How To Buy Rv Parks In Distress - And Turn Your Finances Around In The Process

Our nation is in a depression

Our nation is in a depression. Or maybe you already knew that. But did you know that now is a once-in-a-lifetime moment to buy RV parks? Well, it is. You have never seen more attractive buys in RV parks. Here's how to take advantage of that.

Understand what makes for a successful RV park today.

The type of RV park that is successful today has changed somewhat from that of a few years ago. While many new RV parks sprung up over the past decade, many of those were "stopover" parks that catered to RV users in route to their destination. They were often on the interstate system, but had nothing to do around them, just a pleasant place to spend the night. Those are not the type of RV parks that are working today. Why? A little item called gasoline. With gas prices so high, most RV users are going to a "destination" RV park and staying there for a longer period of time. More time spent sitting, and less time spent driving. So with less driving, they are not needing to stopover so much.

A successful RV park today needs plenty to do in the immediate vicinity of the park, such as national parks, recreation areas or historical monuments. And it doesn't hurt to have plenty of amenities, too.

Understand how to value an RV park.

Many RV park buyers do not have the slightest idea of how to price the asset class. They often look for direction from a broker - absolutely the worst way to go about it. Asking a broker if the price is good is like asking a barber if you need a haircut.

RV parks should be bought using conservative numbers offering a certain rate of return. While a 10% return has long been a standard, in today's depression, you may be able to double that to a 20% return if you are good shopper.

And be sure to use an average of several years' revenue and expenses, not just the current. Occupancy can be fairly elastic, so make sure that you have plenty of "fluff" in your numbers to reduce your risk.

Build a huge pipeline of deals.

If you really want to get a good deal, it's a volume business. The more deals you look at, the better your chance to find a real winner. But how do you find a ton of deals.

First, go to a couple websites, namely www.RVparkstore.com and www.loopnet.com. These sites contain hundreds of listings.

Second, start calling brokers who handle RV parks. You can find a complete list of these brokers at www.RVparkstore.com. They are certainly happy to talk to you and start showing you deals.

Finally, you can cold-call or send letters or postcards to RV parks of your own choosing. Often, you have seen an RV park that you would like to buy - why not call them up and see if it's for sale? You have nothing to lose, and often the sellers are very friendly.

Conclusion

There has never been a better time to buy an RV park. Sure, it takes work to find a winner, but just look at what the reward would be - being your own boss, and building an asset to last for generations. Isn't that worth it?

by: Frank Rolfe

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