Build, Sell, Repeat: How Tim Floyd Scaled to 12 New Construction Projects at Once

Tim Floyd (00:00)
If you know your pros have have real estate deals that need funding, I try to be a one-stop shop for it. And what where I’m seeing my… where I can really help… folks is if if a wholesaler is doing a lot of transactions and they need EMD funding, or they’re doing a lot of double closes and they need funding for that first A-to-B leg, you know, they can come to me and I’ll fund the whole darn thing for them. And then on on with a lot of my end buyers, I’m working on, you know, creative finance structures. That’s that Stack Method or Morby Method where they’re able to acquire properties with zero dollars down, or even sometimes walk away from the closing table with money if we can structure it properly.

Scott Bursey (02:26)
Welcome back to the Real Estate Pros podcast, powered by Investor Fuel. I’m your host, Scott Bursey. And today, pros, we’re delighted to have Tim Floyd with us from Stack Capital. Tim is an owner-operator specializing in single-family residential real estate investing with a particular focus on new construction. He’s currently moving 12 deals a year while running his own transactional lending and investment business. We’re going to dive deep into how he manages that volume and what the landscape looks like for new construction investors. Tim, welcome to the show.

Tim Floyd (03:03)
Awesome, Scott. Pleasure to… pleasure to be here. Thank you for having me on. I’m looking forward to the conversation.

Scott Bursey (03:09)
It is awesome having you here. And to help our pros get up to speed, please give us the ninety-second highlight reel of how your career ignited and where you’re pouring your fuel now.

Tim Floyd (03:19)
Yeah, absolutely. So I’d say about five years ago, I really wanted to get involved in real estate investing. I have an finance and investment background, but I’d never really done anything in real estate directly before. So what I did was I started my own real estate investment company, ended up partnering with an awesome builder here in Austin. We… we do about 12 builds at a time currently. And that’s been an awesome experience. And I’ve… and I’ve really expanded from that this year and gotten more into helping wholesalers and real estate investors scale through funding. So I basically run two different businesses in real estate, but obviously kind of related on the real estate front.

Scott Bursey (04:19)
That is unique and fascinating in its own right, Tim. And what really caught my attention about you was the way you’ve been able to scale from a single-family operator to managing 12 deals a year while balancing a lending business. Taking that a step further, when looking at your journey into new construction, what has been the biggest strength you’ve leaned on to scale your operation so effectively?

Tim Floyd (04:44)
Yeah, great question, Scott. So I… I personally can’t take all the credit for it, even though I’d love to. I have an awesome home builder partner who’s doing a lot of the hard things day-to-day. I’m more on the… the… the money investment side. But so, you know, he… he is a very strong builder. He’s got his own crews that he works with. He’s not relying on dealing with lots of subcontractors, and he’s been working with them a long time, so he dialed in on that front. I just help him scale through my own personal investment, and I will also occasionally bring on co-investors. So, Scott, I’d say, you know, rewind a couple of years ago, we were doing, you know, call it three builds at a time, and so now we’ve 4X-ed that and we’re doing 12 builds at a time, which has been great for him and good for me. So it’s… it’s really been a… an awesome experience.

Scott Bursey (06:40)
Wondering what specific weakness did you encounter early on in your transactional lending career that, once addressed, completely changed your trajectory?

Tim Floyd (06:51)
Yeah, great question. So yeah, if we transition into the transactional lending side rather than the… the home building investment, I would say what really was a breakthrough for me was connecting with an institutional capital partner, so and… and also a team that helps me process these deals so that I can handle large transactions. I’m… unlike a lot of transactional funders, I’m not, you know, waiting for one deal to close before I can fund another. We can handle, you know, basically unlimited deal flow and go into the seven or even eight-figure type deal sizes. So I would say that is one of the ways that I try to… try to separate myself from… from other folks that… that… that are doing similar… similar things.

Scott Bursey (07:48)
Taking a look at the market, Tim, what is the biggest opportunity you see right now for investors looking to pivot into new construction?

Tim Floyd (07:58)
Yeah, good question. So I would say some of the… some of the things that… that my partner, my home builder partner, does really well is he’s very, very disciplined on his entry price. Okay? You know, he… you know, he doesn’t… he doesn’t chase deals and get carried away and pay too much for on his entry side. So we are generally acquiring either empty lots or something distressed in a… in a good neighborhood and building a… a brand new, beautiful home on it. So I’d say entry price is really important for him and us. And I would say also kind of, you know, managing the build process. He… he has his own crew of guys that he’s been… been working with a… a long time. He’s not subcontracting out work to where he has less control over build quality, which enables him, you know, not to, you know, have to, you know, rework builds and aspects of it. So he’s just… he’s… he’s experienced and he’s been doing it a long, long time, so he knows the kind of pitfalls. And… and also I’d say don’t overstretch yourself. So right now with kind of his operation, we’re comfortable doing about…

Scott Bursey (09:16)
Don’t…

Tim Floyd (09:22)
12 builds at a time. We’re not going to try to start doing 20 at a time tomorrow and sacrifice on quality, either on entry price or the build quality. And so kind of what we do, what… what our philosophy is, let’s… let’s keep doing what works. Let’s… let’s stay in this kind of one to two million dollar home range and in good neighborhoods where we can move these properties quickly. So we’re… we try to make it kind of a… a… a freshly oiled operation just to build and sell, build and sell, rinse and repeat, and… and do it over and over again.

Scott Bursey (10:03)
Tim, we’d love your take on what threat are you most focused on regarding the current state of the residential lending market?

Tim Floyd (10:47)
Yeah, good question. So I would say that some lenders are being more picky about the deals that they’re fund. So on the kind of first lien side of things, when I’m working with a… a fix and flipper, let me say, or a… a buy and hold investor on a… on a hard money loan or a DSCR, it’s always… it’s good to work with someone like me who knows how different lenders are trending. So I have a bunch of different lender relationships and I know exactly the types of deals they’re gonna fund. I know the minimum credit score they’re gonna wanna see. I… I know like if they require a track record or experience or not. I know, you know, I know the lending boxes of different lenders. So when somebody comes to me and says, “Hey Tim, I need… I need a… a fix and flip loan or a DSCR,” I can quickly tell, “Hey, here… here’s the deal info, here’s the borrow info info. This is going to be a great lender for them.” So I’d say, you know, it’s important to know, rather than kind of an operator going one by one and trying to… and… and might end up wasting a lot of time with a lender for something that they’re not gonna fund, you know, I… I know where, you know, what lender is gonna fund what. I have a pretty good feel for that.

Scott Bursey (12:27)
Speaking of relationships, what does your professional network look like right now, Tim?

Tim Floyd (12:32)
Yeah, good question. So, you know, I’m decently far into my career, so I have a… a… a big network of… of folks. That’s generally who I’m going to who… who are co-investing with me on the home builder side of things, rather than kind of going to folks that, you know, I… I don’t know. A lot of times I’m starting with the folks in my network. Have a good-sized network over that I’ve built out over time for… for that type of transaction. And then on the lending side, I’m constantly building up the network. I’m in Facebook real estate groups connecting with people on their deals. I’m in different communities of… of wholesalers and and buyer investors and figuring out, “Hey, how can I help you scale through funding? I want you to do more deals and close more deals.” So whether that is me funding your EMD, or me funding the first leg on your double close, or me figuring out a creative structure on a Stack Method or Morby Method deal, I’m constantly building up that network and talking with bunches of different people to… to enable me to fund more deals and for me to help those people scale.

Scott Bursey (14:02)
Looking ahead, what is the one habit or mindset shift that you believe will determine your long-term success in the sector?

Tim Floyd (14:12)
Yeah, great question, Scott. I think it’s… it’s really about building… building relationships and trust with experienced operators that I can do multiple deals with in the future. So when I… when I first started on the… the transactional funding side, I was just trying to chase any sort of deal I could see, and… and… and I think that was kind of the wrong way to… to go about it. Now I… I try to be much more relationship-focused, and… and I really want to partner with… with folks that are doing, you know, several transactions a year and doing large transactions, and be their go-to guy on the funding side of things. So I would say that’s probably, if I’m being self-critical of myself when I first started, you know, would… would try to go after anything and… and sort of be in a rush, but… but this business is really about building… building trust and relationships and providing value to folks, and not just like chasing deals, if… if that makes sense, Scott.

Scott Bursey (16:08)
And that really paints a clear picture of the ecosystem you’ve built, Tim. And if you were starting over today, we’re curious to know, with only the knowledge you have, what is the one anchor move you would make in the first ninety days to facilitate cash flow and equity growth?

Tim Floyd (16:28)
Yeah. Yeah, good question. I would say when I first started, I felt like I needed to know everything about everything before like talking to folks and digging into to deals. And I think that’s the wrong way to go about it. I’m one of those people who learns by doing. And so, you know, not… not being shy about popping on the phone with someone and… and digging into their Stack Method deal, even, you know, even when I was first starting, like not worrying about if I knew every single mechanical aspect of the transaction before exploring deals with people. You can always say like, “Hey, that’s an awesome question. Let me find out an answer for you today on that and come back to you.” So I think, in… in starting out, I… I see a lot of people in real estate, they do too much like YouTube watching, where they just consume a bunch of content and they’re not applying it, Scott. So I like to learn by doing. Let’s dig into some transactions and deals, and… and… and you know, if there’s something I don’t know, I’ll quickly… I’ll quickly get an answer for you.

Scott Bursey (17:48)
Thank you for highlighting that, Tim. And Tim, your operation is certainly gaining traction. What words of wisdom or final thoughts could you leave with our pros today?

Tim Floyd (17:59)
Yeah, so I would say if you know your pros have… have real estate deals that need funding, I try to be a one-stop shop for it. And what… where I’m seeing my… where I can really help… folks is if… if a wholesaler is doing a lot of transactions and they need EMD funding, or they’re doing a lot of double closes and they need funding for that first A-to-B leg, you know, they can come to me and I’ll fund the whole darn thing for them. And then on… on with a lot of my end buyers, I’m working on, you know, creative finance structures. That’s that Stack Method or Morby Method where they’re able to acquire properties with zero dollars down, or even sometimes walk away from the closing table with money if we can structure it properly. And so that’s really what, you know, what I want to leave folks with. Folks can… can certainly reach out to me, which… and be happy to… happy to work with them on their deals and… and figure out kind of the right strategy for them.

Scott Bursey (19:16)
Tim, for those of our listeners that want to keep this conversation moving, stay in your lane, or collaborate with you on future deals, what is the best way for them to plug into your pipeline and reach you directly?

Tim Floyd (19:28)
Yeah, hopefully, you know, Scott, I can work with you on on maybe the description of when this gets posted, and we’ll… we’ll figure out how to best do that. But [email protected] is super easy to just email me. And we… we can perhaps, you know, post other ways. You know, can… we can post my website and perhaps my Calendly link if you want to like talk to me live. Hopefully we can… we can give them an easy way to… to get in touch with me, but [email protected] is… is probably the easiest way to get in touch with me.

Scott Bursey (20:12)
Tim, thank you for joining us today on the Real Estate Pros podcast.

Tim Floyd (20:16)
Scott, this was awesome. Thank you for… thank you for having me on the Pros podcast. And this is a… a pleasure speaking with with you and your audience.

Scott Bursey (20:25)
It’s been a sincere pleasure. And to our listeners, we appreciate you. If you receive value from today’s episode, please subscribe. We’ll be filling your tanks with the lineup of elite guests just like Tim Floyd, who are accelerating and setting the pace for the rest of the industry. Until next time, keep your standards high and your vision clear. We’ll see you in the next episode, everyone.