Anyone With Experience Re-Zoning Residential To Commercial?

As predicted, not an idiot I started a conversation today with a buddy who’s a real estate developer and his dad (s companies) pretty much build my town. He said he will give me a call tonight as it was hectic with kids on his boat and me trying to wakesurf my bass boat behind his I didn’t know your background so apologize for suggesting the simple things which you seem to have covered.

 

I posted asked for suggestions, no need to apologize. I appreciated it, makes me think about things differently, and for everything I know about this stuff, there's just as much that I don't. Based off my due diligence period alone, I will only have one shot at this (with the exception of the appeal period if it's not passed). I would rather lose my DD than have a house payment I have to personally make.. If I ran out of time and was a gambler, I might would buy it anyway (if I couldn't get an answer on zoning during DD), do a little sweat equity and be able to wash my hands of the deal, maybe even make some money.

It's tough because the house and property are literally within walking distance of work for me and the wife and I love it... Not to mention I've been working on landing this "deal" (I say that loosely) for almost 2.5 years.

 

I would also love to hear what your friend has to say, it sounds like something they've probably ran into several times.

 

Good luck with the re-zoning.
Build it and they will come.

 

My parents owned/operated a KOA campground in the Adirondacks for twenty years. It was not a wonderful experience for them.

From just after the purchase there were problems with local government shits as well as local scumbags. They thought living on the property was going to be wonderful. Wrong.

Every time some idiot trying to run two ACs, a microwave and a hairdryer at 2am on a 30 amp service pops a fucking breaker, they are at your door. Hot water out on Christmas day? Yup, at your door. Sewer spewing when you're headed out all dressed up for dinner? Forget it, you'll be elbows deep in some snowbirds shit and Depends while they stand over you bitching.

When Walmart opens down the street and lets the fuckers stay free, there goes the revenue stream. When it rains on a holiday weekend, everyone that made a reservation will be cancelling or trying to get their money back.

The maintenance and repairs are never ending, and the people who stay there, no matter how upscale their units are, are cheap fuckers who don't give a damn about your property, fully willing to rut up your entire lawn with their diesel pusher, rip out the electric box with the tow dolly and stand there and blame you for it.

You'll be a rest stop for fuckers that just want to fill your already taxed septic for free, as well as your dumpster.

When the guy on site 42 is playing his Kenny Wayne Chesney too loud at 10:01pm, bet your ass the husband from site 43 will be bitching that his stupid brat can't sleep and expect you to fix it.

Once you've finished mowing, you've got to turn around and do it again. Same thing with painting. In between all the other bullshit. You're tied to the place. Days on end you might not even set foot off the property, even though you need to escape all the whiny, bitching campers.

Yeah, fuck campgrounds. Rant over.

Good luck.

 

So I take it you don't want a job, then...

 

I really hate that for your parents. That being said, did they make any money?

Being in the rental business I hear these horror stories all the time, and they do happen! However solid business systems and proper screening work wonders.

I plan on targeting long term tenants that are in the area for work, as we do have a local Walmart. City sewer and water will be used and cost will be covered.

I really appreciate the negative insight because these are all 100% accurate scenarios to consider. Thanks

 

Which way does the river flow? Are you upstream or downstream from that sewage plant?

I wouldnt want to hang out downstream from the treatment plant...but thats just me.

 

I’m willing to bet any discharge from the treatment plant will be a fuckton cleaner than the water upstream of it

 

So my buddy basically summed it up about as much as I do. Depending on the way specific codes are written, class or business (he said a campground should fall under or close to a hotel zoning). If it’s up to a county vote to approved the transition make sure it’s detailed ALL you will need which you kind have already stated. He said make sure he has good plans to “get the power in the campground and the shit out of it”. Also stated make sure they know how much money it will bring them directly and what you estimate indirectly, why it won’t turn into a filming location for Trailer Park Boys. Capacity wise he said check with most likely state zoning laws for campgrounds, he thought there was some capacity thing tied to lots with full hook ups, electricity and nothing at all.
His best word of advice... easiest way to turn up a bars clientele avg salary? Charge 3x the price for a drink, clean it up a bit but keep the budget reasonable and provide good consistent service that people feel like they are at home.

 

The first two or three years weren't bad, but there were a slew of converging factors that prevented it from making money in the end. Their stubbornness and unwillingness to admit defeat meant they held on to it for much longer than most would have. It took a huge toll on their physical, mental and financial health, as well as contributing to long lasting strains amongst family members. I should add that these people were multiple successful business owners, not dreamers without a clue. Here's a few of the factors off the top of my head:

1. The cost of maintenance. A heated indoor pool open year round was a huge draw for campers, but also a huge money drain. Everything else needed constant repair or upgrading for legality or safety. Don't underestimate the wear and tear your guests will cause on the property. In the most ridiculous, thoughtless, careless, fucked up ways you could never imagine. They absolutely do not give a shit about you or how they leave your campground.

2. Ridiculous tax assessments that kept them continually tied up in grievances. Being from out of town, the local government smelled money and bled them for years.

3. Ten years of the wettest weather to ever hit the region. Without fail on a crucial holiday weekend. They make you or break you in that business.

4. Walmart's new policy of allowing overnight campers, greeting them with fresh coffee (this was the 90s).

5. Being on the Canadian border meant that 60 percent of the business was Canadians coming to shop at the local mall. When the value of their money fell, they stopped coming.

6. Location. Despite an absolutely gorgeous setting, people wanted to be closer to everything. 25 miles out of town is too far to drive for most campers once they have landed. They want all the attractions right at their door, but want to be away from everything at the same time. Being near a military base did not help when they decide 1am on a holiday weekend is the right time for tank practice. Try explaining that to your customers.

7. Economic factors, price of fuel, ever increasing franchise fees etc.

8. Bears, snakes, bugs. The only place these "campers" want to see those things is on TV or in the zoo. Good luck with that.

9. Because New York Fucking State. Need I say more?

I thought in one of your posts I read about you having "monthly" tenants. Be careful of long-termers who are working in the area or something similar. We had more trouble with them than the overnight guests. We had a doctor (yeah a real doctor) and his family destroy the interior of one of our units and take off owing thousands. Keep in mind that this was an upscale campground, not some state park type filled with rejects from Springer, but there were constant problems. Drunk tenants starting shit with campers or doing target practice behind their units. People who would pull up stakes in the middle of the night without paying, owing back rent. Monthlies who tried to fill their sites with all kinds of junk after being there a week. Lonely workers inviting underage girls back to their trailers. Locals partying on a site they haven't paid for. The last thing you want is the goddamn State Police rolling through your wonderful family campground that you've worked yourself to the bone to make a nice place. And no matter how hard you try, you'll never eliminate that element entirely, and at some point it will bite you on the ass.

In the end you are not operating one business, but something like ten, living area for transient workers, destination stay for family campers, swimming/fishing hole, playground, bike/boat rental, hiking trails, general store, liquor store, propane refilling station, gas station, bingo hall, cabin rental and rest stop for every tom, dick and dipshit who decides your bathroom floor is as good a place as any to piss all over. You need a bio-hazard ready cleaning crew, small engine repair crew, plumbers, painters, electricians, landscapers, tour guides, concierges, mowers, garbage men and occasionally riot police. The old adage about good help being hard to find is triply true in the campground business.

Remember, the only happy campground owner, is an absent campground owner...

 

Would you ever consider getting into the rental business?

Sounds like a terrible experience for your family, and no doubt, they did some stuff to make them successful as the net/liquid worth for KOA franchises are steep. I have no dreams of this being a high end Franchised camping location, with indoor pool etc etc. I've found the more people expect the more they demand. I literally deal with all the trades mentioned regularly with my other rentals, so I'm not worried about that (I do understand the possible expense that goes along with it though). Hopefully your parents made a little money on the back end when they sold out.

Weather is a factor, but this isn't going to be my livelihood, just some extra passive cash if all goes well. Grubhub for people that prefer to not leave, other than the few amenities that will be offered on site. Bugs and animals, I would give them directions to the Hampton/Walmart.

Also have to agree with Sean (whaaaa?) those are all people issues that you get when working with the general public providing a service.

 

And oddly enough, some of the more rowdy campgrounds I've stayed in for work have been further north. Must be the long winters that make people go nuts when the snow clears

 

Canadians get fucked up, aye!?

 

Currently have one rental property we will be selling shortly. Hasn't been a terrible experience, but the older I get the less patience I have for humanity. Get off my lawn...

 

I couldn’t do a campground. You get some really good people but you also get a fair amount of white trash and cranky old people. I can’t say that because I may or may not be both

 

i'm sure you've sorted gross income vs expenses, so how does that look when (assume) financing the property, and the infrastructure costs, as well as a full time maint. guy to be on site? I would think it'd be a $500k or more to put in a pool, all the electric hookups, water treatment system and lift stations for water, etc. ? then $30-40k yr plus free spot for the maint guy.. how does all that pan out with the expected income? Bank is gonna want 30% or more down on this project i suspect. Then hope you can get all built and up and running in reasonable time.
How is rental market for small income producing property there? 2-4 unit stuff? financing is real favorable as it's still considered residential if under 5 unit, so only need 10% down in most cases. you fix stuff up real nice, so can increase rents with a lil' work, and much less risk than a larger venture. Could get a BUNCH of em with what you will likely have to put down for this one project. Or even consider a 8unit or more building.. bank will require 30% down though, but i like the fact you get a bunch of units at one location/1 building. 1 roof, one property to maintain, couple vacancies for month? not the end of the world.
Love the ambition though ! follow the dream.
if i were to do stuff over again, i'd do mini-storage. Friggin amazing the rents these things bring in with way less headache than residential annual rental stuff, let alone a campground with people coming and going all the time.