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 am both an Limited Partner passive investor and also a General Partner.
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 and overall returns from more properties from that one investment.

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

Great cash flows without dealing with tenant or property problems. Double digit cash on cash, huge tax benefits through accelerated depreciation, potentially tripling my investment over a 5 year hold period! Passive investment. What's not to like?

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 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.

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 which will increase cash flows and add millions more to the value of the property.

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. Additionally through cost segregation and year one bonus depreciation, I received 222% depreciation which more than offset my capital gains from selling 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 and the passive nature of it. I have not seen this level of cash flow in anything else for a long time.