What a Winter!!
In more ways than one, it’s been quite a winter. On the one hand, the northern tier of the country has experienced all kinds of record cold temperatures while Boston and a lot of New England experienced record snow falls to go along with the cold. No doubt large numbers of Americans are suffering from cabin fever and are ready to get outdoors.
For me, it’s also been quite a winter. For the first time, I actually spent the winter in Florida, arriving on December 10th and getting ready to head north to Virginia in a couple of days. But what really stands out in my mind about this winter is not just the sunny warm winter Florida days but the intense interest I’ve seen in the RV park industry.
This winter has been the busiest on record for David Gorin Associates. As the RV industry was in its 6th straight year of growth since the great recession, my business growth is obviously feeling the wind at our back. We have fielded more telephone and email inquiries since early January than ever before in a 3 month period. Developer and investor interest in the RV park business seems to me to be at an all-time high. And as my travel schedule certainly attests, the increasing level of interest in the RV park real estate asset class appears to be at its highest level since I entered this end of the business in 2002.
For the first time, business was actually getting in the way of social activities, golf and enjoying the outdoors! Feasibility studies are not quick consulting jobs. They are time intensive and involve significant travel, research, contemplation, financial analysis and study.
I’ve no idea how my consulting colleagues around the country are doing this winter, but for DGA we’ve done projects in Tennessee, New Jersey, Georgia, Alabama (2 projects), Arkansas, Nebraska, New York, Ohio, Florida and South Carolina. And another Ohio, another New York, and Mississippi are still to come. If half of these projects actually materialize and produce new RV parks, it will add significantly to the number of new, state of the art available RV sites. And new product in the market place is certainly a good thing.
Man, I wish I were 20 years younger so I could really take advantage of this exploding market opportunity.
And by the way, much to my disappointment, this winter marked another milestone in my life……I actually turned 70 (freakin’) years old! No fun. Can’t believe I was just 42 when I joined NCOA (the National Campground Owners Association, the forerunner of ARVC) and that was 28 years ago. What a ride it’s been and there’s still much more to do. To the three wise men of NCOA at the time – Dan O’Connell, Al Daniels and Erv Banes – who gave me the opportunity to join the park industry, I wish them a happy 70th also. I’m not sure exactly when they go over the big 70 but if I recall, we were all about the same age 28 years ago.
Baby Boomers v Millennials
For just about as long as I can remember, the RV industry has hitched its star to the baby boomer generation. The post World War II generation, born between 1946 and 1964, were to be the generation that would put the RV industry on the map. Affluent, successful, and getting ready to go over the age of 50 and enter the prime RV buying years, this generation was to turn 50 beginning in 1996 at the rate of 11,000 a day! Surely, there would be RV buyers aplenty out there.
In a recent issue of RoadSigns, a quarterly economic review publication of the RV Industry Association, economist Richard Curtin has turned some attention to the next coming generation, the Millennials.
Curtin points out that the Millennials, the oldest of which were born in 1980 and are now 35, are now the largest US generation, outnumbering the baby boomers. The most important characteristic of the millennials, says Curtin, is that they share core RV values – a deep attachment with family and friends to the outdoor lifestyle, and have an active interest in exploring nature and traveling. They are attracted to products and marketing strategies that reflect these characteristics. Millennials are more diverse in their ethnicity, living arrangements and lifestyles, and they face a less positive economy than prior generations. They are the first generation of the internet and social media age. Forward looking companies and industries recognize that enormous changes are required to serve this millennial market and successful companies will adapt their products and marketing to meet this new group.
Attention Campground Owners – the millennials are not too far way and its not too early to begin to think about what this next cohort of RV owners may find attractive. The average age of the RV buyer, especially buyers of travel trailers and toy box trailers, is already in the low 40s and dropping. Pretty soon they will run into the millennials on their way up. Take a look at your own family, listen to your millennial aged kids and watch what they like and what they do. They are your future customers.
Shoot Out at Walmart
A March 23rd shoot out in a Walmart parking lot in Cottonwood, AZ may have a cooling effect on overnight camping at Walmart that the park industry has been hoping for over the years. The shoot out and brawl involved 8 police officers and 8 civilians.
According to the newspaper account of the incident, the suspects had been staying (living…camping) in a Suburban vehicle for at least four days in the parking lot, according to a man camping out in an RV in the parking lot. The man would not give his name nor do we know how long he’d been camping out there.
The man said he looked out of his RV’s window after the brawl and shootout woke him up Saturday night. He heard screaming and saw people running around and firing guns.
Over the last many years, the issue of safety of staying in Walmart parking has been raised repeatedly. There have been numerous incidents of shootings, kidnapping, carjacking, robbery and other crimes in these parking lots not unlike these types of incidents in almost any city and in almost any large parking lot.
I remember one RVer writing to ARVC years ago when an editorial about overnight parking raised the question of safety. The writer was irate and was sure that ARVC was just trying to scare RVers to staying in campgrounds. He said something like “don’t you try to tell us what to do. We all have loaded guns in our RVs and let anyone come near us and they’ll be sorry.”
Maybe now the Walmart lawyers will decide that overnight camping in Walmart lots, in RVs or Suburbans, isn’t really a necessary feature of Walmart. We’ll see what happens this time.
Salute to Richard Coon
RVIA President Richard Coon has announced he will retire at the end of September. A lot will be written and said about Richard and the outstanding leadership he has provided to RVIA since taking the position in 2006 but the one thing that truly stands out in my mind is his stable, solid leadership of the industry during the recession years of 2008 and 2009. Those were incredibly difficult years for every industry but not many took a hit of the size of the RV industry that endured a sales decline of over 50% during those years. Richard’s strong leadership that steered the manufacturers through that tough time stands out in my mind as a super accomplishment. Taking over in the record high-water mark year of 2006, watching sales plummet and then rebound over the last 6 years is surely a sign of a superb executive.
Congratulations Richard on a job very well done. Enjoy your final months at the helm of a great association. I know campground owners should be on the lookout for the Coon family as you most likely enjoy an RV retirement – at least some of the time.
I know it’s been a booming winter season in Florida and expect it’s been the same in Texas, Arizona and southern California. And as the summer season is just around the corner, I wish all the summer parks all the best for a safe and prosperous summer season. All the stars are aligned for a great camping year.
KOA recently announced that’s its reservations taken during the first 60 days of 2015 were the most in its history. Great news for KOA and hopefully it’s a signal for the rest of the industry – a good summer is ahead.