When it comes to talking about their experiences renting park models and yurts, private park operators across the country have a similar refrain: They can’t get enough of them.
The Jellystone Park at Kozy Rest in Harrisville, Pa., is a case in point. The 170-site park has two site-built cabins, two park models and two yurts, but demand for rental accommodations is so strong that the park had to turn away 200 nights’ worth of rental business last year, said park co-owner Denny Quigley.
When Woodall’s Campground Management (WCM) contacted Quigley a few weeks ago, he was ordering two more park models for use as rental accommodations.
Across the country, park operators tell WCM they have no trouble keeping their park models and yurts rented and that, if anything, they need more rental units.
Consider Pineland Camping Park in Arkdale, Wis. By mid-March of this year, the central Wisconsin campground had already booked its three park models for practically every weekend this summer, said Randy Sondalle, the park’s co-owner.
Across the country, Flying Flags RV Resort in Buellton, Calif., experienced a similar phenomenon, having booked its five park models for practically every summer weekend. In fact, by late April, about the only remaining park model availability during the summer months was for scattered nights during the middle of the week, said Dan Bauman, Flying Flags’ general manager.
Meanwhile, in the heart of Texas, Bryan Kastleman of Hill Country RV Resort in New Braunfels has seen rising demand for his park model rentals, not only from families on summer vacation, but from snowbirds who are opting to spend the winter months in park models.
Kastleman, in fact, just ordered a dozen more park models from Athens Park Homes, boosting his inventory to 52 rental units, most of which are park models.
“We see more rental demand,” Kastleman told WCM, adding that he had to turn away scores of people last winter because he didn’t have enough park models available for rent.
“We hope to buy about 15 a year for the next four years until we are built out,” he said.
Even large campground chains like Billings, Mont.-based Kampgrounds of America Inc. (KOA) continue to boost their park model inventories.
While KOA’s park model purchases aren’t as high as they were a couple of years ago, they’re still significant, with 230 park models expected to be added to KOA corporate and franchise parks this year, said company President Pat Hittmeier. This is after KOA added 230 park models in 2011 and 340 in 2010.
Leisure Systems Inc. (LSI), which franchises Jellystone Park Camp-Resorts, also expects its franchisees to continue to increase their investments in park models this year, with LSI COO Rob Schutter noting that Jellystone Parks reported a 13 percent jump in their rental business last year.
Tight Financing Eases
Of course, while parks have had no problem keeping their park models rented, many parks have had trouble getting financing to purchase park models during the recession. In fact, it’s only been recently that banks have started to provide more financing for park model purchases.
Manufacturers also tell WCM that banks are gradually providing more financing to consumers who wish to purchase park models. “Most require a down payment of about 20 percent, but we’ve also got a couple of lenders that will do 100 percent financing,” said Andy Davis, national sales manager for Ochlocknee, Ga.-based Pinnacle Park Homes.
Most manufacturers, however, tell WCM that financing is still not available at the level it needs to be and that banks’ continued unwillingness to lend more money limits the extent to which the park model industry can grow.
“There are some good signs, but (manufacturers) could sell a lot more if they could get retail financing,” said Larry Weaver, national sales manager for Dutch Park Homes in Goshen, Ind.
Still, enough financing is available to prompt a surge in park model sales across the country.
RPTIA Sale of Seals Shows Industry Growth
Bill Garpow, executive director of the Recreational Park Trailer Industry Association (RPTIA) in Newnan, Ga., said the association is also selling more inspection seals, which signals increased manufacturer confidence in the future pace of park model sales.
“We have seen an improvement in the number of seals that have been sent to our members,” Garpow said. “It’s good to see things headed in the right direction. It’s been a wonderful winter season. We’re even getting some calls from park developers that are interested in creating new parks. They want to see park trailers be a segment of their park.”
And one selling point that park operators can make in their pitch to obtain financing is the fast pace with which park models can pay for themselves, if they are properly marketed.
Flying Flags RV Resort, for example, is generating enough revenue from its park models to pay for each new unit in about a year, said Bauman, the park’s general manager. “It’s really a no brainer (to invest in park model rental accommodations),” he said.
Most parks, however, require about two to three years to pay off their units, with their actual payback timing reflecting the success of their marketing efforts to let people know that rental accommodations are available at their parks.
Joe Moore, general manager of The Vineyards Campground and Cabins in Grapevine, Texas, said it takes about 20 months’ worth of bookings to pay for new park models at his park. But he said park models are a lucrative investment, generating three times the income of a standard RV site.
Park operators also find they can generate a steady stream of income by leasing some of their campsites to consumers who purchase park models for their own use as a weekend cottage or vacation dwelling.
Several park owners interviewed at the spring convention of Wisconsin Association of Campground Owners (WACO) told WCM they were making more campsites available for park model use specifically to accommodate seasonal campers who own their own park models.
Yurt Builders Still Seeing Growth
More parks are also installing yurts as rental accommodations, said Alan Bair, president of Pacific Yurts in Cottage Grove, Ore.
“The (sales) trend has been up for the last two years,” Bair said, adding that he is seeing increased demand from both private parks and state parks, which see yurts as lucrative sources of rental income.
Indeed, while some parks provide yurts with bare bones furnishings, others dress them up and equip them with kitchens and bathrooms.
Another trend Bair sees is a movement by parks to purchase larger yurts. While Pacific Yurts offers yurts in a variety of sizes, including 12-, 14-, 16-, 20-, 24- and 30-foot diameter units, most of the sales activity is for the largest sizes. “There’s definitely a trend toward the 24- and 30 -footers,” he said.
Bair added that parks are using yurts not only to accommodate single families, but groups of people and children.
But despite the well documented need for additional rental accommodations in the campground sector, private park operators are also continuing to look for the best deals, which creates an intensely competitive market environment for manufacturers that produce rental products.
The Breckenridge Division of Damon Corp., a Thor company in Nappanee, Ind., has made some aggressive moves in response to changing market conditions.
“Breckenridge went through the largest revamp of our products since our founding 20 years ago,” said Denise Walsh, the company’s general manager. “We redesigned all of our destination trailer products.”
Walsh added that the new designs have translated into increased sales.
“It really helped,” she said. “We’ve seen an increase in our destination trailer business. Those products are very well received.”
And while Breckenridge historically focused the majority of its attention on park models that it sells to consumers, the company has landed some high profile rental clients, including KOA, which uses Breckenridge to produce some of its custom-designed rental units.
Ocala, Fla.-based Chariot Eagle Inc., meanwhile, is working on new floorplans. The Florida company has also hired Olin Wenrick, formerly of Elkhart, Ind.-based Trophy Homes, and has started producing Trophy’s top-selling park model products. Trophy closed its Elkhart business a little over a year ago, but its products are still in demand.
Manufacturers are also competing with each other on price.
For example, Fairmont Park Trailers, a division of Fairmont Homes, has introduced a Harmony Park series of 12-foot-wide park models that competes with 8 1/2-foot-wide park models. “Retailers have found out that for the same money, their customers can get into a Fairmont 12,” said John Soard, general manager of Fairmont Park Trailers in Nappanee.
“Our price point is very competitive, and our product is more residential since we are a housing manufacturer,” Soard said, adding that the Harmony Park series features hardwood maple with a dark coffee brown stain that is very popular.
Park models account for less than 20 percent of Fairmont’s production, with the balance being manufactured homes.
Custom Work Grows
Park model manufacturers are also generating increased sales by customizing their units.
“The campground and resort owners are telling us what they want to help us design them,” said Davis of Pinnacle Park Homes.
Some park model manufacturers are also introducing completely new products, including North Park Cabins & Park Models of Minocqua, Wis., which produces freestanding bathrooms with showers.
Park model manufacturers are also stepping up their marketing efforts to private park owners and they’re getting some help from campground industry trade associations.
Elkhart-based Skyline Corp. secured a preferred provider agreement with the National Association of RV Parks and Campgrounds (ARVC) last year that provides ARVC member parks with significant savings on towable travel trailers as well as park models.
The California Association of RV Parks and Campgrounds (CalARVC) has also promoted park model camping, most recently by publicizing a late April trip by www.OutdoorAfro.com founder Rue Mapp and her family to the Santa Cruz/Monterey Bay KOA in La Selva Beach, Calif., where they spent the weekend camping in a park model manufactured by Phoenix, Ariz.-based Cavco Industries Inc.