Tag: Frank Rolfe

A handful of updates on past posts

The end of July marks the mid-point of the traditional camping season, although that term has become increasingly elastic and even meaningless due to the distorting effects of climate change. Nevertheless, this seems like an apt moment to hit “pause,” check back on what I’ve written in the past and provide updates where appropriate. Some stories actually do reach a resolution, but many more have a way of continuing with no clear end in sight.

Ghost Town in the Sky just won’t die

One such ongoing drama has to do with Ghost Town in the Sky, a now defunct amusement park in Maggie Valley, NC about which I last wrote nearly two years ago. The property’s greatest champion, Alaska Presley, had entered into a business partnership with a Myrtle Beach-based hustler, Frankie Wood, who sweet-talked her into naming him the managing partner of their joint venture despite his shady past. In addition to contributing the property itself, Presley apparently covered all of the venture’s operating costs; Wood’s end of the deal amounted to little more than half-baked ideas drizzled with snake oil.

Then Presley died, age 98.

Inheriting Presley’s 50% stake in the partnership was her niece, Jill McClure, who cast a notably more business-like eye on its affairs. It didn’t take her long to conclude she was holding one end of a snake—and not the business end of it, either. The upshot was a lawsuit seeking to dissolve the partnership, filed in North Carolina’s Superior Court, alleging that Wood had breached his fiduciary responsibilities and thus was putting McClure’s interests at risk. Given Wood’s history to date, that would have seemed like a slam dunk.

But no. Ruling more than 18 months after the case was filed—in part because of numerous filing extensions requested by Wood, earning a judicial rebuke for “litigation by ambush” that nevertheless had no effect on the final decision—Special Superior Court Judge for Complex Business Cases Adam M. Conrad concluded in mid-May that McClure didn’t have a case. The legal arrangement to which Presley had agreed, and which McClure had inherited, clearly specified that Wood “is the sole managing member of Ghost Town in the Sky and that it has unilateral authority under the operating agreement to manage the company’s day-to-day affairs without McClure’s consent.”

That “management,” as the decision also observes, includes four years in which the venture “did not secure financing, earn income or hire employees.” Since Presley’s death, it also includes non-payment of 2022 and 2023 property taxes. No matter. As Judge Conrad sees it, there is nothing extreme enough to merit an involuntary dissolution of the partnership—which leaves Wood still at the helm, Ghost Town in the Sky even more of a moldering heap than it was four years ago, and McClure gamely telling a local reporter, “I’m moving forward with a positive attitude.”

Stay tuned.

Cacapon locals knock out two RV parks

While Maggie Valley refuses to give up the ghost, a two-fisted attempt to put an RV park in or next to Cacapon State Park, West Virginia, finally appears to have been defeated.

The first such effort, as I wrote a year ago, featured an overly cozy relationship between state officials and Blue Water Development and their efforts to build an RV campground with more than 300 sites in the state park. The proposal quickly generated fierce local opposition from park advocates and local residents, who objected to its size and the amount of traffic it would generate in a rugged area notable for its narrow roads and rustic vibe. As more details emerged of Blue Water’s backdoor maneuvering, the whole idea became politically untenable and ended up getting axed.

But that only made way for a competing proposal that had already been floated as an alternative to the state facility: a 50-acre private development adjacent to Cacapon State Park, with up to 241 sites for RVs, cabins, yurts and tents, as well as such mega-park amenities as a swimming pool, bathhouse, mini golf course, sports courts, dog parks, several pavilions and food truck areas. Ironically, as local opponents worried that the “oversized RV campground” would scar a panoramic viewshed rated by National Geographic Magazine as “one of the top 5 scenic views in the East,” the developer of the proposed campground was . . . Scenic LLC.

Despite boisterous public hearings that divided the Morgan County Planning Commission, all needed permits were approved and Scenic LLC seemed set to proceed. But then the months rolled by and nothing seemed to be happening, encouraging the opposition to renew its battle. In late June, more than two dozen local residents showed up at a planning commission meeting to demand a reconsideration, with some accusing commissioners of “selling out” the community and the commissioners responding that the project had met all county guidelines for commercial development, so what else could they do.

And then, just like that, it was over. Two weeks ago, Aaron Bills, Scenic’s principal owner, announced that he is stepping away from the project. The plan had been to seek a KOA franchise for the property, but apparently the price tag was too steep. This is “shockingly bad timing for finances,” Bills told county officials, according to the Morgan Messenger. “As a family, we’ve decided we can’t deliver on a KOA-branded campground”–indeed, he added, would the county be interested in buying the property for itself?

Danville’s casino-related RV park craps out

A 333-site Roman-themed RV park in Danville, VA, proposed last year by  J. Cubas Holdings of Coral Gables, Florida—which, not incidentally, has absolutely no experience in operating an RV park of any size, much less an avowed “high end” operation—is no more.

After the neighbors rose up in arms for any number of obvious reasons, Cubas switched gears and said early this year he’d build a bunch of new homes, priced between $300,000 and $350,000. Ironically, he’d held that out as a threat against the city if it refused to permit his RV park—only to have the city elders say that more housing is exactly what Danville needs. “Folks moving here, they need somewhere to live and there’s only so many places you can build new developments, so we’re happy to have this moving forward,” explained city councilman Lee Vogler.

Plus here’s another bonus: putting the kibbosh on Cubas’ “Palace Resort” also deep-sixed his plans for an annual biker rally that he promised would rival those of Sturgis, SD and Orlando, FL.

Reservation software getting regulatory stink-eye

As public officials learn about the price-fixing potential of algorithms used by centralized reservation software systems, first extensively detailed by ProPublica two years ago, they’ve started erecting legislative constraints at the national level. Now that’s filtered down to the local precincts: yesterday, the San Francisco board of supervisors adopted the country’s first local ordinance banning landlords from using certain software to set rents.

According to CBS News, the measure bans the sale and use of software “which combines non-public competitors’ data to set, recommend or advise on rents and occupancy levels.” Doing so, said the ordinance’s sponsor, amounts to “automated price-fixing.”

Yes, that’s only one city, and a decidedly liberal one at that. And yes, the ordinance applies to rental apartments only. But it’s not much of a leap to see how the same concerns can apply to widely shared campground reservation systems, like CampSpot, which aggregate user data and enable “individual campground owners to compare their metrics, such as average daily rates, occupancy rates and revenue per available site, with what everyone else is doing—and to make adjustments as desired.”

Sooner or later, the anti-trust police may take notice.

Frank Rolfe is at it again—but badly

Finally, scarcely more than two months after an email blast soliciting customers for his misleadingly titled RV Park University, Frank Rolfe is at it again, still hyping his “RV Park Investor’s Boot Camp.” This broadside, like the previous one, touts his 30 years of experience “building one of the largest portfolios in the U.S.”—experience that can be yours for only $997. “That’s for roughly 20 hours of video,” he writes. “And that’s a true bargain investment in your education on this sector.”

Okay. Pretty standard Frank Rolfe fare thus far. But embedded in the email is a link to a video that’s supposed to seal the deal, “Unlock RV Park Investment Success,” under the equally problematic headline, “The RV Park Boot Camp Is The Gold-Standard.” The first half of the two-minute video is Frank giving his sales pitch. The second half, without anything resembling an introduction, apparently is supposed to highlight one of Frank’s investment successes: the Mission Bell-Trade Winds RV and Mobile Home Resort, deep in the heart of Texas.

This is, as you might glean from the name, not an RV park but a long-term residential mixed-use development catering to retirees (“Homeownership Made Affordable”) and snowbirds. The residents, by all accounts, are a cheerful and welcoming bunch. The place itself is a dump, showing its age and in a generally run-down condition. Its website, where the only items under “news” urges readers to check out “the exciting events of the 2022-2023 season,” is just as outdated.

Judging by this example, Frank’s boot camp deserves the boot.

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Why would any RVer pay Frank Rolfe?

Frank Rolfe, with an assist from his sidekick, Dave Reynolds, is at it again, trying to cash in on the RV park acquisition craze by passing himself off as an expert on something about which he knows squat.

To be clear, Rolfe does have a lot of expertise in the trailer court/mobile home park industry. He’s garnered quite a reputation for buying up trailer parks and then squeezing his captive tenants for every last dollar, while also slashing amenities and maintenance to the bone—then selling his cut-throat tactics as nothing more than good business. That selling comes in the guise of something he unabashedly calls the Mobile Home “University,” which in fact is nothing more than a slew of CDs and printed manuals that explain how you, too, can rationalize predatory practices on the way to personal enrichment.

Okay. Repulsive though that may be, it nonetheless falls squarely within the parameters of modern capitalism, and the devil take the hindmost. But where Rolfe steps over the line is in his blurring of the differences between trailer parks and RV parks, contending that the latter are just a variation on the former and that both can be managed according to the same principles. (I’ve been repeatedly critical of this bait-and-switch in the past, but to be honest, the RV park industry has done itself no favors by increasingly converting transient sites into long-term rentals, not to mention its embrace of cabins, park models and other fixed dwellings.)

While Mobile Home University remains Rolfe’s flagship, he’s again touting its slighter sibling, the equally hubristic RVPark University. This past week he sent out an email-blast promoting an “RV park investing boot camp,” which from all appearances is just an online presentation of material that’s already contained in the “university’s” home study course. There is no boot “camp,” and as it happens, the CDs and printed materials in the home study course can be purchased on RVU’s website for just $497 (or $397 for an electronic copy); watching the boot camp, meanwhile, requires “an investment” of $997. You do the math. Then again, Rolfe claims that the materials in the home study course actually have a total value of $4,688, so any way you slice it you get a heckuva deal!

(You also can count yourself lucky not to be interested in mobile home parks: that online “investing boot camp” will set you back $1,749. Where do all these numbers come from? Apparently, it’s all a matter of what the marks can be convinced to shell out.)

But back to RV parks. Part of Rolfe’s sales pitch is a helpful section headlined “Why Invest in RV Parks?” followed by eight bullet points of varying truthfulness and questionable assertions. Among them, for example, is “low capital expenditure requirements,” explained with the notable phrase, “RV parks are—for the most part—just blocks of land that people park their RVs on.” Oh, sure, “there are other amenities such as clubhouses and pools,” Rolfe concedes, “but what’s lacking are sprawling time bombs of maintenance like roofs and foundations.”

All of which lets me know that Rolfe has never had to fix a broken water main, or snake out a sewer line clogged by RVers insistent on flushing wipes, or repair a pedestal laid low by an errant fifth-wheeler. And with average per-site RV park construction costs approaching $25,000, there clearly are a lot more capital expenditures going into an RV park than Rolfe understands, not to mention all the maintenance issues they will incur.

There are several other howlers of the sort in Rolfe’s pitch, but the one that really illustrates his cluelessness—and that attests to his utterly contemptuous approach to mobile home park management—is the sub-head, “low reliance on personnel.” As Rolfe notes, correctly, “owning a business that relies heavily on employees is becoming a nightmare,” but not to worry! As Rolfe goes on to explain, “The RV Park industry is basically a ‘parking lot’ model in which the customers park their RVs on your land and that’s what you get paid for. It’s not like trying to run a restaurant where just one weak link on your employee base can ruin your business.” Easy-peasy—when it comes to RV parks, no employees required!

Again: clueless. Completely. Because while Rolfe’s description may be apt for a (poorly maintained) trailer court, an RV park that isn’t given over entirely to year-round or seasonal campers is going to need at least some maintenance workers, not to mention desk clerks and housekeepers, plus activities directors, swimming pool attendants and assorted other personnel as those “other amenities” proliferate. But that hasn’t prevented Rolfe from repeatedly representing himself as some sort of authority on RV parks, subbing in his experience as a trailer park mogul to mask his ignorance. In that regard, for example, it’s telling that all of the glowing evaluations and testimonials that litter both “university” websites relate solely to motor home parks.

At a time when mainstream RV park leaders are in a full-throated embrace of their self-assigned role as “the hospitality industry,” with its emphasis on personal connections and personnel training, Rolfe sits at the other extreme. It’s an interesting bifurcation, problematic at both ends. But the Rolfe end of that spectrum, while seeming to offer a cheaper, more streamlined operating model, is a sure-fire guarantee of bad press, bad reviews and bad feelings. Caveat emptor, whether it’s $397, $497 or $997.

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More RV sites don’t mean more room

If you’re a recreational RVer—someone who bought a travel trailer or class C motorhome thinking you’d like to take the kids camping—a pair of reports this past week by two long-time campground observers could make your head spin.

The first, by industry reporter Jeff Crider writing in RVBusiness News, tells readers they can “expect more than 18,000 new campsites through 2027,” thanks to 90 new campgrounds being built across the country, as well as new sites being added at 66 existing parks. For RVers who had been complaining since the pandemic about the increased difficulty of finding a place to camp, that sounds like incredibly good news—or it could be an instance of being a day late and a dollar short, given more recent reports of reservations loosening up. But hey—either way, it can’t hurt that more RV sites are coming, right?

Well, maybe not. Because as the second report suggests, much of that new RV site inventory is already spoken for, and even then there’s not going to be enough inventory to meet growing demand from residential RVers. Or as Frank Rolfe asks rhetorically, in yet another post promoting the investment rewards of RV park ownership, “What’s up with customers moving into RV parks full-time?” The answer, he quickly responds, is that “millions of Americans are starting to realize that they can live in their RVs fulltime and save a fortune on housing costs, with the additional benefits of pleasant surroundings and camaraderie of the RV park.”

Against that backdrop of “millions of Americans” looking for a home, even 18,000 new campsites becomes a negligible expansion. Indeed, if Rolfe is to be believed, the entire RV park segment is rapidly becoming a tricked-out version of the trailer courts that long ago became a depository of America’s most impoverished class.

Now, Frank Rolfe is not someone to be trusted if you don’t have a firm grip on your wallet, so take whatever he says with a grain of salt. He’s not a reporter but a promoter, one who years ago made a name for himself by recognizing that the residents of mobile home parks are a captive customer base, sitting ducks for ever higher lot rents and add-on fees for even the most basic services. But as affordable sticks-and-bricks homes remain in short supply (thanks in part to speculators at the other end of the vulture spectrum, with hedge funds snapping up single-family homes by the thousands), resulting in a 30-year low in home sales in 2023, the resulting demand for mobile homes has made that an increasingly pricey option as well: indeed, the growth in mobile home prices has outpaced that of single-family homes since 2017, soaring 77% to an average nationally of $127,300.

With the average mobile home in 2022 costing more than $100,000 in every state in the country, and as high as $168,500 in Idaho, house trailers have yielded their lowest-cost housing status to travel trailers—which, it should be noted, are explicitly not designed or built for full-time residency, but which are a damn sight better than living in a tent full-time. And if that carries a whiff of desperation, well, that’s exactly the kind of odor that appeals to a bottom-feeder like Rolfe.

So it is that Rolfe has taken to pounding the drum on behalf of RV parks as the next great real-estate cash machine, extolling their role in solving America’s “worst affordable housing crisis since 1776.” (Really?) Sure, RVs are smaller than mobile homes, built to less durable standards and rarely designed for four seasons, but they’re . . . cozy. And they’ve got those “pleasant surroundings and camaraderie” of an RV park to distract their occupants from their narrowed horizons. To make such privation sound more attractive, Rolfe links to a story about a 38-year-old woman living in a 20-foot travel trailer in Austin who simply loves “tiny living.” It helps, of course, that she’s single, has no kids and is healthy enough to bike to work each day, and whose primary motivation—as detailed in a different, more extensive story— is to save a million dollars by the time she’s 45.

That this is not your typical full-time RV dweller should be obvious, but Rolfe is in any case more interested in convincing RV park owners to convert their properties into something that looks more like a mobile home park. “The average RV park customer stays for 14 days per year” (Again—really?), while a full-timer stays for 365 days, “so one full-time customer is as important for your business as 180 normal customers.” The math doesn’t add up (Rolfe divided 365 by 2 instead of 14, mixing up weeks and days), nor do the dollars, since full-timers get a significant pro-rated discount from nightly rates. But as Rolfe goes on to point out, there are other benefits to having year-round residents, including fewer marketing requirements, more consistent cash flow and more stable management.

Indeed, if the Austin “tiny living” enthusiast is an example of what Rolfe is seeking, there are wads of cash to be made by pushing full-time occupancy in RV parks: in this example, lot rent of $750 a month, plus $42 for utilities, or $9,504 a year. Given that a large RV park may cost as little as $10,000 a site to build, those are the kinds of numbers that will have institutional investors falling all over each other to get into the business, and even more so if they’re shown how to run an RV park with minimal fuss—which is to say, with year-round residents rather than transients. So what’s not to like?—unless, of course, you’re the unfortunate RVer looking for a long weekend where your kids can get some fresh air and wood smoke.

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As ’23 winds down, so does the party

Easing into various seasonal celebrations, and from there into year’s end, various RV industry representatives have been spewing predictions for 2024 that are short on context and long on wishful thinking and data cherry-picking. Call it the holiday effect, an irresistible compulsion to make things merry by spiking the statistical punch, morning-after hangover be damned.

Consider, for example, the glowing news announced at KOA’s recent annual convention by CEO Toby O’Rourke that the franchise behemoth had crossed the $500 million mark in annual revenues, up 36% since 2019. Receiving considerably less emphasis was the news that camper nights in 2023 were actually down 4.8%, and up only 5% over 2019, an increase initially notched by a pandemic-driven camping explosion that now seems to be waning. Revenues going up even as camper nights decline can be explained only by higher rates—and, indeed, escalating fees may explain in part why camper nights are down. Camping is getting just too damn expensive.

Indeed, the annual Generational Camping Report, released by RMS North America last week, found that “price is still a driving factor in campground destination decisions,” with a third of respondents “selecting the cost of reservation as their top concern.” Contrasted with O’Rourke’s ambition to increase camper nights by 2% next year, even as she projects a further 5% annual growth in revenue, that concern appears to be a circle that can’t be squared.

Or consider the persistently upbeat outlook propagated by the folks who build RVs. In one trade show after another this fall, dealers and manufacturers conceded that yes, traffic was down—“attendance might not have broken any records,” “traffic was clearly off somewhat”—but that they were optimistic about 2024 and beyond. Precisely why was never made clear, but it might have something to do with an industry penchant for pulling numbers out of the air. On Sept. 1 of last year, for example, the RV Industry Association was forecasting wholesale shipments in 2023 of 419,000; as of Dec. 6, that had slipped only a bit, to 391,499. Today it looks unlikely that even 290,000 RVs will roll out the door in 2023—but that hasn’t prevented RVIA’s statistical geniuses from calling for a rebound to 369,700 units in 2024. Why? Well, why not?

There are a few—a very few—voices calling out this forecasting malpractice. Industry consultant John Spader, for example, has observed that as of June 30, the average North American RV dealer’s debt to equity ratio had ballooned from .97:1 in 2021 to 1.73:1 in 2022 to 3.64:1 in 2023. As he notes, the debt-to-equity ratio is “arguably the most important measure of a dealer’s financial health” and its ability to manage debt. Most lenders want to see a ratio of 4.0:1 or less, so as this trend continues in the wrong direction, expect to see a growing number of RV dealerships going belly-up as they fall afoul of financing covenants. Disappearing dealerships don’t do much to increase sales

A more extensive—and bleak—analysis of this trend by Gregg Fore, whose industry-friendly credentials include induction into the RV/MH Hall of Fame, was published by RVBusiness a week ago. “Margins on sales have dropped, costs of nearly everything has risen, and maintaining safety in cash flow is more critical than ever,” he wrote. “Some dealers will see the handwriting on the wall and close voluntarily rather than lose their entire personal asset base. Others will be forced to do the same as cash flow reaches critical levels.”

RV park promoters and investors tend to be cavalier about such developments, claiming that with so many millions of RVs already cluttering the landscape, a constriction in the supply pipeline will be immaterial to campground owners. But RV parks are part of a larger ecosystem; when any part of it is diminished, the greater whole will feel the effects. Or as Fore also points out, fewer RV outlets will result in a higher percentage of larger dealers, “meaning the consumer will be forced to work harder to make a purchase and to get service (emphasis added).” In other words, owning an RV is going to become more expensive and more of a headache than it already has been.

The same economic forces that are crippling the RV industry are battering the camping public as well, with predictable results. Persistently high interest rates, two overseas wars, the ongoing threat of a federal government shutdown and a polarized, fractious political climate have soured consumer sentiment, which now has fallen for four consecutive months. Consumer spending has followed suit, dipping 0.1% in October, just ahead of the holiday season and the first decline since March. With two-thirds of Americans saying their household expenses have risen over the last year but only one in four saying their income has increased in the same period, it’s perhaps predictable that credit card debt is shooting up and retirement accounts are being ravaged through hardship withdrawals.

None of that adds up to a rosy outlook for next year—at the very least, it’s going to challenge the airy notion, advanced by some (I’m looking at you, Frank Rolfe), that the RV park industry is somehow immune to the economic forces that affect everyone else. Yes, people who already own RVs will want to use them—but not if they can’t afford ever-higher site fees, or if they can’t get their RVs serviced at a reasonable price within a reasonable time frame. Not if they can’t keep up with the outsized payments on their over-leveraged RV loans and have to unload their white elephants. Not if a tightening job market slowly makes that “work from anywhere except the office” lifestyle ever more fanciful.

The party was fun while it lasted, but they’re taking away the punchbowl and tomorrow you’ll wish they’d done so sooner.

Rule 1: own the land under your home

If you’re in the economic bracket that forces you to live in a trailer park, recent news has been alarming, with more than half-a-dozen such parks announcing their imminent closure just within the past week. Yet a growing number of RV parks also are encouraging campers to stay year-round, offering what may seem like a much needed housing alternative—until you realize it’s just another version of the same trap.

Mobile home park closures have been epidemic across the country, driven by aging infrastructure, rising land prices and various one-off circumstances. Officials in Grayling Township, Michigan, for example, have turned off the water to the aging Timberly Village Campground and Mobile Home Park because of its ongoing non-compliance with waterworks regulations: residents are on notice that the entire park will be shut down within a couple of weeks. The city of Flatwoods, Kentucky, meanwhile, has started eminent domain proceedings against a dilapidated trailer court on land it wants to use for a new fire house and city park.

Elsewhere, residents of the Dallas Pike Campground and Mobile Home Park in Triadelphia, West Virginia, received notice that they have 60 days to move out, reportedly because new owners will be using the land for oil and gas industry purposes. In Big Sky, Montana, the George Norman Trailer Court is up for sale after decades of providing affordable housing for local workers, with every expectation that the buyer will find a more profitable use for property located in prime skiing country. And in southwest Nebraska, the U.S. Bureau of Reclamation is demanding that 110 mobile homes be moved off leased federal land that they’ve occupied for decades to make way for a new campground, glamping tents and cabins, a splash pad and a dog wash.

That’s a whole lot of people learning, all within the space of a week, that they’re about to become homeless. But the reality also can be more complicated. In Louisville, Tennessee, only some of the residents of Country Acre Estates are getting the boot—the ones living in RVs. After more than 30 years, city officials abruptly realized that town ordinances regulating trailer parks restrict tenants to manufactured homes only. The occupants of 11 RVs at Country Acre Estates now have until the end of June to move out, but are complaining there’s nowhere for them to go.

Decades-old “mobile” homes are essentially immoveable, too old to withstand relocation, which means their owners typically are out on the street when the trailer court closes. But while even old RVs may be more mobile than mobile homes, the ones used as permanent shelters have two strikes against them, the first exemplified by the Country Acre Estates situation: barred from mobile home parks, such RVs also run up against park rules or municipal regulations that prohibit stays of more than two weeks at many campgrounds, which are viewed primarily as short-term recreational facilities. Moreover, many private campgrounds ban RVs that are more than ten years old, which would affect virtually all RVs that have been fixed residences. The combination can result in a severe lack of options—or none at all.

The other strike against using RVs for full-time housing is their substandard construction when compared with mobile homes. Although the RV manufacturing industry vigorously asserts that its products are intended purely for recreational purposes and are not suitable as permanent housing, the claim has a wink-wink and nudge-in-the-ribs quality, given the way these things are marketed—but by maintaining the fiction, RV manufacturers don’t have to comply with more stringent federal housing standards, such as using licensed electricians to wire their extraordinarily flammable creations. (For more on this scam, see here, here and here.)

The lower standards applicable to RVs are why Louisville and other municipalities prohibit them—at least on paper—from trailer courts. Yet as the Dallas Pike Campground and Mobile Home Park, and the Timberly Village Campground and Mobile Home Park also underscore, not everyone makes that distinction. Many mobile home parks adopt an ecumenical approach that regulatory agencies typically ignore.

Now, increasingly, RV parks are following the trailer court playbook—and as the pace of trailer park closures picks up, the pressure on RV parks to further accommodate long-timers will increase. The basic economic argument supporting that trend was laid out this week by Frank Rolfe (among others), in his observation that “one of the worst attributes of RV parks is that the customers leave . . . and every time they leave, you have no revenue on that space.” Which is true as far as it goes, although the same can be said of any segment of the hospitality and entertainment industries: whether it’s hotels or amusement parks, restaurants or ball parks, customers come and go. But Rolfe, whose commercial real estate portfolio is dominated by mobile home parks, has yet to see an RV park he wouldn’t prefer to convert into a residential property.

Rolfe’s comments came in yet another of his “RV Park Mastery Podcasts,” a series of more than 80 (and counting) sermons to actual and would-be RV campground owners that relentlessly promote RV parks as just another species of trailer courts. This week’s episode was devoted specifically to the wisdom of RV parks having park models, although in a broader sense it was arguing on behalf of permanent occupancy. For Rolfe, it all comes down to attaining “a more dependable revenue stream,” but also of getting on the right side of changing economic trends, most notably “as housing prices have become impossibly high.”

Deconstruct Rolfe’s approach and you’ll soon figure out that what he’s actually advocating is the transformation of RV campgrounds into cheaper mobile home parks. As he relates, “We have brought in literally over 100 park models into one of these RV parks, and they’ve all been sold and people live in there happily, and we as park owners . . . attain extremely stable income.” But as in mobile home parks, the owners of those park models don’t own the land on which they sit. And while park models theoretically are “mobile,” they are as unwieldy to move as house trailers, as well as being built to RV standards rather than more stringent HUD regulations.

All of which means that when things go south, as they so often do, the park model owner may be just as trapped as his or her mobile home counterpart. But that really isn’t Rolfe’s concern, and as increasing numbers of RV parks get snatched up by institutional investors whose primary interest is return on investment, it won’t be of concern to a growing number of RV park operators, either.

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‘Tis better to give than to deceive

This being the holiday season and all, Frank Rolfe is dressing up his miserly predations on the impoverished classes by claiming that higher prices are actually beneficial to them. That’s right: Frank Rolfe, who extolled “Chainsaw” Al Dunlap as the epitome of effective corporate leadership and who regularly notes that residents of trailer parks are fish in a barrel, is taking a leaf from George Orwell’s 1984 to convince us that war is peace, freedom is slavery, and black is white.

Writing on his Mobile Home University blog—cousin to his equally problematic RV Park University blog—Rolfe has presented a Yuletide parable under the headline, “The interesting story of why Dollar Tree raised their prices from $1 to $1.25.” The uninitiated might think the increase was forced by higher wholesale costs, or because Dollar Tree needed bigger margins to fuel its relentless expansion across the American landscape. But no. As Rolfe breathlessly (and without a shred of attribution or supporting evidence) assures us, “Dollar Tree raised prices to actually HELP their customers.”

This selfless act of charity, Rolfe goes on to explain, was prompted by Dollar Tree’s realization that it was “limited in what it can offer in its stores because of the $1 price point.” By raising its one-price-fits-all approach to $1.25 per item, “they found they could offer a substantially larger range of items to meet customers’ needs.” The moral of the story? “It’s not a case of the ‘evil business owner raising prices on the downtrodden’ but instead ‘progressive business owner expanding their product range at the request of customers.'”

Where to begin to address this logic-deficient defense of greed? The absurdity of claiming that Dollar Tree raised its prices to be helpful to “the downtrodden”? The equally absurd and unsubstantiated claim that Dollar Tree’s customers were seeking a broader product range, even if that meant higher prices overall? Why stop at $1.25? Why not $2? $5? Think how many more products Dollar Tree could offer if it became just like Kroger or Food Lion!

But why would Frank Rolfe care about Dollar Tree in the first place? Because he clearly recognizes that it pitches to the same demographic as do his own trailer courts and RV parks. And as he further asserts, what’s going on at Dollar Tree “is very similar to the mobile home park business, in which lot rents go up to allow for reinvestment in the worn-out property to bring it back to life, as well as to provide competent, professional management. It’s a win/win concept, not a win/lose concept.”

As if.

As one news story after another has documented, Rolfe and his kind have been steadily jacking up rates at their mobile home and RV parks because they can, not out of any sense of “customer service.” Such parks are the bottom end of a housing market that has been squeezed without mercy for several years, and especially since the onset of the pandemic, resulting in an unending supply of would-be tenants who will take whatever they can get at whatever price it takes. As Rolfe himself acknowledges, lot rents around Denver that were around $400 a few years ago have more than doubled, yet not only are mobile home parks full, but most have waiting lists.

As for having that extra income go to “reinvestment” in “worn-out” property, or to hire “competent, professional management”? The headlines are replete with stories of trailer parks literally falling apart from neglect, their residents coping with intermittent utilities and streets flooded because of improper drainage maintenance, while management—professional or otherwise—is either absent or nonresponsive.

Dollar Tree may or may not have perfectly valid reasons for upping its prices, but no one can reasonably conclude that it is preying on its customers. The same can’t be said of Rolfe, whose quick dismissal of “the evil business owner raising prices on the downtrodden” trope suggests what’s really bugging him: Frank Rolfe, meet Ebenezer Scrooge.

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Mobile-home Monopoly not a game

[Part II of a two-part look at the growing economic pressures squeezing mobile home parks, foreshadowing the future for many RV parks.]

As deep-pocketed investors continue vacuuming up mobile home parks at exorbitant prices, they have only two ways to make their purchases profitable. One is by replacing trailer pads with higher density housing, such as single family homes and apartments. The second is to jack up rents on the existing sites, in some cases simultaneously slacking off on maintenance and upkeep to reduce operating costs.

The first approach reduces the overall inventory of low-cost housing. The second raises the affordability bar for people most in need of low-cost housing, pushing them out of homes they may have occupied for decades and into the streets, for lack of anywhere else to go. Either way, the result is skyrocketing housing costs that add to inflationary pressures, even as county and city governments grapple with a tidal wave of homelessness that strains taxpayer revenues.

Meanwhile, the people profiting from the economic forces they’re unleashing rationalize their actions by blaming–well, anybody but themselves. Frank Rolfe, offering a prime example of deeply cynical self-serving rhetoric, contends that the U.S. is “in deep trouble” for one basic reason: “A dysfunctional Fed has driven rates up too far and too fast and there will be great economic suffering as a result.” In other words, the patient is sick only because of the medicine prescribed for an economic disease–a disease for which Rolfe is a primary but unacknowledged vector.

But Rolfe doesn’t stop there. “Bad times yield greater demand for affordable housing,” he writes. “So while Jerome Powell is busy raising rates and destroying the U.S. economy, he’s also acting as a powerful force to push mobile home park demand even higher.” The uncoupling of “affordable housing” from “mobile home park,” thanks to Rolfe’s (and his peers’) self-enriching actions, goes unremarked. In his own eyes, Rolfe is a savior of the working class, providing a praiseworthy safety net against the Fed’s recklessness.

The Frank Rolfes of the world owe their success not to any great investment brilliance, but simply to their understanding that residents of mobile home parks a) almost never own the land on which their mobile homes are sitting; and b) that “mobile homes” are almost never mobile. All of which means that the poor unfortunates inhabiting these homes are a captive audience, ripe for the plucking.

It doesn’t have to be that way, but creating the exceptions takes a lot of money and a fair amount of luck. Boston Trailer Park, for instance, which sits cheek-by-jowl with an apartment complex in which one-bedrooms go for $3,000 a month, is that city’s only mobile home park–but it exists today only because former mayor Tom Menino helped its residents take ownership of the land more than a decade ago. As a result, Boston has a little working class oasis in which residents pay just $425 a month for their sites.

Unfortunately, that sort of intervention is becoming increasingly difficult, thanks in no small part to the $4.5 billion in investment money that poured into mobile home parks across the country last year alone. Even though Massachusetts is one of a handful of states with legislation giving residents of mobile home parks a chance to match any purchase offers, outside investors are driving prices to unmatchable levels. Without government help and nontraditional financing, most mobile home residents may as well dream about living in Palm Beach or Beverly Hills.

Despite those odds, some successes have been notched. As NPR’s Morning Edition recently reported, the 200 or so residents of a mobile home park in Wareham, Mass. were able several months ago to match a $12 million offer from an Arizona-based investor–but only after obtaining loans from a nonprofit, ROC USA, and a $1.9 million grant from the state’s Affordable Housing Trust. Approximately five years ago, ROC USA also provided the financing that fended off an outside buyer seeking to acquire the 430-home Halifax Estates in Halifax, resulting in the country’s largest resident-owned mobile home community.

Colorado, where fewer than 10 of the state’s 900 mobile home parks have been purchased by their residents, recently had a similar success story. The approximately 200 adults and 100 children of the Parklane Mobile Home Park were able to recruit county assistance in tapping American Recovery Act funds for a $1 million forgivable loan, which in turn encouraged the private, family-run Bohemian Foundation to underwrite a $2.8 million low-interest rate loan . The balance of the $6.8 million purchase was then provided via a $3 million loan from the Impact Development Fund, a quasi-public financial organization.

Yet as these examples also illustrate, constructing such buyouts is a precarious business, requiring multiple financing streams of limited supply. Non-profits almost by definition have more limited financial resources than their investor-driven adversaries. Funding resources from the American Rescue Plan will be exhausted within a couple of years, if not sooner. And while some state governments are belatedly waking up to the housing crisis on their doorstep, their response is typically hesitant and restrained, hamstrung by concerns over interfering with market dynamics and worries about using tax dollars to intervene in the private sector.

Meanwhile, the mobile home version of Monopoly continues unabated. Earlier this month, it was the residents of Hi-Acres Mobile Home Park in Palm Beach County, Florida, who got their eviction notices, letting them know that the park’s new owners have other, unspecified ideas for their acquisition. One look at an aerial map of the property leaves little room for guessing what that might be: Hi-Acres is surrounded on three sides by a suburban development of single-family homes, and butts up against a golf course on the fourth. This is not an area that will long tolerate “affordable housing.”

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You can’t extinguish fires w/ gasoline

[Part I of a two-part look at the growing economic pressures squeezing mobile home and RV parks.]

In a harbinger of what lies ahead for a growing number of RV parks, the San Jose Mercury News reported this week that a family trust in California has just paid $40.7 million for the Rancho Santa Teresa Mobile Home Estates in San Jose. The mobile home park has 315 spaces, which means the purchase valued each site at $129,200.

Think about that. What kind of astronomical rents will it take to make that a profitable transaction?

And this was hardly the first or even the highest-priced acquisition of mobile home parks in California, which suffers the country’s most expensive real estate. As one example, the 116-site Mary Manor Estates in Sunnyvale sold in March for $39 million, which works out to $336,207 per mobile home pad. And the 110-site Winchester Ranch Mobile Home Park in San Jose changed hands last year for $50 million, or a whopping $454,545 per pad.

Given that price, Winchester Ranch clearly wasn’t purchased as a mobile home park but for its land, so there’s no surprise that it’s been bulldozed to make way for 320 single-family homes and 368 apartments. A similar fate may await other, similarly high-priced acquisitions. Then again, housing costs have become so extraordinarily distorted that even the most bloated valuations may be sustainable if rents are pushed to even more stratospheric levels.

Consider the average Los Angeles monthly rent for a mobile park site last year, which according to the commercial real estate services company Jones Lang LaSalle was $1,103–significantly higher than anywhere else in the country, yet the market still had the nation’s lowest vacancy rate, at 1%. With an average expense ratio of just 43%, that resulted in a market net operating income of $8,600 per site, or just shy of a million bucks for a park the size of Mary Manor Estates. That’s a number sturdy enough to support an awful lot of debt–and if it’s not enough, well, just raise the rates some more. With comparable apartments renting for triple that amount, the market will bear it.

Los Angeles in particular and California in general are high-cost outliers, but where they lead the rest of the country so often follows. It’s instructive, therefore, to read the latest musing from Frank Rolfe about why mobile home parks are better positioned to weather the Federal Reserve’s ongoing efforts to curb inflation by increasing interest rates. Rolfe, who has been flogged by me (here and here, for starters) and the media in general for his predatory approach to mobile home parks, contends that “mobile home park rents are ridiculously low and have massive potential for increases,” so higher interest rates are nothing to worry about.

But juxtaposing Rolfe’s further comments with recent mobile home park sales underscores the tragic transition that occurs when trailer parks–as well as RV parks and campgrounds–are sold by mom-and-pop operators to corporate and investment buyers. “How did mobile home park rents get so low to begin with?” he asks rhetorically. “To understand, you have to go back to the 1960s when the industry was young. Moms and pops owned virtually all of the mobile home parks and they simply were not good about increasing rents. . . . Moms and pops only raised rents at about half the level of inflation, resulting in rents being so ridiculously low.”

Put another way, moms and pops were putting the brakes on inflationary pressures, but now that moderating influence is being steadily reduced, even as inflation is reemerging as a global economic concern. From Rolfe’s vantage point, however–and that of the other investors snapping up such properties–“the greater demand that recession brings for affordable housing will allow offsets–such as higher lot rents–that will battle back the higher rates on loans.”

Those “offsets,” it should go without saying, only throw more gasoline on the inflationary fire.

[Next post: Part II, taking a look at the hypocrisy behind promoting mobile home parks as “affordable housing” by investors who are making them unaffordable, and the increased pressure that puts on RV parks as housing of last resort .]

Sell, sell, sell and cut, cut, cut

Frank Rolfe, already well-known for his predatory approach to mobile home park investing, has been preaching the same gospel to RV park investors in his RV Park “University” offerings and in regular podcasts and email broadsides. I’ve written about him before, mostly as a warning to others, but lately he’s upped his game to such an objectionable level that he’s worth a return mention.

His most recent screed is titled “The three best methods to improve RV park net income,” and it kicks off by turning to “Chainsaw” Al Dunlap for inspiration. Dunlap was “a well-known corporate raider and business efficiency stalwart,” Rolfe would have you believe, and Dunlap’s guiding motto of “sell, sell, sell and cut, cut, cut” is “not a bad mantra for RV park owners, as well.”

Rolfe goes on to write that there are three “key areas” that have maximum impact on the bottom line, the first being an unremarkable emphasis on improved marketing. It’s in the second and third key areas–“increase rents and occupancy” and “cut operating costs”–where Rolfe shows his true colors, and RVers should not be surprised to learn that in this zero-sum game, whatever benefits Rolfe and his acolytes will not benefit them at all.

Step one, “increase rents. Yes, it’s that simple.” Step two, “bring in extended stay customers,” taking advantage of “a large and growing category of customers who want to live in their RVs full time.” Moreover, Rolfe adds, there is a growing fleet of tiny homes “that can only be placed in an RV park by law,” providing campground owners “an extremely dependable (read: captive) source of income.” Step three, put more emphasis on park models and glamping, creating “more of a ‘hotel’ format, where the customer brings no RV of their own.”

Having thus jacked up rates while decreasing the number of transient RVing sites, Rolfe moves on to the expense side of the ledger, starting with “horribly bloated and completely unproductive” payrolls that must be slashed. That non-specific analysis is followed by the equally vague observation that a “simple line-by-line review of each cost item may yield huge dividends,” especially if approached with an “analytical and creative” mindset.

And there you have it: sell, sell, sell and cut, cut, cut.

Oh–but one more thing. Al Dunlap, who earned his “Chainsaw” moniker after cavalierly firing 11,000 employees at Scott Paper, for which he received $100 million in compensation, went on to try the same “analytical and creative” tactics at Sunbeam. He eventually got fired by Sunbeam’s board of directors– creating the memorable headline, “Board Cuts Chainsaw”–and subsequently settled a civil suit, filed by the Securities and Exchange Commission, accusing him of several counts of accounting fraud that misrepresented Sunbeam’s financial results. He paid a $500,000 fine and agreed to be barred from ever again serving as an officer or director of a company.

Three years after it fired Dunlap, Sunbeam filed for bankruptcy. Two decades after that, Frank Rolfe has found his mentor.

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Truth in advertising–not

Say you’re Erik the Red and you’ve just been exiled because even the Vikings, it turns out, have a low tolerance for murder. Now you’ve found a new island home and you’d like to tempt some of your former colleagues into joining you, but how are you going to get them to sail across the bitter north Atlantic to settle on a hunk of rock that’s 80% covered by an ice sheet? Why, just call it “Greenland,” of course.

That’s pretty much the approach taken by Frank Rolfe, whose sometimes misleading promotion of RV parks was last mentioned in this blog Sept. 18. But now Rolfe seems to be stepping up his game, headlining last week’s email blast with the seductive promise, “Vacation while you work: welcome to the RV park owners lifestyle.” Land ho! Is that a massive, glaciated island up ahead?

Giving him the benefit of the doubt, let’s assume Rolfe is simply clueless and not actually trying to sell us the Brooklyn Bridge. Still, there are some real howlers in his polemic, such as the claim that “you have the best of both worlds” when owning an RV park because this “will allow you to effectively feel like you’re on vacation while you’re working.” He then goes on to list the benefits of a hands-on approach to ownership, concluding with this bit of supposed wisdom: “You can also select exactly how you spend your time each day, and never again miss out on any personal activities that you would like to attend. At the end of your life, you will never think back on ‘could I have done something different that I would have liked more’ as you have taken your destiny into your own hands.”

Uh-huh. This is from a man who apparently never, you know, actually ran an RV park. True, he did operate a trailer park–or mobile home park, as he prefers to call it–some two decades ago, but these days he busies himself as an investor, not an operator. More to the point, claiming contemporary RV park insight based on 20-year-old trailer park experience is like having a typewriter repairman tell you what you need to upgrade your MS-DOS platform and thinking he’s kept up with the times.

To put it most bluntly, these days the RV park business is a ball-buster. It was never easy–no hospitality industry is, given that every customer is your “boss”–but the past couple of years have been wracked by a worker shortage, an increasingly pugnacious public and a wave of newcomers who often don’t have the vaguest idea of how to operate their equipment. Both the hours and the seasons have grown longer, even as tempers get shorter. Not only is there no room to “select exactly how you spend your time each day,” there isn’t enough day to do all the things that must be done, and never mind the “personal activities that you would like to attend.”

If that’s your idea of a vacation, I hear there’s a nice little cottage available in this paradise-on-earth we call Greenland. . . .