RV Park Expenses - How Much is it?

[Jonathan Johnson]

Hi everybody.

My family owns a 60 acre lot outside of the under-served market of Midland Texas.  I'm think about putting an RV park on it.  What I'm trying to find out is this: How much does one RV space cost per month with on site water, septic, and satellite TV.?

Thanks for any information !  

[Jack Martin]

@Jonathan Johnson there are more variables than the basic expenses, so it is difficult to pin an exact percentage.  I have owned and operated MH and RV parks and find the expenses tend to land in the range of 40-60% of gross revenue. 

The lower end of that range would be appropriate for an RV park where the residents are full time, with little to no amenities, and no regular high cost items like landscaping.  (If you have to mow 40 acres of grass every week to keep the park looking nice, that would be a high cost item)  A park like this will require less staff to run it and there are less variables. 

The higher end of that range would be appropriate for an RV park with daily traffic and a full package of amenities (pool, clubhouse, sport courts, premium landscaping, etc). A park like this will require a lot more staff to attract and service the daily traffic and keep the amenities looking good.  

It might make sense to use 50% in your underwriting just to be safe and if you end up beating that, your return will be better.