Why am I Buying when Gas Prices are Going Through the Roof?

By: Steve Klontz of Campground Brokers

June, 2008

YOU MISSED YOUR CHANCE!! The Madras KOA is SOLD!

I am the Buyer!

Why am I buying when gas prices are going through the roof?

I am not alone. The big players in the market who buy campgrounds with over $1,000,000 in income are all buying. In fact, we can not find any really large campground that is for sale…ANYWHERE!

WHY? 

The "big boys" know that there are 8,000,000 RV's on the road and people are making payments, paying insurance, etc. They understand that if an RV gets 10 miles to the gallon and fuel goes up a $1 a gallon, then a 1000 mile trip only costs about $100 more.

Millions of RVs will still be visiting campgrounds this summer. They may travel shorter distances and stay longer at base campgrounds, but they will be used.

What is the real effect of higher fuel prices? Almost everything is affected by petroleum prices, from the manufacture of plastics, tires, food, and fertilizer, to the transportation of all goods. Just this week Dow Chemical announced an across the board 20% price increase. Everything will soon cost more.

Look at what has happen to the dollar! It has dropped in value by almost a third against most of the major currencies. If you go to Europe, Japan or even Canada, your American dollar will only buy what $.66 did just two years ago!

There is a shortage of campground spaces in many markets. Study the rates on the East Coast and in California. The rate in many of these markets is around $70. Those rates will move inland; first, to areas like Denver, CO, Salt Lake City, St. George and Cedar City, UT, Durango CO, Bend and Sisters OR, and hundred of other nice areas that are short of campgrounds. There are just not enough sites to go around!

The fact that campgrounds sell close to 10 times their net income, we believe that inflation will make campground values sky rocket over the next few years.

I purchased the Madras/Culver KOA so that I could take advantage of inflation rather them be a victim of it. Besides…I believe in this business!

What are you going to do? Take advantage of inflation or wake up and find that campgrounds have increased in value to the point you are priced out of the market?

I put my money where my mouth is. If you agree with me…Give me a call!

Steve Klontz, Broker

Campground Brokers

P.S. If you are mobile and would like to exchange some work for on-site training, while getting a first-hand look at this business, I could use you NOW! Call me today!

Call Campground Brokers at 800-648-1624 to discuss any info on this property.