RV Campground Resort investment

[Don Spafford]

Investment Info:

Other commercial investment investment.

Purchase price: $8,050,000
Cash invested: $90,000

This is an RV Resort Campground. This is a syndicated investment.
I sold two of my fourplexes I had in AR that were not performing well and giving me lots of stress and put all of capital and gains from those into this deal which is just one property inside of the Outdoor Hospitality Sun & Fund with Beyonder Holdings.
I am both an Limited Partner passive investor and also a General Partner. Not only will this property hit double digit cash on cash and likely triple my investment over a 5 year hold period, but it also was able to provide HUGE tax savings.
I did not bother with a 1031 exchange from the two fourplexes that I sold. So no stress that can come from that. Instead I put it all into this property which was able to deliver a 222% total depreciation on my K-1 report which more than offset the capital gains from selling those other properties. Thanks to cost segregation with year one bonus depreciation.
This property will continue to increase in cash flow and since it is within a fund, more properties are being added to the fund so my money can be included in all of them to add more depreciation and cash flows from that one investment.
This is a completely passive investment so I don't have to deal with usual landlord issues like I was dealing with before, like having to come up with more money to replace an HVAC or new flooring, flooded toilets, etc.
I have learned that being a passive investor and getting double digit cash on cash and tripling my investment over 5 years and getting huge tax breaks is my preferred method of investing.

What made you interested in investing in this type of deal?

Great cash flows without dealing with tenant or property problems

How did you find this deal and how did you negotiate it?

I invested as an LP investor in a syndication through Beyonder Holdings. This was a 506c fund for accredited investors.

How did you finance this deal?

It is a syndication, so I did not have to sign any loan docs or take out hard money. I used equity and capital I received from selling a couple of fourplexes

How did you add value to the deal?

This deal will be adding value through expansion of more RV pads and nicer and better amenities and also increased rental rates over time

What was the outcome?

In the first year, 3% distribution in the first quarter, 2% in the second quarter, third quarter is expected to be higher. And additionally this property provided 222% depreciation back to the investor K-1s which was a huge benefit for me to offset the gains from the fourplexes.

Lessons learned? Challenges?

I much prefer passive investing than actively managing properties, even in this case where I had a property manager for this fourplexes that were out of state for me. Still had to deal with problems and pay money out of pocket for repairs and lost money from evictions and non-payers.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Great investor relations team at Beyonder Holdings. I have invested in three deals so far with them. Planning to do more because of the great returns.