RV Park & Campground Investment Guide
Why Invest in RV Parks?
RV parks and campgrounds offer unique investment opportunities in the hospitality sector:
- Growing demand - RV ownership hit record highs post-2020, with 11+ million households owning RVs
- Multiple revenue streams - Site rentals plus ancillary income from stores, propane, rentals
- Lower buildout costs - Less construction than hotels; sites are relatively inexpensive to add
- Flexible pricing - Adjust nightly rates based on season, events, and demand
- Value-add potential - Add amenities, upgrade hookups, improve marketing to boost revenue
Key Metrics Explained
Occupancy Rate - Percentage of available site-nights that are rented. RV parks are highly seasonal; blended annual occupancy of 50-60% is typical.
RevPAS (Revenue Per Available Site) - Total site revenue divided by total sites. Useful for comparing parks of different sizes.
Ancillary Revenue Ratio - Non-site income as a percentage of total revenue. Well-operated parks achieve 15-25% from stores, laundry, and services.
Cap Rate - NOI divided by purchase price. RV parks typically trade at 8-12% cap rates, higher than multifamily due to operational intensity.
Typical RV Park Metrics
- Cap rates: 8-12% depending on location and quality
- Nightly rates: $30-$80 for standard sites, $50-$150 for premium
- Operating expense ratio: 45-55% of gross revenue
- Peak season occupancy: 70-90%
- Off-season occupancy: 20-40%
- Ancillary income: 10-25% of total revenue
Seasonality Considerations
Most RV parks experience significant seasonal variation. Key factors:
- Peak season - Summer months (May-September in most markets)
- Shoulder seasons - Spring and fall with moderate demand
- Off-season - Winter months may see 20-40% occupancy
- Snowbird markets - Arizona, Florida, Texas see inverse seasonality
- Event-driven - Rallies, festivals, and local events can boost off-peak demand