From Actuarial Science to Flex Space Development: How Land Play is Redefining Texas Real Estate

Written by:

Steve Marcinuk

Date:

15 Sep 2025

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The Texas development landscape is experiencing a shift as younger entrepreneurs challenge traditional approaches to commercial real estate. Among them is Alec McElhinny, Founder and CEO of Land Play, who has carved out a distinctive niche in flex space development by applying actuarial principles to real estate investment and focusing on underserved markets along the I-35 corridor.

McElhinny’s journey from actuarial science to real estate development began with a simple calculation problem. While studying to become an actuary at Securian Financial, he used time value formulas to determine his retirement timeline. “I couldn’t find a number that made sense,” McElhinny explains. “I would have to work every day for 30-40 years, and at the end of it, I’d be able to retire. I’m like, that doesn’t make sense. There’s got to be another way.”

The answer came through real estate mathematics. While stock market returns typically yield 7-8% adjusted for inflation, real estate offered significantly higher returns, especially with leverage. McElhinny’s first investment, a duplex purchased with an FHA loan requiring just 3.5% down, validated his calculations when the property’s value increased by more than his down payment within the first year.

Building a Different Kind of Flex Space

What sets Land Play apart in the competitive Texas market is McElhinny’s commitment to creating “niche” products. Instead of building basic metal warehouses in industrial parks, Land Play focuses on high-visibility locations with premium finishes.

“When people think of flex space, they think of buying some land in an industrial park and building some metal warehouses for contractors,” McElhinny says. “I want to do something different.” His New Braunfels project exemplifies this approach: a 10-acre site on I-35 with 150,000 cars passing daily, featuring imported windows from Eastern Europe and full HVAC systems.

The HVAC decision reflects McElhinny’s attention to tenant experience. “A lot of people build these flex buildings without AC or HVAC, and you have these poor guys who work in the Texas sun. It’s 100 degrees out and inside that metal warehouse, it’s even hotter, and they’re just drenched in sweat all day,” he observes. “I bet they’d pay a little bit more to have a little bit of AC.”

Strategic Location Selection

Land Play’s development strategy centers on identifying counties with streamlined approval processes. McElhinny targets areas outside city limits where regulatory hurdles are minimal, allowing for faster project turnover. His New Braunfels project in Comal County illustrates this approach’s effectiveness.

“Right across the street from my flex space project, they’re putting a Costco. Costco is breaking ground in two weeks. There’s Academy, there’s thousands of homes going up. There’s a middle school that was just built. They’re building a high school,” McElhinny notes. The key advantage: “Because they can get it approved so quickly out in Comal County, if they go just half a mile south into New Braunfels, it could take a year and a half.”

This regulatory arbitrage has proven effective. While traditional developers struggle with lengthy approval processes in major cities, Land Play capitalizes on growth corridors with business-friendly jurisdictions.

Market Positioning and Competition

McElhinny believes institutional investors haven’t yet recognized flex space’s potential, comparing it to mobile home parks, which were once considered Class C or D assets before institutional capital discovered their returns. “I think flex space is just a little more forward than they feel comfortable with,” he explains. “We’re just early in the market right now.”

This early positioning provides competitive advantages. For the New Braunfels project, McElhinny secured land at $5.70 per square foot for what he describes as a retail site with insufficient sewer capacity for traditional retail development, perfect for flex space. “Nobody will be able to find land for the price I got on I-35 to build the product I like,” he says.

Risk Management Through an Actuarial Lens

McElhinny’s actuarial background influences his approach to development risk. “Actuaries are not very big risk takers. I do everything I can to mitigate risk in every step of the development process,” he explains. This translates to securing land at prices that allow profitable exit strategies, choosing easier-to-build asset classes, and targeting locations with minimal regulatory friction.

His New Braunfels deal exemplifies this risk mitigation: even if development plans fail, he estimates the entitled land could sell for $8-9 per square foot, well above his $5.70 acquisition cost. “If you’re a developer, you have to make sure that you get your land for good basis. Because if things don’t work out, you need to be able to get out of the piece of land and still make a profit.”

Capital Markets and Interest Rate Environment

While rising interest rates have challenged many developers, McElhinny views the environment positively. “I think the best people in business were made in the recession, were made in hard times,” he says. “Because I started developing when interest rates were very hard and it was hard to raise capital, it made me have to find the best deals.”

This contrarian perspective reflects his belief that easy capital can lead to suboptimal projects. “In America, we’re very spoiled, we can get really good debt, and we can build things that maybe might not necessarily be the highest best use, but we have enough bank debt so we can still make money on it.”

Capital sourcing has required geographic diversification. McElhinny notes that Austin capital has “dried up” due to multifamily overbuilding, forcing him to seek investors in Dallas, Houston, and other markets.

Regulatory Challenges and Market Dynamics

The approval process varies dramatically across Texas municipalities. While Comal County offers streamlined approvals, cities like New Braunfels and Austin present significant obstacles. “In the city of New Braunfels, it could take a full year and a half to get site plan approved, which is almost as bad as Austin,” McElhinny observes.

This regulatory inconsistency creates market distortions. “A lot of people say how bad it is that rent is so high and there’s not enough housing. It’s a government-caused issue,” he argues. “If you want to build a site, and it takes three years to get government approval just to start the construction piece, there’s no way to respond to the market.”

Future Outlook and Market Opportunities

Looking ahead, McElhinny identifies New Braunfels and Comal County as prime markets for institutional development activity. The Mayfair development’s acquisition of nearly 2,000 acres signals larger institutional interest in the corridor.

For newcomers to Texas flex space development, McElhinny emphasizes differentiation over imitation. “Don’t do what everybody else does. Try to actually solve a problem,” he advises. “A lot of developers are kind of like sheep. And I don’t think sheep do very well in development.”

Encouraging the Next Generation

Despite the challenges, McElhinny strongly encourages younger entrepreneurs to enter development. “I think we can do more than what we believe we can. I think bigger is not harder, it’s just bigger,” he says. “Especially with AI coming, there’s so much knowledge available. The baby boomers had to work so hard for many years just to learn how to run a company, and now we have all this information, and we can learn it in a year.”

This optimism, tempered by respect for the work ethic of previous generations, reflects McElhinny’s broader philosophy: combine analytical rigor with entrepreneurial ambition, focus on underserved niches, and never underestimate the value of solving real problems in the marketplace.

As institutional capital begins recognizing flex space opportunities and Texas continues its rapid growth, Land Play’s early positioning in strategic corridors with streamlined approval processes may prove effective. For an industry often criticized for following rather than leading market trends, McElhinny’s approach offers a template for how analytical thinking and contrarian positioning can create sustainable competitive advantages.