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Dave:
Right. Yeah, so those are basic thoughts on building an
RV park. I guess we’ll move on here. I think we’ve
covered a ton of stuff. I guess we’ll move on to a few
final thoughts here and then we’ll wrap it up.
Frank:
All right. Well, do you want to start the first one,
Dave?
Dave:
Sure. Yeah, I guess the first one is let’s say you’re
out there looking to buy an RV park. I think one of the
key things is you need to know what your budget is, how
much money you have set aside. If you have $150,000.00
set aside then that’s all you have to your name. I
wouldn’t suggest going out there and looking for a park
where you have to put $150,000.00 into. I would
probably look at maybe 100,000.00 or so. You definitely
want to not stretch yourself too thin. If you’re gonna
quit your job and all that kind of stuff and basically
change your lifestyle, you need to have some type of
nest egg or something to fall back on in case things
don’t go as planned.
Frank:
Yeah, absolutely correct.
Dave:
So first thing is definitely don’t stretch your budget
too thin.
Frank:
Absolutely. Yeah, because you have to be ready and you
need to have some money that you’re holding back for the
natural problems that will come up. Right, and the last
thing you want to do is get in the park and realize that
you’re gonna have difficulty making it happen, and
paying the bills, and it’s just not good. So you always
want to have more capital and I think it’s a natural
rule in life. Things always end up costing more than
you think. Right, so you want to have not all of your
money on the down payment. You want to have some money
left over for a rainy day, and fixing things, and things
like that.
Dave:
Right. Okay, and I guess the next item would be you’ve
listened to over 20 hours now of tape or CD and you need
to sit down now and decide really are you ready to own
an RV park? What type of RV park do you want to own,
seasonal, nightly, destination, whatever it is, and you
need to really decide is this something you want to
tackle? Because owning an RV park is not like owning an
apartment building or a mobile home park where you just
kind of sit back and deal with problems, collect the
rent on the first, and just deal with the problems that
come up.
You’re there, it’s a
business. It’s typically people are in and out of there
all the time, every day, so it’s not like you can, well,
I’m gonna take a three-week vacation. If it’s you and
your spouse running the park, and no one else is working
there, and it’s the middle of the summer and your
traffic is there, it’s not like you can just pull up and
take a two-week vacation most of the time.
Frank:
That’s exactly correct.
Dave:
And it kind of goes on to say if you’re a family, if
you’re gonna be a family running the project, are your
kids or is your spouse, are you guys all behind each
other on the plan? Is it something that you really want
to do as a family? Because most of the successful RV
parks run by families have the whole family taking a
part of it, whether mowing the grass or sitting in the
office, they’re all basically helping out as they’re
able to.
Frank:
Yeah, I mean I myself have not had an experience but
Dave, you were moved as a kid into a park, correct?
Dave:
Yeah, I moved into a mobile home park, actually.
Frank:
Right, but similar thing, as a family business, right?
Dave:
Sure.
Frank:
And did you like that?
Dave:
Well, no, I didn’t but there were other reasons involved
with that. I mean we went from a huge town to a tiny
town and lost sports and all that kind of stuff. I
liked working and getting the paycheck.
Frank:
Well, sure, but again the key is will your kids be happy
in the new atmosphere or not? ‘Cause as Dave says, even
though financially it might work for you, you think, if
it’s gonna mess up your family, maybe it’s not still a
great idea.
Dave:
Sure, and so I think a lot of people wait to buy an RV
park and they actually run it after their kids have
moved out in kind of midlife crisis or a retirement kind
of thing where a lot of people – and it’s worked
successfully. But it has worked real successfully for a
lot of families. I know several that own parks and they
love it.
I guess the next
thing is – this is kind of like a pun but you probably
are not gonna go out and buy a campground because you
like the idea of camping. Because if you’re buying a
campground because you like to stay in your RV and visit
the country, that’s not the reason to get into the
business ‘cause you’re not gonna be doing much of that
anymore.
Frank:
Yeah, and of course it’s a lot less expensive if that’s
your only desire just to go camping more. Right? It’s
kind of like I’ve seen people, again, another one of my
corny bad analogies, but a guy will be so into cars that
he wants to be a car dealer when in fact all he really
wants is access to cars. He’d be better off buying a
couple sports cars, or renting them, or something,
rather than risking his entire life on a car dealership
when he really never wanted to be a car dealer. He just
wanted to have access to all these fancy cars.
Dave:
Sure. Yeah, I mean you’re not gonna go out and buy the
restaurant just because you like to eat.
Frank:
Yeah, and of course it’s a lot cheaper just to go eat
more. If you get to eat out only once a week and you
want to eat out every night, you’re not better off just
buying a restaurant. You’re better off just changing
your budget to eat out every night because buying the
restaurant is not going to really satiate your desire.
Dave:
That’s right. Yeah, you’ll get tired of it real quick.
Frank:
Exactly. Then you can go to a different restaurant, but
if you own the restaurant, you’re stuck there.
Dave:
Yeah. Okay, next item would be with owning an RV park
we’re talking here more of the overnight, people in and
out every night, or every weekend, or whatever, but you
have lots of long hours. During your season you’re
gonna have from sunrise to sunset, sometimes after, that
somebody has to be on call to deal with problems, deal
with check ins, run the convenient store, rent the boat
rentals out, or whatever it may be. And during that
season, you’re not gonna have a lot of privacy.
I mean a lot of
people own the park and they have their house in the
park, or like a typical KOA where the houses are
apartments right above the store. And so your personal
lives, if you’re used to living in a rural area, or in a
city, and you have your own house, and nobody ever comes
in and bothers you, that’s not gonna be the case
anymore. People will bother you and be calling you all
hours of the night. Employees will call in sick, and
you’ll have to work two shifts, or whatever it is. So
you’ll definitely have a lot more contact with the
public, as well.
Frank:
And really, if you’re not a people person, RV is
probably not the thing for you because it is a very
people person thing. In other words, if you want to be
an investor and not the operator of the RV park, that’s
one thing. But if you’re gonna actually run the thing,
it’ll be hard to be successful without being a people
person. So if that’s not part of your personality then
it’s probably a really bad idea.
Dave:
Right, and I think I already talked about it but
definitely the kind of campground operation you want to
buy. Do you want to buy the seasonal park where you’re
open in the summertime, or do you want to buy the
year-round park where you’re open year round and the
business is always going strong? Or did you want to
open the overnight type park versus the destination, the
park near Mount Rushmore, or on the beach, or something,
or do you want to – that’s more permanent type park
where people stay there for months or full-time year
round? So all different thoughts that you need to
decide in what you’re looking for.
And another thought
is if you are gonna move to say a different city or
state, or if you’re used to living in the city and
you’re moving to – you’re buying a park in the mountains
and it’s a completely different climate, you want to
make sure you’re gonna like that area and that city
first before you actually make that move, and pull
everything up and move stakes.
Frank:
Yeah, absolutely. ‘Cause once you’re there, it’s too
late. Visit that town if you can more than once. One
time out you may have a really lucky trip, the weather’s
good and everyone’s smiling. But you need to go several
times to kind of average them together because a lot of
people have screwed up in thinking after one great trip
it’s a great place. And then when they move there, they
don't fit in or like it at all. How in the world did I
get stuck here? And you’re stuck there.
Dave:
It’s hard to sell it back once you take over ownership.
Frank:
That’s right. You’re just basically stuck.
Dave:
Right, and a lot of times when you’re making such a big
change or lifestyle, your husband quits his job, or you
both quit your job, and you decide you’re gonna go run
your own business and run an RV park, a lot of times
your family members (parents, siblings, etc) are gonna
think that you are crazy. We’re not talking to you.
You’re gonna lose everything.. So you’re gonna have to
in some cases deal with that family negativity, or
ridicule, or whatever it may be in your case.
Frank:
Yeah and I’ve had the same problem. People still ask me
all the time when I’m gonna get out of that stupid
trailer business. Although I got to tell you, there was
a whole lot more respect in the industry in about 1997
or 8 when The Millionaire Next Door came out, or
maybe it was called The Millionaire’s Handbook.
I can’t remember which one.
It was a national
best seller and if you look in that book, it has a
section called kind of like, “What do millionaires do?”
And about, gosh, four or five entries down is owning a
park. Right, and I think it says mobile home or it says
mobile home and RV, but it’s all the same thing. I mean
the guy who wrote the book, he’s not an expert and
doesn’t know probably what an RV or a mobile home even
is.
But at any rate,
next time someone laughs at you, you might take solace
in pulling the book out and looking at it, or just
looking through the Forbes 400 which contains Sam Zell,
who again, was probably not an RVer but is a billionaire
off of basically mobile home and RV parks kind of as a
hybrid. But it is a very large industry. There’s
several publicly traded RV manufacturers. There is at
least one REIT
which is very heavily involved
in RVs.
Dave:
Correct.
Frank:
Yeah. Again, it’s not a goofy start up, hardscrabble,
ne’er-do-well business. It’s just a business that
people don’t know or understand ‘cause they actually
have no personal contact with it much at all. Right?
And there’s lots of business like that out there, right?
I mean I see trains
pass all the time. I don’t know who builds train cars,
right, and I’m sure it’s a multibillion-dollar
industry. But I could see the average person if someone
says at a cocktail party, “Well, I’m with the company
that builds train cars,” or, “I build train car wheels,”
people go, :Oh, how quaint. My son has a toy train.
Are they plastic, or are they metal, or something?”
And so it’s the same
thing with the RVs. I don’t tell people anything about
it at cocktail parties because they don’t know what the
heck I’m talking about, right? So the last thing you
want to do when someone says, “Oh, so what do you do?”
say, “Oh, I run an RV park.” They’d be like, “What the
hell are you talking about? What’s an RV? What do you
mean?” So you can just say, “I’m in real estate.”
Dave:
Yeah, they understand that better.
Frank:
Yeah, they understand that. Actually they really don’t
understand that but at a cocktail party it sounds more
important so they’re, oh, you’re in real estate. Sort
of like the guy that works at the gas station says, “I’m
in oil.” Same kind of deal.
Dave:
Yeah, when I first told my grandma that I was gonna buy
my first mobile – it was a mobile home and RV park in
Colorado. She basically told me I was an idiot and
actually she wouldn’t talk to me for about six months.
Frank:
Yeah, that’s how mine was, too. Did we have the same
grandmother? I never checked that out, actually. I’ve
had the same problem all along. It’s just if you’re
looking for reinforcement from your peers, forget it.
You won’t get any. No one will ever tell you that
you’re smart, or a good investor, or anything getting
involved in RVs because they don’t know what the hell
they’re talking about, right?
But when you say it
they think of maybe some kind of Jeff Foxworthy mobile
home thing, or joke, or something. They can’t
understand what you’re talking about so it’s easier just
not to talk about it with anybody. It’s just better to
change the conversation.
Dave:
So I guess a few more final thoughts. Why do you want
to buy an RV park? Are you buying it for full-time
income? For land appreciation, speculation? Are you
gonna supplement your retirement or are you just plain
bored and you need something to do?
Frank:
Yeah, and that last one’s not a good idea.
Dave:
No, probably not.
Frank:
No, that’s a bad idea. You might build radio controlled
airplanes or something if you’re that bored but don’t do
RV out of boredom.
Dave:
Sure, if you’re real bored and that’s the whole reason
you’re getting into it, just go work for another RV
park.
Frank:
Exactly. That’s exactly correct.
Dave:
Right, and then choices between franchises or
independent type RV parks. Like one that we just talked
about a few minutes ago was sometimes the franchise will
have good training programs so if you’re new to the
business that might be a good option. Start out with a
franchise or maybe even go to some of their training
programs.
Frank:
Exactly. All right, well let me give one final wrapping
up concept here, Dave. This obviously has grown into a
very, very large number of hours of taping here and the
key item here was that Dave and I were really concerned
with our thoroughness more than our timeliness. I mean,
yes, we could have distilled it down to one or two
hours, but what kind of product would you get? We’d
gloss over almost everything. You’d learn virtually
nothing. And we didn’t want to have something where
people would just say, oh, gee. Yeah, I got the little
funny RV CD. That was kind of entertaining.
What we tried to do
here was something where there would certainly never be
any equal to the raw amount of information that was
tossed out. And so hopefully we’ve accomplished that,
and even though it may seem like Dave and I ramble and
amble here sometimes, really we’re working for the most
part from a script of information that we wrote that we
thought needed to be included which is only a little
smaller than the Guttenberg Bible, maybe only four pages
shorter I think. Obviously you can’t see us moving the
papers around, they’re in the background and we’re going
through all of these pages, and pages, and pages of
notes and points and to make sure we didn’t miss
anything.
And I’m happy to say
I don’t think we did. I don’t think we missed anything
at all. Of course if we did miss anything at all you’re
always welcome to contact us at the site and say, oh,
I’m still curious on this one item, but I don’t think we
missed much.
Dave:
Sure, and I think the more you continue to educate
yourself, and look at other parks out there, and start
getting an eye for what you’re looking for, like Frank
says, we covered everything that we could in detail.
And just if you continue your education or you’re
looking out for other stuff out there that is related to
RV parks and how to buy them, sell them, manage them, or
whatever, it’s definitely gonna help you in your journey
to be successful.
Frank:
And one more item. Some people always say that Dave and
I are a little negative on things and that’s because we
try and be very realistic. In listening to all these
tapes if you say, well, gosh, these guys sure sound – I
don’t know what, overly serious or worried, that’s
because that’s what we think people need to understand
are all these potential pitfalls, and problems, and
such. And if you say to yourself, well, gosh, that’s
not what I dreamed RV ownership would be. I thought it
would be just this fun little goofy thing, then if we’ve
educated then not to buy an RV park then we’ve also done
our job because you don’t want to go buying it unless
you’re looking at it as a serious legitimate business.
Right?
And that’s why
throughout we’ve told you don’t lie to the bank, don’t
lie to these different people, because it isn’t just
some little hobby. It’s an actual business and if you
know what you’re doing and work it, you can make lots of
money with it. Not that you’ll make a billion dollars
but again, it’s the kind of thing where you don’t take
it lightly. And that’s why we tried to design this to
be so very thorough was so we would not be contributing
to people not taking it seriously.
Dave:
Right, and kind of to add on to that point is there are
so many of these late night television shows promoting
the no money down, make millions in real estate, buy
foreclosures, buy this, buy that, for no money,
guaranteed wealth, and all that. You never, ever hear
of these people talking about any negatives. But I can
guarantee you if you look at all the people that have
bought their courses and all that type of stuff, the
number of people that have actually lost their life
savings or had foreclosures because they bought into
this no money down, make millions, flip the house, and
all that type of stuff, there’s just got to be a
tremendous amount of these people that have lost life
savings, and time, and just basically wasted their time
in that whole business plan.
So like Frank said,
we’re trying to educate you with the good and the bad
side and so you can know what to look out for and know
what to look for.
Frank:
And I saw last night on late night TV, Dave, they’re now
selling The Man From U.N.C.L.E. CD set, which I
think is 28 tapings, so we’re only maybe ten short of
The Man From U.N.C.L.E. I’m definitely proud of
that.
Dave:
Right
Frank:
Right, and unlike a lot of products, again, our products
are all backed by the fact you can always reach us at
the site. This is not just a standalone product with no
further reinforcement or human contact that’s
available. We’re always there at the site if you have
any questions additionally and you will find that we are
perhaps the only really friendly people out there doing
this type of thing. You can call and actually get Dave,
and you can actually get me, and we will happily answer
your questions and in almost all cases not charge you
for it unless it’s some special assignment you want us
to work on. But it’s been our goal to create the best
information out there and I think we’ve yet accomplished
it, Dave.
Dave:
Right, and along with that, what we’ve made out there is
a tremendous amount of questions or people that want to
listen to other people’s questions and so forth, we
might put together some type of a monthly question and
answer show or something like that, maybe a forum or
something where people can post questions. Because if
we respond to every question one on one, it’ll be
difficult for us to get to all of those. But if we
could do it in some manner where you post a question or
call into a Q&A session where we can get 50 peoples
questions answered in an hour or two, that would be much
more beneficial for everybody out there and would
definitely be a great addition to the site and
everything else like that.
Frank:
Right, exactly.
Dave:
All right. Well, Frank, I guess thanks for being on
these tapes with me.
Frank:
Well, Dave, yeah, it seems kind of sad signing off.
We’ve been together so long on this one that it’s almost
like The Walton’s homecoming reunion. But again,
all great things must end so I’m just glad I think we
did a good product and we hope everyone enjoyed it.
Dave:
All right. Thanks again, Frank.
Frank:
Thanks a lot.
Dave:
All right, bye.
Frank:
Bye.
RV Park &
Campground Investment Series
We have completed the series on RV Park
and Campground Investing.
Over 20 hours of audio (on CD) with
Frank Rolfe and I, taking you through the process of:
-
Finding RV Parks and Campgrounds To
Buy
-
Evaluating RV Parks and Campgrounds
-
Negotiating and Buying RV Parks &
Campgrounds
-
RV Park & Campground Due Diligence
-
Operating, Turnaround and Selling RV
Parks
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