Building a park from scratch, opinions welcomed!!!

[Packbacker]

My family and I are in the process of building a park from scratch. We are farmers and are looking for diversification. Over the last two years we have noticed just how packed the parks are within an hour and a half from us and had a neighbor mention that we have a perfect location.

We are located in the southeast, midway for snowbirds, off a major interstate and the exit we are off of is a heavily traveled highway. While we wouldn’t be a destination park, we do have a major military base that is a 15 minute straight shot from us, a mid major city with some attractions and great restaurants 12 minutes away, nice medical facility 10 minutes away, and lots of good golf nearby.

The interstate is heavy with RVs all the time. We were hoping for a good bit of overnighters and hoping for good business from the military base via family visitors, contractors, and soldiers who are living in RVs due to moving around so much. The land we are looking at is 38 acres that we feel like could hold around 200 spots. We are looking at starting with about 100 spots, an office/store, bathhouse and laundry, a pool and playground, and a couple dog parks. We also have 10 acres we were planning on having walking and biking trails on. We hoped to build up to the 200 spots and add some cabins in the future.

The other parks we’ve been observing along the interstate have had anywhere from 75 to 140 RVs in them at any given time, even now during December and January. We feel our location is superior to these other parks we’ve observed and while knowing anything is subject to fail, we feel very good about the potential. We are looking at about a 2.5-3 million dollar budget to get started with 100 spots and possibly have money leftover to build more.

Would love to hear some feedback from those with more experience.

[lbrjet]

RV's are running up and down I95 365 days a year. You look to be in a perfect location to succeed. Before I built an RV park though I would talk to a company like CBRE and explore potential leasing of your land for commercial development. That may be a better business opportunity.

[NJRVer]

Ralph Cramden wrote:

Ivylog wrote:
If you get a feeling that the controlling authorities or neighbors are not in favor of your project, I would STOP. You did put a refundable deposit on the property subject to permitting approvals...written by a real estate attorney and held in Escrow by him/her.

Palm Beach Motorcoach Resort in Jupiter,FL hoped to open during the winter of 15-16. This winter they have some sites finished after having to change or redo almost everything...the counter top was 3/8th" to high.........

Your local authorities enforce codes. A counter top being 3/8" too high was most likely something to do with ADA. A public service counter can be no more than 36", an accessible counter with sink can be no more than 34" to the top surface of a sink. Even a mirror is not immune. No more than 40" to the reflective surface. That's ultimately driven by the feds. Sounds like the owners, or their contractor, did not know what they were doing.

But permitting for anything can be a real bear in many areas especially when a zoning change is required.

Here is a case in point. We have campground near us in PA that had been in place for years and wanted to expand its size. The owners also intended to franchise in to KOA. They finally were able after 8 years of trying. Almost every resident along the 3 mile country road leading to the place, probably 150-200 residents, fought tooth and nail for years to prevent it. It was actually comical. Some made huge banners out of bed sheets and hung them on the fronts of their homes in protest. The campground owner told me she had close to a million invested in attorney, redesign, and other costs over 8 years related to the approvals. It's now enlarged and a KOA, but at times she was ready to just throw in the towel.

Don't ever discount the fact that others in the area are going to be dead set against you using your property as you desire for a whole host of reasons, with #1 being people are basically ******** in general. Not in my back yard.

Where is this campground?
I think I would make it a point to give them my business as a show of support.

[atomlinson]

Excellent points here! Are you going to allow seasonal/annual campers? If so, designate an area of the park just for them. Make sure they keep their units and spots clean and enforce it. I've read many reviews where RVers who were overnighting or staying for a weekend were turned off by how many seasonal campers were there and how junky their sites looked.

[Ralph_Cramden]

valhalla360 wrote:


Technically true but often used for ulterior purposes.

Small harmless things often are overlooked if the authorities are fine with the project. If the inspector let's it slide, there is plausible deniability that they must have accidentally mis-measured, so no real risk letting it slide.

If the authorities are against a project, 3/8" suddenly becomes a big deal and the project comes to a halt.

The code books are typically big enough that if the inspector wants to cause problems, they can come up with an issue even if the owner/contractor knows what they are doing.

I can agree with most of that, but as a contractor we do not play around with ADA requirements, nor do many inspectors "let it slide" on ADA items.

Too many so called lawyers running around with a knowledge of ADA, and a tape and a level, who go weaseling around checking things. Then they have a list of disabled people to use in the lawsuit they file against the business, contractor, code official, municipality etc, and its off to the bank. Usually ends up as a nice cushy settlement that is kept as quiet as possible and amounts to legalized extortion. More of that happens than most people realize. I've sat in the dispositions.

Here in PA the local code enforcement person is audited by the state. The local person inspects and issues the certificate of occupancy. The state may come along later and reinspect/audit. If they find the inspector lets things go, especially ADA, it gets ugly. It does not take many bad audits for an inspector to lose his credentials.

[valhalla360]

Ralph Cramden wrote:

Your local authorities enforce codes. A counter top being 3/8" too high was most likely something to do with ADA. A public service counter can be no more than 36", an accessible counter with sink can be no more than 34" to the top surface of a sink. Even a mirror is not immune. No more than 40" to the reflective surface. That's ultimately driven by the feds. Sounds like the owners, or their contractor, did not know what they were doing.

Technically true but often used for ulterior purposes.

Small harmless things often are overlooked if the authorities are fine with the project. If the inspector let's it slide, there is plausible deniability that they must have accidentally mis-measured, so no real risk letting it slide.

If the authorities are against a project, 3/8" suddenly becomes a big deal and the project comes to a halt.

The code books are typically big enough that if the inspector wants to cause problems, they can come up with an issue even if the owner/contractor knows what they are doing.

[Ralph_Cramden]

Ivylog wrote:
If you get a feeling that the controlling authorities or neighbors are not in favor of your project, I would STOP. You did put a refundable deposit on the property subject to permitting approvals...written by a real estate attorney and held in Escrow by him/her.

Palm Beach Motorcoach Resort in Jupiter,FL hoped to open during the winter of 15-16. This winter they have some sites finished after having to change or redo almost everything...the counter top was 3/8th" to high.........

Your local authorities enforce codes. A counter top being 3/8" too high was most likely something to do with ADA. A public service counter can be no more than 36", an accessible counter with sink can be no more than 34" to the top surface of a sink. Even a mirror is not immune. No more than 40" to the reflective surface. That's ultimately driven by the feds. Sounds like the owners, or their contractor, did not know what they were doing.

But permitting for anything can be a real bear in many areas especially when a zoning change is required.

Here is a case in point. We have campground near us in PA that had been in place for years and wanted to expand its size. The owners also intended to franchise in to KOA. They finally were able after 8 years of trying. Almost every resident along the 3 mile country road leading to the place, probably 150-200 residents, fought tooth and nail for years to prevent it. It was actually comical. Some made huge banners out of bed sheets and hung them on the fronts of their homes in protest. The campground owner told me she had close to a million invested in attorney, redesign, and other costs over 8 years related to the approvals. It's now enlarged and a KOA, but at times she was ready to just throw in the towel.

Don't ever discount the fact that others in the area are going to be dead set against you using your property as you desire for a whole host of reasons, with #1 being people are basically ******** in general. Not in my back yard.

[valhalla360]

Packbacker wrote:
We have a very good engineer on board who has RV park experience. Right now we’re in the process of tying up the land and then we’ve been told we have 4-6 months to wait on permits before construction can begin. As far as price goes, we had figued on an average of around $47.50. Prices at parks that would be similar to ours in our region range mostly from $40-$60 nightly. We were hoping to get our name out about 3 months or more ahead of opening and hoping for an average of 40% occupancy. Other parks in the area seem to operate at 60-70% occupancy even during this time of year. I realize that it will take some time to get established but we feel very good about our location.

One thing I haven’t seen mentioned much is a hot tub. We have a pool in our plans and I was wondering about a hot tub with it too, is that something anyone looks for?

Have you done any research on what to expect in terms of occupancy? The fact you say the nearby parks "seem" suggests to me that you probably drove by and just did a quick mental estimate without looking at longer term numbers.

Also, you seem to have conflicting information. You suggest you aren't going to be a destination park but you have destination park pricing and mention destination park amenities and nearby attractions. Quick just off the freeway overnights are usually lower priced. They also don't translate to high occupancy rates and they increase the costs for staffing since you need to interact with lots of people on a daily basis. They counter this by keeping the costs for amenities and other stuff minimal.

If you are talking about seasonal or other long term stays, figure drastically lower per night pricing. Monthly stays might be in the $20-25/night range for a nice park (monthly stays are often in prime months not year round so don't figure 100% occupancy) and annual could easily drop down to $10/night depending on the area.

I'm not saying it's not a good business opportunity but it doesn't sound like you've done the research to determine if it is a good deal.

PS: We like hot tubs but your first order of business is to determine what type of park you want to be and then assess how much each feature is likely to draw in customers from that market type. People like lots of stuff but are they willing to pay for it? Spend the money on items that pull people in, stay longer and allow you to charge higher prices.

[lakeside013104]

Wildtoad said it nicely, give the sites plenty of room. That includes room to maneuver in and out of the sites easily.

Many great ideas on this thread. One question I have: "Will you be prepared to be 'married' to this business for many years?" Paying for some labor is necessary, but to make this endeavor really worjk, you or your family members need to be the primary labor force. More of your income will go to the bottom line, rather than be paid out in wages. Just a thought.

Good luck and keep us posted.

Lakeside

[John___Angela]

Consider adding a few level 2 EV chargers. This will facilitate visitors to your guests. Consider making them a time based charge fee as opposed to a KWH based charge fee as this will prevent people from parking there EV's there and leaving them sit there after they are charged. This is easily done by the programming on the EVSE. You would need a 40 amp 240 breaker per charger when planning the power break out.

[Ivylog]

Mr.Mark wrote:
Ivylog, Packbacker owns the land already. He said they are farmers and wanted to diversify some of their property.

I certainly hope that they can proceed forward successfully.
MM.

In his next to the last post he say "we are in the process of tying up the land". In his first post I read that they are diversifying from farming and next they have a hardware store...doubt it's on the farm. Maybe he will clarify.

[Mr_Mark1]

Ivylog, Packbacker owns the land already. He said they are farmers and wanted to diversify some of their property.

I certainly hope that they can proceed forward successfully.
MM.

[Ivylog]

If you get a feeling that the controlling authorities or neighbors are not in favor of your project, I would STOP. You did put a refundable deposit on the property subject to permitting approvals...written by a real estate attorney and held in Escrow by him/her.

Palm Beach Motorcoach Resort in Jupiter,FL hoped to open during the winter of 15-16. This winter they have some sites finished after having to change or redo almost everything...the counter top was 3/8th" to high.........

[westernrvparkow]

Dick_B wrote:
Maybe the reason more new parks are not being built is because of all of the really good suggestions of all of the criteria to be aware of starting with zoning, etc.
Seems to me it might be a good idea to talk to someone who has more recently built a park. I think there is a relatively new park in Michigan called Sunnybrook.

I think you have reason 1-A at the very worst.
If I was to rank all the issues working against construction of new parks it would go something like this.

1. Permitting, including zoning, public opposition, environmental concerns, waste treatment etc.
2. Out of pocket costs, since very little RV park construction can be financed.
3. Overall costs including land.
4. Time from inception to profitability
5. Opportunity costs. You can often make more money, faster and easier with other developmental options on your land. Hotel, commericial buildings, storage facilities, residential development etc.
6. Lack of an easy exit strategy. There is no established resale marketplace for parks.

It isn't a bad business, once you are in it and established, which is why several people have echoed my opinion that it is much better and easier to buy an existing park and redevelop it to that buyer's vision. Many of the barriers to entry have already been removed.

[Dick_B]

Maybe the reason more new parks are not being built is because of all of the really good suggestions of all of the criteria to be aware of starting with zoning, etc.
Seems to me it might be a good idea to talk to someone who has more recently built a park. I think there is a relatively new park in Michigan called Sunnybrook.

[westernrvparkow]

Ralph Cramden wrote:

westernrvparkowner wrote:

doxiemom11 wrote:
We are full-timers and I can tell you we would never pay $47.50 per night. If we did, that would mean we pay $17,337 in a year for campground fees. Maybe others are different but we are not willing to pay that much to park for a night. For those wondering -- NO we do not usually park at Walmart but seek out Corp of Engineer, forestry parks, city and county parks and parks that give camping clubs discounts. We usually pay $8 to $20 per night with many being full-hook up pull thru sites.

The OP doesn't own a city park, a National Forest, a county park and likely isn't in charge of the Army Corp of Engineers, so he apparently isn't seeking to make you a customer. $50 a night RV sites are not uncommon, there tens of thousands of RVers paying that amount every night. I have no doubt that if the OP builds a quality park and the local market rate is close to that amount, he will be able to get customers at that rate as well. One of the great things about RVing is the fact that there are multiple options for sites to meet nearly every RVers needs.

Wow WRVPO, give the PA state parks a try, one of the newer full hook up sites they have been building in some of the parks.
Here is the cost structure.

$15.00 Campsite.
$4.00 Modern. If the park has showers. Most do and you pay it if you need/use them or not.
$4.00 Weekend / Holiday.
$6.50 Electric.
$8.00 Water.
$5.00 Sewer.
$2.00 Pet. All the FHU sites I have seen are in the pet sections and you pay that if you have one or not.
$6.00 Service charge.

So a weekend Friday/Saturday stay is @
$47.50 per night.

Have a toad or 2nd vehicle? Add $5.00 per night.

Out of state resident? Add $5.00 per night.

$57.50

My point was Doxiemom11 wasn't a target customer for the OP since she says they never spend over $20.00 a night. Apparently, these new PA state parks aren't marketing to her either. My point to the OP is you have to develop a marketing plan and then execute it. You will never, ever be able to please 100% of the RV population. Focusing your business plan, your marketing strategy and then executing those plans to the best of your ability is the way to grow a business. You have to be able to ignore those who criticize your plans because you have chosen to not serve their niche. Having a park with the amenities the OP is considering is not compatible with also charging a fee less than $20, so the park can attract Doximom11 and those with similar RVing habits. Bluntly put, if the OP wants to build the park they are describing, and wants to charge the rates they mentioned, they are just going to have to ignore comments and input from those who want something they cannot and will not be providing. Trying to integrate those suggestions into their business plan would be a fool's errand.