Building an RV Park from scratch under 50k?

elialane7 wrote:
Hi again, thanks for the pointers here! I still don't know how or if I should break it to them.

For the person saying I am more involved than I let on, omg thank GOD I am not!!!! Absolutely not, I hate to let you down but I think if I were this delusional I wouldn't be here getting information and doing my due diligence, I would just live in ignorant bliss...I will confess that 2/3 people involved are some of my best friends on earth and the other person is an ex of mine.

What is hard for me is that I spent a year not speaking to any of them and I (in the back of my head) wished for karma to hurt them....but now we have reunited and I feel horrible for ever wishing that, they are kind and amazing people, if YES very misled and very...idealistic to a fault.

I like what someone said about know the region and knowing that they could rent it for 300-400 a month, I think that is their budget situation, 15 spots at 350 a month would give them a profit. Their mortgage is 700 a month and they'd give 1/3 of the profit to the investor.

Yes I think the investor is not smart. Yes I am worried its going to fail miserably. Yes, their financials are a disaster. Yes I thank my lucky stars every day that I am not involved.

But No, I am not going to write them off immediately...maybe they can get people to agree to live in a shitty dirt lot with basic access to water and power for 50k without the right permits, and then as time goes by they can save to get the upgrades and permits they need, I DONT KNOW. i honestly doubt it very much, that is an ideal scenario...

tbh, they are all high school or college drop outs, very smart but not practical. I have a couple ivy league degrees (so obnoxious I KNOW) but they disregard my more "analytical mind" as closed and limited to opportunities and potential. I, on the other hand, view their plans as impetuous and reckless....

I am glad I am on the side I am .... they risk all their money on that 1 in a 1,000 shot, I on the other hand only fork over my money if the odds are greater than 50/50.

I used to wish that time would prove me right ....but now....No. I don't want that. I want to protect them...or help them succeed without involving my money and without seeming too controlling or negative...WHICH IS VERY HARD--given the power dynamics between us. As it is, anytime I correct my Ex or make fun of their language, I get a "sorry I am not as sophisticated as you" or "sorry I don't have the degrees you do" or "you should get back together with xyz because they are educated" --It is very very hard for me to relay pertinent information without it being targeted as pretentious babble of the elite...even though, like I said, I am from the same poor ass town they are without any savings or inheritance of my own
...

What would you do if these were your 3 best friends on earth? Who have a history of not listening to you or thinking you are too much of a blue blood ? (even though you are self-made?) It's a very delicate process for sure...

Maybe you should be questioning why you have several Ivy League degrees and your three best friends are uneducated. Why you are successful, and your three best friends are a financial mess. Why your best friends treat you with contempt, offering backhanded insults with the "we aren't educated, like you" comments.
Do you have a need to be vastly superior to the people you are around, or do you have a "Knight in white armor" complex and need to be the fixer for everyone? I think the solutions to concerns with your friend's ridiculous plan lies not in what you can tell or offer them, but, rather, in why you are involved in the first place.

myredracer wrote:

westernrvparkowner wrote:
Doesn't take anywhere near 125 sites to be profitable. Say you had a 40 site park and built it for $800,000. Operates for 8 months out of the year with a 60 percent occupany rate (not bad, but not exceptional either) At $40 a night, that would be revenues of $230,000. Figure operating costs of about 30 percent, you will have net income of about $160,000. That's a 20 percent return on your investment, not too bad. Even if you paid a manager couple $5,000 a month for those eight months, instead of running it yourself, you would have a return north of 15 percent. Can't get that on your savings account.
The trouble with the OPs situation is $50,000 is a far cry from $800,000 and building a park in the middle of nowhere won't ever generate $40 a night rates or 60 percent occupancies.

125 sites didn't seem right. This is the first time I've seen a CG owner post actual realistic numbers. Thanks. We've been in a few CGs with only around 20-30 sites so small ones do work.

Curious, how does an owner market your CG/RV park to get customers in the door, esp. if new? Do you need to get connected with C-C, RPI or one of the others? Does internet only work? Get into local tourist type magazines? It's nice to think about building a CG but I'd be pretty nervous that nobody would show up.

Internet is the best advertising medium today. Who knows what will happen 10 years from now. I would only get involved in two types of parks, destination at a location where people want to be, or an overnight park located on a major thoroughfare preferably near a mid sized town. You would have to plan on at least three years to build traffic. A problem many new parks have is they were built on the cheap, using existing buildings etc. They look half-done and reviews will reflect it and they will have a very hard time building reputation and hence business.
If I was doing it, everything would be brand new, and that would be the theme of my advertising. I would have highway billboards on the approaches to the park, preferably about 10 to 20 miles out proclaiming "ALL NEW PARK".
The third advertising leg would be to either affiliate with GoodSam or become a KOA. Those are established names that draw customers.
Magazines and the like are a waste, unless you have a seasonal park and I have no experience or expertise in those parks so I wouldn't know what works for them.

I guess if they were my friends, and I cared that much for them, I would help out non-monetarily, if asked, or if they accepted that offer. Otherwise, I'd have to let them do what they are going to do.

As far as building it on the cheap, and avoiding permits 'for now' and getting permits later. I suspect if they avoid permits now and try to correct it later they will be in a for a very rude awakening with fines and being shut down until everything is done properly. Not anything I would want to go through.

It sounds to me like the clientele they are targeting won't care about ameneties or safe/secure camping... and if it's a starving artists commune, I suspect they won't mind not paying (since they likely will have little to no income), and they, in turn, will 'prey' on the good will of others to give them another shot.

Can you post the GPS coords of the property? I want to keep an eye on it so I can buy it cheap when it collapses.

Mike

Think I'd not worry about it as much as you do. For the most part it's not their money they'd lose, it's their investors money, who isn't much of an investor, probably someones relative.

I'd try to only bring up things once, like asking if they checked on permits and inspections needed, then drop the subject. If you harp on it you'll be seen as a downer. Volunteer to help, non financially of course, looking into things if they want you to. Otherwise, let it go and try and be just a friend, not a mother. If they proceed act enthusiastic if you want to still be friends down the road.

From your description you're already looked down upon by them to the point I doubt nothing you say will change that, so walk away and watch closely. It'll be over before you can blink.

Hi again, thanks for the pointers here! I still don't know how or if I should break it to them.

For the person saying I am more involved than I let on, omg thank GOD I am not!!!! Absolutely not, I hate to let you down but I think if I were this delusional I wouldn't be here getting information and doing my due diligence, I would just live in ignorant bliss...I will confess that 2/3 people involved are some of my best friends on earth and the other person is an ex of mine.

What is hard for me is that I spent a year not speaking to any of them and I (in the back of my head) wished for karma to hurt them....but now we have reunited and I feel horrible for ever wishing that, they are kind and amazing people, if YES very misled and very...idealistic to a fault.

I like what someone said about know the region and knowing that they could rent it for 300-400 a month, I think that is their budget situation, 15 spots at 350 a month would give them a profit. Their mortgage is 700 a month and they'd give 1/3 of the profit to the investor.

Yes I think the investor is not smart. Yes I am worried its going to fail miserably. Yes, their financials are a disaster. Yes I thank my lucky stars every day that I am not involved.

But No, I am not going to write them off immediately...maybe they can get people to agree to live in a shitty dirt lot with basic access to water and power for 50k without the right permits, and then as time goes by they can save to get the upgrades and permits they need, I DONT KNOW. i honestly doubt it very much, that is an ideal scenario...

tbh, they are all high school or college drop outs, very smart but not practical. I have a couple ivy league degrees (so obnoxious I KNOW) but they disregard my more "analytical mind" as closed and limited to opportunities and potential. I, on the other hand, view their plans as impetuous and reckless....

I am glad I am on the side I am .... they risk all their money on that 1 in a 1,000 shot, I on the other hand only fork over my money if the odds are greater than 50/50.

I used to wish that time would prove me right ....but now....No. I don't want that. I want to protect them...or help them succeed without involving my money and without seeming too controlling or negative...WHICH IS VERY HARD--given the power dynamics between us. As it is, anytime I correct my Ex or make fun of their language, I get a "sorry I am not as sophisticated as you" or "sorry I don't have the degrees you do" or "you should get back together with xyz because they are educated" --It is very very hard for me to relay pertinent information without it being targeted as pretentious babble of the elite...even though, like I said, I am from the same poor ass town they are without any savings or inheritance of my own
...

What would you do if these were your 3 best friends on earth? Who have a history of not listening to you or thinking you are too much of a blue blood ? (even though you are self-made?) It's a very delicate process for sure...

Yet nobody has mentioned how "artists" will be able to afford to pay the sites? Of course, this is providing the project ever reaches completion.

sayoung wrote:

I have found that most people that start a business this deep in debt have NO clue on how to run a business .

Yeah, that's the thing. Their finances are ALREADY a disaster.

Might check if there is a co-op water corporation that would put a line & meter to property . A lot cheaper than drilling a well especially if north of San Antonio. Maybe just gravel at sites only.
Septic is going to bE the money pit. With only 9 acres the law on this is very strict . No electric permit required BUT Texas does require a licensed electrician to install this type electrical system, not saying it doesn't get done without one.
I have found that most people that start a business this deep in debt have NO clue on how to run a business . They might surprise us & succeed but I am glad its not my money on the line.

westernrvparkowner wrote:
Doesn't take anywhere near 125 sites to be profitable. Say you had a 40 site park and built it for $800,000. Operates for 8 months out of the year with a 60 percent occupany rate (not bad, but not exceptional either) At $40 a night, that would be revenues of $230,000. Figure operating costs of about 30 percent, you will have net income of about $160,000. That's a 20 percent return on your investment, not too bad. Even if you paid a manager couple $5,000 a month for those eight months, instead of running it yourself, you would have a return north of 15 percent. Can't get that on your savings account.
The trouble with the OPs situation is $50,000 is a far cry from $800,000 and building a park in the middle of nowhere won't ever generate $40 a night rates or 60 percent occupancies.

125 sites didn't seem right. This is the first time I've seen a CG owner post actual realistic numbers. Thanks. We've been in a few CGs with only around 20-30 sites so small ones do work.

Curious, how does an owner market your CG/RV park to get customers in the door, esp. if new? Do you need to get connected with C-C, RPI or one of the others? Does internet only work? Get into local tourist type magazines? It's nice to think about building a CG but I'd be pretty nervous that nobody would show up.