As you make your way around Canyon Lake, you may notice that our RV parks are almost without exception completely FULL. The occupants include boomers who have transitioned to life on the road; snowbirds; people who have a home under construction; and even a new class of Millennials who work remotely and prefer an escape from city life. The little-known fact is that RV parks and self-storage are commercial investment opportunities with some of the best ROI here in the Hill Country.

If there’s one thing to know about investing it’s this:

Demand > Supply = Opportunity

There’s opportunity whenever the demand is GREATER than the supply.

Whether you realize it or not, opportunity is all around.

The initial cost of buying an RV park is, on average, between $50,000 to $3,000,000+. Some would consider this steep, however, on average RV park owners see an 8-10% Cap Rate with $60,000-$200,000+ in earnings annually. You can’t beat those numbers.

I’d be happy to explore this investment avenue or any others with you! Please feel free to reach out anytime.

Kindly,

Kaitie Moore Underwood

REALTOR®, Residential & Commercial

737-203-4178

[email protected]

Bluecollarcommercialgroup.com

 

 

3 Considerations Before Investing In a RV Park

 

#1. Starting from scratch vs established park

In case you haven’t noticed lately, costs for new construction has skyrocketed. If you’re a busy professional like me, purchasing an established RV park maybe the better route to go with less headaches.

Buying an existing park will already have essentials such as:

 

  • parking pads

 

  • electric/water hookups

 

  • gravel/concrete

 

  • septic system

By having these in place plus the permits and licenses, this makes it even more tempting to purchase an existing park.

Some of the downsides to purchasing an existing RV park are:

 

  • location is already locked in

 

  • large upfront cost

 

  • possible repair costs

 

#2. Land

In real estate investing, the first thing to consider is the location. If you’re considering building a park from scratch, the location should be heavily considered along with the construction costs and any county restrictions.

Let’s break these down even further…

  • Location

Finding the right location to build a park is an important factor to consider.

Occasionally you’ll run into states or communities that are NOT RV-friendly or have topography that’s not attractive to potential visitors.

You’ll need to consider a high-traffic site near where people travel long distances to visit (national parks, scenic areas, etc.)

Also, you should factor in the number of RV spots you potentially want on your property.

A rule of thumb is that one acre should fit 10 campsites.

 

  • Cost

You’ve probably heard the phrase, “you get what you pay for.”

If someone is trying to sell you cheap land for a successful RV park then be aware of potential problems.

Before purchasing, consider researching whether it’s in a flood plain and have soil samples taken to make sure it can withstand new park construction.

Another consideration is the cost to purchase the land itself. Most park owners have an average of 10% to 20% ROI on their real estate investments. By knowing this, take into consideration what the monthly payments would be and the amount of time to pay off the loan.

 

  • Restrictions

One of the most overlooked things new park owners run into has to do with country land restrictions. Most people are under the impression that land can be used at the owner’s discretion.

If someone wants to buy a lot and build a restaurant then typically they don’t give it second thought it may not be able to be done.

 

Examples of country restrictions include:

 

  • minimum structure size

 

  • structure height

 

  • utility lines

 

  • farm animals/hunting

 

  • land use (commercial, recreational, industrial, etc.)

 

  • septic tank installation

 

  • number of dwellings permitted

As you can image, many of these zoning restrictions catch a potential new park owner by surprise.

 

#3. Cost to build

One of the largest expenses RV park owners will run into are building costs. If want to save money then consider offering a non-hookup site.

This means there’s no water, sewage or electricity available. If you plan to cut out amenities to save money on the initial investment, you may turn away business.

One of the highest priced items will be laying down the concrete parking pads. This can cost anywhere between $4-$8 per cubic foot depending on your area.

Also, depending on the concrete thickness, size, material costs and labor, you’re looking at spending anywhere from $3,500 to $8,000 for one parking pad.

 

  • Septic

Septic systems is what holds the raw sewage from the campers visiting a park.

Costs to install can range from $5,000 to over $20,000 which include:

 

    • site inspection

 

    • soil testing

 

    • schematics

 

    • installation
  • Water

Typically counties require land owners to have some form of water access whether from a well or municipal supply.

Costs to bring access to land range from $2,000 to $25,000.

  • Electricity

The costs to run electricity to land for a park will be determined based on how far the land is from a city (or grid).

Costs for this can vary between $10,000 – $30,000+.

 

Other Considerations For an RV Park Business

[…] Whether you purchase an existing park or build one from scratch, make sure you have competent on-site management. As with any investment property, having poor property management in place can negatively impact your asset.

Another consideration is that people need to know your park exists, right? Having a marketing strategy for RV park listings needs to be in place to make people aware of your park to ensure the best possible return on your investment.

Finding someone to help with advertising will involve: email marketing, social media, Google ads and a website.

Is Owning an RV Park a Good Investment?

For many people, RVing is now the way to escape the city life grind and tour the country.

After the pandemic, RV travel represents one of the safest ways families can travel together and enjoy themselves.

As this type of travel continues to gain popularity, RV parks should be considered when it comes to investing in real estate.

Especially if you want to diversify your real estate portfolio with the potential to get a better return on your investment.

Remember, before you buy or invest, consider the park’s location, extra amenities, and size.

RV parks need much less attention and upkeep than other types of commercial property, making them an excellent option to invest in.’

 

(source: DebtFree Dr, https://www.dentaltown.com/blog/post/17459/should-you-consider-a-rv-park-investment)

Your Partners in Commercial Real Estate Success

At Blue Collar Commercial Group, we don’t just work in the Texas Hill Country commercial market—we live here. Our deep-rooted understanding of this unique market, combined with our unmatched expertise in commercial real estate, positions us as your ideal partner for navigating the complexities of office space selection.

From identifying your perfect office space to closing the deal with confidence and ease, our team of seasoned commercial real estate professionals is dedicated to guiding you every step of the way.

Ready to make your mark in the Texas Hill Country commercial real estate landscape?

Contact Blue Collar Commercial Group today. Let us empower you with the insights, resources, and personalized support needed to turn your commercial real estate aspirations into reality.

Reach out to us now and embark on your journey toward commercial real estate excellence in Texas Hill Country.

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About the Author: Kaitie Moore Underwood

Kaitie Moore Underwood
Kaitie Moore Underwood's roots in competitive rodeo in Texas intertwined with her academic pursuits at the University of Houston, where she met her husband, Hank. Their move to the Hill Country in 2021 marked the beginning of both their family and Kaitie's successful career in real estate, assisting 18 families in her first year. With a background in the hospitality industry, recognized for her service excellence by the Starwood Hotel Sales Organization, Kaitie has honed her skills in financial analysis, strategy, and marketing. Now, as a pivotal member of the Blue Collar Commercial Group, she continues her professional ascent, consistently exceeding expectations through her dedication to relationships and solutions.

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