Month: April 2024

Here’s a remote way to kill RV parks

Taped on the wall next to my desk where I do my writing is a handwritten list of owners of multiple campgrounds and RV parks. Three years ago, such a list would have been exceedingly short. Today there are nearly a score of names, and I’m sure the list is incomplete, since I’ve made no calculated effort to keep it up-to-date and add to it only when I stumble across a new name. Some have only a handful of properties; others, many dozens. All, I must confess, baffle me.

Several weeks ago, OHI—that’s the Outdoor Hospital Industry—sponsored an on-line chat with Adam Lendi, self-styled “real estate guru” and owner of one of those rapidly growing RV park chains, Beyonder Campgrounds. Lendi was a deputy sheriff in Colorado’s Arapahoe County until 2019, when he apparently realized there was a lot more money to be made in real estate, and the following year he plunged into the campground business. Today his Beyonder name tag has been slapped onto seven RV parks and he’s on the prowl for more. None, it should be noted, are actually operated by Lendi himself, who unabashedly asserts that he’s modeling a remote management style best suited “for people who want a life outside of their campground.”

“Freedom!” he adds, like a modern-day Braveheart. It’s all about freedom.

The thing about my list of group campground owners that baffles me is precisely that necessary reliance on a remote management style. And the thing about Lendi that baffles me—aside from his supernaturally rapid ascent to “guru” status in less than four years—is his ready acknowledgment of all the risks incurred by this approach. It’s not that he doesn’t see the problems. It’s that he thinks, with only limited evidence, that he’s got them beat.

Conceding that “nobody’s going to care about the business as much as you do,” Lendi’s chat included a rapid-fire series of pitfalls that await absentee owners: the property is neglected, no one answers the phone, employees steal stuff or time, guests get mistreated, bills don’t get paid. All of which should be enough to dissuade anyone from handing over the keys to the kingdom, but Lendi is undeterred. His magic formula? Cut through his biz school mumbo-jumbo—create a plan, follow the plan, inspect what you expect, etc.—and it all comes down to just one thing: “Hire the right manager.”

Wow. How’s that for guru wisdom?

There’s no arguing that choosing the right manager is a make-or-break proposition, and it’s possible that Lendi may have a knack for doing just that. But in the world of rapid RV park turnover and the exodus of seasoned campground owners, the reality is that the pool of competent campground managers is extraordinarily shallow. This is not a new problem. The guy who sold us our campground, in 2013, had known he was burnt out a couple of years earlier but couldn’t quite bring himself to let go of a decade-and-a-half of pouring his heart and soul into the business. Maybe, he reasoned, he could have someone else do the heavy lifting while he kicked back and reaped the rewards.

That illusion lasted just two years and two campground managers before he threw in the towel, listing the park for sale before it became any more run-down.

Past is prologue. In the three years since we sold that same campground, after owning and operating it for eight years, the new—remote—owners have gone through four managers and are now on their fifth. Two of the managers are single and three were couples, although one 26-year marriage ended in a split and subsequent divorce after just six months on the job. Running a campground is hell on relationships! A second management couple should have rung alarm bells when it never moved out of its fifth wheel—and abruptly pulled out mid-season after just seven months, so the wife could become general manager of a luxury RV resort in Florida; her only prior management experience had been seven months as an assistant manger at a lodge in the Tetons. That’s how thin the pickings are.

Such a revolving door has consequences even more dire than those mentioned by Lendi. New leadership every camping season means a loss of institutional memory, forcing management to relearn a property’s quirks and to reestablish links with community resources and vendors. New management invariably means new campground rules and procedures, jeopardizing regular campers’ expectations and threatening the loss of repeat business. And new managers, whether out of ambition or ignorance, have been known to take on expensive property improvements with little or no understanding of zoning or environmental limitations or of the actual time and financial costs involved, disrupting campground routines, burning through the budget and courting regulatory sanctions.

But the most debilitating effect of revolving management is on employees. Buffeted by ever-changing management styles and expectations and poorly paid under the best of circumstances, campground workers end up scattering; not a single employee who worked at our campground is still there, and most were gone within the first year. Subsequent workforce turnover has been just as rapid. Worse yet, as word about working conditions gets around in rural communities, recruiting new workers becomes increasingly difficult—and those who do respond increasingly come from the bottom of the labor pool. The result? Poor work, or none at all, and a diminishing workforce.

That leaves the unfortunate campground manager with just two choices, neither of which will end well: let the work slide, or step into the breach and do what needs to be done. The first choice causes the kinds of woes Lendi described, as the property gets neglected and guests get mistreated. One clue as to whether a campground falls into this category is to take note of its office hours: when the office is open only 35 or 40 hours a week, you know that the manager has decided, “Hey, it’s only a job, not a religious calling.”

The second choice, however, is a sure-fire prescription for burn-out. Owner-operators may shoulder 70 or 80-hour workweeks when necessary because they have a lot at stake, but even the most conscientious hired hand will flame out long before someone who has skin in the game. Lendi seemed to acknowledge as much in his chat, asserting that a manager has to have a sense of ownership “so it’s not just a job.” Unfortunately, he never did say how that sense can be created. And with most campground managers paid in the mid-five figures, even with free housing and other perks thrown in, working for a remote owner will always be . . . just a job. And a demanding, stressful one at that.

Looking at my growing list of remotely managed RV parks and campgrounds, I thought about the diaspora of family-run Chinese restaurants throughout the United States—the Great Walls and Jade Gardens and Golden Dragons that serve pretty much the same menus everywhere. Almost all are family owned, with the parents toiling in the kitchen and their kids, some as young as ten, taking telephone orders and running the cash register; homework gets done between orders on one of a handful of usually unoccupied tables, since most business is carry-out. Open 10 to 12 hours a day, seven days a week, they are the kind of foot-in-the-door enterprises that take all your time, labor and care in exchange for some measure of economic independence and self-sufficiency.

Adam Lendi is not beating down their doors to create an empire of remote-managed Chinese restaurants. Why would he think campgrounds are any different?

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RVers’ public image is less than great

Where an RV park developer sees a blank slate, at right, Mansfield’s residents see a looming catastrophe threatening their town’s only elementary school, just across N. Caldwell Avenue.

At a tad more than two square miles, Mansfield is so far west in Arkansas it’s almost in Oklahoma. Its population is virtually unchanged from 1940, when it barely topped out over a thousand. The town’s name, according to one story cited by the Encyclopedia of Arkansas, was coined by a line surveyor who, at the end of the day, reported he had gotten as far as some “man’s field.”

Mansfield, in other words, is about as far as you can get from the rah-rah impulses of contemporary American society. But that doesn’t mean its residents don’t know what’s going on in the wider world, and judging by their response to a proposed RV park, what’s going on has no place in Mansfield—or in a man’s field. Not if that field is across the street from the town’s only elementary school. As one local resident put it, “Last thing we need is strangers across from our kids. Everyone in this town watches out for the children, let’s keep it that way.”

So it was, earlier this past week, that the Mansfield City Council unanimously voted to deny a rezoning application that would have opened the door for such a development. That no actual plans for an RV park had yet been submitted was irrelevant. The number of possible sites, the kind of RVing public to be targeted, the amenities and additional facilities that would be incorporated—all unknown. No traffic studies, environmental impact statements or projected economic benefits to the area had been prepared. The rezoning applicant, Don Wheeler, owner of a roofing and construction firm, spurned an invitation to attend the council meeting and wasn’t on hand to answer the inevitable questions.

The Mansfield City Council, in other words, didn’t reject a proposed RV park. It rejected the idea of an RV park, and that should concern anyone with a vested interest in RVing and RV parks and campgrounds.

In that regard, the concerns and anxieties that prompted the city council’s adverse vote are eye-opening. For a very vocal segment of the Mansfield population, RV parks are a threat to public safety and social order, teeming with child molesters, drug addicts and vagrants. “No one wants strangers with unknown backgrounds that close to their little ones,” one local resident protested. Another contended that RV park residents would find it “easy to hand drugs to kids through the fence and no telling what they [students] might witness from their schoolyard.”

Although a couple of voices were raised on behalf of the economic benefits an RV park would bring to town, they were drowned out by the paranoia that prevailed. “I can tell by the looks on your faces, I know how you will vote,” local resident Bobby Musgrove was quoted by the Resident News Network. “But we are losing businesses in this town . . . with this RV park, the city could charge a 2% tourism tax. You have got to think about the city. We have run businesses out of town out of stupidity . . . I can see all your points, you’re afraid that some kids might get kidnapped, raped or molested, but that can happen anywhere, at any time.”

That’s hardly a reassuring point on which to conclude, but Musgrove’s defense of campgrounds also didn’t address the over-riding question: as one local resident asked in a Facebook exchange, why would anyone stay at an RV park in Mansfield in the first place? The answers were blunt. “Property values and rental prices for stick and brick houses is [sic] continuing to rise,” came one response. “Living fulltime in an RV is much more affordable.” Answered another, “homeless people are now living in campers.”

And then there was this satisfied response to the council’s decision: “Good move, really,” wrote Stephen Leonard. “Would have ended up with a bunch of raggedy, rundown eyesores people called campers/RVs parked in there, with a bunch of junk piled up around them. Last thing we need in Mansfield is more eyesores. The town is making headway toward being better, cleaner and more visually appealing, no need in back-tracking now for an RV park that would just end up looking like a slum park in the long run.”

That’s a pretty bleak prediction triggered by nothing more than the words “RV park.” But as this unintended word-association test suggests, some significant portion of rural America looks at RVs and doesn’t see the adventurous, freedom-seeking community of self-sufficient nomads that the RV industry promotes with unrelenting enthusiasm. It sees the scrapings of society, a pestilent horde of parasites preying on communities that are themselves struggling for survival. There’s no economic benefit from inviting the destitute to move in, but there’s no end to the grief attached to such hospitality.

To some extent, alas, the RV industry has brought this PR problem on itself, by resolutely ignoring the increased use of RVs for full-time living. And RV parks and campgrounds have played along by making a growing percentage of site inventory available for long-term stays, seduced by the lower costs and easier money to be made by having less turn-over. But as the Mansfield example illustrates, the industry’s anticipated solution to overcrowding—just build new campgrounds!—is running up against a growing community resistance of the kind that might meet a proposal to build, say, a local whorehouse.

Think about that the next time you’re trying a book a site and can’t find anything available.

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Notes on an evolving RV landscape

When we bought our campground, in 2013, there was only one insurance company that would provide us with liability coverage. It wasn’t that we were an especially bad risk. Campgrounds were such a niche market, and so poorly understood, that the insurance industry simply didn’t want to touch them. The sole exception was Evergreen U.S. A., which had been founded almost 40 years earlier and was owned by campground and RV park owners precisely because that was the only way they could get the financial protection they needed. We were lucky they were around.

But that didn’t last long. Just as we acquired a campground because—among other reasons—we thought this was a dynamic industry, larger, more mainstream insurance companies likewise realized they were missing out on a sure thing and suddenly began piling on. By mid-2014, Evergreen’s board of directors had thrown in the towel and stopped renewing policies. Bigger, better capitalized insurance companies had the resources “to beat our rates and provide incentives we can’t always match,” explained Evergreen’s president, Lucas Hartford, at the time. “In these times, price is more important than ever to our customer’s success.”

Well, what goes around comes around. This month’s Woodall’s Campground Magazine has a half-page ad from K&K Insurance advising readers that it “protects campgrounds with coverage designed for your unique needs.” Campground owners should ask their insurance agent for a quote from K&K, the ad advises—unless their “unique need” is owning a campground in Florida. Because even though the ad specifically states that K&K is a licensed insurance producer in all states, with FL license #L007299, the ad just as specifically states that its campground coverage “is not available in Florida.”

Care to guess why? What is it about hurricane central, garnished with rising sea levels and appalling heat, that makes it unappealing for a company that exists specifically to underwrite risk protection?

K&K is just a canary in the coalmine, but similar redlining is all but inevitable. And it won’t be just Florida that gets hung out to dry, or just K&K pulling in its horns, as extreme weather becomes more widespread, more prevalent—and as campgrounds and other outdoor venues increasingly are seen as being especially vulnerable.

But unlike past decades, when RV park and campground owners rallied to meet a common need, the industry these days is far too fractured to respond in similar fashion. The big corporate-owned chains have deep enough pockets to self-insure or to package their various properties into more insurable risks. The national organization that once represented campgrounds and that might have taken a leadership role in addressing a common threat now has a new, androgynous name—OHI—and broader ambitions: it wants to be the spokesperson for “outdoor hospitality,” a role that apparently precludes any conversation about climate change.

That leaves the so-called mom-and-pop owner/operators fending for themselves, just as they did in the good ‘ol days.

Meanwhile, another slow-motion train wreck affecting the campground industry—and specifically those campgrounds chasing after algorithm-driven reservation systems—is shaping up in the form of lawsuits in Arizona, Tennessee and Washington, D.C. and criminal investigations in North Carolina and by the U.S. Justice Department. In their cross-hairs is RealPage, a Texas-based property-management software company that is being accused of illegally fixing apartment rental prices.

ProPublica reported extensively on this problem 18 months ago, and in a subsequent post I raised the question of how something similar is happening with many campground reservation systems generally, and with CampSpot specifically. As outlined in a second post, Campspot already has a lion’s share of campground business, which means it also has an enormous amount of reservation data to crunch, such as site and occupancy rates sorted by campground size, day of the week and any number of other variables. This data is then available to Campspot’s clients, in supposedly anonymized form, with those campground owners free to do with that information what they will.

That’s handy for the campground owner who wants to see how his property stacks up against others. It’s also a first step toward cartelization, enabling supposed competitors to adjust rates in lockstep without directly talking to each other, which would be an antitrust no-no. Whether RealPage—and by analogy Campspot, if on a much lesser scale—are nevertheless facilitating anticompetitive behavior is the question state and federal authorities are raising, but as a Wall Street Journal article a couple of days ago noted, the Biden administration is generally taking a much harder line on price fixing.

“Any rulings against Real Page could have legal ramifications for other business sectors, such as online retail, where companies also use algorithms to make pricing decisions,” the Journal noted.

The headlong rush by the industry to embrace new digital technologies—AI increasingly is coming into play, as well—is just one more step away from the fundamental aspects of camping that made it a worthwhile pastime in the first place. It’s all done in the name of improving business fundamentals, of course, but those “improvements” invariably reshape “the business” until it becomes just like everything else: more gentrified, impersonal, homogenized and packaged—and, above all else, expensive.

The glamping phenomenon is of course the apotheosis of this trend, exploding across the campground industry over just a few years. But just how far things have gone may be exemplified by the recent announcement that AutoCamp is now partnering with . . . Hilton Hotels, which has as much to do with the outdoors as Louis Vuitton. “This is the first time a major hospitality brand and outdoor lodging company have come together in this way to create even more choices for travelers while redefining the outdoor hospitality experience,” crowed a Hilton executive. How nice for OHI’s expanding portfolio. . . .

Which brings me to one final report, that of a Colorado entrepreneur who earlier this month broke ground on Kosmos Stargazing Resort, just outside Alamosa, in the San Luis Valley. The planned 22 glass-domed stargazing villas, which have received a special use permit as a “campground,” are to be rented for $700 to $1,200 a night.

Now that’s camping, eh?

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Signs we’re at an RV market top

Malcolm Forbes must be spinning in his grave.

A larger-than-life promoter of unbridled capitalism, Forbes had a Falstaffian appetite for over-the-top excess, exemplified by his extravagantly opulent 70th birthday bash in the Moroccan desert. The shindig cost a reported $2 million, featured Elizabeth Taylor as “honorary host” and had an 800-person guest list that included Barbara Walters, Walter Cronkite, Oscar de la Renta and three U.S. governors. That was in August 0f 1989. Six months later, Forbes was dead.

For all that, however, Forbes’ eponymous magazine was a serious—if doctrinaire—journalistic effort, with reporters and editors and fact-based writing. You might have disagreed with its emphasis or story selection or “spin,” but at least you could understand how it arrived at its conclusions. But the three-plus decades since the old man shuffled off-stage have not been kind to his legacy. The magazine now publishes just eight times a year and is no longer owned by the Forbes family, but nonetheless lends its name to such sketchy endeavors as the Forbes Business Council, a fee-based way for self-promoting businessmen to claim ersatz legitimacy as truth-tellers.

One current example of this faux journalism—and a pretty good if unintended signal of a market top—is this week’s piece headlined, “From Silicon Valley Cubicles to Scenic Vistas: How Millennials Are Redefining Success With Luxury RVs.” Written at least three years too late by Ben Spiegel, founder of “a boutique real estate private equity syndication and investment firm,” it purports to lay out the reasons why the RV park sector should be getting your investment dollars. Spiegel’s firm, Redwood Capital Advisors, actually has only one smallish RV park in its portfolio—a 56-site property in Alabama that it acquired just five months ago—but that didn’t prevent Spiegel from rhapsodizing about the “freedom, flexibility and an unbridled spirit of adventure” that makes RVing an irresistible millennial magnet.

Even the most blatant advertorial, however, should be grounded in solid facts, so it’s disconcerting to observe that Spiegel’s foundational observation—the one on which he builds his entire thesis—is that “the average RV owner today” is 32-years-old. Just rereading that statement should have made Spiegel question himself, but he did not, and neither did anyone at Forbes, which apparently is unconcerned about what’s published under its name. Neither did RVBusiness or the RV Industry Association’s News & Insights newsletter, both of which reposted Spiegel’s propaganda without comment and without questioning either his lack of expertise or his lack of a competent editor. Or a reliable BS detector.

At a guess, it seems that Spiegel misread an RV Industry Association (RVIA) report that concluded the average age of RV buyers is now 32—a vague and questionable assertion in itself, but in any case a long way from concluding that this is the average age of all RV owners, which remains several decades older. But accepting the misstatement at face value serves the industry’s increasingly desperate efforts at seeing only blue skies where others might notice that thunderheads are building. Wow! lookit all them young’uns piling into the RV space!!

One might shrug this off as just so much more industry self-promotion, if not for the fact that it comes at a precarious moment. The rapid approach of summer increasingly looks more threatening than inviting, with global warming leading to predictions of an early wildfire season in the Midwest and one of the most active hurricane seasons on record in the Atlantic. Ocean temperatures, meanwhile, have broken records every day for more than a year, and not just on the margins: 2024 is beating 2023 records by a lot. Warmer oceans account for the grim hurricane prognosis, of course, but more broadly are responsible for greater weather turbulence overall, which isn’t what campers want to hear.

A different kind of heat, meanwhile, is affecting capital markets, marked by this week’s report that the consumer price index rose 0.4% in March over the previous month, and 3.5% over the past year. Core prices, which strip out more volatile food and fuel costs, moved up 3.8%. All those figures, reported the Wall Street Journal, were higher than economic forecasts and suddenly raised the specter of continued high interest rates right through the end of the year.

That’s not good news for the people who make and sell RVs, the great majority of which require financing—and which, to be blunt, are not exactly “must have” purchases, no matter how much Ben Spiegel may claim that “more and more millennials are choosing to ‘put their equity on wheels.'” RV manufacturers have been desperate to refill the production pipeline, down almost half from its 2021 peak, and were almost gleeful about a 17.8% increase in February shipments year-over-year. But most of those newly produced RVs are just piling up on dealer’s lots, with sales in February down 8.9% year-over-year, even as a continuing inventory backlog of 2023 and even 2022 models has led to steep discounting. And while dealers typically increase inventory at this time of year in anticipation of a spring wave of shoppers, February’s decline is casting a long shadow.

The campground end of the business is likewise jittery. Despite KOA’s repeated announcements of how much business has improved year after year, those statements invariably are couched in dollar terms rather than camper nights, which actually have been declining (as I reported last fall). That means camping is only getting more expensive, which is just one more knock on a recreational activity whose backbone has been an increasingly beleaguered middle class.

Yet while KOA has not been forthright on the subject publicly, at least it is beginning to acknowledge the new reality internally. A KOA corporate “all hands on deck” meeting a few weeks ago to brainstorm ways to rebuild attendance reportedly resulted in various suggestions for franchisees, notably by tossing aside years of corporate opposition to discounts as “cheapening the value experience” of staying at a KOA. Deeply discounted “hot deals” are now in, especially for campers who add nights to their already booked stays, and especially midweek. Campgrounds that increase camper nights the most will get special awards, too—although those awards almost certainly will go to those who need them least, since larger multi-park operations will be better able to absorb price cuts than their mom-and-pop counterparts.

Meanwhile, the tattered remnants of the Forbes empire are still being milked for whatever cachet they can lend to poorly researched “pay to play” journalism. At least poor Malcolm went out on a high note, 35 long years ago.

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It’s the good Samaritan needs help

One clue that an enterprise has lost its way comes when it starts “rebranding,” usually with the explanation that it’s seeking a wider audience or is identifying its actual “core discipline”—“people-moving” instead of flying airplanes, for example. As often as not, the change signals either a loss of focus or an ultimately futile chase after higher returns, even if that means getting into an entirely unrelated line of business.

General Electric is a poster-child example of this. Once a manufacturing powerhouse that by 1994 was the sixth-largest revenue generator among all U.S. companies, GE went on a diversification spree that created an increasingly complex and unwieldy behemoth. The transformation was led by chief executive Jack Welch, who from 1981 to 2001 closed factories, laid off workers and instead diversified into financial services, all to sycophantic praise from the Wall Street crowd. Instead of making things, GE put its energy into lending money—and soon got bogged down in various bad bets, tried to manipulate its way out of trouble and eventually unraveled. But by then, of course, an enormously enriched Welch was long gone.

This past Tuesday marked the end of that particular hubris, as the erstwhile industrial powerhouse completed a three-way split into the independent and much diminished companies of GE Healthcare (spun-off last year), GE Vernova and GE Aerospace. Tellingly, it’s GE Aerospace—a manufacturer, in this case of jet engines—that retains the GE stock symbol. Back to basics!

The one thing GE didn’t do during all that bobbing and weaving is change its name. As much can’t be said for the Good Sam Club, which while hardly in the same class, this week continued a steady march to irrelevance by announcing a rebranding “that could better speak” to a wider audience. As explained yesterday to an RVBusiness reporter by Good Sam executive vice president Will Colling, “when we looked at our niche within the RV space, what we realized is that we’re a road travel and recreation enthusiast company. We will always have the niche within the RV space, but we speak to this broader set of consumers.”

Where to start unpacking all that nonsense? For openers, there’s the mouthful about being a “road travel and recreation enthusiast company,” leading to the observation that the more words it takes to describe what you’re doing, the more unfocused you risk becoming. Ditto for the substitution of generalized descriptors for specific ones, as in “road travel” instead of “RVing,” or “recreation enthusiast” for “camping.”

Then there’s the undeserved cockiness encompassed by the phrase “we will always have the niche within the RV space.” Really? Sure about that?

Once upon a time, veteran RVers will remember, the Good Sam Club was, in fact . . . a club. It claimed more than two million RVers, organized into state and local chapters that sponsored trips and rallies. Its name was derived from the parable of the Good Samaritan, emphasizing that members were ready to assist each other when needed while pursuing this fringe idea of traveling the country in a home on wheels. Its logo featured a stylized smiling face with a halo over its head.

Then it got more corporate. In 2011, Good Sam Enterprises merged with Camping World and began its slide into obscurity—always, of course, with the intention of broadening its appeal by making itself less distinctive. First to go: the smiling face on the logo. Then the word “club” was erased. The network of state and local chapters? Dissolved in 2020, ostensibly because of the pandemic, but then never resurrected. And yesterday came the announcement that the logo has been changed again. Ixnay on the halo—indeed, bye-bye to the name itself. Jumping on the latest corporate rebranding bandwagon, now it’s just initials, “GS,” on a dark shield instead of the formerly distinctive red ball.

And, of course, there’s a suitably meaningless new tagline, “Good to Go.” As in . . . going, going, gone?

Just to be clear about what his company is doing, Will Colling emphasized that a big aspect of the rebranding is a marriage of Good Sam membership and credit card programs into a combined rewards program. Plus the revamped Good Sam will be introducing “cornerstone partnerships,” like a recently announced boat and RV storage center, as well as “other travel partners like Princess Cruise Lines, where we acknowledge that the RV consumer wants to experience more than just road travel.”

Well, sure. The RV “consumer” also wants to eat—consume—actual food, and send kids or grandkids to college or trade school, and buy clothes and electronics, and . . . why, the list of diversification possibilities is endless. Indeed, at some point the whole RVing thing will become a “niche” product under the corporate umbrella, just as kitchen appliances became a distraction for GE, its customer base trickling away because . . . why? As for the “club” aspect that once attracted so many members, or the promise of mutual assistance bound up in the now all-but-invisible name itself? That’s all history. It’s all transactional now.

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