Editor’s Note: This is an excerpt of a story that was published in Woodall’s Campground Magazine’s (WCM) October issue. Industry professionals can subscribe to receive a monthly issue of WCM for FREE. To subscribe, click here.
The real estate market for campgrounds and RV parks has settled down, according to park operators, brokers, lenders and consultants who regularly work with private park buyers and sellers.
“The crazies are gone and it’s back to reality, which is OK,” said Jayne Cohen, founder and CEO of Campground Consulting Group.
“CAP rates have adjusted. (Sellers are) not getting multiple offers for every property like before. Economic uncertainties may hurt the ‘mom and pop’ buyers or the lifestyle buyers, but not the multi-park owners,” she elaborated. “They are still buying but not paying crazy money for parks. Extended stay or seasonal parks are sought after right now — parks with reliable, regular income. Vacation or nightly RV parks are tougher to sell today.”
Cohen says institutional buyers or multi-park owners “are still out there.” She added that the majority of parks still need infrastructure and campsite improvements.
“Most parks need improvements,” Cohen said. “It is rare to see a park in tip top shape (to) sell, unless it was recently built.”
Jim Omstrom, co-founder of Open Road Resorts, which is actively acquiring campgrounds and RV parks, said many parks need everything from better maintenance to new amenities, clean bathrooms and Wi-Fi.
“We look at a lot of parks each year and most have a need for increased maintenance, capital spending or investments in addition to amenities,” he said. “Guests care a lot about cleanliness and Wi-Fi. So, a lot of the parks we look at need to see a big investment in renovating the bathhouses and upgrading the Wi-Fi infrastructure.”
One noteworthy variable affecting the sale prices of private parks this year is weakening occupancies and revenue performance, Omstrom said.
“An interesting dynamic we’ve noticed and heard about from other buyers is the inconsistent results this year,” Omstrom said. “In recent weeks, we’ve looked at several parks in historically strong markets and they are down 15% to 25% or more year-to-date, but sellers are trying to peg their sales price off of 2024 results. I think this is causing some pause in certain deals.”
Richard O’Brien, CEO and founder of Athena Real Estate in Orlando, Fla., said there have been many changes in the real estate market and in park revenues since the pandemic and both buyers and sellers need to be aware of these changing market conditions, which now also include dramatic declines in the numbers of Canadians traveling to the U.S.
“Starting in 2022, interest rates and cap rates increased, and values declined,” he said. “Revenues have softened since that time due to the post-COVID-19 decline in the RV transient business, now exacerbated by the Canadian travel declines. Expenses for payroll, insurance and property taxes have increased during that time. Values of RV parks on paper are down 25% to 35% if a park was purchased in 2021 and 2022 — absent major value creation.”
“Values across asset classes have reset lower, and some owners who bought at peak pricing are facing difficult decisions,” said Maria Piper, a broker with NAI Outdoor Hospitality Brokers. “While there are pockets of non-performing loans and distressed assets, the overall level of distress is not enough to disrupt the industry. On top of that, higher insurance costs and rising operating expenses are ongoing challenges for many owners. Still, transactional volume is increasing, and the outdoor hospitality market continues to adapt and move forward.”
Brokers offer varying perspectives, however, on the extent to which sellers are being “realistic” with their asking prices.
John Sheedy, president of Park Brokerage & Commercial Real Estate, LLC, said he believes the pace of sales has fallen due to sellers who are clinging to the types of prices that were common in 2021, when the market was at its peak.
“It’s important to note that the logjam in the market is mostly due to unrealistic sellers,” he said. “There are still plenty of willing buyers to purchase parks and campgrounds. However, sellers are still way too emotionally attached to the 2021 market highs, which will probably take several years to return to, especially in heavily saturated and/or tertiary markets.”
But even though the pace of RV park transactions has slowed, Sheedy says we’re now seeing a volume of transactions that is more normal.
“The market has slowed down only as it pertains to the overheated market of 2021-2022,” he noted. “Total numbers of sales are about what they have always been, historically, if you look at it over a 10-year period. I expect the market volume, not necessarily pricing, to pick up as owners have begun to get accustomed to new realities and some distressed assets come on to the market as five-year locked loans mature over the next 18 months.
“The frothy market of 2021 is likely not to come back for several years, if ever, and values and offers that were presented then will take a long time to achieve again,” Sheedy added. “There are countless groups looking to purchase communities for proper pricing. It’s sellers holding up the market as they are too emotionally attached to a price from 2021 that isn’t likely to return in the near future. We do, however, have some notable deals in the pipeline, but the sellers are either offering seller financing or an attractive entry cost.”
“The worst thing a seller can do is overprice the park for the market and hang it out there so long that everyone thinks there is something wrong with it,” said Russell Baehre, of Baehre Real Estate in Kerrville, Texas. But he also understands why some sellers are aiming for top dollar.
“Truthfully,” Baehre said, “there are a lot of parks — new and old — that the sellers have more invested in than they are currently worth and no one wants to take a loss. Marketing parks in a buyer’s market is different than in a seller’s market, where you are just filling orders.”
O’Brien, for his part, sees sellers coming back to reality as considerable amounts of five-year debt matures.
“The overall economy, at this time, is stable,” he said. “Sellers have become more realistic in their asking prices, and I am confident we are going to see more volume closed in the fourth quarter of 2025 and the first half of 2026.”
O’Brien also sees more multi-park owners getting into the market. He noted that his RV resort company, Applebrook RV Resorts, which has nearly 15 parks and 3,000 sites, anticipates doubling in size during the next five years. He also sees new owners continuing to improve the parks they acquire.
To access the issue’s digital version and read the full story, click here.
