Carefree RV Resorts Expands Portfolio
2008 has been a down year for many campgrounds and RV resorts due to rising fuel costs and continuing uncertainties involving the economy.
But Scottsdale, Ariz.-based Carefree RV Resorts has had a very good year at most of its 33 RV parks and 11 manufactured home communities.
“Our occupancies are ahead of projections in all but four or five parks,” Carefree President Colleen Edwards told Woodall’s Campground Management. “We’ve had a good year.”
Edwards’ name may sound familiar to private park operators. She and David Napp co-founded National Home Communities in 1996, which they eventually built into a network of 42 parks by 2004. Their RV resort holdings, which included numerous parks with the Encore brand name, were among the finest in the private campground sector.
Edwards and Napp sold National Home Communities’ holdings to GE Capital and Chicago-based Manufactured Home Communities (MHC) in 2004. MHC subsequently changed its name to Equity LifeStyle Properties (ELS) and has continued to acquire RV and manufactured home properties across the U.S. and Canada.
Meanwhile, Edwards and Napp never left the RV industry. In fact, while ELS, a publicly traded real estate investment trust, has built itself into one of the largest owners of RV resorts and manufactured home communities in the country, Edwards and Napp have quietly been doing the same thing, albeit on a smaller scale.
With Edwards as president and Napp as CEO, they started Carefree in April 2005 with the acquisition of three RV resorts from Bel-Aire RV Resorts, including two in Florida and one in North Carolina. They also brought on several former NHC executives to join them, including Greg Barton, Roger Buchanan, Terry Harrell, Mike Rosenhagen, all serving as vice presidents, with Charles Ellis serving as vice president of acquisitions.
Carefree later purchased another resort in Lakeland, Fla. The company subsequently brought in Five Arrows Realty, a subsidiary of UK-based Rothschild Bank, as an equity investor and obtained financing from GE Real Estate. Since then, Carefree’s portfolio has grown to include 33 RV parks and 11 manufactured home properties in eight states and Canada with approximately 10,000 sites.
Carefree Targets Destination Markets
Carefree’s properties are collectively worth more than $275 million, Edwards said, adding that her company has spent over $5 million in improvements by remodeling facilities, adding amenities, paving roads and instituting brand standards. All Carefree parks have wireless Internet or Wi-Fi service, mostly through Austin, Texas-based TengoInternet, although some had existing Wi-Fi agreements with other companies.
Edwards said Carefree plans to make more acquisitions and has enough financing behind it to keep doing so for at least two more years. “Ultimately, we’re looking at acquisitions on a park-by-park basis,” she said. “If an individual acquisition makes sense, then we’re going to try to buy the park. We have a line of capital that we think will suffice for a couple of years. We don’t have a capital issue right now. But we’re not going to push through any deals that don’t make sense.”
In terms of geography, Edwards said Carefree is targeting locations in established destination markets. “We’re going where we know RVers and retirees want to go,” she said.
While Carefree apparently has a large and growing base, the company has no plans to make its parks a membership business, although it does cross-market them.
Carefree Reaches Out to Younger Campers
Carefree, instead, is targeting a younger demographic.
“We’re focusing on the younger, Baby Boomer-type RVers,” Edwards said. “We’re trying to make sure our resorts offer modern amenities and plentiful amenities. They’re used to brands and they want to know what they’re going to get.”
“Most of our resorts,” Edwards continued, “have activity directors. We train
our managers to think outside the box and work with local event planners to plan other activities taking people outside the parks and visiting local attractions.”
In an effort to reach out to younger RVers, Carefree has also overhauled its website at www.carefreervresorts.com and offers online campsite reservations for all of its parks. “We know so many RVers do research online, especially younger folks,” she said, although the company also markets itself with advertising in printed campground directories.
Carefree is also using its website to market park models at its resorts. Like ELS, Carefree is actively selling both new and used recreational park trailers or “park models” at its resorts, which people can use as weekend retreats or vacation homes.
“We’re selling a lot more used park models than we ever have before,” Edwards said. In fact, as many Florida RV parks have been acquired by developers for other uses, Carefree has been purchasing their used park models, fixing them up and reselling them to people who would like to use them at Carefree parks.
“Many of our parks have 70% to 80% of their sites occupied by park models,” Edwards said. “There are many people who like to stay for a long season.”