

Tye Shumway (19:00.593)
No, it was a little bit of intentional to do it because I have been in construction my life and I saw I’ve been listened to like in 2015 I started listening to you know bigger pockets and started listening to this and started reading books and listen to podcasts and I understood that Contracting is not everybody doesn’t understand. I thought everyone did I thought it was

things go together, it’s just the way it goes. It came easy for me, so I didn’t understand that it didn’t come easy for everyone else. as I started to learn and grow in real estate, I understood the skillset I had and how great it was. So I’m like, I can’t let go of construction. I’ve got to keep that going. But I love real estate, and I love what it can do for somebody. So I’m like, how do I make them work together? And as I was…

Obtaining properties and holding properties. under I started to see okay Well, I could build something or I can do this value add a lot better than anyone else because I understand it I don’t have to you know rely on other contractors to come in and do it. I already knew what it would take and so So it was it was a bit intentional To make it happen per se and and it’s worked out good in some situations and it’s worked out not good in some other situations, you know, but

Brett McCollum (20:03.09)
That’s right.

Tye Shumway (20:20.834)
because contractors screw up too. Like I ain’t gonna say I’m perfect, but man, it’s definitely help over.

Brett McCollum (20:29.178)
Yeah, let me ask you this question. think you’ll appreciate this one. Let me see. So it’s said a lot of times in real estate, the boys and girls who control the money control the deal. And while there’s some truth to that, I think a better way for me, personally, I think if you can control construction, you control the deal. What’s your thought?

Tye Shumway (20:49.922)
Definitely that is one thing. Yeah, I think so if you can control the time frame the and even I just even in the budget the time frame, know, and you have control of it more I do use a lot of subcontractors and stuff that aren’t but if I have a good I got a crew that comes in I know what they can do It helps out everything. It makes me underwriting Any kind of real estate going into a deal?

I have a better understanding of it than most people make. Okay, this is reality and this is what I can see happen. this is, So yeah, definitely if you can control it, it’s gone better for me that way, knowing and gives me that comfort level that there’s not unknowns. So if something comes and hits me in the face, it’s because I screwed up. It’s not because I didn’t know about it. It’s because I had screwed up and didn’t do my full due diligence.

Brett McCollum (21:46.918)
Yeah, no, and that’s what I, I have been so many jobs and projects and stuff where, you know, like delays and this and that, and then, change order here, change order there, you know, and all the classic stuff, you know, and I’m like, man, I can have the money in capital raise, but if I can’t, if I don’t have my construction figured out, like, I mean, it’s game over a lot of times, you know, and I’ve lost plenty of.

times with situations like that where you think you’ve got the right people and then a couple years down the line this is the crew we’ve been working with for two years and then now they’re now they’re double dipping and stealing from us now you know doing stuff like that like I am now really more burdened to believe that like if you can actually control the construction if you could actually own the construction the deals go way better I think you’re in a really cool spot for that man that’s really cool

Tye Shumway (22:33.08)
Yep. Yeah, exactly. Yep.

Tye Shumway (22:40.034)
Thank you, I appreciate it, Brett. No, I love it, I think it’s good. It gets me excited. I love construction and I love real estate. So every day I wake up like, dude, I ain’t got it too bad. And I live in a beautiful part of the world. So I’m knocking it out of the park in a lot of spots, for sure.

Brett McCollum (22:59.334)
me pause. Yeah, so Tye, what I was starting to say, of like, think the best thing you’ve got going is actually owning the construction side of it and like your ability to really truly control the deal in its entirety. You’re just, what you’re doing and how you’re doing it, you’re in really cool position for it, man. It’s super cool.

Tye Shumway (23:19.96)
Well, thanks, Brett. No, I just, I thank my lucky stars that I’m able to be in the position I am. It’s not easy. There’s challenges, but it’s just lucky I get able to do stuff I enjoy.

Brett McCollum (23:33.266)
Yeah, that’s incredible, Yeah, so what are you working on? Like, what are you looking forward to now? Like some maybe present, maybe a little bit future?

Tye Shumway (23:42.254)
A couple things I’m looking forward to is I’m really working hard on my construction company to bring people in that can do it without me. And I’ve got some good people that are running the operations. Like I’m not in operations anymore, but I still have to wear the sales hat and the estimating hat and the budgeting hat and run the company. But trying to get some people that can…

can take some of that stuff off my plate and focus more on the real estate development side. Because I don’t know if you know traction or visionary integrator stuff, but I’m your classic visionary. I get 20 ideas a day, you know, every day and maybe. Oh yeah. Oh yeah. Luckily I have a wife who’s very practical.

Brett McCollum (24:23.772)
Yeah. yeah.

Brett McCollum (24:31.058)
and they’re all the best ideas you’ve ever had in your life, right? Yeah.

Tye Shumway (24:40.578)
very understanding and is very blunt on being able to, okay, those 20, we’re done today, okay? Just try again tomorrow. And then when she sees something that has potential, she lets me know and says, that’s not a bad idea. And then I know I can run with it and go forward with it. But yeah, I love it. then, go ahead.

Brett McCollum (24:51.687)
Yes.

Brett McCollum (25:01.702)
Yeah, we do something.

No, I was gonna say we do something in our home. It’s very similar. My wife is the practical one. am the, I have a hundred million ideas at all times. We do a thing where I’m like, hey, I’m gonna throw out this idea. It’s Monday. Let’s pick it back up on Friday if it’s still a good idea. Can we keep talking about it? You know, that’s something we started doing, because most of the time they’re trash. know, like, just like, well, that’s not good.

Tye Shumway (25:23.95)
Alright, that’s good, dude.

Tye Shumway (25:29.9)
Yeah.

Brett McCollum (25:32.902)
Yeah, I get you, man. I live that life every day. man, I’d love to give people more of an opportunity to connect with you tie and get to know you follow along the path, follow the journey, that sort of thing. What’s the best way for that to happen?

Tye Shumway (25:46.03)
Best way to get a hold of me. Yeah, you can send me an email at Ty Tye is how you spell my name. It’s not short for anything. Not long for anything. It’s just Tye at TWS construct.com and that’s easiest way to get me an email and I can get back to you. Reach out on any of the social medias. It’s under my name TWS construction or Ty Shumway. I’m on LinkedIn.

any of the social medias you can usually find me and look me up there. I’m pretty active on all that stuff.

Brett McCollum (26:21.126)
Man, and guys, we’ll make sure all that’s in the show notes for you guys. Like, follow along, because the fact that you’re able to kind of keep it all moving together in conjunction, that that synergy, like you said, it’s cool to watch. And guys, if you’re listening and you’re considering doing stuff like that, like, definitely follow along, because it definitely, somebody you can look up to with this and learn more. So, man, Tye, dude, thanks for being here with us, man. Spending some time.

Tye Shumway (26:44.334)
Thanks, Brett, appreciate it. Thank you for letting, working with me and me being out of the office today. I was hoping to be in there, but now I appreciate you working with me and my mobile office.

Brett McCollum (26:53.99)
Yeah, there you go. Perfect. All right, guys. Well, it’s been a great episode. Appreciate y’all hanging out and we will catch you on the next one. Take care, everybody.