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By Andy Zipser
A recent email blast from Frank Rolfe, who among other pursuits runs something called RV Park University, began as follows: “Earlier this week … the study firm Research and Markets predicted that the global RV industry will expand at an average annual rate of 7 percent a year until 2025, and more than 11 percent of American households now own an RV. That all adds up to a siren call for big-money investors who never would have given the sector a second look a couple of years ago.”
Sound familiar? Regular readers of this site may recognize those unattributed words from the lead paragraph of a story that appeared in RV Travel on Oct. 22, under the headline “Big money investors pursue RV parks, but not without conflict.” Rolfe, as it happens, is one of those big money investors, but he also wants you to know that what he does isn’t as easy as it looks. Reports like the one from Research and Markets give people “the false impression that they can buy just any property at any price and make money,” he writes, but “nothing could be farther from the truth.”
Rolfe has been relentlessly flogging RV parks as the next big investment thing for several years. . . with articles under such seductive headlines as “How to Make Every Day a Holiday When You Own an RV Park” and “Vacation While You Work: Welcome to the RV Park Owners Lifestyle.”
Rolfe goes on to let his readers know that he and his partner have been “buying and operating RV parks for nearly 30 years, and over time we have seen many properties that were good deals and plenty of others that were a nightmare for any buyer.” That means he can help you avoid the land mines strewing the RV investment landscape, and the best way to do that is by purchasing his RV Park Investing Home Study Course for just – wait for it – for just $497, not “$5,000 or even $1,500.”
That might sound like a lot of snake oil, if not for a couple of things. First, Rolfe has been relentlessly flogging RV parks as the next big investment thing for several years, and even more so lately with articles under such seductive headlines as “How to Make Every Day a Holiday When You Own an RV Park” and “Vacation While You Work: Welcome to the RV Park Owners Lifestyle.”
And second, he’s already been enormously successful in working his investment magic with mobile home parks, becoming – together with his partner, Dave Reynolds – either the fifth or sixth largest mobil home park owner in the U.S., depending on which of his numbers you believe. Whichever it is, Rolfe’s track record with mobile home parks offers a sobering foretaste of what to expect from him and other “big money investors” in the RV park sector.
Mobile home parks, more familiarly known as trailer parks or trailer courts, are one of the largest sources of non-subsidized low-income housing in the U.S., home to approximately 20 million Americans. What Rolfe and Reynolds realized, more than two decades ago, is that the “mobile” in “mobile home” is a myth – that most house trailers aren’t going anywhere, because they no longer have wheels or a tongue, or because they’re so old they’ve settled too much to withstand hauling around, or because the people who live in them can’t afford the $3,000 or $5,000 or more to hire a professional mover.
The other thing Rolfe and Reynolds realized is that most people who live in trailers own their units, but they don’t own the land on which they’re sitting – and that makes them a captive audience. As documented in numerous news articles, a John Oliver “Last Week Tonight” episode and the book “Manufactured Insecurity,” that captive status gives Rolfe and Reynolds carte blanche to raise rents and start piling on fees from day one, sometimes doubling the housing costs of their unfortunate tenants within mere months.
It’s worth noting that it’s not just outside observers that have remarked on this predatory relationship – Rolfe himself is an unabashed promoter of this asymmetry, most regularly through the in-person seminars he leads under the umbrella of the Mobile Home University (companion to the RV Park University, the Outdoor Billboard University and the Self-Storage University, all components of the Commercial Real Estate University). Held regularly around the country in pre-COVID days, and more recently in Zoomed on-line sessions, the $2,000 three-day course promotes the idea that there’s money to be made from those who don’t have any.
“Affordable housing is the hottest arena in commercial real estate right now,” the Mobile Home University website proclaims. “With over 20% of Americans trying to live on $20,000 per year or less, the demand for mobile homes has never been higher – and the big winners are the owners of the mobile home parks in which those customers reside.” As Rolfe further explains in one of his videos, “The customers are stuck there. They don’t have any option. They can’t afford to move the trailer. They don’t have three grand.”
RVs are more mobile than mobile homes, and most are still owned by people who would not fall into the lower 20% of the socio-economic scale. But two developments should raise some warning flags. First, Rolfe and Reynolds are busy promoting to prospective RV campground owners many of the same cost-cutting and revenue-enhancing measures they’ve wielded to such great effect at mobile home parks, from quick rate increases to charging for water and electric use to removing maintenance-intensive amenities, from swimming pools to large trees.
The second is that RV parks are seeing an increasing number of people who view them as a more accessible alternative for housing of last resort, raising the possibility that they will trace the same downward arc already seen at many mobile home parks.
Next week:
Growing pressure on RV campgrounds from people squeezed out of mobile home parks, many of them by a couple of promoters who are simultaneously stressing the “fun” aspects of RV park ownership.
*****
Andy Zipser is the author of Renting Dirt, the story of his family’s experiences owning and operating a Virginia RV park. The fascinating book, recently published, is available at many large bookstores and at Amazon.com.
##RVT1025b
I already see “RV Resorts” here in FL becoming “trailer courts”. There are plenty of rigs in one particular park nearby that haven’t moved in years and won’t. Mixed in with them is the “could be mobile but it’s not rigs” and these owners are not going anywhere. One of the saddest this is most of these owners have no idea what maintenance is required for a RV (even if you don’t go anywhere).
Yep, trailer courts are sprouting up where RV Parks used to be – at least here in this part of the country.
I can’t help but wonder that if Rolfe and Reynolds are so successful at buying up RV parks and trailer courts, why are they selling these expensive seminars to teach everyone else how to do it? Did Hardees, Burger King, and Wendy’s pay Ronald McDonald to teach them how to succeed with fast food? Reminds me of the travelling tent shows teaching people how to make millions flipping houses with other people’s money. In the meantime, I couldn’t tell you how many times we have pulled into and right back out of RV parks full of ‘campers’ surrounded by washers, dryers, freezers, huge propane tanks, etc.
This kind of real estate devouring is happening across the country, and even the planet, with investment companies buying up entire condominiums and housing developments, even before the developer has completed building, just to secure a better long-term return on investment (ROI) through rentier economics than they can get from traditional investments like stocks and bonds.
Sounds similar to house flippers. In North East Pa some residents of mobile home parks had their water shut off because park owner didn’t pay the water bill. Some were shut down for bad septic systems. Then when they shut down the residents have no where to go or no money to move mobile home.
I live in a small college town. Due to the pandemic, private rental home owners who normally would rent to students, had to rent to non students in order to make the mortgage. Now there is a student housing crunch. The university doesn’t have the funds or the inclination to build more dorms. They want the community to solve the problem. So the KOA in town has now set aside a portion of their park to house students in RVs. My town is a tourist destination and near the “Mighty 5” national parks. So now there will be less campsites for the tourists.
a bunch of us are worried the campground we have seasonals in was just sold to a managment company in fact the company bought 2 in the same area I do not trust them one bit
The new owners of our RV park openly said they plan to make this very popular, part monthly and part overnight, big-rig friendly RV park into almost all monthly sites. In fact, they plan to double the size of the place and make all the new sites monthly. The fact is, the owner makes more revenue from the monthlies as it requires at least 50% or 16 days booked per month at the full nightly price for a site to break even with what a monthly tenant pays. No way around it – and it’s far less work. The tough part is keeping down the riff raff. And like you say, as time marches on, the owner can slowly raise rents – like boiling frogs. Your Social Security check increased 6% – why how ironic – so did your rent! On the other hand, there are a lot of workers on temporary assignments who get nice per diems. These mostly young singles and couples actually make money by living in an RV park as the lot rent and RV payment combined is only about half their monthly per diem. Good gig for them.
Trying to figure out that math, when as a traveler I routinely am asked to pay 3, 4, 5 or even 6 times what the permanents are paying per day (I say asked because I routinely go elsewhere). Some of them I imagine feel sorry for the aging tenants and leave their rates low while jacking up daily rates constantly for tourists. Too bad the big chains will not be that merciful after the buyouts.
I do agree that lots of owners find it easier to be a landlord dictating terms to trapped tenants, rather than a host offering services to travelers. All I can do is avoid these folks.
It started with predatory lenders, 15% interest for 20 years. Now we have predatory landlords, raising rents on a relatively captive population. It won’t happen over night but gradually over time.
They are predatory scum. Just because you can does not mean you should. I know I am old and come from a family business that lasted 103 years on a hand shake, BUT right is right and wrong is wrong. Yes, life is not fair, but you have to be able to look yourself in the mirror. It is completely clear none of these big investors own a mirror. Maybe that is by their choice.
Unfortunately, greed comes in all forms.
welll, JC, maybe the reason for no mirrors is that ‘vampires go to great lengths to avoid mirrors, because mirrors reflect their mortal images rather than their actual ones.’ ..