Building an RV park for overnighters?

jkwilson wrote:
Was talking to my brother-in-law over the weekend and he asked me about ideas for a piece of investment real estate he owns. 120 acres with a 10 year option to purchase more in the future. Location is three miles off a major EW Interstate and about 9 miles from its junction with a major NS Interstate. Property is on a state highway that connects a rapidly growing mid-size city (with a major university) with a town that is becoming a major bedroom community for the bigger city.

Hopes are that about 20 years out, this property will be in high demand for commercial or residential development. It is fairly flat and is currently in hay production.

I mentioned that a no-frills RV park intended for overnighting or people visiting family might be a way to increase the income from the land without extensive investments. Gravel pull-throughs with electrical service and water. Dump station would probably be a cheap perk to offer. Could start small and add sites as wanted or needed without requiring a massive investment up front.

The exit off the interstate has a few fueling places including a truck stop/travel center.

Is it foolish to consider? Advice?

At what price would you offer the sites? Who is your competition? If the competition is parking for free at Walmart or the truck stop, how do you intend to beat free? How are you going to attract people to go three to nine miles off the interstate? How much is it going to cost to man the operation? Will your state's licensing requirements allow a simple dump station? Is the water and sewer a municipal supply or will you have to have a well and sewage treatment system? If it is a well, you will have certain requirements to meet since you will become a public water facility. Most states don't care your personal well water has too much lead, arsenic, biologicals etc, but they do care if you are supplying that water to others.
Ultimately, it will come down to costs versus income. Will the rate of the return be good enough to justify the costs of building and running the park. The most important thing I can tell you is if you build 25 sites don't base your income off of 25 guests per night, because that isn't likely to happen. Most businesses fail because the business owner is way too optimistic on revenues and way to low on their estimated expenses.