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This 25-year-old built a picturesque ‘Tiny Hotel’ that generates him $500,000 a year

Growing up in his father’s construction business, real estate seemed to be a natural fit for Isaac French.

In 2020, he moved to Waco, Texas to take advantage of the real estate market, and has since built a stunning multimillion-dollar property that generated $500,000 in bookings in 2022.

French, a 25-year-old bookkeeper, and contractor, initially ran a cloud-based accounting business before taking on the construction business and real estate market.

Waco was just 2 hours away from Austin, Fort Worth, and Dallas – making it a great area for real estate. French then bought a 5-acre plot in 2020 and built a “tiny hotel” made of seven cabins, all between 550 and 650 square feet.

Built in the Scandinavian style, the small property is now called Live Oak Lake. French said, “I’d had these ideas sort of brewing to create this modern Scandinavian housing concept in Texas.”

His entrepreneurial spirit and experience working in his father’s construction business gave French the confidence to execute his ideas, resulting in a spectacular hotel that immediately generated interest after opening last year.

French started with a blank canvass. He used $138,000 from his savings to purchase the empty lot and then used his knowledge in the construction business to build his tiny luxury hotel.

He estimated that construction costs would amount to about $1.6 million. His father, two brothers, and father-in-law then joined him as minority partners, which allowed him to secure a construction loan worth 80% of the appraised cost of the build.

His partnership with the family gave French access to the line of credit from his father’s construction business to cover further construction costs.

He was certain that the property would be appraised at a higher value than the cost, particularly when he could show that it was a commercial success.

The project ended up costing $2.5 million to construct. The price increase was largely due labor shortages and soaring lumber prices, as well as additional features such as hot tubs and a pool.

As the general contractor of the project, French used all his experience and knowledge in the construction business and supervised the construction of roads, utilities, and a man-made lake.

“I was surrounded by lots of incredible people as well, as far as contractors and landscapers,” French said. After nine months of construction, the tiny hotel finally opened for business in January 2022.

Live Oak Lake was appraised at $3.1 million four months after it opened, and French did an 80% cash-out refinance.

He received a loan of 80% of the property value amounting to $2.48 million, using plenty of drawings and renderings in planning forms to highlight Live Oak Lake’s critical selling point as an “experience.”

The new batch of funding allowed French to pay off his original construction loan and the line of credit in his father’s construction business that he used to complete the project.

French eventually accomplished his goal of building an oasis for his guests. The seven identical cabins have floor-to-ceiling windows and two floors with two bedrooms, one bathroom, an open-plan kitchen, and a living area.

Each cabin also has a washer and dryer, a private entrance, parking space, an outdoor hot tub, a hammock, and a fire pit.

“It was very high cost per square foot because these are very high-end — we chose very nice finishes,” French said.

French was inspired by Olson Kundig, a Seattle architecture firm that designs sculptural buildings that draw from nature.

He said, “I’ve always loved design. I wanted to be an architect when I was younger.” He wanted the hotel to strike a balance between being “completely lost in nature” and having a “village” feel.

In addition to the cabins, Live Oak Lake has a common area with a small dock, picnic tables, paddleboards, and kayaks.

The tiny houses are a couple of hundred yards apart and surrounded by trees, with string lights between buildings that are reflected in the water.

French may be knowledgeable in the construction business, but he needed to come up to speed in the short-term-rental industry to ensure his property’s success.

He relied on online resources and YouTube, particularly Robuilt, a channel run by another short-term-rental entrepreneur.

Friends who owned a short-term-rental management company gave him advice and introduced him to automated property-management systems.

To set prices, French uses a pricing software called Wheelhouse. The app automatically adds price increases and discounts and standardizes them across accounts on Airbnb, Vrbo, and depending on demand in the area.

It also allows French to add markups because of charges by specific platforms, which encourages guests to book directly from the Live Oak Lake website.

Cabin prices for one night range from $300 on weekdays, to $400–500 on weekends. Rates may go as high as $1,200 during busy visitor periods, such as during graduations or high school football games.

Still, Live Oak Lake is registering high occupancy rates at 90% to 95%, with almost 70% of bookings coming directly from Live Oak’s website and the remaining 30% from Airbnb, Vrbo, and

Their main marketing platform is social media. “Instagram is our main funnel for bookings,” French said. The Live Oak Lake Instagram account now has over 64,000 followers.

With its potential for long-term success, French believes that Live Oak Lake is well positioned to weather the economic downturn.

Current trends indicate that wealthy or middle-class tourists from cities such as Austin or Dallas prefer to vacation closer to home for short periods rather than go on longer international holidays.

With his experience in the construction business and his success with Live Oak Lake, French will surely leave a mark in the country’s luxury hotel industry. 

Take a virtual tour of this small paradise:

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Friday 17th of February 2023

A beautiful place! Well done!

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