#410 - Austin Tunnell - Founder of Building Culture - The Power of Developing Beautiful Buildings

Chris Powers: I kind of wanted to start with how you made a decision to actually go to the Peace Corps. Because the only memory I have of a friend I know that went to the Peace Corps, it is wild. We were in our investments class in 2008. The world had melted down. And at the end of class, our teacher was like, hey, the Peace Corps is set up in the hall if anybody wants to stop by. One of my best childhood friends was in that class with me, walks out, had never thought of the Peace Corps in his life. He stops at the table. I go straight probably to the bar. Who knows what I was doing. And like two weeks later he's like, I'm going to the Peace Corps. And he was there forever. And so, when I was doing research on you, it kind of sounded like you diverted your life into a Peace Corps moment. So I'm like, what do these people tell you to get you interested? So, my first question out the gate is, did you find the Peace Corps or did it find you? 

Austin Tunnell: Oh, I found the Peace Corps. Google found the Peace Corps when I was searching cool jobs. Literally, that was the term. I was at KPMG right out of college, graduated in 2011 in Houston, and I was miserable. Like, my dad was an accountant, and I'd never really thought about what I wanted to do. Hey, it makes sense. It's practical. You're making decent money. And I just remember my first year in college, after college being like, is this it? Is this what my life's going to be, doing this and maybe I'll make a little bit more money or whatever. I didn't have debt. I was trying to do all the right things and I was- I remember laying on the couch on Sundays and just like not being able to get up. Like the actual like depressed where you're like I can't do anything. And so, it's more like, I don't care if I don't make money. I've got to find something I care about was kind of the decision I came to. And I'd never even heard of the Peace Corps, really. So, when I was googling it, I was like, Africa, two years in a village? That sounds awesome. And so, I applied, and it was a year long process to learn... at that time to find out if you get in. So, I stuck around KPMG for a little bit, but still waiting. And finally I just quit. And I had found this job, this kind of internship, free internship in Panama. And so, I quit KPMG, sold my car, and right, like two days or a couple days before I left for Panama, I found out I got into the Peace Corps and it started like right when my internship was up. So went down to Panama for a few months, which there's some things that happened there. Like I met this master mason, which ultimately is how I ended up back in Oklahoma – not back – in Oklahoma, and then spent two years in the Peace Corps. And the first person I met off the plane was my wife, now my wife, another volunteer, and we got placed in the same village, started dating a year in, and fun story and really valuable time, but also realizing like, well, I don't want to do this long term either, like international development, but it was really valuable. I'm really glad I did it. 

Chris Powers: It's like eerily similar to my friend's story. He met his wife on the Peace Corps... 

Austin Tunnell: Did he really? It's so funny. Most, like Peace Corps, at least our cohort was very heavy female, and I think a lot of the Peace Corps is. But it's like if you talk to how, generally speaking, how do the women end up there, they're like, I've wanted to do this my whole life, blah, blah, blah. And most of the guys are like, yeah, I just thought it looked cool.  

Chris Powers: So you met the mason in Panama, or you met him while you're in the Peace Corps? 

Austin Tunnell: I met him in Panama and he's from Georgia and he happened to be down there on a weak consulting thing. And I just met him, the way he was talking about these buildings, because he was building these pre war masonry buildings, these solid triple wide, three layers thick masonry buildings, and kind of talking about the disposable building culture in the US and kind of going like, oh, this is interesting. But I never really thought about architecture or real estate, but it was that combination. And I was working for a company trying to build a sustainable town in the jungle. Didn't actually happen. But I learned a lot and started reading about this stuff. And I grew up in the suburbs of Houston, which is the exact opposite of all of these things that I'm learning about and reading about. And I spent a few months traveling in Spain and Portugal, and I was just sort of questioning, why is the US so ugly? Why does the US look like this? I'm not saying it should look exactly like Europe or something like that, but we're the wealthiest, most technologically advanced country in the history of the world. And you wouldn't know it when you look at 95% of what's been built over the past 50 years. And so that was my first question of like, why? And I started diving in and started recognizing why. And that's when I really just got obsessed with real estate and kind of like I want to be a part of shaping a future like built environment in the US.

Chris Powers: Why didn't it work in Panama, what you were trying to build? And what was the goal? Like, if you had built what you set out to do, what would you have built? 

Austin Tunnell: So I was an intern, like unpaid. And in fact, it wasn't unpaid. I was paying to be an intern. That's how- it's just a program that didn't really work. 

Chris Powers: The lowest level intern... Of the levels of intern, you were a low level. I love it. 

Austin Tunnell: Right. So it was three months, and basically a bunch of people show up in the jungle and have fun. 

Chris Powers: Okay, so the mason, though, was he on that job? Or you just like met this guy in a coffee shop? 

Austin Tunnell: No, he's older. He's like in his 50s. The guy that was running this program had like brought him down for a week because he wanted to build some masonry stuff. It never happened. And this guy that I learned from is in his 50s, but, I mean, he was building stuff, and he was a oil painter and sculptor in college. Like, people think of construction as like construction, blue. This guy's an artist. And he ended up with masonry because masonry is really sculpting, the way it used to be done, it's all these little pixels that you're really sculpting out of when you've got the depth play with. And so, he was an artist that was a true craftsman. He'd been timber framing since he was like 17. And so, apprenticing for him, when I got back from the Peace Corps for two years, I just learned so much because I was laying brick, I was doing timber framing, I was putting on roofs, I was digging footings, kind of doing the whole thing. And it was... I learned a lot very fast. 

Chris Powers: What do you mean when you have the depth?

Austin Tunnell: In modern buildings, you kind of have your structure, whether that's steel, whether that's wood, the structure, and then you've got sheathing, and then the brick is just a veneer. It's just the siding. Before World War II, generally speaking, the masonry buildings, like if you- I mean, this building might be. I can't see any walls in here. But like most of the old buildings, they're solid masonry buildings. They're two layers thick of brick or three layers thick of brick of solid brick masonry. There is no wood framing. So, I call it structural masonry or mass wall masonry where the masonry is the structure and the sheathing. It’s all like one system. And when you start playing with that, when you have a foot of depth of a masonry wall, you can corbel out pretty far, like bring brick out. You can take away brick and create these deep shadow lines. So, when people say like, why don't buildings look today like they used to, even brick buildings, that's one of the reasons why. We've lost a lot of techniques and stuff too. But there are inherent limitations with veneer because you're just playing with three and a half inches thick of brick. So, you really can't add much depth or take away much depth. Even windows, people talk about windows feeling pasted on, well, there's no real depth to our buildings. When you're dealing with mass wall masonry, you get this real depth and you get deep shadow lines. And it's not something that people are cognizant of that don't know architecture per se, but they feel it and they know it and they say, why is that beautiful building beautiful and that one not? People will go over to Europe and see this great building and try to copy it at home and it looks terrible for multiple reasons. But one of them is that. 

Chris Powers: What’s the significance of a shadow line? 

Austin Tunnell: What makes something interesting in my mind from an architecture perspective is playing with light and shadow. Like a lot of details, if you look at the stuff that we've built, like my buildings are pretty simple. They're not like super complex buildings. I'm largely building in rectangles or rectangle based buildings. And it's not like we've got insane masonry details, but we'll put like little flutes is what I would call it even, where we kind of like just take out- like up in a gable. So, you've got a gable in a house. We'll just put little flutes in where we take out a brick, and it just creates this kind of deep shadow, and it looks like this beautiful detail. And it was so simple. It cost us almost no money. We can kind of poke brick out, we can corbel things out. And it'd be easier if I could show you something. I've got a little book over here that I'll show you a couple things. And so, it's this incredible medium to play with. And the reason though, beyond kind of like the beauty and all this, of why I like structural masonry, it's not everything we do. It's more expensive. I do it when I can. I would like to see the industry move towards a structural masonry based building system in a lot of the country. Europe is more masonry based than we are. We're wood frame based. 

Chris Powers: Real quick, even today or is that just all the stuff they had built, or are they still on that track? 

Austin Tunnell: They're still on that track. And I mean, when London burned down, what did they do? They rebuilt out of masonry. When Chicago burned, what did they do? They rebuilt out of masonry. Masonry is just inherently durable, not susceptible to termites, to fire, to rot, to mold, to high winds, the way the vulnerabilities that a lot of our wood frame buildings have. I think wood frame buildings absolutely have their place. You can absolutely build a quality wood frame building. But like, what makes a building last for a long time? It's how many points of failure are there? And there are fewer points of failure in structural masonry, except for like a seismic would be its biggest weak point. So, like building a 10 story structural masonry building in California might not make sense. But we do not build things that last in the US. Most things end up in a landfill in, what, 50 years, 75 years. What are we building today that will be around in 500 years? We think 75 years is a long time. It's not. Go travel most of the world and you're walking through things that are 200, 300, 500. The Pantheon in Rome is 2000 years old, and it's still standing. And I think there's just- there's beyond the economics of it of like build something once, like you want sustainability, it's not lead certifications, build something that lasts. You want something to lasts, it needs to be durable, it needs to be useful, and it needs to be beautiful. Beauty is an incredibly important ingredient in building durable buildings, anything durable, because people take care of things that are beautiful. People love things that are beautiful. Is it John Marsh... But like, lovability is really important in our architecture and also the continuity of like culture. Who are we? Like I really think architecture in our buildings are a reflection of our values. And not only are they a reflection of our values, they kind of like permeate those values outward for forever. And so, it's like, what are we communicating? What are we giving as an inheritance to our kids? We're building a bunch of liabilities, generally speaking, between our infrastructure and our buildings for our kids and our grandkids to deal with, rather than assets that they can keep building on in society. That's kind of how I think about it in terms of durability. 

Chris Powers: Is it purely a function of cost that we got away from it, or is it the time it takes to build a house got shortened by going to wood frame? Like, was it efficiency, cost, both? I guess they're kind of both. 

Austin Tunnell: I think it's both. There's regulatory issues. There was real lobbying issues with like steel and concrete were major lobbying things that happened in the early 20th century that pushed things a certain way. And people in the US tend to think like rules are what they are for good reason. And that's a lot of times not the case. Things happen. And it's weird, if you start getting involved with how building codes are shaped, for example, even at the state level or the IBC or the IRC, it's a very few and small amount of people that end up making rules and everyone else just accepts them and assumes they're a really good idea. After World War II, when people were coming back from the war, there was this- we had this incredible manufacturing industrial base that was all pointed towards military. And then it was like all these people coming home, you got to give them jobs, you need to expand housing, all of this. And so there was this massive building boom and kind of really the beginning of suburban sprawl and stick frame buildings or wood frame buildings, which I would say is honestly a kind of a brilliant system in a lot of ways because it is fast and it is cheap. And I think fast and cheap buildings are an important part of any city as it's evolving. But over time, those buildings and those building typologies should mature into something more durable as an area matures. At first, you want it to be able to change quickly and be fast and cheap and see what an area really is going to be. But this is how cities have been built forever. It's not like Florence was just always beautiful masonry buildings. They were wood shacks just kind of cobbled together. And most of the European cities, and it was during the Renaissance that they started rebuilding things slowly out of these more durable buildings. That really is a net positive economically long term. But it's really hard in our investment environment where everything's on a five year IRR, it's really hard to justify building something that's going to last, because guess what, you don't care if it's going to last.

Chris Powers: Because you're not going to be in it that long. 

Austin Tunnell: You're not going to be in it that long. You're not going to own it that long. You're not going to see the problems. 

Chris Powers: If you were to build one, I'm going to kind of pick it apart, is insurance cheaper if you own a masonry home? Because basically everything you just said, like it's fire resistant, it's more waterproof, it is termite resistant, all the things. Like do you have any data around that? 

Austin Tunnell: I don't right now. I hope to over time as we're building more because we've been doing like homes, now we're doing some commercial buildings in masonry that we're holding long term. Your capex is going to be a lot cheaper. I mean, you virtually have no exterior maintenance for 50 something years. Maybe you have to tuck point it in time. Your mortar joints will kind of wear over a long period of time. But your capex will be dramatically lower if it's something you're going to hold long term. 

Chris Powers: Okay. I want to go back in time a second though. So, you meet this guy. You have not spent your life thinking about masonry, thinking about architecture, thinking about any of this. This is a rare thing that you meet a stranger that literally changes the trajectory of your life. So, I'm going to dig a little deeper there. What was said, what was the aha moment that you go, man, I could actually see myself working on this? 

Austin Tunnell: When I got back from the Peace Corps, I'd spent two- I'd met this guy right before the Peace Corps, spent two years in the Peace Corps thinking about, reading about all this kind of stuff about urban design and architecture and kind of educating myself and have this tension of do I want to go be in the UN or foreign service or something? And two years of the Peace Corps and kind of seeing the nonprofit world and the NGO world, realizing I don't want to be a part of that. When I got back, it's like, well, I want to be in real estate, but I don't know anything about it. I'm not educated. I'm not an architect. Do I go work for a builder? Do I go become an architect, go back to school, become a developer? And I decided like I really want to learn from the ground up. I really am interested in real estate and development. And my financial background, it kind of makes more sense. But like, I don't just want to do it from a spreadsheet. I want to like understand what I'm building and build different ingredients. Buildings are ingredients. Like build different ingredients. And so, I literally just call him and said like, hey, I met you a couple years ago. Of course, he didn't remember me. I said, I'm back in Texas. I thought he was in Georgia. He just moved to Carlton Landing, Oklahoma. I said, can I come work for you? And he was like, you can come out for a week. And so I went. I had a five week engagement with my wife when we got back because I had to like meet parents and stuff like that. Got married. Then my wife... 

Chris Powers: Y’all got engaged before you even met each other's parents? 

Austin Tunnell: No. There was like, obviously they kind of knew it was happening, but it was like waiting. We called it the garage sale for a while. One of our friends coined that term so we could talk about it without really talking about it... And we went down for a week to Carlton Landing, Oklahoma. There's like 40 houses out there. This is 2015. And my first day on the job, I went over for dinner. I was deathly ill because coming back from the Peace Corps, I had like schistosomiasis, I had had malaria, I'd had dengue, had all these things and I was like in bad shape, all these bacteria and stuff. And I like had gotten super sick. So, I had to leave dinner in the middle of this and was like, I can't... And so, then I stayed in this horrible hotel for like seven days or five days or something while my wife is kind of like nursing me back to some health. And then I'm like, okay, I can come on the job. My first day on the job, we dug a 5 foot by 8 foot hole- a 3 foot by 5 foot hole 8 feet deep down to bedrock. And it was me and another apprentice and then him. He was like, I forgot to pour the foundation for the chimney. It's really bad dirt. We got to go down to bedrock. So just a shovel, no excavator. I hadn't done any working out for two and a half years. I mean, all day from like 8am to 8pm and we dug this three foot by five foot hole eight feet deep in clay. And I was the most sore I've ever been in my entire life. And I played college football, and this was like the most pain I'd ever been in. And we went through a week. At the end of it, I was eating dinner with him... He was like, all right, well, I'll see you later. I said, can I stay? And he just goes, okay. I said, can you pay me? He's like, 12 bucks an hour. I was like, deal. So excited. And so, then we went back, got my stuff, moved down to Carlton Landing. We moved in a four hundred dollar a month house. And you follow, because we couldn't afford Carlton Landing, my wife started cleaning houses so that I could learn how to do this. And so my wife, even though she's not directly involved with Building Culture, has been a tremendous... None of it would happen without her. So that was really the origins and the beginning of it, doing that for two years, learning stuff, starting Building Culture in 2017, teaching myself design, which I never thought I could because I didn't even know I was artistic, couldn't draw. But when you start building things and looking at things and understanding things, and then also desperation of like, what am I going to do after this apprenticeship? Like, I don't know how to like read other people's plans. I know how to like put something together in my own head. So, I ended up teaching myself design. And so, the first house we built were houses I fully designed. My first house I spent a year designing it. 

Chris Powers: Dude. All right. So you get there, you spend a week. You're sore as you've ever been. God, your wife is saint. You're like, we're moving up. I got the job of a lifetime, honey. $12 an hour. You're going to be an intern. What did you actually do over those two years? Was it just digging holes and being on site every day? Did he give you a full 360? And what was he doing? Building homes? 

Austin Tunnell: Yeah, he is like the quintessential craftsman. So, this isn't like- It wasn't a volume game. It wasn't a we're building 10 houses... He was building one house when I got there, and then during it, we were building two houses. So I got to see start to finish of housing, and we laid all the brick. It wasn't like a brick crew. It was me and another apprentice. And I think maybe we ended up bringing on a couple laborers to help mix mortar. So, we were mixing mortar, we were laying all the brick, and there was like 80,000 brick that goes in one of these houses.

Chris Powers: So you were doing labor. You were doing manual labor... This was not pushing paper. 

Austin Tunnell: Oh, zero paper involved. I tried to be like, let me help with like understanding the costs. And that didn't work out. So, it's just labor for two years. 

Chris Powers: Okay, so how hard is it to do this stuff? Because even in the development I've done, you can tell the difference between a poor- And we're just doing basic brick. I mean, what you said, the facade, this is not design based brick. And you can tell very clearly when you have an inexperienced crew versus an experienced crew on just that. This guy's having you do some of the most detailed brickwork maybe going on in all of Oklahoma, maybe the country. I don't know. So, like how did you kind of build into that? Did you have some practice, like sandbox he made you where you kept working at it? 

Austin Tunnell: I first laid brick that you wouldn't see later. And I love learning this way because this is how I think about it. He basically gave me a trowel and kind of drew something out, was like, here's how you lay brick kind of, just start practicing. And he came back an hour later or two hours later, and then he would give me a tip, like, okay, now that you have a sort of feel- So then tips start to make sense to you and then you just practice and get better. But laying structural masonry is fundamentally different than laying against a veneer building because the building exists and you're just kind of laying to it. When you're doing structural masonry, like the brick is the form and so it all needs to bond together. But in some ways, it's almost easier in some ways because it's like more intuitive. You don't need to like cut a brick at the end because you're going to put the window at the end of the brick or something like that. It's not like the windows there. And you're like, well, I didn't course it out well. But I've innovated a lot there too of kind of like understanding how to do it. Like when I'm measuring where our windows go in, I'm not saying it goes in at exactly 21 foot 6 off the slab. I'm saying it goes in on top of course 14. And it's going to be really close to 21 foot 6 or whatever I think it is, but it's all by course. And then the window goes in on the brick. So, it's kind of almost a very intuitive building. I mean, people have been doing it for thousands of years. When I was In Uganda for two years, what do they build out of? Mud bricks. Really simple building material. 

Chris Powers: What's course? 

Austin Tunnell: A course of brick is like one course, two course. Every time you lay a brick all the way around, that's a course of brick. And then so a second course and a third course as you go up. 

Chris Powers: How do you know you have the same amount of cement like on top of each bricklayer so that some aren't sitting higher and some are sitting...? 

Austin Tunnell: It’s all about leads. So we put up poles and pull strings whenever we're doing masonry. So it's all lead based. So rectilinear things that are on a line are much easier because you've got a string that you can follow and you're laying brick and making sure it's kind of pretty close to that string. When you start doing curves and other more organic shapes, it's much harder because then you don't have strings. But I would also say masonry today is all about laying brick absolutely perfectly. Like the way bricklayers today measure their skill is how perfect does it look. If you look at my buildings or if you look at his buildings, the mentor I learned from, it's actually messier brickwork in a lot of ways, but it's human. Like there are all these- A brick is the size it is to fit the human hand. And then when you lay a hundred thousand of these in a building, you kind of want that humanity reflected in it. And so, our mortar joints aren't perfect. They're not perfectly struck. And it's not like we're trying to make it look messy or old. It's more like we're just laying brick practically. And I do care about the aesthetics. And we want to make sure to strike the joints so water doesn't get in and things like that. But we're actually much more okay with the more organic feel. And so, people look at our buildings and they think we're doing a restoration of a historic building. I’m like, no, this is new. And they're like, yeah, yeah, a new restoration. I'm like, no, no, this is new. And it's not because we're brilliant. This is very accessible stuff. We've just kind of lost the knowledge. And so that's what excites me. I’ll have students down sometime, I haven't done it in a few years, students from an architecture school and have them build a whole structural masonry like archway that you can walk through, and it's beautiful. And they've never laid a brick in their life. And I just have to show them a few things, show them how to set up. They're really slow at it. It's going to be a little sloppier than I would do, but they could do it. 

Chris Powers: Okay, here's a philosophical question. Why is it that naturally humans gravitate towards a more humanely built building than what appears to be like a building that's perfect, that's almost built by a robot? Like, what is it about us that pulls us into that? You have to have studied this somewhere. 

Austin Tunnell: Yeah, I used to think about some of this stuff, like more 10 years ago than even I do now in terms of philosophically on the brick working stuff. 

Chris Powers: But just anything in general. Like, I think we just like things that seem more original or more like humane. 

Austin Tunnell: I mean, you hear, you see- there's like in Japan and stuff, but the perfection- Humans are not perfect. So seeing some of that imperfection is like what makes it beautiful and what makes it human. And that's not all the time in all cases. But I make the comparison sometimes of masonry, brick, could be one of the most human materials, and it could be beautiful and stunning. And also prisons are built out of it. It's kind of weird that you can have these both where it feels very inhuman. But I think a lot of it's about design and scale too, not just the brick. I mean, there's beautiful wood buildings, there's beautiful wood lat buildings, and there's beautiful brick buildings and not beautiful brick buildings. So... some of it’s just... 

Chris Powers: Like magic. How do you describe it? Because it's like you know when you see it. 

Austin Tunnell: Yeah, that's why it's hard for me to- People ask me how I learned how to design, and I'm like, I looked at things I found beautiful. That's how I learned how to design. I'm not trying to copy something exactly how it was. And people said, well, what style are you? I don't know what style it is. It's something that I find beautiful. That's really the best I can say it. And it's like when you're using real materials like masonry, which works in compression, and you're not relying on steel or something to make it do something it's really not meant to do, it kind of limits your optionality where your proportions start changing, your window sizes start changing, your openings start changing, your arches need buttressing on them to like kind of carry the weight down to the ground, versus when you introduce steel in it, you don't have to abide by any of those kind of constraints. Steel's an amazing material. We use it. But I think the natural limitations of these materials, too, like lend themselves to a more human form. 

Chris Powers: If you were talking to like, there's a lot of developers that listen to this, I don't know if I'm going to ask this the right way, and you were to say, here are the few things you probably don't know, you're not a great mason, but if you did these certain things around a house with brick, it's like the cheapest way to get the best value?

Austin Tunnell: I can absolutely tell you. 

Chris Powers: Okay, what are the things that we should be doing with brick that anybody could do that they're not thinking about doing? 

Austin Tunnell: Yes, you can do this on homes, you could do this on multifamily buildings, you could do it on apartments, you could do it on commercial. Okay. The first thing is people use the wrong brick. They get these extruded brick. They're called extruded. They're wire cut. And so they're perfect. They got these very sharp edges. That's problem number one. We get- a wood molded brick is beautiful but going to be really expensive. A wood molded brick, literally, they put it in a wood mold and then bake it. And so, when you take it out, it has kind of deformities to it. It's not all perfect. So, it's very like- it's a handmade brick. You can get them in the US but they're expensive. We don't use them. We use what's called a dry tumbled brick. It's an extruded brick, but then they run it through a tumbler and it takes off all these sharp edges. So that's number one. Use the right brick. We use modular brick in our company because that's, generally speaking, a lot of people use king brick for veneer. And you can still make it look good with king brick. I prefer modular. It's just a slightly different shape. But use a dry tumbled brick. Don't try to find a brick that just looks old because it like has fake patina on it, like where they painted it to make it look old or like ran a stamp on it to make it look old. It's probably going to look stupid if it's not real. So, get the right brick. Don't make the mortar joints perfect. And you actually have to get on the masons about this. Rather than like making every joint absolutely perfect, we'll take a little tuck point instead of kind of a jointer and we'll make sure all the gaps are filled in from waterproofing, but our mortar is a little bit softer. Like, it just has a more organic feel. We color our mortar because brick, everything today is very Portland based, so it's very gray mortar. We will tend to color our mortar to be more in line with the brick. I'm not saying you have to match the brick and it depends on what style you're doing. Get the right brick. Make the mortar joints, don't make them perfect. Try to color your mortar if you can. That one's less essential, but I would recommend it. And then the last two details are, get your arch details and your lintel details right. People don't really- when you're building an arch over a window, it's really easy. You can do like a row lock and then another one and you can pull that other one out a little bit and create a little like one inch reveal. And suddenly you've added depth. Even in a veneer building, you've added depth. When someone looks at our veneer buildings, they don't even realize, they think it's structural masonry because we just get the details right. We use a natural stone lintel over our windows rather than cast stone. Depending on the size, if it's a really big opening, we'll do cast stones. We can put steel in it to actually bear the weight and like those five things. Oh, and we use stone sills. Most people below the windows will just kind of take a brick and slope the brick a little bit and have the- and you can do that. But it's also actually not a very good practice because all those mortar joints will move and water will get into your wall. Whether structural masonry or veneer, we put a solid stone sill. This is all the old buildings. If you walk around Boston or Charleston or Savannah, you'll see stone sills, whether they're cast stone or they're natural stone. And suddenly you've got a beautiful architectural detail that barely costs anything. It's way better waterproof wise. And suddenly you've got a great detail. So if you get that lintel, the stone sill and either an arch or a lintel on top and just do those details right. And you could literally look at our website when I say do the arch right and you'll kind of see what I mean and go look at other veneer buildings. It's not hard. It's not a skill thing. It's just something that's not really done. 

Chris Powers: Okay, so if we say, okay, we're going to do all those things, do I have to ask my contractor, are you capable of doing these? Does my architect have to draw it a little differently? Like, how do I take your great wisdom and actually put it into practice if I have a deal going up in Fort Worth and you can't make it down to help me? 

Austin Tunnell: Insisting on it. And it's hard. Anyone can do this. Any masonry crew can do this. But it takes kind of like we're doing it this way. I don't care if you've done it before. It's not hard. And I don't mean you have to be mean, per se. Depends on who it is. But it's just kind of insisting and caring enough to make sure those details are done right. And once they understand it, it'll be easy. And so, I think it does start with the architect and making sure that they're kind of drawing things right and understanding it. But then it also matters for the GC and then mason to kind of all be communicated a little bit. But it's not hard. Like, I'll tell you if something's hard. There's hard things out there. I wouldn't recommend people go do structural masonry buildings just because the industry isn't built up around it. But getting these masonry details right is not hard. 

Chris Powers: Okay, so what would I, if I was interviewing architects, what would be my questions I would ask to immediately get them out of this? How would I know they couldn't do it? Because I would assume architects are all- Some would just say we don't do masonry. That's fair. But for the ones that are, they just want business, like what would be a question you would ask that you could tell pretty quickly like this architect's not capable of understanding my vision? 

Austin Tunnell: I would probably- it's hard because we kind of do all this in house. So I'm not used to like having to communicate it to another architect, per se. So, it's actually a little bit harder question for me to answer. I would actually show them reference images would be what I would do of like here's what we're looking for. Do you know how to draw this in? And making sure that they are kind of coursing out where windows are going so you don't get little slivers of brick and stuff like that, which can make a building pretty ugly, pretty quick. But I think a lot of it is kind of like being more involved as an owner or developer, which can be a little uncomfortable, whatever. You can build a mock up. That's probably what I would do is like try to get them to understand it, try to get them to draw it, and then build a little mockup wall or mockup window and make sure it looks right. 

Chris Powers: Do you train all your people that you bring in to your liking, or have they already demonstrated that skill somewhere else? 

Austin Tunnell: We basically had to train it. On our new project, this Townsend project that we're doing, well, I've used this crew one time before, but they're a commercial crew. And so like I can take any just good bricklaying crew and turn them into what I want to really easily, just with details, like kind of on the job site type thing. So when we're doing structural masonry, right now, a lot of that still lives with me and I'm trying to pass it off to my team and document it and things like that. Because when you're innovating, it's really hard to do that. And you're a small company. So, I'm working on trying to pass that off. But then I'll be there a lot probably when we first start and then I really won't have to be there that much. And in the long run, people will know these things. But yeah, you can take any crew and kind of- because it's not hard, they just have to know a few of these little details. 

Chris Powers: Okay, let's talk about this project. How did this one come together? And what is it? 

Austin Tunnell: So, we are doing, it's about 1.1 acres in downtown Edmond. And I know you're familiar with Edmond. So, Oklahoma City is where I live. This is a suburb of Oklahoma City about 20 minutes north, historically the wealthier area, the best schools, lowest crime, all that. Very desirable place to live. So people have lived there and then commute down to Oklahoma City for entertainment, things like that. There's this old downtown main street in Edmond that they nicknamed Deadmond for a while because there was nothing there. There's some old antique shops. Over the past five years, it went from like being four something restaurants down there to 35 and counting. And most of these are retrofits. There's not a whole lot of new construction happening yet, but like cool restaurants are going in, ones that were like in Oklahoma City, local restaurants in Oklahoma City also coming to downtown Edmond. So, when I'm looking for where to do one of our projects, because we're really focused on urban infill, I would say, it is where do I see things progressing in kind of a more walkable area. Walkable areas are not for everyone. But people think density or walkability and they think density, high rises, five story apartment buildings. That's not necessarily what I'm talking about. You can achieve walkability with two to three stories really easily. It's like from your house, what can you do within a 10 minute walk? And so around this downtown Edmond area, there's now some institutional money coming in with apartment buildings, all these kind of restaurants and things. And I think there's a lot of missing housing right now and also office. We're building 18 townhomes, two live work units where they've got like a commercial space downstairs and a loft upstairs and then 13,000 square feet of mixed use commercial. That's going to be like an executive suites and office space and stuff like that. And we're only doing that commercial piece out of the structural masonry. The rest is going to be normal wood frame and veneer just because of cost. So, we're doing these. These are pretty high end homes that we're doing. But we're also doing another project like five blocks away in downtown Edmond that's a very similar concept. There's 30 something townhomes arranged around courtyards, really beautiful, really wonderful living experience. And it's going to compete with class A multifamily in terms of rents. We'll be at like 215 a foot is what we're underwriting. And so, it's kind of like two different levels. You're getting the same experience. One has nicer finishes than the other, but they're both going to be beautiful, a great experience. And so, this rental project, it's like, well, rather than live in a 300 unit apartment complex, I can live in this wonderful 30 unit neighborhood where I walk out my front door, I own my- basically have my own house and it has gardens. I've got 30 neighbors, not 300. And I'm still a five minute walk to the center of downtown, parks, events, things, great for kids. It's a really family friendly environment in Edmond. And so that's kind of what we're looking for when we're doing a project. And then doubling down on that, I have a thesis that supply of walkability and demand go in the same direction. The more supply of walkability, the more demand because the more desirable a place gets, the more businesses that come in, maybe it can support a better school. And so, kind of doubling down on these areas rather than just being indiscriminate and building anywhere. Because you can't just put townhomes anywhere and it do well. People would rather live in a single family detached house, generally speaking. Unless you have a reason. Unless there's a whole lot of benefits. Townhomes are kind of like split that difference. Right now, I meet a lot of people and there's a lot of Gen Xers, millennials and even boomers now who are like, I don't want my 5,000 square foot house. My kids are out of the house. But I also don't want to go live in an apartment building downtown or even like a high rise condo building. So where do I live? And this is what I would call the missing middle housing and townhomes could be such a great thing where they can be 1200 square feet, they could be 4000 square feet, but you can achieve enough density to have a completely different daily lifestyle that in my mind is so much more connected and enriching than 90% of the neighborhoods built today. 

Chris Powers: And when you say these will be stick frame, will the exterior still look like your signature masonry work? 

Austin Tunnell: Yeah. People looking at the outside won't even be able to tell. 

Chris Powers: Because when I was looking at it online, I'm like, this thing's amazing. 

Austin Tunnell: Yeah, yeah. You won't even be able to tell. 

Chris Powers: And what you're telling me is that masonry work, is it 10% more expensive to do or is it like it's the same cost, it's just the thought and the attention to detail, if you do it up front, you're really not adding cost? 

Austin Tunnell: When you're on the veneer side- structure masonry, yes, more expensive. But on the veneer side, yeah, I mean, maybe we're using a brick that's 65 cents a brick. Maybe you can get a brick for 55 cents a brick or 45 cents a brick. But when you're just doing a veneer on a townhome, your actual brick material budget is quite small. So, I would say if it is more expensive, it is not much more expensive at all. Definitely not 10%. 

Chris Powers: And you've said multiple times, like these are beautiful projects. Why are they beautiful? Like if you had to describe why they're beautiful. And then the follow up to that is like, why do people, if it's not costing that much more, build beautiful stuff? Because I'm telling you, like you go over to some parts, Fort Worth, some of the townhomes that have been built over in East Dallas, they're the ugliest things I've ever seen in my life. I mean, they're so bad and they sell for a ton. The interior is not that bad. I mean, it's a good layout. But I could drive you to some areas around here. Hell, to be fair, I've built some of them that I'm like, this is what the architects put out. It's efficient. You can get four to a lot, blah, blah, blah. And you just don't really think about the beauty of it. It really is what will the bank finance, how quickly can I get this built, and does it comp out? So, I'll reverse back again. Like, why is your stuff beautiful? 

Austin Tunnell: I think because... beauty is one of our just core values, like whatever we- And of course, is beauty subjective? Is it objective? I think there is some component of subjectivity, but there is beauty... 

Chris Powers: Like you're actually like well-known on the internet because of your beautiful stuff. So, you're well known for beauty. 

Austin Tunnell: I think beauty is real. A lot of people don't as in like- But I'm kind of like 98% of people agree on who is a beautiful person. I mean, it's pretty... you know when you see it. And maybe people think this person or this building is more beautiful than the other. But one, I think beauty is real. Two, I think beauty's important. I think beauty, and it's hard for me to articulate this, beauty somehow connects us with the divine. And because there's not necessarily a good practical reason to pursue beauty just from like a straight numbers perspective or something else. Although I do think beautiful things will outperform. I do believe that. But I mean like, it's hard to justify beauty, except to say I think beauty connects, it's like the pursuit of beauty connects us with something higher. It's even just the recognition of like, why do we find this beautiful and what does it- why do we walk into a space and it kind of makes- elevates our spirit, it elevates our soul. And so, I think of beauty as almost like an invitation. You could build the most perfect city on earth, the most beautiful city on earth. It doesn't fix all the world's problems. It doesn't fix all the people. There's still going to be crime. There's still going to be all these other things. But beauty, I think, is an invitation. It causes people to like, even just kind of wake them from their stupor that there is something else going on in the world. Because you can't quite explain beauty. You can talk about it, you can get around it, you can write poetry about it. You can't just- It's not logical per se. Although there is kind of like math behind it and geometry too, where it's more logical than people think, which I’m not educated enough to talk in depth about that. But it's like, I think beauty and the outcome of it is so important for society. But I also think the pursuit of beauty is important for all of us. And we talk about beauty in our company, not just in our buildings. When I say we pursue beauty, like literally one of our values is pursue beauty. And it's like there can be beautiful Excel spreadsheets, there can be a beautiful process. And so, beauty is intention and doing things with intention and excellence, but also kind of this connection to something that's inspiring. And so, we work from a place of inspiration, I would say. And what's so weird about like when we design, we're involved with these projects, is I've got a partner, Matt, who's an architect, and we kind of design things together now. And it's just this amazing thing that it's like, I don't know who designed it. We're both just kind of designing. Oh, we'll go with that detail. We'll do this, we'll do that, and then somehow we just know. When it's right, it's like, that's it, that is it. And that's like one of the best feelings that I can possibly- What is that? I don't know. Like, are we connected to something? Like, where is that coming from? I don't know, but I know it when I see it. And there's just something like a resonance that happens or something. And then watching other people enjoy beauty is like one of the most kind of like life giving things to me is when something's actually there and then people come and enjoy it. I mean, that fills me up. That motivates me. 

Chris Powers: So were you this way before you met the mason? 

Austin Tunnell: No, I think this has been a long, kind of a long process for me and a long process of realizing that I'm actually quite like sensitive to things, because I literally grew up playing football, being a jock. 

Chris Powers: What position were you? 

Austin Tunnell: Running back. And just kind of being a jock, not artistic, none of those things. And kind of recognizing it was over the past few years, and honestly, meeting with John [?] that I mentioned earlier, he was like, you're an artist. And I was like, I wouldn't even let myself think about myself as an artist, even though I was designing all these houses, picking every selection, obsessing over what hardware it was. And I'm like, I'm not. And it's kind of hard because like, as an artist, it's like I feel, I mean, in terms of like part of me is, where I'm like, I can see what could be. Like, that's... I'm really not that interested in what is in some ways because I'm like, I can see what we could do. I could see what is. But I'm not happy just living in the abstract. I'm not just happy doing only a podcast or writing or talking on social media. It's like, I need to see this in reality. And not only do I need to be building stuff, I want to be changing rules, changing laws that are kind of preventing or at least putting huge obstacles in the way of building beautiful things and life giving things. And so it's just kind of like this whole life mission that I feel incredibly passionate about. 

Chris Powers: What are rules and laws that prevent beauty? Like, what's the first couple things? 

Austin Tunnell: There's a few layers, but I would say, what was it, the 20s or 30s or something when they started introducing Euclidean zoning and kind of single use zoning, which is kind of how our cities got destroyed where we used to- Like, we don't even have a comprehension of what a neighborhood is anymore. Like, we have subdivisions, and each subdivision has houses that are, this one has 300,000 to 400,000 square foot- I mean, $100,000 houses. This neighborhood over here has $700,000 houses. The rentals are over here, your school's way over here, your work's way over here. It's got all the ingredients of a city, except it's not actually organized as a city. And it's like a pie. You've got eggs, you've got water, you've got sugar, you've got butter. It's the same ingredients. But if you don't actually mix those ingredients into a pie, they're not a pie. They're not going to taste good. 

Chris Powers: So what you're saying, in your view, a city should have all those different income levels and product types mixed in together? 

Austin Tunnell: More so. And I'm not saying every- like people can take this to an extreme or something. It's okay for there to be affluent areas. It's okay to have areas of really big houses. But I'll give you an example. I live in Wheeler district in Oklahoma City, right by downtown. There are $300,000 houses, there are million and a half dollar houses, and everything in between. There are ADUs and garage apartments. There are three story live work units. We got little commercial spaces and two stories above, there's a three unit apartment complex that just went in. There's little fourplexes. And I would say there's like a village center, like every neighborhood, a complete neighbor. And this is how humans have lived for literally all of human history. Like until the past hundred years, this is how people have always lived, where people live together. And there is kind of like a center of town. And I'm not saying it's the downtown area, but if you think of a city as more like a mosaic, so if you think of like a tile mosaic and you've got all these tiny little pieces. But all those pieces make up, tell a much bigger story because they're creating art, it's showing a flower. But we really focus on the individual piece in the US, and in a lot of ways, not just in architecture and building, but focused on the individual buildings and not like- it's really hard for us to even comprehend a city. Because we don't have really truly civic space or public space. And part of the reason I'm kind of going down a rabbit hole here, because I want to get back to the beauty thing, but the reason I think this is so important is it changes your everyday life. If you think about how most people live and how I've lived and how I grew up living, you grow up as kids. Your mom or dad has to drive you everywhere to do anything. How are you getting to school? How do you go to a play date? Everything has to be planned. As a parent with young kids, it's like everything has to be so organized, and they've got to go do this and we've got to do this, and we're going to have dinner from 7 to 9pm. We're going to have a play date here. And you spend all your time kind of driving around. You've got kind of like maybe your close relationship friends that maybe you see, I don't know, once a month. And we've really lost kind of these loose connections of people we live around. And I'll give you an example of where I live, one of the reasons I love it is I don't have more best friends than I used to have. I have kind of the same amount of core, like really close friends. But around my neighborhood, I go to the same coffee shop, I don't know, two, three times a week, see the same baristas, have these really just short interactions. So it's like what is the quality of your everyday life? On Friday nights, we don't know what we're going to do. So we just kind of go out to the center of town and you can get a beer, you can get tacos, you can get sushi. There's a playground right there. It's very family friendly. And I talk about if you make something family friendly, I don't mean like Chuck E. Cheese family friendly, but something, just make something where kids are comfortable and kids are welcome, suddenly everyone wants to be there and it's this very like wholesome- you can have beer, you can have alcohol involved or not, but you invite kids and families into it. And guess what, you'll also see teenagers on dates there too. It's just like a completely different feel than how we think of like a midtown where’s it’s just very like bars and whatever. So this is a real neighborhood where we’ve got the center of town. And we walk over to our house and sit on our front porch and it's so quiet and peaceful. There's people walking around. There's public parks. And it's just I have all these loose connections. I walk around, I see people – oh, hi. And I think that leads to a much more like enriching life and actually feeling part of a community. I mean, there's a statistic that 79% of Americans report a sense of non-belonging in their own community. And like that's really sad. When you see the degradation of our society, like social, cultural, the loneliness epidemic, the suicide, the drug use, the average teen spends almost five hours a day on social media, parents are lonely, people don't have dinner at the dinner table anymore, they don't really know their neighbors, I think a lot of this is downstream of our built environment because we've kind of basically built bad hardware and you can't really run good software on bad hardware. And so it doesn't mean that good hardware fixes everything, but it's really hard to fix those things without first fixing the hardware. 

Chris Powers: So you're telling me the town center with Walmart, Dutch Bros, Church's Chicken, a KFC, and an Aspen Dental is not your idea of a town center? 

Austin Tunnell: Believe it or not, it's not. And I get why those things happen. And a lot of it, capitalism is very good at taking the incentives and then becoming very efficient at it. And these are the incentives we've created through our laws, through regulations. And I didn't even get to our building codes, our fire codes, our or traffic engineers. It is a profoundly broken system that thankfully is starting to shift a little bit. There's a lot more conversation. So it's not like I blame people for doing these things. You're kind of following- You’d have to be kind of crazy to try to like do it differently because it's so much harder. You're going to spend way more time, you're going to spend way more battles. You talked about doing some mixed use before. It's really hard. And so you really have to care about it. And so, part of what I want to do is, one, do it because I just have to, I can't not do it. And then two, change rules, change regulations, which is actually a lot more possible than I ever realized, so that other people can do it more easily. And I think that is absolutely possible too. 

Chris Powers: I don't think the common citizen knows how much fire code screws up development. 

Austin Tunnell: They have no concept. 

Chris Powers: Like, you know it better than I do, but like the distance you have to be from a fire hydrant, the amount of ingress egress, the amount of like radius turning a fire truck has to be able to turn around. Like you take what is the greatest designed master plan and totally screw it up so that a fire truck can get around. And it's why obviously those old towns in Europe, like those would never pass code anymore, those tiny streets and like you can't even get a fire truck down them. 

Austin Tunnell: Yeah, well, we have the biggest fire trucks in the world in the US. And we love- they get bigger every year. It's like, oh yeah, big fire truck. You should see the marketing on these fire trucks. It's like big bad fire truck and you go to try to talk to the fire- It's really hard because I don't run into burning buildings. You don't run into burning buildings. We all admire the bravery and courage of firemen. So it's not that. That's not what I'm talking about, but it's kind of the industry, the fire industry. And like you said, the turning radius and stuff, the street widths. Because the streets are so wide, turning radiuses are large. Cars go faster. All for the- We basically build our cities around fire trucks, which is like the stupidest thing in the world. Build your city how you want to and then make the fire truck fit. In Charleston, guess what, the fire trucks are smaller. In Japan, the fire trucks are smaller. And guess what, they have no fire problem. 

Chris Powers: Yeah. If you put all that money in that we build in extra infrastructure and just gave it back to where we could build these masons- that we could move the money into building structures that really can't even catch on fire. 

Austin Tunnell: It would be awesome. 

Chris Powers: Instead of these huge... There's so much. And like, obviously, and again, it's little things, but like buildings need to be handicap accessible, of course. But to people that have never developed a building, you wouldn't believe how the ramp that goes into the building dictates the whole building. 

Austin Tunnell: It's so hard. Or the size of the elevators. We have the biggest elevators in the world. And it makes it really hard to do small scale. That's why people immediately go to big scale. Because at this point, with all the brain damage and all the stuff you got to do, you might as well go build a 300 unit apartment complex because it's just as hard as building a 30 unit or a 12 unit. 

Chris Powers: God, some of our apartment complexes have gotten pretty bad, haven't they? 

Austin Tunnell: They really have. They really have. We need the housing. It's like two things can be true at once where I'm not like mad there's more housing per se. And I get why it is, but I think, I don't know, something I've been thinking about is this idea of faceless money. And so much of our real estate is funded by institutional money. And they don't care about your community. It's not their job to care about your community. They don't care about Fort Worth. They don't care about Oklahoma City. They're looking at a spreadsheet in your community as a line item and they're choosing the best metrics and data. And I'm not saying you shouldn't do that because I think that's important as a real estate investor and things like that. Of course, they're managing endowments and people's pension funds. But when it starts dictating what the built environment is, and the built environment is the human habitat, it really is kind of like this public good, unlike a lot of other things. And we're all forced to live with it. And I've noticed that when people are connected to what they're investing in, there's a completely different mindset. And so, I think in US culture, the reason my company is called Building Culture is kind of this two pronged meaning, the building culture, the construction culture. And I used to think most of the problem was on the technical side, the regulatory side. We've lost the skills, we've lost the knowledge, the financing mechanisms, and all those things are true. But it's also building culture because all this stuff is downstream from culture in a lot of ways. And you need people that value these things if things are going to change. And a lot of the greatest cities that have been built on earth that people still visit today and love and spend billions of dollars just to go see for a week, guess what, they weren't funded by institutional capital from people all over the world or the country. They were funded by people there, living there, who were invested in the community, wanted that thing to be built and wanted their community to be better. And so that's why I kind of get excited about where we're at now with just... the rules changes of the 2012 Jobs Act, but the 506C exemption where like we can go raise money on social media announcing what we're doing and attract people with values. It's not just about your Rolodex, it allows you to access. And then even things like AppFolio and management platforms that allow small operators to manage investors without like killing themselves trying to get out 50 K-1s at the end of the year. And I think it enables smaller developers, more local developers to go to neighborhood level projects, get neighborhood level capital or even aligned capital that's national, and then go make their own community better. Like, don't leave it up to- We're taught to be consumers in the US, like just consume the system, consume what's kind of given to you. Go to your doctor, they'll tell you what to do to be healthy. Don't think about it, don't do your own research. If you go to 10 different doctors, they'll tell you different things. It's like, let's take a little more control of our own destiny. I think that's part of the danger of just a wealthy society is we forget because we have all these systems and rules and institutions and we forget we are in control of our own destiny. Like if you want something to change, you have to. I'm not saying you can care about all the problems. I'm really focused on this problem because I can't worry about this problem over here. But we really can shape the future of our neighborhood, our city and our country, I think, as people kind of wake up to this, and I feel like it's happening. There's like a counterculture from the stagnation, which excites me. 

Chris Powers: Do you think that you can do what you do at scale, and scale being like, could you be a national company with projects going on in 20 cities? 

Austin Tunnell: I think that would be hard because so much of it's relational based. We have to have relationship- to kind of work these projects and get them through and then make them excellent, doing something excellent is really hard, but we have to have relationships with city councilors, with city managers, with the mayor, with all the city staff. And those people turn over, and guess what, you have to like stand in front of people to keep- maintain those relationships over time. So it's a lot of work. And I think it is hard to scale just in like I'm going to build a company that's just going to build projects all over the country. Right now, and I'm not like promising this because I will say every year my vision does kind of get bigger about what's possible, but right now, where my vision is, is that if we can focus on Oklahoma City and kind of be doing at least one of these projects per year, so you really probably have three to four ongoing projects where one is being delivered every year, that's a lot of work. And that's enough work to shape policy at both the local and the state level and even the national level in a lot of ways. Because you need to be building. Like when you can build something and show people something, it's a lot easier to start shifting things. And so that kind of like, one, it starts making our neighborhoods better. I think we can have a huge impact on the trajectory of Oklahoma City and the Oklahoma City metro in the state. But my vision of scale is actually, and I was just listening to this, I'd listened to it a while ago and I'm a big fan of Moses Kagan and Rhett, but what they're doing with Reseed, so it was actually listening to Moses on your podcast that helped me make the connection of what I'm doing and this idea of long term capital. I hadn't quite figured it out yet and literally until kind of like running across Moses Kagan, like, oh, there's a different way to pitch this to investors than how am I going to get a 22% IRR in five years and blah blah, blah, blah, blah, versus you build in the right place where people want to live, build it with quality because you're going to hold it, and then hold it long term, leverage it conservatively and hold long term, manage it well. They're doing that with rehab and value add. And I think you can apply the exact same thing to quality new construction infill. And so my vision of scale is not right now, is that five years from now or something, once we kind of really get our operations going and being able to develop, design, build all of these things in kind of a system, is to have some kind of like reseed type thing for other developers across the country. I can't go develop in Fort Worth better than you can develop in Fort Worth. You know the people, you know the sites, you know all these things. But what I can do is help facilitate it because capital, the people that do know how to do these projects, they're not good at raising capital. Maybe they need to partner up with someone too. But can you come- Because financing them is very difficult, both from an equity perspective and a debt perspective. Where are the comps? If someone hasn't done this exact thing before and is renting for this exact amount, it gets so much harder. So when you're doing anything new, it's way harder to finance. And so, if we can kind of have knowledge, and kind of even Moses talks about this, we have this massive checklist of due diligence, well, we're building that right now for ourselves. And it's like I don't want to keep it for myself. I want to help other people do this. And whether that's coming as an LP connecting them to good designers and architects because there's very few out there that really know how to do this stuff well because schools, architecture schools are completely broken in 99% of colleges, and then see- empower ground up kind of local developers. I was just on the phone on the way here with a guy from Baltimore that's like, I'm ready to go out on my own. I've been doing this for- he's 35, been in the institutional world. He knows all the stuff. He's ready to go out- He's like, I want to be in Baltimore and I want to do this stuff in Baltimore. I'm like, heck yeah. There's so many people like that that want to be in their neighborhood doing this thing, and they just need like one, whether it's LP capital or some structure help or architecture, whatever it is. So that's kind of my current vision for Building Culture. 

Chris Powers: You said, I could scale it by changing local policy, state policy, and then maybe federal policy. What's your vision? What policy needs to be changed? Like, what do you want to see happen? 

Austin Tunnell: So where we are building in Oklahoma City and Edmond, we're already looking for where- I'm not going to go take a bunch of risk on a complete zoning rewrite if the zoning isn't there. I don't mind asking for variances for small things and taking some risk there. But if it's like it's zoned for single family detached with minimum 7,000 square foot lots, you can do a PUD. And maybe I would do that in some things. But the areas I'm looking at is where the politics are already shifting. And so, a lot of cities, Texas is pretty ahead in some of these things, where they'll create, carve out a little area and say we're going to kind of create a CBD type district, a central business district. I don't mean it has to be some big area, but just where we're going to allow more mixed use. We're going to reduce the minimum lot size. We're going to allow up to 35ft of building. We'll allow some commercial. And it's like those are the areas I'm looking at because it's already- It's still going to be hard to work through all the stuff, the fire and all these other obstacles. But at least the zoning is kind of there for you to do what you want. And so like looking for that. And things are starting to shift all over the country and different municipalities are trying to carve out little areas or do whole new zoning rewrites. So, there's that. And I want to keep shifting the zoning to make it better. There's the fire policy stuff. I'm constantly talking about getting smaller fire trucks. I'm sure that will take me 50 years for that to ever happen. There's building code things. We're kind of like battling little things, streetscape standards to like- some of these things are actually kind of technical to talk about in a podcast, I'm realizing.

Chris Powers: Keep going. It's a real estate podcast.

Austin Tunnell: At the federal level, it's like, I mean, you've got to change the elevator stuff. You can't have these massive $150,000 elevators in every building when you're building a 3,000 or 3,500 square foot building. It makes it really hard to build these smaller human scale, neighborhood scale projects. By the way, if you had more neighborhood scale projects, you would have a lot less nimbies. Trust me, they'll still come out. But when you're starting to build beautiful things, these more like human scale things, it's way more possible. Some fire stuff even in terms of just like negotiating with a fire department. Will you back up your fire truck a little bit? Come on, can we back up a little bit? Like Elon Musk can catch a 400 foot rocket landing. Can you back up your fire truck? A lot of it's relational too, building trust and being like who you say you are over and over again. We go to city council meetings. I'm on a couple committees, well, one, my partner's on a committee too, like a development impact review committee. And we're talking about new development process. Because I'm like, this has been a disaster. This has been terrible. No one else is going to do this. We need to make this better. How do we partner together to make Edmond the best place in the state to develop? Why shouldn't that be the vision? I'm not saying it's- like why shouldn't that be the actual vision? And the city manager is like, heck yeah, let's do it. I mean, people, there's way more influence you can have as an individual than I would have even dreamed of four years ago. 

Chris Powers: The craziest thing about the whole situation at the city is, A, these people don't stay around forever. Some of them are elected. But B, they're not making any more money whether your project gets approved tomorrow or in five years. It's an incentive issue as well. There is no incentive at the government level, which they hold, outside of you got to make it through the neighborhood association, which we won't talk about the proverbial group of Karens that shows up to take over the HOA board. The only people who want to be on an HOA board are nimbies. So, you make it through that, you fought that knife fight. Then you get to the city, and these are good people, they're well intended people, but they have zero incentive to see your project get done. And there's no penalty. I'm sure you've been through this where they approve something and then it's once you're actually building that they're like, oh shit, that's not right. And you're like, I know, but you approved it and it's going to cost us like X amount to redo it. And they're like, yeah, that's not our problem either. They don't have any consequences for things that go wrong and they have no benefits for things that go right. And so, if I was going to build the city of the future, and I know we're getting into dreamland here, like properly incentivize them at the city. You get projects done quicker, you get a bonus. Guess what, more developers are going to come in. There's more fees that the city's going to incur. Like, they're going to make more money. There's going to be more property built, so there's more property taxes. Like all of these things are paid for. It's not like we're having to find the money to incentivize people at the city. But it's a big issue. And like you said, you're building great relationships. Well, I've had city council members in the past tell me like, hey, don't bring your project until the election's over. Like, I don't want to make your project a big contentious part of my election. I get it. I'm not mad at them. That's the game. But that's not leading to better housing. That's leading to two more years of sitting on city council. 

Austin Tunnell: It's something I think about a lot. 

Chris Powers: You're fighting the good fight. And I think anybody that doesn't know development doesn't realize like the building and designing is almost the easy part. 

Austin Tunnell: Oh, literally once we broke ground, I was like, finally, the part that I feel comfortable knowing how to do, and that's pretty sad. 

Chris Powers: Getting back real quick to beauty, so we've talked about beauty and development as aesthetic. We've kind of talked about the exterior. On the interior, is there anything you're doing like space planning wise or how you think about beauty that way? Because I think it works both ways. You can actually walk through something that's been thoughtfully laid out and you're like, this is just really laid out well. And then when you're like, I don't really know why, maybe it's proportion sizes, maybe it's there's not these random rooms. How do you think about like functionality and build out? Because it seems like I keep going back, I think the title of this episode is going to be like the Mason that Changed My Life or something. But like you've clearly thought about the outsides of the buildings and the walkability and we've talked a lot about what's outside. How do you think about what's inside? What happens when I walk through the front door that matters? 

Austin Tunnell: I have a lot of fun on the inside of buildings. 

Chris Powers: I know you do. That's why we're not going to be done until we talk about the inside. 

Austin Tunnell: I love bringing structural masonry inside even when we're building a wood frame building. I'll build like an arch, like a brick arch inside and we build a lot of like 2,000 square foot houses. Like we built some 5, 6000 square foot houses, but like that 2000 square foot house because that's a more like urban housing typology even if it's not a townhouse. And we'll bring a structural masonry arch inside. So it's like you walk in your front door, maybe there's a vestibule, you've got your living room. It's still like an open concept. Most of these are two stories that we build. I don't know if we've even built a one story.

Chris Powers: Is the master down or all rooms upstairs? 

Austin Tunnell: It depends how much room there is. A lot of times the master's upstairs just in an urban environment. Because you can't, you just can't do it. People don't understand. It's like, well, do you want a garage? Do you want parking behind? Do you want a little yard? Or do you want a downstairs undersized master or a really small living and dining area? So there's inherent limitations. Most of ours are upstairs. But I think about dividing space for one. So like even in an open floor plan concept, when you're building smaller, like you probably don't want to divide it up too much. Like we'll build some kind of archway or even like a wood frame between the living and- just to like you're walking through from one space into another and like that visual cue- So maybe you don't have the money to do brick. You can do a drywall wall with a little trim around it in a box beam and make it a little bit thicker, make it 8 inches thick, so you're walking through. That alone in like a lot of apartments would make a huge difference. I think we use a lot of wood stained trim. If you're building a multifamily building, maybe it's just like that price point over and over again is just too much. But for a lot of even rental products, heck, I've even done pine before where it's like super cheap material and we're staining it around the windows and doors, and it doesn't look dated, it doesn't look old, it looks warm. Because everyone complains about the all white, all gray apartments. And so, we bring warmth into ours and like wood is a really nice material. So, we do some of that. I would say those are two pretty big things. On our windows, and this is more expensive, but I like having muttons... like so you've got a window, but rather than just clear glass, you've got divided light, like these little dividers, like because all the old buildings have that. It was like putty glass. You have individual panes. Now they don't really have individual panes. They call it simulated divided light. But we still do that in almost all of our buildings wherever we can afford it because it- and I'm not saying- in some more modern styles, it might not look right. But I think like that makes a huge difference even on the inside. I’m trying to think of some others. We just pay attention to the floor plans. Like we're working on this rental product right now, and I've got three, I've really got kind of like three partners on it. And we met- two of them are architects and we've like met tons of times on each floor plan, like dialing in the floor plan, comparing five different versions of the same size unit and just kind of like literally trying to walk through backing into it from a human perspective. I love how Steve Jobs talks about like you don't start with the technology. You don't start with the hardware, how engineers tend to think. You start with the user experience and then you back into the hardware. Build the technology around the human experience. So to say that's how we approach every project is like imagine yourself walking in the door, imagine your kids, imagine before you had kids, imagine what is going on in each thing and that will lead to hopefully better decision making, and just kind of like just thought and intention can go a long ways. 

Chris Powers: Okay, so you've put all these projects together or you put this Townsend and you're going to replicate this. You found LPs. I loved how you talked about how Moses talked about it. Because if the goal is always IRR, there's just some projects that'll never get done. It's just reality. Like let's just call it that. But before I get to that, let me ask one more question real quick. Are you getting any tax incentives or are cities like giving you any additional funds for the types of projects you're doing or are you trying to find areas where there are incentives or are you doing these purely incentive-less? 

Austin Tunnell: That's such a good- I'm glad you brought that up because I meant to say it. Not only do we look for places where the politics are already kind of like at least heading in some ways to where we think we can work there with zoning. But also TIF districts are really big, so tax increment financing, and they're becoming more popular around the country, particularly in urban areas where they're trying to incentivize growth. And there's different types of TIF. It can be set up completely differently. I actually quite like the way it's set up where we're working. The city doesn't give us any money at all. $0 up front. But on our Townsend project, for example, we got $3.2 million of TIF approved. That is a reimbursement over time. So right now, the land is worth... This is wrong. But like let's call the- Well, actually I can be pretty accurate. The land's worth $2 million, a little less than that. So, the property taxes on that are not very much the city's getting. At the end of the project, it'll be $30 million. And so, the property taxes are going up by whatever is that, 25 times something, 20 times. And they pay no money up front. But we have it approved and we actually use it for our bank financing because the bank- and we've actually signed the TIF to the bank so that like they know they're covered and they're at least getting this money. And it's a reimbursement where the city keeps the same property taxes they've already been getting. They'll get a 20% of the increment. So, the increase in value, they'll capture 20% of that immediately. So immediately as soon as we're done building, their property taxes go up by like four times even just with that 20% increment. But then we capture 80% of that reimbursement. It's really a tax abatement in some ways. And it's annual. And there's limitations to it. It's not going to take an unworkable project and make it workable, especially on the reimbursement because it takes us 12 years to get this full TIF back, so like there's kind of diminishing returns, particularly from an IRR perspective because just how long it is out. So if you were to suddenly be like, well, we'll give you 4.5 million rather than 3.2 for the same value of project, it wouldn't really affect our financials all that much, at least from an IRR perspective because the time- it would just be like, well now you're getting it like through 17 years. So that's one way. Sometimes cities will front TIF money like to do public infrastructure and stuff like in cash. And that's obviously worth more. And I think that can make sense for utilities and streetscape and other public improvements, paving alleys, putting utilities underground, things like that. So, I think TIF is really great and to be just not indiscriminate but to discriminate on what kind of TIF projects you want to fund, you need to be fair, you need to be clear. But it's like we want these types of projects, these are the types of projects that are eligible for TIF. And then people can apply and I would say to be generous with TIF because it's like, but for this project and but for TIF, this project wouldn't happen, these taxes wouldn't exist. There's only positive for the city and upside in terms of increased tax base, services, all that. 

Chris Powers: And so then the pitch to investors, if it's not in and out in five years, is basically we're going to build this product, we think based on our building standards and the attractability of the property, we're going to get above market rents, we're going to moderately leverage it and produce a nice yield that, as Moses would often say, we'll put long term financing on it and we'll refinance it as rates go up and down. 

Austin Tunnell: I've stolen multiple of his terms, like opportunistic refinance. 

Chris Powers: If most people stole what Moses had to say, they would be very successful. 

Austin Tunnell: Yeah, I mean, I can't say how much like just his little... It just completely- It was like the last kind of piece of like it all clicked into place of how all this can work. But yeah, exactly that. And... on our Townsend project, it's kind of a complex deal because we have some for sale stuff in there and then we're keeping the commercial long term. So that's a little bit kind of like even tougher to evaluate from a financial perspective. But like this other one we're doing that is- it's just one lot. It's basically a BTR setup. It's just- But I wouldn't call it that because that means something to people. But it's more like it's one piece of dirt, one lot, 30 something townhomes, and you're building them all so you can stack utilities and things like that. 

Chris Powers: We call it- well, you can call it beautiful to rent. It doesn't have to be... 

Austin Tunnell: I like that. We'll rebrand it. 

Chris Powers: There you go, BTR. 

Austin Tunnell: And so we're focused, we're trying to underwrite it fairly conservatively. It's like, well, no one's built a product like this, so I cannot just point to this product over here and tell you this is the rents it's going to get, but I can point you to the multifamily around, here's what the rents are. And I think this is better than multifamily. And so, we're kind of like Moses on a project like that, focused on unlevered yield on cost. Because we don't want to do something that's like just not going to work day one that we're only expecting it's only going to work if rents increase a ton. We're looking at unlevered yield on cost to make sure it kind of like just at least makes sense. And then it hopefully in the long run is so much better than what we're saying is the hope, with increased rents over time because the area is becoming more desirable, more people want to live there. I think it has a potential to outperform, but I also don't want to promise investors that, by any means. 

Chris Powers: Let's say you... You kind of already said it, but I just want to back into location again. So does it have to be in a TIF district or something where there's some type of incentives or is that just preference? 

Austin Tunnell: I think preference and it probably depends, it depends on your land basis, what's going on. It depends. But it can be very helpful, and it's not like on our project we're looking at that we're currently in entitlements on and we're asking for TIF, I think we'll get it, if we didn't get the TIF, it would be harder to raise money for. Like I can't remember what it takes it to. It takes it from like a 6.5 to a 7 unlevered yield on cost. So for more conventional capital, that could be the difference between getting the deal funded or not. But if you're syndicating from high net worth individuals that kind of like want to see this project happen, they don't care about a 6.5 versus 7. So, it'll make it slightly easier to raise capital, but it's not like, well, the project just doesn't work without it. 

Chris Powers: And the goal would be to have three or four of these going at any point in time around the Oklahoma City area. And then maybe one day you'll branch outside of Oklahoma City. 

Austin Tunnell: I think so. I've got to grow a team. What's hard is you start to scale. We're doing development and entitlements, raising the money, doing the architecture, doing the construction. I'm not sure we'll construct all of our projects. As we scale, it’s like how big do I want that GC arm to be? I want to be really good at managing GCs, which actually... Because I was listening to the most recent one on my way down of Moses and Rhett, he was talking about like people don't know how to manage GCs. Like if you don't have experience and even if you're not constructing it, the knowledge is still going to be very valuable. But like I think, we're an eight person team right now and I think we're going to need to be probably a 12 to 15 person team to be able to kind of like do this scale, several of these... we’re one project a year, so having three to four ongoing projects at any given time, I think we're going to have to be 15 plus, probably. 

Chris Powers: Do you ever think about the media side of your company? Like what you do is so unique. You're so well known for it. Not to go say to build a media company, but as entrepreneur to entrepreneur, it's one thing to be building these. You ever think like it's even a bigger business maybe to teach the world how to build these? 

Austin Tunnell: Probably, and it's something I really want to do. And I played... had a podcast and stuff. It's just hard to find the time when you're a small business owner and... you just wear so many hats and starting to try to like hand things off and stuff. And my business is just changing very quickly. But it's absolutely on my mind, and I think I've been probably saying this for 10 years now, but I actually think in the next year or two, I think we'll be able to focus on it a lot more. And I think it'll be core to our business just in terms of raising money, getting the word out, getting things leased up, attracting great tenants on the commercial side, I think there's so many downstream benefits of it that will literally help our business and the profitability of it, that we will- I mean, social media has already helped me a lot business wise. I've just never been able to focus on it. Like I haven't posted on X in like four months. I'll like post for a week and then I don't post for like four months. 

Chris Powers: On the live work units that you've mentioned, what kind of tenant? I've never actually been in one. Like what would that look like? Is that actually a storefront or is that just somebody that wants to work at home that has an office on the first floor? Or are they like catering to the community? 

Austin Tunnell: It's cool because they're really dynamic. And if you ever come to Oklahoma City, I would love to show you actually Wheeler district where I live, where we haven't- Well, we built some houses and hopefully we'll be developing there soon. But they have this like little center commercial area and I don't know how many live works they have. They probably have like 16 or 24 or something like that. And they're three stories, and they're only like each- It's probably a 600 square foot footprint. Like so small offices, like your office is 600 square feet. But yeah, their store, it looks like a storefront, and the door to the home, the second story could be on the front or the back depending on just how it's set up. But it's like got a little storefront look on the front of this kind of like three story townhome that are only 14 to 18ft wide, and you can do them wider. I'm not saying there's a limitation per se because they're actually IRC buildings, which is a big deal from like a fire code and all kinds of things that makes it easier. There's a carve out in the IRC code. You can build these as IRC buildings. There's a lot of flexibility there. So I highly recommend looking into it. But in our neighborhood, I mean, there's a chiropractor, there's a law office, there's a photography center, there's a little butcher shop, there's a salon, my wife gets her haircut there, like just all these little small businesses and you can go rent your own storefront, put a cool sign out for 1200 bucks, 1600 bucks. Like how cool is that? And it's not like in some office building somewhere. This is street front like space with kind of almost a pretty pedestrian level street where you can- They're both facing each other, and so a great place to walk down and experience. So, I think live works are just so cool from a small business perspective that you can get these like neighborhood level businesses at a price point that makes sense for them and it makes sense for the landlord. 

Chris Powers: Do they typically have employees? Or are they solopreneurs, it's just kind of a one man shop? 

Austin Tunnell: It really depends. I've seen- because a lot of times, these live work units might be built and kept by someone and they're just leasing out residential up top and the residential below. So you can do that. And a lot of these have been bought by an investor and the investor’s just renting them out. But it can also be bought by a business owner that wants to work there. And maybe they live there and work there, or maybe they live there and don't work there, or maybe they work there and rent out the top, but it’s their little real estate investment. So it kind of breaks the scale down and makes these things accessible and kind of gives like ownership and stuff to a different group of people. Obviously institutional capital’s not going to be interested in a 1600 square foot live work unit, unless there was 200 of them. 

Chris Powers: Austin, I appreciate it. I'm a huge fan of what you're doing and I'm really rooting for you. 

Austin Tunnell: Well, I appreciate it. Thanks for having me on.