OUR ASKING PRICE IS $149,900.00
That’s for the entirety of the Assignment Fee and The Contract To Purchase
Everyone looks at RV Parks expecting income to be the salvation of the deal. Sometimes real deals come blindfolded and delivered looking like a hostage situation. Just based on this low end estimate you will be walking into an equitable position from Purchase Appreciation by nearly as much as the purchase price you’ll pay.
Now in this case there are no real numbers because the seller abandoned the enterprise portion of this venture and just never put their heart into the project because of whatever personal situation he and his family were facing.
This property is grandfathered in with the County of Lafayette in the manner it sits today. So sorry, there is not a value add to the property by additional sites and such, but there is still a nice income producing property sitting here waiting for you to take it over Today!
It would be excellent for a owner-operator looking for a nice place to retire and have their bills being paid for them by the income it would generate over the years. There are RV sites down the road, SITES, not 1.61 acres and all kinds of infrastructure already in place, just a site on under 10,000 square feet of dirt going for over $239,000.00. THIS IS A STEAL!
What we are presenting here is a Pro Forma based approach AS IF you were actually planning to operate this compound as a business from your purchase date into the futue.
SO, let’s make some Assumptions first so we can establish a baseline to how we can Evaluate both the Estimated Value and the Estimated Value Per Site.
Assumptions:
Based on: Monthly ONLY Revenues – so the strategy for this projection is Long Term Guests
Based on: Only the Full Hook Up RV Units being occupied by the 2nd Year
Based on: A 10.25% CAP Rate
Based on: Expenses being controlled at roughly 45% of Gross Revenue
Does NOT: Inlcude Tent Sites or the Cabin rental potentials as part of that GR
Includes: Electric, water, and internet as part of the Monthly Rental Rates
Based on: Average Rental Rate of $650.00 for each of the 8 pads for a 12 month cycle
THE NUMBERS:
Total Rental Sites:
Rent: $650.00 x 8 units x 12 months = $62,400.00 GPI (Gross Potential Income)
Expenses: 45% (we’re estimating at a conservative value of the GPI)
Projected Net Operating Income (NOI): $34,320.00
CAP Rate: 10.25% (based on a rural setting)
This Provides:
Estimated Total Park Value: $334,829.34 (Low end estimate)
Estimated Per Site Value: $ 41,853.66
**NOTE** At the contract + assignment fee price of $149,900.00 You are getting this investment at just 45 cents on the Dollar on the (ETPV) Estimated Total Park Value as shown above. Not included are unknowns like total closing costs, or the cost of getting the property cleaned up and prepared how you are going to want your guests to see it when you get going. We estimate closing costs to be around $2,340.00 and a site preparation amount of $20,000.00, which includes some equipment purchases such as lawn mowers, weed eaters, etc, plus any utility deposits, etc., and initial marketing and setup fees like licensing, etc. I would call it $25,000.00 as a rounded number.
THE FORMULA USED:
Value Per Site = Estimated Total Value ÷ Total Rentable Sites
Estimated Total Value = NOI ÷ Cap Rate
Example: $120,000 NOI ÷ 8% cap rate = $1,500,000 total value
$1,500,000 ÷ 75 sites = $20,000 per site
NOTE: Industry benchmark range: $15,000 to $40,000 per site for most stabilized parks.
Resort and coastal parks can exceed $40,000 significantly.
Rural and seasonal parks may trade below $15,000.
How YOU end up operating the property will depend on whether that is higher or lower than we’ve briefly outlined here for you. The numbers used were purposely conservative and the entire first year of operation is not shown due to you shoring the property up to make it that unique experience you want your guests to have and so that will take some time and then once done it may take a few months to get those Eight special guests that understand what a great value they’re getting at your price point.
Regardless, you could lower those estimates even further, but what will still be revealed is that the $149,900.00 we’re asking for you to settle on the contract is way less than the real value of this Diamond In The Rough!
CONTACT US TODAY …