Orlando Magicians, The Orosz Brothers, Get Back In Action

Left to right: Matt Orosz, Co-president, Steve Orosz, Co-president, Andrew Orosz, Executive VP/General Counsel, Trinity Family Builders

There's no time like the present to begin digging in on an empire of the future. Not to be ignored amidst a feeding frenzy of mergers and acquisitions deals, one of homebuilding's pan-generational, "lightning-in-a-bottle," serial regional empire-building teams deserves a look-see.

Two years ago, almost to the day, Matt, Steve, and Andrew Orosz celebrated the sale of their four-year-old Orlando-based start-up, Hanover Family Builders to Landsea Homes for $250 million, giving Landsea a national footprint and a powerful beachhead platform in what has since been one of homebuilding's hottest markets.

Here we are today – non-competes satisfied and a whole new rest-of-the-2020s demographics-fueled housing cycle in play – and they're at it once again. The three brothers – Steve, who focuses on finance, accounting, and the back office, Andrew, who operates as executive VP and General Counsel, and Matt, who drives marketing, sales, and the field side of the operation – joke that their parents got lucky, "so if the three of us were a venn diagram we would only overlap just a tiny bit in the center." They've hung up a new shingle – Trinity Family Builders – begun moving dirt, readying specs, and cutting the ribbon on the first neighborhoods of what promise to be a burst out of the gate, with a sharp upward trajectory toward scale.

Our first projects are in Groveland, Leesburg, St. Cloud, and Clermont," Trinity Co-President Matt Orosz shares with The Builder's Daily. "The official first start was in Groveland, with a community called Blue Springs featuring 25’ townhomes with two-car garages. We have started construction on our first three subdivisions and will have another five under construction by 2Q. Phase 2, has another 12 subdivisions owned or controlled that will come online late this year or early next year."

Calling the Orosz brothers, their father Bill, and critical strategic and operational impact players Colby Franks and Nichola Mitchell a pan-generational "lightning in a bottle" act is no exaggeration.

We closed 1,968 homes in four years as a start-up," Trinity Family Builders Co-President Steve Orosz told us at the time of Landsea's acquisition of Hanover, kicking off homebuilding's 2022 mergers and acquisition season.

That type of meteoric growth and accomplishment has practically become as much of a sure-bet as there can be in homebuilding.

We were honored to work with their father Bill, selling Cambridge homes in 2005, and with Steven, Matt, and Andrew in the sale of AV homes to Royal Oak, as well as the sale of Hanover to Landsea," says Tony Avila, CEO of Builder Advisor Group. "These guys are some of the best builders in the United States, and they have amazing land positions throughout Orlando. This is going to be another winner."

Here's a snippet of what we wrote about the dynamic family dynasty at the time of the Landsea-Hanover Family Builders deal:

Let's take a look at the serial achievement of a third generation family of builders, who with the sale of Hanover Family Builders, show they're capable of striking lightning in a bottle over and over and over again, when it comes to creating value around smart land acquisition, strong relationships with construction teams, and supply chains, and managing day-to-day details that roll up as operational excellence.

Co-presidents Matt and Steve Orosz and their brother Andrew, senior VP and general counsel at Hanover Homes, kick-started Hanover Homes less than eight years ago, shortly after the 2014 sale – with their father Bill Orosz – of Royal Oak Homes to then-AV Homes [now operating under Taylor Morrison] for $65 million.

At the time of that deal – where the buyer was represented by the late Michael P. Kahn and the Orosz family were represented by Builder Advisor Group [BAG] – we wrote:

The deal can be said to model as a classic "win-win." In Royal Oak, AV Homes acquires a vibrant, well-operated, well-disciplined operator in a hot market, with talent and pedigree to boot. At the same time, the combination gives the Orosz brothers, Stephen and Matthew, a much-needed infusion of growth capital as the the battle for access to more lots, more development resources, and more expansion opportunity, gets more ferocious.

Looking back even farther, to 2005, BAG advised Bill Orosz on the sale then of a company he'd started in 1991, Cambridge Homes, to K. Hovnanian.

Clearly, the brothers Orosz' success owes to more than their generational pedigree, and what becomes even clearer is their uncanny sense of timing the marketplace. This pivot now removes their debt and personal guarantees against it, and fuels their ability to strike at new opportunity in Central Florida and beyond, just as others may feel rattled as the ground shifts beneath their feet in early 2022.

With Trinity Family Builders, they're about to kick it all back into gear, having spent the past two years in their signature "secret sauce" mode, tapping into trusted relationships and lining up a lot pipeline powered to ignite explosive growth, particularly among home seekers that have been at a loss for more affordable price points.

It's an interesting time," Matt Orosz tells us. "Every time that we've done one of these start-ups, we've been in an interesting cycle. I don't know if the cycle has driven our sales opportunities as much as our internal dynamics, but we're excited that the market has continued to be under-supplied. That's the big driver for us, especially for how that applies here in Florida. We're optimistic and our land acquisitions have supported that position. We've bought about 7000 lots over the last 24 months in Florida. The next three or four years are going to be good for us."

The Orosz formula – if it can be called that – springs from a "land-first" DNA. They note that pervasive lot supply constraints – ranging from capital uncertainty to permitting and entitlement delays to horizontal development snags – slowed the stream of vacant developed lots and projects to a relative trickle, particularly for projects aimed at first-time, entry-level buyers.

We've taken that as an opportunity to fill that gap," Matt tells us. "Historically, we're probably 55% to 60% first-time, but we're probably going to be 80% first-time to start. We'll fill in with the higher-end product once we get stabilized."

That "stabilization" threshold, a critical inflection point in the life-cycle of an early-cycle entrepreneurial start-up homebuilding business, will come at about the 600-home deliveries per year.

That 600-unit mark is the level that we've gotten comfortable with," Andrew Orosz tells us. "That's our goal, and we think we'll be there in the next two or three years if everything goes according to plan."

Fortunate for Trinity Family Builders' early prospects for success, their earlier success at building operations that catch the fancy of acquisitive, larger strategic players gives them a capital runway – their own financial resources – that allows them to some level of immunization from a bank financing backdrop that's created big challenges for many privately-capitalized homebuilders.

We're planning on capitalizing it internally up until the 700-unit mark, which we should be able to achieve in about 24 months" Matt Orosz says. We do have a few of our lenders – traditional building lenders who have remained committed to us, and we expect to bring those as construction lenders out of the gate, and that'll certainly help get us up to speed. They've been flexible on increasing the number of inventory homes on their construction lines in the last two or three years, so that has supported that inventory home strategy buyers favor these days."

Although Trinity Family Builders' website is brand new and its name will clock in as an entity out of the blue, the DNA and its helix of success run deep.

We're going back with the three trees again," Matt tells us. "The Trinity name has symbolism for us. It's the three brothers, and our third venture together. The logo has served us well, so we thought let's let's not reinvent the wheel on this one."