How One Remodel Led to a Thriving Construction Company: Aaron Lewis and The Luria Story

Audio Transcription

Mark Lamberth:
Hello, and welcome to another episode of the Contractor Grow Show. This is Mark, and today I have the pleasure of speaking with Aaron Lewis: from Luria Construction in Bel Air, Texas. Aaron, thanks for being with us today. 

Aaron Lewis:
Hey, Mark, thanks for having me on. It’s an honor. 

Mark Lamberth:
Fantastic. So yeah, we looked at what you guys are up to, but maybe you could tell us maybe the history of the business and what you guys are up to now. 

Aaron Lewis:
Yeah, so Luria has been around since about 2013. Construction was always something I felt drawn to since really, probably since I was in high school, and I was always mesmerized by it. My first job, well, I worked through high school and everything, but right when I got out of high school, I worked for an electrical contractor and we were installing underground all the main feads from the pole into the various schools around Houston, also known as HISD, but construction was more looked at as an interest or a hobby, not really something I could lay my head down on. Construction science was kind of a new major they were starting to offer in colleges. This is around 2003, so I’m dating myself here a little bit. 

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Aaron Lewis:
So I went off to college, did the whole college thing. My family was always supportive. My mom was a long time realtor here in Houston, hot top producer, so I’d always see a lot of her clients working with various different investors and so forth and them doing projects, and I always would see things they would do and be like, that’s not right, and I would get in and get involved and try to remedy that. I speak fluent Spanish, so I was always able to communicate. I learned a lot from working with the labor around Houston, so bountiful. 

Aaron Lewis:
So I worked in real estate with my mom a little bit when I got out of college. And then I did the corporate thing. I worked in corporate for a long time. I worked from back in the days of Continental Airlines all the way into selling oil and gas software and then working in marketing roles for some different major communication companies. But construction was always in the back of my mind. I’d see a construction project and be like, man, I wish I was out there. And then doing some side jobs and consulting a little bit, just small consulting. I’m like big helping guys trying to get across the finish line with their jobs. 

Aaron Lewis:
So it came to, I had done some small jobs here and there, and my brother-in-law had seen that I had a skill and he’s a very successful guy and he wanted me to help do a project for a friend of his who was looking to move. And we put this crazy deal together where I was able to, it’s literally all the stars and planets aligned where the P knew the people that owned the house and they didn’t have the capital. Anyway, I wound up redoing this house and then his friend wound up not being able to buy it, but it sold for the highest price per square foot in that neighborhood. Then I got some not, and so I started kind of snowballing getting to, we formed the company and started kind of just, sorry, you want to say something? 

Mark Lamberth:
Well, just an investment company to buy investment properties. I mean, this was like a flip house. Is that Rick? 

Aaron Lewis:
It’s a really interesting question. His friend was looking to buy a house in that neighborhood, but the prices were at that time, now those prices would be a bargain, but at that time, that time it didn’t make sense. So he was like, well, if we could get it for this amount, and Aaron could do the remodels, and I basically, I did it for basically nothing. I wanted to prove myself this was going to be my baby. I made something. And I mean, but it wasn’t, he got, it was a good deal. 

Mark Lamberth:
Okay, sure. 

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Aaron Lewis:
But so what had happened was, and I’m glad you asked. The whole point of talking on a podcast is we were looking for this house and we found this house. I was like, man, this house is the best bones of anything I’ve seen out here. And he goes, wouldn’t it be cool if I could tell the homeowners that I would finance the remodel? And then they would get their proceeds at closing and it would be full price, which was a little, they wouldn’t have to negotiate at all, and then this guy would get it at cost his friend and it benefits everybody. And I was like, that’s never going to happen. Who’s going to go for that? Right. Well, it just so turned out that he knew he grew up, we looked in the tax roll and saw that he actually knew the guy who owned the house. 

Aaron Lewis:
It was his family’s house that he grew up in, and they had been sitting on it and they needed the money for his mother’s estate. And they were kind of stuck at that, been sitting, and they were like, yeah, sure. We’d love to do this deal. His guy had also done business deals with my brother-in-law. He’s like, yeah, love to work with you. So all the planets aligned perfectly to where it was like, Hey, this is my brother-in-law. He’s new to construction. He can do this. This is his chance and opportunity. And everybody just took a leap of faith on it. And so it was just a one-off project that I just did, we just did to make this deal happen. And then from there, through my mom’s real estate and then just people seeing my name on the job, I started getting calls and the business just started booming from there. And so it came to a point where I was making the same money doing both, and I had to decide did I want to not further my growth or did I want to take it to the next step? And I did that 

Mark Lamberth:
Further your growth learning to run a construction company or to become a better builder or to 

Aaron Lewis:
All those things. But I mean, definitely all those things because grown so much as a builder since then, but more along the lines of I had a corporate job and this was a side gig, and I was doing all these jobs in my off time and a little bit taking calls while I was working my other job. And so I had to make a decision. I couldn’t do that forever. So I was either going to have to keep my company at a low level or just stop and just say, Hey, I’m going to be a corporate guy my whole time, my whole life. And not that there’s anything wrong with that. I think some days as a business owner, you’re like, why could I not be okay working for somebody? But there’s definitely, I just knew that I wanted to own my own company. I didn’t know what, and this seemed more like a dream than a reality. And when I saw that there was something tangible, like I said, I was making the same money doing both. So I really enjoyed having that double income, but I knew I was going to have to take a lifestyle cut in order to do this to be safe. And I knew that I either had the thought of giving up and not going for it wasn’t an option. 

Mark Lamberth:
That’s fantastic, dude. I love it. So just reading here off your site, kind of cool description based in Bel Air, which is where you guys are in Central Houston, Lu construction company’s full service, custom build and remodeler, but then it’s kind cool, the story, what you’re talking about here is that you started LU in 2013 with purpose remodeling your own properties to sell. 

Aaron Lewis:
That was the project we did. 

Mark Lamberth:
And then due to just the overwhelming positive response you got from different folks and the public and whatnot, that property is sold quickly, maybe went through a few other properties, and then decided to start kind of open shop for the public to go out and do these remodeling services for homeowners. 

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Aaron Lewis:
Yeah. 

Mark Lamberth:
Is that right? 

Aaron Lewis:
Yeah, no, that’s for sure. 

Mark Lamberth:
I love it. And so man, I’m curious. I’ve done a fair amount of real estate work myself and remodeled a lot of houses for our own flip properties ultimately. And I’ve also done a lot of construction work for other people, remodeled conditions, this kind of thing. How has you, having been a principal in that position, remodeling your own properties, how has that had an effect on the way that you think about remodeling other people’s properties and maybe sometimes your investment property even that you’re dealing with? I don’t know that, but you kind of can see through the eyes of that sort of investor or owner, principal. Does that affect the way that you approach these jobs at all? 

Aaron Lewis:
Yeah, no, that’s a great question. So yeah, I feel like when you’ve, you’re always worried about liability, that’s the easiest way to say it. You’re thinking about ROI. I’d say that there’s a lot of times I go on consults with clients and I’d probably make a ton more money if I just said, yeah, let’s do that. But I’ll say, let’s, that’s putting $80,000 into remodeling your laundry room. I’ll do it. But I don’t think that’s going to give you a huge net return on your home, especially if you’re on the planet to live here three to five years. A laundry room is a laundry room. People really aren’t going to look to, because I am thinking about one project in 

Mark Lamberth:
Particular, 

Aaron Lewis:
And this lady wanted this really, it was a great, I would’ve loved to do it, but I just looked at her and I was like, if this was your master bathroom, if this was your kitchen or something like that, yeah, let’s go for it. This 

Mark Lamberth:
Is not going to pay back. This is not going to pay you a return as long as you know that we can maybe proceed. But you need to know that upfront. And most builders are not going to tell someone that, right? They’re going to say, hell yeah, I want the money. 

Aaron Lewis:
Yeah, I mean for sure. I mean, we’re a capitalistic country and I have no problem with that. But 

Mark Lamberth:
Yeah, sure. 

Aaron Lewis:
I look at it like that, and I always want to be able to lay my head down on my pillow at night and know that I gave somebody the best advice possible. 

Aaron Lewis:
And there’s also things I look at where I don’t want, I always say I love my referral base. I love my clients, but I don’t want ’em to call me unless they got more work for me. I don’t want ’em to call me with problems. So because that’s how you can get yourself in litigation or something like that. And I feel like any investor, anybody who’s building, I mean, I’ve seen some investors who take some shortcuts and I don’t want Seth to come back at me and bite me because they can make you look really bad. And that’s always been a paranoia of mine. So I am very critical to make sure we’re doing the best stuff possible so it doesn’t come back. 

Mark Lamberth:
Interesting. And we had talked, actually you and Haley had talked, but our team, you guys had talked some before you and I got on the phone here, and I think you had a couple of ideas, some things that I think you are especially have got some unique skills in. I mean, one thing is I’m what your thoughts are around as a builder remodeler going into a project, but analyzing your numbers and then putting as much sort of analytics behind quotes as possible. So you’re going to go quote a project, how do you approach creating analytics metrics, things that you can measure? So that quote is spot on exactly where you want it to be. 

Aaron Lewis:
Are you talking pre-construction or post-construction analytics? 

Mark Lamberth:
With pre-construction analytics? I mean, I wasn’t prepared for that, for there to be multiple more options in that. 

Aaron Lewis:
Yeah. So a little bit about me. When I graduated from college, I was the first person in my family to graduate college, so that was part of the pressure I had there. And I remember when I got my corporate job, they had me doing spreadsheets and all this analytics, and I hate numbers, I hate ’em, still do. But I realized that I had dodged a lot of responsibility as far as being more analytical and being able to do analysis. And so I went back and got my MBA and I got that in 2012, and I went to my alma mater, I went to before and got that, and I got an MBA, and I was like, I really need to hold myself, no pun intended, accountable. So I got an MB in accounting. 

Mark Lamberth:
Great. 

Aaron Lewis:
And not by no way an accountant, but I know enough to be annoying and dangerous. And also from analyzing stuff, when you look at your numbers, so I hate to say, I mean, some may disagree, but I feel like anything in construction or anything, you’re going to skin your knees a couple of times on different jobs. You might have underestimated something or you may have forgotten something needed to be done. 

Aaron Lewis:
And so I look back at previous estimates that I feel are similar or I try to do an analysis and look at that, look at what my cost was, what was the size of that job relative to what I had remodels. People always want to ask you that number, what’s your price per square foot on a remodel? And it’s like, well, I mean it depends upon how much square footage you have. They kind of make you feel, I know I’ve how people, because I think they’re also used to the whole exact inate thing or just whatever. They hear that you give a price per square foot, a price per linear foot, and you can’t necessarily do that because it depends upon, we’re more on the luxury side. So it depends upon what type of finishes they did, what kind of special considerations we had to take into consideration. 

Aaron Lewis:
The space, if you’re doing a larger space, your price per square foot’s going to be lower, where relative to a smaller space where it’s going to be higher, you have more space to spread that cost out. So I always look at that and compare previous, it’s a very simple thing. Look at that. I look at all my line items, did I miss? Did I forget anything to kind of do that and have my checklist accordingly. And you have your standard stuff that you typically put in there, but we’re custom. So every estimate has its unique thing, but kind of looking at similar line items, and that is what I do on the pre side of it, I would say mid and post. It’s checking your yield, it is checking to see what you’re yielding, what did you totally net on that job and putting your overhead expenses and so forth like that into the project. And I mean, in really doing a full analysis, I mean, I’d say one of my things that one of my business coaches had said, perfection is the problem. Procrastination is the enemy. And that’s relative to, I sometimes wait a little bit too late to do my analysis. I want to make sure was any cost going to come up? Is anything else going to come in here? But you realize if you have maybe four to $500, that shouldn’t really affect too much on your yield or whatever on your project to know how you perform relative to estimate. And then seeing how well that worked out. So 

Aaron Lewis:
That’s kind of how I calculate that. 

Mark Lamberth:
That’s great. What software do you use or recommend to run analysis like that? 

Aaron Lewis:
I do it on Excel. 

Mark Lamberth:
Oh, Jesus. 

Aaron Lewis:
Okay. Forget it. I’m an Excel nerd. I mean 

Mark Lamberth:
To run yield on various aspects of the job in Excel. 

Aaron Lewis:
Yeah, no, I’m an Excel guy. I like to see my numbers. I like to see my formulas. I am an Excel guy. I probably should develop something. That’s awesome. But yeah, 

Mark Lamberth:
Well at least it sounds like a relatively straightforward process. If you can run that in Excel, lemme sure, you’ve got some complicated equations and things, but this is some crazy fancy software. This can be done basically. 

Aaron Lewis:
Yeah. I mean you don’t have to go put some big capital investment into it. And I particularly like raw data. That’s why I wouldn’t really, I mean, I know there’s probably solutions out there and someone will hear this podcast and probably try to call and sell me something, but I like the raw data. I can get out the abnormal, especially with custom. If I was doing more production type stuff, then maybe that would be easier. But with custom everything, there’s so many variables that go into it. 

Mark Lamberth:
How many folks do you have on your team these days? It kind of fluctuate Some, but 

Aaron Lewis:
So I mean, we run off the lean model it me, my mom works as my office manager. And I mean really, she’s my manager, even though I’m the owner of the company. But she helps me with the day-to-day taking calls and helping with scheduling customer stuff and really just filing, keeping up. There’s so much paperwork. I mean there’s so many invoices and mail and always something that comes in. 

Mark Lamberth:
So 

Aaron Lewis:
She helps me keep up with all the office stuff. And then I have a project manager who’s my right, right-hand man, and he really facilitates with me with clients dealing with subs, because we have a huge network of subs. I probably have maybe time between 60 to a hundred subcontractors. I’m talking total employee count working for me at a time that I’m responsible for. So he’s keeping up with them and keeping eyes on all them as far as what they’re up to. And then relaying stuff back to me. And then I have a construction manager where he kind of goes and puts out my fires. He knows my standard, he’s checking stuff. And then when we have a small little thing, this concrete is patched here or something like that, he goes and puts that out for me and Ken knocks that out. Or if we have a really small demo, he’ll go knock that out. And that’s kind of how this past year we’ve leaned out our headcount because this is probably the slowest year I’ve ever had in business. And that seems to be across the board with everybody I’ve talked to. 

Mark Lamberth:
Things have slowed down 

Aaron Lewis:
Between economic stuff, between economic stuff in the country, and then election years are just always down. It’s been like that every, yeah, it’s always like 

Mark Lamberth:
That. Everybody’s been talking about that 

Aaron Lewis:
And it doesn’t matter what, I mean, I’ve learned to become very politically agnostic because, 

Mark Lamberth:
Tell me about it. 

Aaron Lewis:
Well, because when one side of the party wins, they go spend a bunch of money and it’s vice versa. So it’s just not, and I don’t know, I’ve seen too many people lose friendships over that. It’s just not worth it. 

Mark Lamberth:
Yeah, yeah, 

Aaron Lewis:
Sure. And I have great clients of both political affiliations and so I don’t really care. So that’s part of it. I also think that we’ve, everybody talks about interest rates and how they were high and that they’re supposed to start coming down, and I do think that’ll help on the new construction part of it. I mean, I’m fortunate that most of my clients, even on half a million dollar construction projects, their cash pay, and I’m not really dealing with banks on that and all the inspections, but 

Mark Lamberth:
A luxury market and less the fluctuations of the economy. Yes. 

Aaron Lewis:
It’s always going to be relative 

Mark Lamberth:
To the economy. It’s still feeling that. Okay. Yeah. 

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Aaron Lewis:
Yeah. I mean, for example, if the stock market’s surging, people are going to want their money in the stock market. I can get a little tangential, so you might have to reign me back in, but my target demographic, I would tell anybody who’s working in residential, I mean, we also do commercial. I have a commercial side we do too, where we’re doing a lot of restaurants. But I would say if we’re talking residential, for example, your target clients on a residential is 

Mark Lamberth:
Women. Interesting insight. 

Aaron Lewis:
And I always say any construction project where the wife is not calling the shots, you’re going to have a bad project because you want her to be happy. That’s who you’re trying to appeal to. And if the husband cares more about where the cookie sheets go, you got an issue. Right. You know what I’m saying? 

Mark Lamberth:
This could get complicated. Yeah, I got it. Yeah, 

Aaron Lewis:
I jokingly say one of my best projects, it was almost a half a million dollar remodel and one of my best jobs I’ve ever done, and I love this client to this day that she and I keep in touch all the time. I worked with her most of the time. I met her husband once before we started, and I met him a second time after it finished, and he never gave me any issues. He was a doctor, he worked long hours, we’re in the middle of the project, not want nothing out of him. And he says she wanted to put the microwave in the island, and then she goes, Hey, he called in, my husband called and asked if we could put the microwave higher up, don’t be upset. I was like, he just doesn’t want to bend over. I go, absolutely, no problem. We will change the cabinet layout. This guy’s giving us no issues. We want him to be happy. So that’s a little bit, so you need to know that you on the residential side, that you really want to, and a lot of guys make this mistake. I’ve heard people tell me that they’ll go meet with a client on residential and they’ll only look at the husband the entire time during the 

Mark Lamberth:
Consult, 

Aaron Lewis:
Or it’s 

Mark Lamberth:
A wrong move, right? 

Aaron Lewis:
It’s just disrespectful. Or they’ll do things like, they’ll say the wife will ask him to do something and then he’ll look at the husband to see if he is okay with it. And you can’t do things like that. 

Mark Lamberth:
No, that’s not Who’s making the final approval here, 

Aaron Lewis:
Guys? And that’s not who you’re going to be working with. So that’s a really important thing for people to know when they’re taken on these jobs. So one thing, understanding your target demographic. We’re talking about cus Go 

Mark Lamberth:
Ahead. Oh no, just, yeah, back to the topic there. Yeah. 

Aaron Lewis:
So the other topic was I think another reason we’ve seen from interest rates, I feel like another reason things were soft is because people depleted a lot of their cash reserves post covid when they were buying new homes. So you had people, if you remember the real estate market, I mean, for example, in my area, if someone bought a house for 1.5 million, they were pricing at the top of the market. And then you had people who were buying stuff, didn’t even see the house, they’re just making an offer of what they see out the internet and they’re making an offer for, they wind up getting a competitive situation. The house goes under contract for 1.8 million, so the person’s now going to agree to pay $300,000 more. And then on top of it, then the house doesn’t appraise for the price. It only appraises for 1.4. So now their person’s going to have to spend more on their down payment and go, what, $400,000 out of pocket? And they didn’t. 

Mark Lamberth:
Oh, interesting. 

Aaron Lewis:
So when the wife, 

Mark Lamberth:
They liquidated their cash reserves, 

Aaron Lewis:
Right? So when they say, well, we wanted to make these remodels to our home, they have to wait a couple years. And I think Interesting. 

Mark Lamberth:
Save up some cash again. I see. 

Aaron Lewis:
It’s save up some cash again. And that’s going to be, no matter what socioeconomic lifestyle you’re at, there’s a point where money is still an object. It’s not, money’s no object just because you’re successful. It’s just how it is. 

Mark Lamberth:
Wow. Interesting. Well, I mean, are you guys at the kind of sweet spot of your own growth right now? Or do you think that you’ll grow some over the next few years? You planning to grow some percentage? 

Aaron Lewis:
Oh, we’re going to grow. I mean, I don’t necessarily have a percentage. I mean, this is kind of an unprecedented time where it’s been soft. It’s been, this year we generally are doing about 2 million on the low side up to about three and a half. So I would say that my goal is to get to five, and then in the next five years, I’d like to be at a 10 million annual revenue. That’s 

Mark Lamberth:
Great. 

Aaron Lewis:
But that’s going to take us increasing our commercial footprint and doing some more new construction and various things like that. 

Mark Lamberth:
Interesting. And then what do you think, man, I’m just curious. I mean, as a businessman and as someone that has multiple degrees in business and looks at this from a business angle, what’s the long-term vision, man? I mean, is it to sell? Is it to exit? I mean, so you get five years down the road, you guys are at eight figures, at $10 million. By that point, you will inevitably have had multiple offers of people coming along saying, Hey, we want to buy it from private equity to competitors. What makes sense to you as one possible outcome down the road? 

Aaron Lewis:
The thing I have in my heart, and it’s the timing of this question is a little crazy, and I’m probably going to get in trouble for saying this now, but we just found out my girlfriend was pregnant a few days ago. Congratulations. Amazing. I’m in a little shock. 

Mark Lamberth:
You’re hard to hear first guys. 

Aaron Lewis:
Yeah, I’m in a little bit of shock right now and I’m very excited. It’s a bit surreal. I never thought that this would happen. 

Mark Lamberth:
Incredible. 

Aaron Lewis:
It has, and I’m super stoked. But talking about, especially now that we actually saw before I came here, we saw the ultrasound first ultrasound today. So it’s a really cool thing that going through. Yeah, it’s very cool, man. I’m 

Mark Lamberth:
Super surreal, man. How exciting. 

Aaron Lewis:
Yeah, no, dude, beautiful. I hear people say, and I’m like, ah, yeah, now I’m going through. I’m like, damn, this is a real thing. It’s super cool. So I’m going through the emotions on it right now and all great stuff, but definitely now I’d like to ask something I could pass down to my kids. I’ve always thought that, and now that this is that. Now, if going to be, I also have younger twin sisters. One’s a surgeon, one’s a nurse anesthetist. If my kids will probably be smarter than me, if they want to go be doctors, lawyers or whatever like that, that’s fine. I want to build something. I build, I like building. So my goal is to build as long as I can and whatever the end result is, if I have something that somebody wants me to pass down to them, I’d love to be able to do that. If not, we will see who else. We’ll just see what happens when that time comes. 

Mark Lamberth:
That is awesome. How inspiring, man. 

Aaron Lewis:
Thank you. Thank you. 

Mark Lamberth:
Fantastic. Well, Aaron, Aaron Lewis:, Lu Construction over in Aire, Texas there Southwest, a little bit of Houston. Beautiful. Beautiful area of Houston. If folks want to get in touch with you, Aaron, or they want to take a look at your website, your work, where’s the best place to reach out to you? 

Aaron Lewis:
So we’re actually in the process of a website reboot, and I need to just need to go ahead and launch it. But go to our website, luria construction.com, L-U-R-I-A, construction.com. We’re also on Instagram, Luria Construction. You can check us out there. I do a lot of q and a stuff that I talk to. I mean, it’s fun to do this because I want contractors to know tips that I’ve learned along the roads and so forth, and drop me an email, drop me a phone call. I’m always happy to tell people whatever they want to learn or if I can help ’em at all. 

Mark Lamberth:
Yeah, that’s great. We didn’t really talk about it. I know you’ve got a lot of great video content on, Erin. I feel like we only scratched the surface here. I think there’s a lot of great stuff to talk about. I’m totally curious about your bilingual nature, how you guys have grown the business and all kinds of things. Maybe we’ll have a chance one of these days on the road today, get you back on the show. 

Aaron Lewis:
I’d love to, man. Yeah, I definitely have some things that I’d love to call out too, if anybody’s wanting to listen. 

Mark Lamberth:
Fantastic. Alright, well thank you so much. Everybody go take a look at Aarons over@luriaconstruction.com and we’ll talk with you Againt now. 

Aaron Lewis:
Alright, appreciate it. Thanks Mark. Okay.