RV Park Acqusitions

searcher profile

August 15, 2022

by a searcher in Columbus, OH, USA

Most real estate business acquisitions seem to be focused on valuing businesses around multiples of the Net Operating Income as opposed to EBITDA. Likely because the actual land and buildings are included. Do any searchers have experience around what multiples are commonplace in acquiring RV campgrounds?

0
10
153
Replies
10
commentor profile
Reply by an investor
from Fort Lewis College in Denver, CO, USA
It depends. We owned/operated manufactured housing communities and often had an RV component in those communities. RV is riskier for a number of reasons and justifies a lower price (i.e. higher cap rates/lower multiples). They can easily move and the income stream can be much less predictable. A few years ago, high gas prices really slowed down business. Also the "type" of RV park is important. In some, it is really just another affordable housing option versus RV parks that are for travelers for short stays. Private utilities (i.e. water wells, septic systems) add additional risks and are priced lower. Happy to share more in depth if you want to DM me directly.
commentor profile
Reply by a professional
from University of Texas at Austin in Austin, TX, USA
Agree that it depends on a few piece. I'd recommend talking to your lender / financial institution if you are planning to finance. These are pretty typically considered commercial real estate transactions (like an apartment complex) vs. an operating business.

I have a great contact in the MHP / RV space that brokers these deals, many off market. If you are interested, DM me and I'll be happy to connect you to him.
commentor profile
+8 more replies.
Join the discussion