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Expect a lot of turnover in campground ownership this year

There’s a good chance longtime RVers will see many new faces when they check into their favorite campgrounds this summer. Campground owners are handing over the keys.

Many campgrounds—just like houses—have been selling well above asking prices and sparking bidding wars among potential new owners. Seasoned campground owners are pulling the plug, cashing out, and heading to retirement or other business opportunities.

Join the campground-purchasing fray?

So, should you sell your house, cash out your retirement accounts, and join the campground-purchasing fray? Many individuals are doing just that, even if they must compete with big corporations and outside investment groups.

Mark Whitworth, president and associate broker of Parks and Places, recently told the RV Industry Association that while his firm has sold more than 150 parks in the past 12 years, it has seen the rate of sales increase to 33 campgrounds in 2021 alone. The company already has 13 more ready to close in 2022.

“I’ve never seen a market like this,” Whitworth said. “Just like in home sales, everyone wants to sell while the market is hot. But we’re still seeing a lot more buyers than sellers. For properties that are priced right and are making money, sellers are getting top dollar.”

Mom-and-pop campground owners

Some RVers fear that most new buyers are either faceless corporations or private investment firms, but that isn’t always the case. Whitworth said there are still smaller “mom-and-pop” wanna-be campground operators out there ready to enter the market. Larry Brownfield, Assistant Vice President of Franchise Development Services for Kampgrounds of America Inc., agrees.

“We still are seeing strong interest from the traditional buyer, which is typically a family-based business seeking to purchase a single unit and manage the day-to-day operations,” said Brownfield. “At KOA’s most recent buyer’s workshop held in April, most attendees could be described as fitting into this category. At our ownakoa.com website, the traffic is up again over last year and we receive numerous requests for information from the traditional (family) buyer.”

KOA has been conducting Buyer’s Workshops for potential new campground owners since 1979. The workshops have had more than 200 attendees since 2020. The next workshop is set for Oct. 8-9 at the Fort Collins, Colorado, KOA.



Yet while interest from traditional mom-and-pop owners remains high, Whitworth and KOA’s Brownfield both said they are also seeing an uptick in larger corporate or investor buyers looking to purchase multiple campgrounds.

“We are certainly seeing a steady increase since about 2018 of those who wish to purchase multiple campgrounds, which traditionally is a corporate buyer or investment group,” said Brownfield. “I will say we have seen an acceleration of this type of buyer over the last couple of years.”

Easy money but a softening market

Buying a campground is considered a good risk for many lenders. Running a campground is far from easy, but it essentially involves renting a slightly improved piece of land. Banks and other lending institutions see the wisdom of loaning money to campground buyers entering a very hot market because the owner’s main asset—the land—continues to rise dramatically in value at the same time owners can realize up to 20% profit margins through rate management.

Brownfield said while he is still seeing campgrounds being added to the “for sale” inventory, he is beginning to sense a softening of the market. He said Cathy Reinard, a realtor specializing in RV park and campground resales and the designated realtor for the Own A KOA Resale Program, is reporting that the market currently isn’t as strong for sellers as it has been. “While campground prices may be beginning to stabilize, it’s still more of a seller’s market than a buyer’s market,” Brownfield said.

“What Cathy is seeing is buyers offering less money than last year for similar income opportunities, but also noted that she continues to work with a lot of eager buyers,” Brownfield said.



Rising rates

It’s a fair assumption that campground owners, both new and established, will be looking to maximize their take on rates this summer. After all, they are faced with the same inflationary pressures as the rest of us. Fuel, electricity, labor, lumber, and other materials are all more expensive. As in every business, increased costs of operation are passed along to consumers to maintain profit margins.

RVers can also expect a bit of turmoil as this plethora of new owners take over. Reservation systems will change along with staff members and park rules and procedures. And every new owner will be reviewing business plans to ensure they are maximizing profits through rate management.

Camping—at least for now—is a great business to be in … if you can afford the purchase price.

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Mae
27 days ago

The Park that we are at sold a year and a half ago and it has continually gone down hill ever since. It was bought by a group of investors that have no idea how to run a Park/Campground. They can’t even keep the grass mowed. This Park used to have a five star rating and now it’s dropped down to a three star and of course they raised all of the camp sites and cabin rates to the point that the Park is not full like it normally would be. They also have a long term section and they just raised those spots 26% with no new added benefits or amenities. Its really sad…..

Tony Barthel(@tony)
1 month ago

While not a campground, I have owned a resort. Specifically this was a nine-room B&B made of vintage railroad cabooses. Talk about a cool place.

And that cool place attracted cool people, many of whom shared my love of trains. So you would think that a cool place with cool people would be a fun job.

Unfortunately about 10% of the people were just miserable jerks and that’s what sticks in my mind. So those miserable jerks are why I sold it after 7 years and, now, 7 years later the people who I sold it to sold it again. Basically the same reason.

As an RVer I’m grateful for places to stay but owning a campground isn’t something I’m going to wish on anybody I actually like.

Tom A B
1 month ago

Paying top dollar, these buyers aren’t looking to maintain the status quo. They will put in a pool, rename it a resort, and double the price. Or, convert to mostly long-term tenants or glamping. Or some other scheme I haven’t thought of to increase revenue. You won’t be seeing new faces there because you will not be staying there.

Larry Brownfield
1 month ago

Mike, thanks for the article. Just a point of clarification. The KOA buyers workshops has had over 200 attendees since 2020 not 200 per season and thank you mentioning the next workshop at the Fort Collins KOA in October.

CLeeNick
1 month ago

As fuel prices continue to climb, I foresee the tourism industry to take a huge hit within the next year, maybe sooner, with the entire economy following suit. Current owners are probably smart to get out now, while real estate prices are high. Anyone who’s bought real estate at the inflated prices of the last few years is going to be left holding the bag, and real estate revolving around tourism will see the worst decline, just as happened in 2008.

Billy Smith
1 month ago
Reply to  CLeeNick

Gas will go down as soon as we get someone in that cares about people enough to open Alaska oil fields again.

bull
1 month ago

When you buy a campground you just bought a 24 hour a day JOB!

Who the heck would want to do that?

Rodney Lacy
1 month ago

People that has unused land could open an all off grid camping area. No amenities. Maybe install dump station. Little to no overhead. I’m all in.

Bob p
1 month ago

35 years ago I had 15 acres of land in north AL that I thought would make a great campground. After several months of thinking, investigating, and thinking some more I decided against it. It was 8 miles from I 65, first negative, it had a creek I would have to build a bridge to support the big RVs, 2nd negative, and I was working 56 hrs/week at my full time job. I’m sure glad I didn’t make that decision to try it. My wife would’ve been the manager and I would have to hire many people to do the maintenance that I couldn’t do because of my work schedule. Now I enjoy the retirement from my job and SS, living in FL and that property is still there just like it was back then, it’s someone else’s dream/headache. I don’t regret my decision.

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