OT: Wanna buy a campground?

[Christyhicks]

Well, I hate to be the wet blanket, and I don't know how it is down there, but around here, most auctions for real estate already have a buyer who may or may not bid at the auction, depending on how high the bids go.  Most auctions are due to death, divorce, bankruptcy, or a last ditch effort to get more than a seller has been offered so far.  Usually they have a backup buyer, and the deal is often "done" before the auction is ever held.

If there is a loan against the property, you can bet that the mortgage company's rep will be bidding at LEAST up to what they are owed.  They are not about to lose their interest in a property.  If you buy a property at auction, you run the risk of buying a property worth less than the leins against it.  Contrary to popular belief, an auction does not necessarily "clear the leins" as some people would think. 

Having said this, I have to reveal that we did purchase my brother's property at his auction, which was held due to a divorce and inability to agree on the details needed to divide, list and sell the personal and real property.  We were nearly at our maximum when we won the auction, so there are times that you can buy property at auction.  However, we didn't get a steal. . . we likely paid exactly what the property was worth at that time. 

I suggest that someone could search the courthouse records and see what leins are filed against the property.  Often, you can pay a title company as little as $100 to do a quick report, which basically searches courthouse records and gives you a list of loans/leins currently against a specific property.  It is not guaranteed to be thorough, but usually they catch most things.  If you have the owners names, you can also search courthouse records to see if there are any pending judgements against them also.

I can not imagine being able to research the property, and then put together a group of investors and a thorough operating agreement in such a short time.  As for the auctioneer setting a reserve, well, usually that doesn't happen.  It's the owner who will set the reserve, and remember, although the auctioneer may have a minimum amount he charges to set up the auction, the more he gets for it, the more he makes.  The land is worth exactly what someone will pay for it.  Tax assessments, appraisals, etc., are of little use when determining the value of a unique piece of property or business. 

I would think that the proper form of action for a group wanting to "own" a campground would be to first, form the group and come up with a general consensus of how it would be run, and what general locations would be preferable to the ownership.  The idea that you could buy and own a campsite for as little as $1,000, and that you really have "ownership" not rental of that site, without continued investment, well, I think that is likely one of those "sounds to good to be true" situations. 

Sorry if I sound like a wet blanket, and I'm not saying you can't do something like this if you really wanted to, but I don't think you want to do it like this.  Christy Hicks

[chargePlus]

I think in order for this venture to generate profits, There needs to be a good busisness plan.
I'm referring to capitol to revamp the property so it would be up to standards, codes, and to be
competitive in order to generate a profit. I propose we set up a discovery commitee to generate
a plan of approach. This commitee can meet with Dallas and Cat and collect all the info they know,
and get a good prospective of the possibility's and the potentials. This way we can see the real money
that needs to be in place instead of just throwing numbers in the air. By the time of the auction, I would
like to know for sure, exactly what we should pay for the property. Not a penny more!
Let me know
Nick-

I agree here. This could be an interesting proposition.

The campground is in an interesting location. It could be a decent stopping point for trips along the east coast.

Some distances and times:

Destination	Distance	Approx. Time
Boston, MA	850 miles	14.3 hours
Albany, NY	775 miles	13 hours
Philadelphia, PA	550 miles	9.25 hours
Virginia Beach, VA	335 miles	5.6 hours
Daytona Beach, FL	390 miles	6 hours
Orlando, FL	440 miles	6.8 hours
Arcadia, FL	555 miles	8.8 hours
Pensacola, FL	600 miles	9.3 hours
Miami, FL	650 miles	9.6 hours
Key West, FL	800 miles	12.6 hours

Dallas, how far is the campground from Darlington Speedway? How full is the campground leading up to, and the week following the Nextel Cup race? Also, what do you know about what appears to be a road-racing track on South Warren Street, northeast of the campground?

What kind of conveniences, fuel, restaurants, convenience stores, etc. are located nearby? If there is no convenience store this could be something to consider adding as time and $$$ permit. Stocked properly they generate a decent income.

Does the campground have any kind of signage on the interstate prior to the exit both south- and north-bound? Think of the blue signs that "advertise" restaurants and gas stations.

• How much do they charge per night now?
• How much could the nightly rate be raised if improvements were made?
• How much would it cost to upgrade the electrical to provide 30A and 50A service at all the existing sites?
• How many more sites are there realistically available on the site?
• How about adding potable water service to all existing sites?
• Does the site already have a dumping station?
• How much would it cost to add one?
• What could you charge people to use the dumping station if they were not staying at the campground?
• Would it be worthwhile pursuing membership with any of the various campground associations like KOA, for example?
• Would it be worthwhile to pursue creating a simple web site to help promote the campground?

So many questions...

Count Natasha and I as "interested" in this proposition. I'm also interested in helping out with the forming of a business plan. I wrote a few when I was in college. I have some time while I'm currently searching for work, and I have access to some interesting research tools as part of my outplacement services from my last job.

Update - 3:30pm East Coast Time
The owner of the property in question is listed as Lockhart, Inc. in Timmonsville. The property in question appears to be ~69.66 acres. Lockhart, Inc. also owns another parcel ~7.69 acres directly in front of the big parcel. Floyd's Convenience store is wrapped by the ~7.69 acre parcel.

I also discovered that there are two other commercial properties for sale nearby on Young Road. One is ~192 acres for $2.3 million ($12,000/acre) and a ~47 acre plot for $941,000 ($20,000/acre). I have no idea how long either has been on the market or the level of interest in them.

Residential property that is open land and not listed as part of a subdivision in Timmonsville appears to range from $2,500 to $12,000 per acre.

Assuming a best case ($2500/acre) scenario the campground property could be "worth" $174,150 and worst case (commercial at $20,000/acre) it's worth $1.4 million. The perceived value of the property will depend on how the purchaser plans to use it and the number of usable acres on the property.

Without seeing the books it would be difficult to appraise the value of the going concern. I made a few assumptions, a $10/night fee and 9 sites occupied per night (25%), and that works out to $32,850/year gross. The currently assessed property tax value of $91,000 would be roughly 2.7 times annual estimated gross revenue, and at $2500/acre valuation it would be just under 5 times gross revenue. If the numbers (occupancy and rental rates) are higher that improves things a bit.

If I had to guess the owners of the campground have been trying to sell it as a going concern and are having no luck. The auction is a last resort to get their money out by valuing it as a property, not a going concern. The big drawbacks for many developers (both commercial and residential) are likely the lake/pond. The proximity of I-95 is a plus or a minus depending on your planned use.


Cheers,

- John

[bubbaqgal]

The rate right now is $20 per night with less if you rent by the week or month.  You could get more, maybe $30 or so if you upgraded.
The cost of upgrade on the electrical would have to be determined by an electrician.
You could easily get 80 more sites, maybe not all full hook-up on the site
There is already potable water at all existing sites
There is a dumping site and we have charged $10 to dump for non campers
There is also a propane station on site
I don't think it would be worthwhile going with KOA since it was originally a KOA site and they moved to a larger area further north
Dallas has already looked into a web site and we have one we have already purchased that would be available for use.
There is one billboard on the freeway that is hard to see.  There are no "blue" signs because the owner didn't want to pay for them.
He had one buyer that had wanted to purchase this property and 1 other one but the deal fell through.  The owner had been "throwing" the campground in because he feels it is worthless.   He has not had it for sale until just recently but is property rich and cash poor and wants to unload some of his local properties.
There are a few restaurants in Timmonsville and many others just about 10-15 min away.  The mall is also only about 10 miles from here.

Dallas and I have lived here for 18 months and love the area.  There are 4 other camper families here that have been here for months or years.  They have been renting out some of the permanent campers and also have a few in storage.  The convenience store building also houses a garage and a diner.
Dallas took pictures of the campground today and will post a link to them later.  Cat

[Dallas]

Here is a link to some photo's I took of the place today.

http://busphotos.busconversionstuff.com/photo/index.php?cat=5

I'll have more later, but these can give you an idea of the possiblities.

Dallas

[Ross]

So is this an absolute auction?  The owner has to know that a commercial property literally abutting I95 is worth something.  What is he expecting to get?  What was the sale price the last time he had it under contract (the one thet fell through)?

Ross

[Dallas]

You kind of have to remember, this is a small town with a lot of small town thinking.
It isn't like it was near a major population center, and all that entails.

Also, Myrtle Beach is too far away to be a real factor in real estate here.

We do have a Honda plant up the road about 3 miles, but they don't buy from local vendors. Everything they get is shipped in JIT.

To give you an idea of how small the thinking is here.... the local hardware store is closed on Saturdays.

Other than that, I have no other information on the sale or auction.

IHTH.
Dallas

[niles500]

I have done a little (very little) DD on this and William Lockhart appears to have done some development in the area - so I don't think he's going to give the property away - that being said anyone who uses the auction process to liquidate property is not interested in a lot of inquiries and wouldjatakes, they are usually only interested in a no-contingency cash offer by a single principal- recently I have seen properties sell at well over their value at auctions due to emotional purchases, so buyer beware - it also appears that part of the parent parcel may have been sold to one Saundra Parlor, so I'm not clear as to the size or shape of the remainder or what's for sale - Anyone interested in this property might want to keep this in mind - FWIW

[Dallas]

Thanks Niles! I have very little experience at buying real property, so I'm really not the person to be asking.

Dallas

[niles500]

No Dallas - To the contrary - Thanks to you and Cat for posting the info and answering the calls and messages - I think we all appreciate your time and consideration -  You have provided all the info that's necessary - Thanks again

[wcox]

I think it is a good opportunity, just a question of who my have an interest in the property on sale day. Please count me in.....a newguy from Yorktown Va......thanks  Wayne

[captain ron]

As versatile as this group is with the many different back grounds and professions there should be enough people to do all upgrades and development this property needs and get their labor costs converted to shares or paid out of profits annually or some type of sweat equity deal. For most of us it's probably a pipe dream but I know it Is doable for others. If one or two out of this group could purchase this property with the interest of every body in the group that would buy time to put together a better business plan. And for investors to get their ducks in a row. I for one could spend a few months every year there working carpentry, general labor and maintenance for a sweat equity deal. Just a thought. Proceed with business as usual

[John E. Smith]

You guys might just evict me from the group, but I am fixing to be a real wet blanket.

I don't see how this is going to be feasible, given the amount of time involved and the variables.

First, there is less than a month in which to do Due Diligence, form a group of investors, form a entity to actually bid, etc.  My biggest problem is with the Due Diligence... Niles has already found a potential claim to the parent parcel and who's to say that there aren't others?  Has there been any search of the UCC filings, and are there any blanket assignments against the property and/or  assets of this Lockhart?

Since this is a private sale auction, any leins against the property will still attach to the property title after the sale; only a bankruptcy sale or confiscation sale clears the leins, and even then there are exceptions.

I just don't see how there is enough time left to do the research necessary to avoid buying "a pig in poke", so to speak.

There are also a couple of other factors involved.  This particular exit has been an area of interest for two major truckstop chains -- both Flying J and Pilot have shown interest in the 192 acre parcel you mentioned, although their level of interest is unknown at this point.  There is currently a small fuel stop nearby, so there will be a moderate amount of truck traffic in the area -- which could detract from business.  There is also the Swamp Fox campground at the next exit north, and the KOA.  Darlington is 12 miles away, so the place may be on the outer fringe of any benefit from it.

These factors could be overcome by marketing -- but in the time frame alotted, I just don't see how we could make it with any guarantee that we wouldn't get stung at some point after the sale.

There is also the fact that I am almost 100% certain that the bidding will start well above $150k -- as someone said, Lockhart has done development in the area, and surely knows the potential.  To me, being property rich/ cash poor means that they don't have the cash to develope it themselves -- but they know what they want for it from someone who does.

Sorry, but I just don't see it happening.

[Dallas]

John,
I promise, you won't get tossed out of the group.

I agree that time is short and risks are real.

I do have some reservations on your Truckstop data though.
Flying J already has a major truckstop 33 miles north at exit 183, I think.
Pilot has a major fuel stop at exit 164, 16 miles up the road, as does TA.
Petro is situated at exit 169 so that isn't a factor.

It seems to me, the major truckstops have about saturated the market in this area.

If it doesn't sell to one of the members, thats fine, if it does, that's fine too.
I prefer to just be the messenger.

As far as I know, the auction is at the end of March which gives about 6 weeks. Everyone that is interested in the parcel should get together and start setting up a plan.

Dallas

[gg04]

Old campgrounds are a dangerous investment without real research..Last one we did in Texas had 40 acres to expand  on. Enviromental impact was oked, state health said systems would pass , power dept said no problem with increased service..then as we started permits, city, county decided a $2600. per spot infrastructure impact fee was needed up front to cover incidental government expenses... police fire etc..and we were only adding 400 spots..go think,,,and we already had 3 months research in...gg04

[JAX_N]

Hi gang
New member ( Jack Hays ) southern illinois,,been trying to keep up lol - will do ok if you don't get to ,,technical,,  I have bookmarked the campground on my (google earth) - thought those who have (google earth) could just click on the link and view the campground from the air!

If the link doesn't work you can put in the zip (29161 ) Dallas gave me and follow interstate 95 down to the next exit highway 403 and it's in the northwest corner off the exit -- double hoop with pond north of it.
If you don't have (google earth) download it if you can it's pretty cool - free   http://earth.google.com

Actually it's more than pretty cool - it's fantastic!