MERGERMARKET ARTICLE
NOVEMBER 2, 2018

Road Adventures Resorts (RAR), a newly established developer of luxury RV campgrounds, seeks private equity and other investors to finance a proposed chain of approximately 15 RV resorts primarily in the eastern half of the US, said co-founder and COO Chris Haydocy. Financing would be used to acquire and upgrade existing RV parks as well as to build new ones, he said.

 

Based in Columbus, Ohio and established this year, RAR is working with accountant GBQ Partners to liaise with equity investors including PE firms, family offices and wealthy individuals about raising up to USD 45m on a per project basis, with an equal amount to be financed through bank or other debt, Haydocy said. He added that initial investors would have first rights to future resorts.

 

Its first project was announced in October and is a USD 6m 5-star RV park to be built on 20 undeveloped acres adjacent to the Hollywood Casino in Columbus.

 

He said RAR has received conditional loan approval for the majority of the purchase of land, which is currently owned by Gaming and Leisure Properties (NASDAQ:GLPI), and build out. RAR is “exploring options on the correct balance of equity and debt for the project,” he added. Investors in the Columbus project will also be able to benefit from tax breaks associated with the RV park being located in a federal opportunity zone.

 

Haydocy said RAR has identified five other properties – existing RV campgrounds that would be upgraded with luxury amenities including a clubhouse, lodge and added security – in the Midwest, Southeast and along the East Coast. He estimated the cost for each project would be about USD 6m.

 

RAR is a new partnership between Haydocy, who owns automobile and Airstream dealerships in Columbus, and John Ehmann, also based in Columbus and formerly with IBM and eBay in e-commerce roles. Ehmann also serves as president of the company. They also own a sister company, Road Adventures, Inc., which was established in 2017 and offers RV rental and trip planning services.

 

Haydocy said there are more than 13,000 privately owned RV parks in the US and over 1,600 state parks catering to RVers. Privately held Kampgrounds of America (KOA) is the largest with about 500 properties in the US and Canada, followed by Yogi Bear’s Jellystone Park Camp Resorts which has 85 locations in the US and Canada, he said.

 

The vast majority of RV facilities are small independent operators, according to Haydocy, with an average length of family ownership of roughly 33 years and many at the third generation stage.

 

“We believe the market is ripe to consolidate,” Haydocy said, adding that very few RV parks currently cater to an upscale clientele with the added potential to rent fully stocked Airstream and other RV brands.

 

The executive said Haydocy Airstream & RV is the second-largest Airstream dealership in the US. Had it not been for his “first-hand experience” with the RV industry, “we would not have discovered this opportunity” to develop resorts.

 

He said the average person who goes RVing stays within 50 miles of home and is often looking for amenities near the campground including restaurants and entertainment venues. “The biggest need we see [as a dealer] is for 5-star resorts,” he said.

 

RAR works with Luther Liggett of the Columbus law firm Graff & McGovern.

 

by Jeff Sheban in Chicago