We've been traveling around the country and staying in a variety of campgrouds. Some are pretty well managed, many aren't. I'm curious about the economics of owning a campground. Has this been discussed here?
I know that there are a lot of variables, but is it really expensive to develop a campground from country acreage? Would it be cheaper to buy a campground and upgrade it? How expensive to lay concrete pads as opposed to gravel? Is the sewer the most costly service to put in?
I would think it would be cheaper to buy an existing one and upgrade as necessary rather than start from scratch. Either is far more work than we want and traveling time during the summer would be 0. That is a seven day a week job.
The first thing you will need to do is sell your RV. You wont have time using it for a while. I know quite a few CG owners and consider them friends. You have to have great passion and be able to do hard work yourself to be successful. The best CG's I have been to are the ones where you see the owner there on a daily basis to keep things running smooth. It is something I could not do, unless I could buy the place for cash. I will use 1 place as an example. Tall Pines Harbor CG in Sanford Virginia was purchased many years ago by the present owners. I have watched the present owners bust thier butts in turning the place into an absolute beautiful place. In the 9 years we have visited this place, they have doubled in size, have some of the largest sites anywhere, have fantastic amenaties, and great activities. Check out thier Facebook Page and you will see what hard work and passion can do. Tall Pines Harbor
A lot of variables in developing an RV park or campground. In California, the state will tell you how to develop. Some of the potential unknown costs are weather or not the park would be connected to an existing sewer or water system. Developing these types of public utilities could be cost prohibitive. In some of the new parks that I have been involved with, the construction costs are equal to about 7 to 15 grand per space.
There are a number of Real Estate Brokers that specialize in RV Campgrounds and Resorts..a couple of them have very comprehensive websites explaining the ownership issues and "how to's". I've known several people who built from scratch new RV Parks, and others including myself that researched extensively and traveled around to get the "stright poop" from real owners.
Don D's. "Buyacampground.com" has a good website, rvparkscampgroundsforsale.com, and many others. Be careful as always, there are also shysters out there.
We even met a nice retire couple that bought some property up in Shasta California, hired a popular RV Park/Campground designer and built a beautiful well ran and popular resort that we have returned to many times.
My posts shouldn't be taken for factual data. They are purely fictional, for entertainment purposes and should not be constituted as actually related to scientific, technical, engineering, legal, spiritual or practical advice. Amen.
the one we used to go to started out as a pretty little park next to the river, five years later it is now an exercise to see how many spots they can cram into their acreage, you are literally 3 feet from the next spot, no trees anymore and the pall from the 60 or so "campsites" on holidays when they can fill the spaces puts a smokescreen across the sites, I wont even drive through there anymore its just sad (they let people keep spots year round (not that there is anything inherantly wrong with that) quite a few are now neglected and rotting into the ground where they are parked and probably couldnt move if you had to. You can really tell the owners that wish to give a great camping experience and those that are just in it for the money.
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Buying an existing park is by far a better plan than building from scratch unless you have a whole lot of capital to invest and not need cash flow for several years. To physically put in a park will take at least one year and maybe two. Figure at least 1 year to get approvals before that construction can begin. After those two to three years have passed and you start taking guests, figure at least two years before the business builds to a level that will cover your fixed costs. By the time 5 years have passed you may be into the black, assuming you were correct and the park is in a money making location. You will also probably have to carry all the construction costs out of your pocket, it is almost impossible to find bank financing for a park where the owner has no previous park experience.
As for concrete sites, figure a minimum of a 60 x 12 pad. At a minimum it will need to be 6 inches thick, that will take 15 yards of concrete. Concrete in my area runs $80 to $110 a yard. Also figure a minimum of $500 per pad for steel and then labor to pour and smooth the pad. You are now somewhere between $3000 and $5000 per pad. Then you will need to backfill the actual site to the pad, another couple of hundred. Not bad if you are doing one or two pads. Do a park of 100 sites and you can easily be at $500,000. Then you will also have to pave the roads, since concrete pads and gravel roads will quickly lead to the pad becoming uneven with the road and eventually cracking.
Sewer pipe runs about $2.00 a foot plus trenching and backfilling. Where sewer gets very expensive is if you will need a treatment plant. Most state and local governments will no longer approve tanks and leach fields for commercial applications. You will need a lagoon at a minimum and perhaps a private treatment plant. That will run $50,000 on the low side for a lagoon system and up to $500,000 for a treatment plant. If you have a public sewer system available, you will save a bunch of money, but have much higher recurring costs. Commercial sewer tap fee for a park will probably be around $25,000 and then you will have a monthly charge based on your usage.
Water will also be an issue. Municipal water, not problem, but expensive. Well water is fine if you have a really good well and good water. Get water with sulphur or other unpleasant contaminants, figure on a lot of treatment. You will also need to have your well water tested by the state frequently.
Power may also be an issue. Be sure you can get enough service for a commercial application. The power company may put you on the hook for commercial services installation, which can be another $25,000+.
As for the comments that there are parks for sale everywhere, that may be true, but only because there are over 10,000 parks across the country. As far as I can tell, at any given time there is less than 1000 parks listed for sale. That means somewhere less than 10% of all parks are for sale. Not really an extremely high percentage. You also very seldom see a good park go belly up. It is a pretty secure and profitable industry, if you are willing to work. What you can't do is buy one, sit on your duff, collect money and not put any back in. If you do, you will soon have a run down park that no one will stay in and you will be heading for closure. We habitually re-invest 75% or more of our net income each year. Doesn't really leave a lot of play money, but the parks are always top shelf.
Before buying or building you need to investigate and research. Go to a campground ownership seminar or class. See if you can work with a park owner for a few days to see if it really will work for you. Owning an RV park is not a continuation of RV vacationing, it is actually the polar opposite. It is work and a lot of work at that. It can be both personally and financially rewarding, but it is not playtime.
* This post was
edited 06/16/12 03:10pm by westernrvparkowner *
Roundtwo-40 wrote: the one we used to go to started out as a pretty little park next to the river, five years later it is now an exercise to see how many spots they can cram into their acreage, you are literally 3 feet from the next spot, no trees anymore and the pall from the 60 or so "campsites" on holidays when they can fill the spaces puts a smokescreen across the sites, I wont even drive through there anymore its just sad (they let people keep spots year round (not that there is anything inherantly wrong with that) quite a few are now neglected and rotting into the ground where they are parked and probably couldnt move if you had to. You can really tell the owners that wish to give a great camping experience and those that are just in it for the money.
So called cramming of sites happens for more reasons than just pure acreage. Space between sites costs a lot of money. The combined utilities in material alone will run around $12+ per foot. Roads being extended cost money. Keeping large sites landscaped and maintained costs more money than smaller sites. Land at desireable locations tend to be expensive so that drives costs up geometrically. Most people are not willing to pay double the rate for a site twice the size as the one they are on. But that is pretty close to what would have to happen.
westernrvparkowner wrote: Buying an existing park is by far a better plan than building from scratch unless you have a whole lot of capital to invest and not need cash flow for several years. ....
Note the posters name, I've stayed at this campground and can say it is competently ran
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