The California Association of RV Parks and Campgrounds (CalARVC) will sponsor a day-long seminar titled “Everything & Anything You Need to Know About Park Trailers” Jan. 13 at Newport Dunes RV & Waterfront Resort in Newport Beach, Calif.
A panel of park owners, operators and vendors will cover these issues:
- Pros and cons of renting park trailers for vacation use, including marketing, usage policies, housekeeping issues and maintenance.
- Pros and cons of long-term leases for seasonal/annual use, including marketing, policies on out-buildings, landscaping, age limits and upkeep.
- How and whether to purchase, lease and financing considerations.
- John Pentacost, an attorney with Hart, King & Coldren, who will speak on the state’s eviction law for park trailers.
- Brad Harward of California Housing and Community Development, who will speak on the state’s laws regulating park trailers, from park trailer design to installation.
- William Garpow of the Recreational Park Trailer Industry Association (RPTIA), will provide an update on industry trends, new products and innovations.
The fee is $75 for the first attendee and $65 for each additional attendee.
Lunch will include brief introdutions from the program sponors. A tour of the resort’s park trailers also will be available.
For more information, contact CalARVC at (530) 885-1624.
PUBLISHER’S NOTE: Among the more thought-provoking conversations we encountered at the National Association of RV Parks and Campgrounds’ (ARVC) 2009 InSites Convention and Outdoor Hospitality Expo this week (Nov. 9-12) at the Orange County Convention Center in Orlando, Fla., involved exhibitor Bill Garpow, executive director of the Recreational Park Trailer Industry Association Inc. (RPTIA). Garpow, based in Newnan, Ga., voiced concerns in this brief interview about a creeping trend that most in this industry are well aware of by now: RV’s designed for leisure pursuits being used by a growing number of hard-pressed Americans as residences during the ongoing recession. Here’s the crux of that conversation:
RV BUSINESS.com: Bill, we’re all aware of an increase in destination-style “camping” in units generally designed for longer term use. That’s a trend with which we can all live. But now we’re seeing news reports about people settling into recreational park trailers and conventional RVs for full-time habitation, which has caught many in this business off-guard. It’s an emerging trend, is it not?
Garpow: It is. The last thing in the world that a park owner wants to have is a school bus stopping at the front gate and picking up kids from his park. That’s the final warning call to a local unit of government. And it means approximately $6,000 to $12,000 per child that somebody has got to pay for in school taxes, property taxes. And they’re not getting it from the RV parks right now. That’s not to say that if the trend continues they won’t find a way to get it because they probably will.
RV BUSINESS.com: That certainly couldn’t be viewed as a good thing for the recreational vehicle sector.
Garpow: We don’t want that — don’t need it, can’t use it. It would just increase the heck out of the cost of a camping site. If we want to maintain the industry the way it is, we’ve got to be very careful about allowing recreation vehicles to be used as residential property.
You’re talking about mixing good people who are using it (the RV) the way it should be used as a vacation and seasonal dwelling — people of stature, people of means that come to your park and they spend money while they are there and their kids have a great time. And when they’re done – or if they have a problem — they go home. They don’t leave that problem and put it on the local unit of government to try to solve it for them.
Quite frankly, they don’t have squabbles in the household, if you know what I mean. You don’t have the police department out there at 2 o’clock in the morning trying to straighten out a man and a wife that have gotten into a (loud) discussion.
RV BUSINESS.com: You are frankly talking about something – the residential aspects of recreational vehicles – about which this business arena has always been quite wary. Certainly, your typical mainstream park operator wouldn’t want any part of it. Nor would the members of the Recreation Vehicle Industry Association (RVIA), which has always tried to keep its distance from all this for a variety of reasons, especially with regard to federal standards pertaining to residential dwellings.
Garpow: The recession has kicked that particular use up, and we’re seeing more and more of it. Unfortunately, when a park owner lets that genie out of the bottle and has people in his park using it as a domicile, chances are pretty good that those folks aren’t going to mix real well with your standard camping family.
As a matter of fact, they will probably have an attitude because, after all, the way the full-time resident sees it, ‘I live here and you’re only here for a weekend or 10 days, and when you’re here, you’re a pest. You pull in to the campsite at 10 O’clock at night when I’m watching my favorite TV show and it’s disruptive and I don’t like it.’ It doesn’t take too long for our good camping customers to figure out that ‘we’re not really appreciated here anymore.’ And what are they going to do? They’re going to go some place else.
So, what is the campground owner going to be left with? He’s going to be left with a trailer park. It’s going to be full of people who are going to be living as full-time residents and it’s going to be very difficult to convert back to an RV park.
RVBUSINESS.com: So, you’re essentially talking about crossing that long-held divide between a “campground” and a “trailer park.”
Garpow: Kind of, except that you are going to be using less than a manufactured housing park (in terms of space and infrastructure) to do it. You are using something that is smaller, tighter and less expensive. And guess what? That’s the kind of folks you are going to attract — people that can’t afford anything else.
It frightens me, and the reason it frightens me is because, long term, we’re dependent on the local units of government to welcome recreation vehicle parks with open arms into their community.
They are an asset. People come from other locations, and while they are in that park, they spend money at the park and in the local community. They go out to eat and they buy gasoline and groceries and they entertain themselves. It has an economic impact on the community.
It was money that was earned someplace else, so it doesn’t take any jobs away from the local community. The economic largess is wonderful. In the past, that’s worked for us. But if you suddenly bring in people of lesser means who don’t have the capability to do any of these things, and they start sending kids to school and they start imposing on government services, suddenly the welcome mat is going to be pulled out from underneath us.
RVBUSINESS.com: Before we close out here, Bill, we probably ought to ask you about the current state of the recreational park trailer marketplace.
Garpow: We’re down about 55% from the high that we had for 12-wide units. Things are starting to pick up a little bit as they are for other segments. Some of the manufacturers have even got a little bit of a backlog, which is great news. I hope we don’t run into supplier problems. We may see some of that because we’ve never experienced a deep, long-term turndown like this before.
We’ve had some deep ones before. I remember back in 1979 during the gas crisis. That was deep, but within six months we were back where we were.
But this time, we’ve had some suppliers that have basically shut off their ability to produce and we may have some difficulty obtaining OEM parts.
RVBUSINESS.com: So, the recovery at this point is real?
Garpow: I think we’re seeing it. We still have a problem with financing. That’s going to take some time. We still have a problem with the consumer who lost a lot of their 401(k) in the market. But fortunately, some of that has come back. We’ve also had some people, worse than others, take a real hit in the value of their primary residence that could be as much as 40% in some cities. But in other locations it hasn’t been too bad. If you look at it, those places that experienced great galloping increases in the last 10 years or so (in real estate) are the ones getting hit with the great galloping decreases in value.
Nine recreational park trailer manufacturers will be displaying their latest units for the RV park and campground industry in the Park Model Pavilion at the annual InSites Convention & Outdoor Hospitality Expo Nov. 11-12 in Orlando, Fla.
The show is sponsored by the National Association of RV Parks and Campgrounds (ARVC) and will be held at The Rosen Centre.
The displaying companies are: Airstream Inc., Athens Park Homes, Breckenridge Park Trailers, Cavco Industries Inc., Chariot Eagle Inc., CrossRoads RV, Keystone RV Co., Skyline Corp. and Stone Canyon Lodges & Park Models LLC.
Meanwhile, in a related development, ARVC and Thor Industries Inc. announced in October that they have formed a strategic alliance to provide private park operators with exclusive prices on park models and travel trailer units specifically designed for use as rental accommodations at campgrounds.
“Three of Thor’s companies, Airstream, Breckenridge and Keystone, now offer unique lines of park model cabin and travel trailer units that have been specially designed to meet the durability needs of private park operators who are anxious to expand their offering of rental accommodations,” said Shane Ott, Thor’s director of campground relations.
Ott, who was previously president and COO of Kampgrounds of America Inc. (KOA), joined Thor last summer and developed the company’s rental accommodations initiative with ARVC.
“We welcome this exciting Thor program and feel that the favorable pricing and unique designs of these units will be very enticing for campgrounds, RV parks and resorts as they continue to diversify their business base with rental accommodations,” said Linda Profaizer, ARVC president and CEO.
About one-third of the nation’s commercially owned campgrounds, RV parks and RV resorts offer rental units to accommodate families and other travelers who don’t have an RV, but want to enjoy the Great Outdoors – and the numbers are growing.
“Private parks have long seen the merits of investing in park model cabins for use as rental accommodations, and now they have a chance to invest in both park models and travel trailers for on-site rental use at special prices that are exclusive to ARVC members,” Profaizer said. “Many travel trailer owners already leave their units at campgrounds and RV parks and use them as getaway cottages.”
Ott said this strategic partnership, the first of its kind involving ARVC and RV manufacturers, has enabled Thor to develop unique units using the input and experience of campground owners across North America.
The ruggedized features along with a variety of floorplans and cozy design elements offer campground owners durable units built to withstand the rigors of high occupancy usage. The lodging units featured in the promotion include four Breckenridge park models ranging from 22- to 36-feet; two Keystone travel trailers, including one 29- and one 37-foot model; and one 25-foot Airstream travel trailer.
Ott added that while the initial promotion involves Airstream, Breckenridge, and Keystone, additional Thor companies could become involved in the promotion in the future, depending on the level of private park interest.
T.R. Arnold and Associates Inc. – an internationally accredited certifier of quality management systems based in Elkhart, Ind. – now is turning its expertise to the recreational vehicle industry and the growing desire among manufacturers and consumers for environmentally friendly RVs and recreational park trailers.
Operating under the name TRA Certification Inc., the company already has demonstrated its ability to certify “green construction” in the manufactured and modular housing industries. It has to date certified five companies as green capable and is in the process of certifying several others.
Arnold founded his company in 1967; it now is an employee-owned company. Besides work with factory-built homes and buildings, it also offers a complete line of inspection and consultation services to the RV, cargo trailer and park trailer industries.
In order to certify a building or an RV as environmentally friendly, there would naturally have to be some sort of an industrywide consensus standard of what it means to be “green.” Although there is a consensus standard for the RV Industry, no green requirements exist. So, Tom Arnold, president of TRA Certification, said to implement a standard he turned to the National Green Building Standard to develop a standard — a consensus standard for single-family dwellings established by the American National Standards Institute, the Association of Home Builders and the International Code Council.
“We’re using this as a platform to implement the applicable parts of this for the recreational vehicle industry,” said Arnold. By using an existing standard developed through the consensus process, Arnold feels he is ensuring that any green certification his company makes is legitimately environmentally friendly.
The first step in the certification process is to certify the manufacturer is green-capable. “We go to the factory and we look at what’s going on with their processes,” said Arnold. That involves examining their recycling programs and manufacturing methods to ensure they are able to produce green compliant RVs. “We’re giving the manufacturer who is doing a good job recognition for what they do,” said Arnold.
The second step in the process is to examine the materials and appliances that go into making the RV.
Arnold said that any supplier can claim his materials are environmentally friendly, but “the engineer (at the manufacturer) does not have the time to do the research.” TRA Certification, he points out, does that for the manufacturer.
Arnold said TRA Certification is just now launching its green certification program and he fully expects to have many manufacturers certified by the end of the year. “We have proposals out to several park trailer companies now,” he said.
His staff for the company already is in place. Amanda Leazenby, who has professional accreditation in Leadership in Energy and Environmental Design, is the manager of the program. Clay Huth will serve as director of marketing, and Sherman Hansen is a green certification consultant.
For more information on TRA Certification’s green program, contact Amanda Leazenby at 700 W. Beardsley Ave., Elkhart, IN 46514, (574) 264-0745 or visit the company’s website at www.tragreen.com.
Fleetwood Enterprises Inc. has extended until Saturday (Aug. 8) the bid deadline on the sale of its manufactured housing unit.
The auction, should it be required in the case of competing bids, will be delayed similarly to Aug. 10, at 2 p.m. The final hearing to approve the sale will remain as scheduled on Aug. 12.
As of Friday, Cavco Industries Inc., a manufactured housing and recreational park trailer manufacturer based in Phoenix, Ariz., and an investment partner, Third Avenue Trust Value Fund, have submitted the lone bid. The partners have offered $28.9 million for seven Fleetwood plants, trademarks and other assets.
Fleetwood filed for Chapter 11 bankruptcy protection on March 10. It has ceased travel trailer production and has already spun off most of its motorhome business to American Industrial Partners.
During an investors’ conference call last week, Cavco President and CEO Joe Stegmayer explained Cavco’s reasoning behind bringing in a partner to make the Fleetwood purchase. Each party would own 50% of the Fleetwood housing business. He called it “a prudent approach” and a way to conserve the company’s cash in these difficult times.
Despite recording a $1.5 million loss for the most recent quarter on sales of $13.6 million, Cavco is in “a strong financial condition” and has no long-term debt, he said.
“We want to preserve capital and have it available to inventory finance our distributors,” he said. “We have to be prepared for it (downturn) to continue for some time. This provides the opportunity to leave our balance sheet in a very pristine condition.”
All seven of the Fleetwood plants are operating but at a low level of utilization, he said. On average, each plant has the capacity to produce about 1,000 homes a year, he estimated. Cavco’s plants are operating at a 25% utilization rate, he added.
If successful, Cavco would take over the Fleetwood business “in a fairly short order” as it is Fleetwood’s intent to make a “fast transfer of assets,” Stegmayer during the onference call. The Fleetwood name would be retained.
If the Cavco/Third Avenue bid fails, Cavco has other options, Stegmayer continued in answer to one investor’s question. “We don’t feel we need to do anything immediately, but we have looked at other projects,” he said.
When first announcing its offer on June 30, Stegmayer noted, “The Fleetwood brand is one of the strongest in the industry, and we are excited to have this opportunity to integrate Fleetwood’s strong family of product offerings with our own growing business.”
Third Avenue Management, the investment adviser to Third Avenue Value Fund, is a New York-based company with expertise in value and distressed investing. Third Avenue Management manages approximately $13 billion of assets for private and institutional clients. Most or all of Third Avenue’s proposed purchase will be made by Third Avenue Value Fund, the company’s flagship mutual fund.
Cavco and Third Avenue’s $28.9 million “stalking horse” bid is subject to execution of a definitive acquisition agreement (with customary conditions to closing) and bankruptcy court approval. The purchase price is subject to adjustment for the assumption of certain warranty liabilities and other customary post-closing adjustments.
The Fleetwood assets proposed for purchase include seven manufactured housing plants, one office building, all related equipment, accounts receivable, inventory, certain trademarks and trade names, intellectual property, and specified contracts and leases. The manufactured housing plants are located in Nampa, Idaho; Woodburn, Ore.; Riverside, Calif.; Waco, Texas; Lafayette, Tenn.; Douglas, Ga.; and Rocky Mount, Va.
The proposed purchase does not include the company’s operating plants in Alma, Ga., Elizabethtown, Pa. and Garrett, Ind. The facilities included in the proposed purchase currently employ more than 700 people in seven states.
The state of New Jersey has reportedly agreed to back off residency rules that threatened to evict residents this fall at a Cape May County campground, according to The Press of Atlantic City.
About 60 residents of Carol Lynn Resorts in Woodbine met with state Sen. Jeff Van Drew, D-Cape May, Cumberland, Atlantic, about the state’s decision last year to impose a six-month residency limit on seasonal campgrounds.
Van Drew announced that the state Department of Community Affairs will grandfather existing recreational park trailers, also known as park models, at the state’s campgrounds. These are trailers of 400 square feet or less that, according to the state, have electrical systems that might be substandard.
Residents still must comply with local ordinances over residency, Van Drew said. In Woodbine, that means residents at campgrounds such as Carol Lynn Resorts can live there daily from April to November and remain 21 days per month the remainder of the year.
Carol Lynn Resorts is considered a campground, but residents here hardly camp. They live in their park models year-round.
“Technically, a campground is not and never has been a year-round residence – technically,” Van Drew said. “The DCA has now agreed this requirement will only apply to new trailers coming into the park.”
Woodbine has never enforced its own rules governing campground residency. But when the state imposed the new six-month rules, campground owners Anthony and Carol Saduk gave residents a Nov. 1 deadline to leave.
The residency rules stirred tempers and raised consternation among campground residents. Van Drew began his comments by imploring the residents to “be nice.”
But the sudden eviction notices caught many people by surprise, and for-sale signs began popping up in the windows of many of the trailers.
DCA spokesman Chris Donnelly could not be reached for comment late Thursday. Van Drew said he was negotiating a deal with former DCA Commissioner Joseph Doria, before he resigned last week amid a corruption scandal.
Van Drew said he reached a similar understanding with the agency’s new acting commissioner.
Campground owners may impose their own rules that may be more restrictive than the state’s, Van Drew said. But Carol Saduk on Thursday said if Van Drew is correct, the state’s response satisfies her concerns about complying with the law and her tenants may stay through the winter.
“The regulation is on the books. You can’t ignore it because so-and-so said you can.
We wanted it in writing,” she said. “We were just doing what the state told us to do. The shame of this is it put us in the position of being the big bad guys throwing the senior citizens out.
“All’s well that ends well. We’ll move on from here,” she said.
Residents applauded Van Drew’s announcement and said the state’s decision satisfies them.
Meanwhile, the New Jersey Campground Owners Association has proposed a compromise to establish a 270-day or nine-month season. The trade group represents 105 campgrounds and resorts in 13 counties.
“If there are any situations where people are there longer, we’re proposing they get an electrical inspection by an electrician to certify it’s safe for use and meets the residential code,” said Jay otto, trade group president. “This should satisfy the DCA’s concerns about the electric systems in the units.”
Cavco Industries Inc., a Phoenix, Ariz.-based manufacturer of recreational park trailers, manufactured housing and cabins, announced Wednesday (July 29) financial results for the first quarter of its fiscal year 2010 ended June 30.
Net sales for the first quarter of fiscal 2010 totaled $13,595,000, down 62% from $35,509,000 for the first quarter of fiscal year 2009, according to a news release.
Net loss for the fiscal 2010 first quarter was $1,449,000 compared to net income of $853,000 reported in the same quarter one year ago.
Joseph Stegmayer, chairman, president and CEO, said, “Our first fiscal quarter results are representative of the continued challenges faced by the general economy and our industry, which are especially poignant in our core Southwest market area. For the five months ended May 2009, industry-wide reported manufactured home shipments continue to be very low at 380 and 611 in Arizona and California, respectively. In an effort to further streamline our cost structure in this environment, we have moved our Phoenix, Ariz., park model and vacation cabin operation to one of our other nearby factories. The combining factory had excess capacity available for a second production line, which is now being utilized for these specialty products. The transition was completed by the end of the first quarter with no interruption to the customers of that business.”
He continued, “While business conditions are certainly challenging, we are well positioned to expand our presence in our current markets. Meanwhile, we are continuing the previously announced bid process for seven operating Fleetwood Enterprises Inc. manufacturing facilities in as many states across the nation. Through a 50% owned subsidiary, we signed an asset purchase agreement last week, and are now working toward potential ownership in the near term. There are no assurances that this transaction will close or that it will be in the form currently contemplated. We do believe that a successful purchase will be a positive long-term strategic move for both the Cavco and Fleetwood Homes brand names.”
All the fears expressed by the Pearl River County Board of Supervisors in Poplarville, Miss., about someone purchasing former FEMA recreational park trailers and offering them for sale locally has come true, according to the Picayune (Miss.) Item.
Now their biggest concern is someone buying one of the trailers and trying to live in it. “We need people to understand they can’t be used for permanent residences,” said Anthony Hales, board president. “They do not come up to HUD standards.”
According to Federal Emergency Management Agency (FEMA) lead public affairs officer Jim Foster, the trailers are more than likely ones purchased through the General Services Administration’s auction website. “FEMA only sells through the GSA auction website,” said Foster, adding that the site indicates where the trailers are located. “They are sold individually or by the lots.”
Foster declined to say if FEMA was investigating the sale of the trailers at a site in nearby Nicholson, Miss., and the GSA website no longer lists any of the trailers for sale.
The owner of the trailers that are being sold in Nicholson said he purchased 50 of them through the GSA auction website and said he makes sure he tells people that the trailers are for camps or storage only and not to be lived in. “I do not want to deteriorate our community,” said Darryle Whitfield, “I tell anyone interested that these are not to live in. These are strictly for deer camps, fishing camps or storage units.”
Whitfield admits that he has had “only three people” indicate they were considering purchasing the trailers to live in.
Business had been brisk, Whitfield said, though he says he had done very little advertising and was amazed at the number of people interested in purchasing one.
“It is amazing of the number of people who want them,” said Whitfield, adding that he has had people from as far away as Virginia and Texas buying the trailers. “They’ve been from Virginia, Missouri, all over Texas,” he said, adding that several of the trailers have been sold for use along the Gulf Coast and in northern Mississippi.
Even so, the sale of the trailers has the supervisors stymied on how to prevent someone from purchasing one of them and moving it in place of a FEMA trailer without the county’s knowledge. “FEMA has questioned us several times since day one and has asked about making them permanent residences,” Hales said. “They said they would abide by our regulations.”
The county so far has refused to set a deadline for residents still living in FEMA mobile homes and travel trailers to be out of them or to be cited for living in housing that does not meet county codes. FEMA cannot force someone to move out of the travel trailers, instead having to rely on local officials to enforce zoning and code regulations.
In Pearl River County, as of July 16, there were 111 families living in FEMA housing units. Of those, 79 were in travel trailers. Harrison County has 172 total in FEMA housing, with 116 in the travel trailers, and Hancock County has 74 with 60 in the campers.
Admitting that the FEMA travel trailers within the county are not hard-wired electrically, thus making it possible that someone could try and switch the trailers and not apply for any permits, County Planning & Building director Ed Pinero said his office was taking steps to prevent someone from trying to place one of the campers in place of a FEMA trailer without the county’s knowledge.
“We are in the process of contacting FEMA so they can make us aware of when a camper has been moved (out) so someone can not move one in,” said Pinero. “It is not legal for one of these to be used as your permanent residence.”
Pinero said that the sale of the trailers could pose a problem not just for Pearl River County, located in the extreme southwest corner of the state, but for several other Mississippi counties.
“These are going to be a problem for the southern six (counties) because a lot of these are going to be sold,” said Pinero, adding that to date, no one had applied for any permits for one. “We will stay on top of this,” he said. “These travel trailers are not permanent housing and can not be used as such.”
The Federal Emergency Management Agency (FEMA) is sending out 1,385 rebate letters to 2005 hurricane victims who paid more than $5 for their federally issued trailers or mobile homes.
Last month, the Obama administration announced that, as part of efforts to avoid large-scale evictions of people still in the units, they’d allow for recreational park trailers or park model trailers to be purchased for $1 and mobile homes for $5, according to the Associated Press.
As a matter of fairness, the administration said it would offer rebates to those who’d previously paid more.
FEMA says the average range of cost paid for park models and mobile homes prior to the announcement was $8,500-$16,000.
Smaller travel trailers — over which concerns have been raised about formaldehyde fumes — are not eligible for purchase.
Retail registrations of towable recreational vehicles totaled 13,901 in April off 39.5% from April 2008, according to Statistical Surveys Inc.
The Grand Rapids, Mich.-based firm, which tracks retail sales for the RV industry, reported these sales figures by category compared with April 2008:
- 9,006 travel trailers, down 36.9% from 14,283.
- 3,776 fifth-wheels, off 42.1% from 6,517.
- 1,018 folding camping trailers, a 49% decline from 1,998.
- 181 recreational park trailers (park models), off 44,6% from 327.
Year-to-date, towable sales totaled 40,015, off 40.8% from 68,892 through April 2008.
Thor Industries Inc. retained its commanding position in the RV industry with a 29.5% share of the towable market. Jayco Inc. was second with a 14.2% share while Forest River Inc. was a close third with a 13.1% market share. Heartland Recreational Vehicles LLC and KZ RV LP rounded out the top five.
By segment, Thor was first in travel trailers, fifth-wheels and park models and FTCA Inc., marketing under the Coleman name, was first in folding camping trailers.
Like other RV manufacturers, recreational park trailer builders have been hard hit by the recession, with unit shipments being roughly half of what they were in 2006, when a record number of 10,100 shipments were recorded.
“I think the market is starting to improve. We’ve seen some movement in the marketplace. And a few manufactures even report having a small backlog, which is something that we haven’t experienced in the past year,” Bill Garpow, executive director of the Recreational Park Trailer Industry Association (RPTIA) in Newnan, Ga., told RV Business.
But manufacturers remain cautious about the economy, and generally don’t see the recreational park trailer or “park model” industry to rebound until the nation’s banks are in better financial shape.
“As I talk to my contemporaries, I’m hearing the same from everyone, that it’s really tough out there. And what business is out there is really tough to get,” said Tim Howard, president and CEO of the Breckenridge Division of Damon Corp., a Thor Industries Inc. company in Nappanee, Ind.
Like most manufacturers, Breckenridge has had to dramatically scale back its work force to remain viable during the current economic downturn. “We’re in very good shape,” Howard said. “Our balance sheet continues to be very strong. We have virtually no debt.”
But as a manufacturer, he said, it has been “heartbreaking” to have to let staff go because of the economic downturn. “You have an emotional bond to quality people and an investment in quality people,” Howard said, adding that Breckenridge has just over half as many employees as it did a few years ago, when the park model industry was experiencing record sales.
But even though all segments of the RV industry have been particularly hard hit by the current recession, Howard and other park model manufacturers and industry officials believe the park model industry still has a long ways to go to reach its full potential.
“I’ve always said this market is in its infancy, and I still do, especially given the trend from a transient to permanent camper,” said John Soard, a longtime park model industry executive who spent 20 years with Breckenridge and Middlebury, Ind.-based Woodland Park before becoming general manager of Nappanee, Ind.-based Fairmont Park Trailers in 2005.
Indeed, Soard and other park model manufacturers believe consumer interest in “destination camping” will continue to increase, and as it does so will demand for park models.
Soard, in fact, noted that many of the leading RV manufacturers are now building towable trailers up to the 400-square foot limit precisely because they believe consumer interest in destination camping is growing. “Each one of these major RV manufacturers has a destination travel trailer that’s intended to be parked, not towed,” Soard said.
Garpow, for his part, noted that park models remain one of the most profitable investments campground owners can make, a point that was underscored by Atkinson of KOA. Park model rentals typically generate two or three times as much revenue as a typical RV site, plus they stay rented for longer periods of time throughout the year. “Park models not only generate more revenue, but they do it for longer periods of time than a typical RV site,” Garpow said, adding that campground owners often generate enough income from their park models to pay them off in three years or less.
Garpow also noted that the Obama administration’s efforts to increase CAFÉ standards could further increase demand for park models. “One way to increase fuel economy is to produce lighter vehicles as well as vehicles with smaller engines, the net effect of which is to reduce the vehicle’s towing capacity. But as towing capacities are reduced, it’s going to be harder for consumers to find vehicles that can tow the biggest trailers, and that could lead to increased demand for park models or for destination camping.”
As a result, he said, many consumers may find it easier to purchase park models that are professional installed on permanent campsites than large travel trailers or fifth wheels that require a tow vehicle. This is precisely what happened when CAFÉ standards were increased in the late 1970s and 80s. In fact, the resulting reduction in vehicle towing capacities helped foster the birth of the park model industry.
Garpow also noted that many of the nation’s campgrounds have yet to open their doors to park models, either for rentals or sales, and that represents a significant growth opportunity for park model manufacturers.
Many campground operators say they are pleased with the return of investment on park models, including Jeff Gordon of Raintree RV Park in Rockport, Texas, which sits along the Gulf Coast roughly 30 miles northeast of Corpus Christi. In addition to 80 RV sites, Gordon also offers one cabin, two fifth wheels and four park models for rent.
“We’re actually going to phase out the fifth wheels and just go with park models,” Gordon said, adding, “All of our requests are for park models. They’re nicer accommodations, and that’s what people want in this area.”
Coincidentally, Gordon had to interrupt his interview with RV Business to answer questions from a woman who called on another line to reserve one of his park models. He said he’s also had some people change their vacation plans to coincide with days when he has park models available.
Such is the demand for park model accommodations, which is why campgrounds and RV parks continue to invest in these units, even during the current recession.
“Roughly 25-30% of the nation’s private campgrounds offer park models as rental units, and the numbers are growing,” said Garpow of RPTIA.
Mike Atkinson, facilities development manager for Billings, Mont.-based Kampgrounds of America Inc. (KOA), said his company’s park models, which it markets as Kamping Lodges, have the highest occupancy rate of any category of rental accommodation in the KOA system. He said KOA parks had taken deliver of 163 park models as of early June.
KOA, like other campgrounds, furnishes its park models with beds, linens and kitchen utensils. “Our numbers show that the customers who are coming to our campgrounds want lodging that has amenities,” Atkinson said. “They want a bathroom. They want a comfortable bed. And they don’t want to pack their car with everything. They don’t want the labor.”
Park operators often invest in park models so that they can have rental units available for people who don’t have their own RV. Many park operators also take it a step further and form their own park model dealerships. This way, they can potentially make a profit on the sale of the park model in addition to generating ongoing revenue from the campsites they lease to park model owners.
Some parks also set up rental pools using the park models they have sold at their parks. This way, the owners can make money on their park models when they’re not using them.
While park models have long been a rental option of choice for Winter Texans, Gordon of Raintree RV Park said boating enthusiasts also like to rent them as well. “We’re on the coast, so we get a lot of people from San Antonio, Austin and Houston and the surrounding areas,” Gordon said. “But if they’re pulling their own boat down, they can’t pull a camper, too.”
Park models are also ideally suited for campgrounds in popular tourist destinations that want to broaden their business base to compete with hotels and motels.
Crater Lake RV Resort in Fort Klamath, Ore., purchased three park models in 2006 and installed a fourth one this year. “They are our most requested cabin,” said resort owner Babe Hamilton, whose park also features 14 RV sites. “They’re just a nice looking cabin with the wood siding. They all have their own gas barbecue on the deck, and they’re right on the creek. It’s a very nice setting.”
Some private park owners are also finding that park models can be used for more than guest accommodations.
At the River’s Edge at Deer Park in Heber, Utah, which is close to the Deer Valley and Park City ski resorts, Cavco park models are being used not only as guest accommodations, but as seasonal employee housing for during the winter months, said resort owner John Kenworthy.
“We’re continuing to expand the lodging part of our business,” Kenworthy said, adding that his park models remain are in high demand.
Garpow and Linda Profaizer, president and CEO of the National Association of RV Parks and Campgrounds (ARVC), are scheduled to discuss the merits of investing in park models on Sept. 15 during the 41st annual Pennsylvania RV and Campground Show in Hershey, Pa. The show features the largest park model expo in the country.
Happy campers they’re not.
In past years, visitors with recreational park trailers or park models were free to stay at campgrounds throughout New Jersey for as long as they wanted.
But this year the state is limiting those stays to six months, saying safety issues make it necessary. Owners of the 400-square-foot park models reject the state’s concerns, and say the new regulation is arbitrary, according to newjerseynewsroom.com.
“The electrical system of park models is intended for ‘seasonal use’ only,” he said. “The electric code, however, does not specify what seasonal use is. Therefore, the department has defined six months as seasonal to us,” according to the article.
But the president of the New Jersey Campground Owners Association, based in Middle Township, rejected the state’s reasoning.
“They’ve convinced the state Legislature this is a health and safety issue when this has never been a problem,” Jay Otto, the president of the group, told the Press. “They perceived this danger that doesn’t exist,” he said.
The Texas Association of Campground Owners (TACO) launched a new website Tuesday (June 9) that highlights campgrounds and RV parks in Texas that offer cabin, cottage and recreational park trailer or park model rentals.
The website, www.TexasCabinRentals.net, features more than 130 campgrounds, many of which offer cabins, cottages and park models that can be booked online, according to a news release.
“We’re trying to make it easier for consumers to identify campgrounds and RV parks that offer rental accommodations,” said Brian Schaeffer, TACO executive director and CEO, adding that private parks are increasingly investing in park models and cabins to accommodate people who do not have an RV but want to experience the camping lifestyle.
Several Texas campground owners said they were looking forward to the new website because it will help spread the word about the availability of rental units in private campgrounds.
“It’s often cheaper to stay in a park model than a hotel,” said Jeff Gordon, owner of Raintree RV Park in Rockport, which has four park model rentals. “We’re on the coast, so we get a lot of people from San Antonio, Austin and Houston and the surrounding areas. Many of them bring their boats down and stay in park models because they can’t pull a boat and a camper, too.”
Jim Rowley, owner of the 108-site Pecan Park in San Marcos, has two fully furnished park models, which he said are ideal for people who have never camped before. Each unit is fully furnished linens and kitchen utensils and can sleep up to eight people.
“A lot of people want to know what campgrounds are like, and park models give them a chance to have a camping experience without buying an RV,” Rowley said, adding that his park models are positioned on a bluff overlooking the San Marcos River.
“I definitely think TexasCabinRentals.net will help our business,” said Jenifer Johnson, director of business development for Mill Creek Ranch RV and Cottage Resort in Canton, which has 100 RV sites and 31 park models. “All of our park models are owned by individual owners, and when the owners aren’t here, we rent them out,” she said.
Most people only dream of a lakeside vacation home, but a growing number of RVers are discovering they can afford that summer cabin experience — and they don’t have to travel far to get it, according to The Edmonton (Alberta) Journal.
Buying a spot or renting one long-term in an RV resort is becoming increasingly popular, said Doug Ross, general manager of Grove RV and Leisure, a dealership in Spruce Grove. “People like to get away from the city, but the cost of towing and gas prices and everything sometimes makes it a little more expensive.”
Now, however, holiday playgrounds where RVers can leave their units year-round are popping up within easy driving distance of Edmonton, Ross says. Among them are Lake Arnault RV Resort, an hour west of the city, and Allan Beach Resort on Hubbles Lake in Stony Plain, 30 minutes from Edmonton.
“This way, they can drive in their car out to where their recreational vehicle is set up,” said Ross. “They can have everything all set and ready to go the minute they arrive.”
That’s the kind of person developer Pablo Galvez hopes to attract to Allan Beach Resort, which will start pre-selling lots on spring-fed Hubbles Lake this summer.
“People are just so busy, and they don’t have time to drive three or four hours to a cabin on a lake,” Galvez said. “Imagine: Get off work at five o’clock on a Friday, and by 5:30 you’re at your cabin with a glass of wine on the deck.”
Property prices in the four-season resort will start at about $145,000. Owning land in an RV retreat is attractive for another reason, said Galvez. “RV condos like this are the cheapest form of lakefront ownership,” he said.
Don Dobing, owner of Lake Arnault RV Resort, agreed. Pre-sales have begun for lots in his project. Prices range from $60,000 to $100,000.
“It’s a nice alternative (to traditional lakefront property),”Dobing said. “You own your property, and if you want to give it to your family or you want to sell it, you have title to it. So you’re going to get your investment back.”
And then some, said Arnie Lank, sales manager for Gleniffer Lake Resort and Country Club, southwest of Red Deer. The popular vacation spot started out as an RV resort 20 years ago. The gated community has indoor and outdoor swimming pools, a hot tub, fitness center, golf course and swimming and boating on Gleniffer Lake. When it first opened, lots sold for $12,000 to $18,000. Lank says a property for sale now in an older part of the park has an asking price of over $200,000.
The final phase of the resort is restricted to cabins and recreational park trailers or park model RVs, but the only time the huge units move is when they’re towed to a permanent or semi-permanent site.
A number of resorts close to Edmonton rent spots for the entire summer.
At Hubbles Lake RV Resort on Hubbles Lake in Stony Plain, seasonal rates start at about $1,800. Customers can store their units at the resort over the winter for $150.
“It’s a cottage atmosphere,” said park owner Laurie Zimmer. “We’re (within) proximity to Edmonton here. People can just quickly run out with the van or a small car.”
Many rental places are so popular, spots are snapped up even before the season starts. That’s the case at Hilah-Ayers Wilderness RV Park on Mulhurst Bay at Pigeon Lake, an hour’s drive from Edmonton.
There are no spots left for this year, said spokesperson Charlene Dawson. Spaces are rented for a one-year period. Rates start at about $2,100.
The Whitemud Creek Golf and RV Resort in southwest Edmonton has monthly rates from about $750.
“In Edmonton, you only have so many RV spots, so we’re busy,” said Manager Jo-Ann Ruff.
Canadian RV maker Glendale International Corp. reported the appointment of Murray Hannan as its CFO.
As part of Glendale’s ongoing restructuring and cost rationalization, Brian Jennings has agreed to resign as the corporation’s CFO and will be replaced on a part-time basis by Hannan.
“We are very disappointed with Mr. Jennings’ departure as a member of the executive management team, but reducing costs at all levels of our business given the current economic environment is necessary,” said Edward Hanna, Glendale CEO. Hanna also indicated that “we are fortunate that Mr. Hannan, a member of the board of directors and former CFO of the corporation, has agreed to assume the role on a part-time basis which will make the transition from Mr. Jennings seamless.”
The company’s Glendale Recreational Vehicles division, located in Strathroy, Ontario, makes RVs for the Canadian and U.S. markets. The Travelaire Canada division, located in Red Deer, Alberta, manufactures recreational park trailers and relocatable structures for the Western Canadian market place.
The corporation also owns 43.6% of Firan Technology Group Corp., a leading North American manufacturer of high technology printed circuit boards and precision illuminated display systems.