RV Park Feasibility Study in Minnesota

Minnesota campgrounds: second in the nation

Minnesota is a national center for SBA campground lending. With 90 approvals worth $49.2 million from FY2017 to FY2026, it ranks 2 of 47 states for RV parks and campgrounds, and its location quotient of 3.47x puts the class far above its national share of the state's SBA book. Within Minnesota the class is 14 of 39. The distinctive measure is size: the Minnesota median of $447,500 is 0.64x the national campground median, and our screen finds it beyond the margin against both Minnesota lending overall and RV parks across the country. Half the Minnesota loans fall between $294,000 and $766,000, sums that fit the purchase of an established lake-country campground or resort rather than a large new RV resort.

This is a 504 market almost entirely. SBA 504 financed 67 approvals and SBA 7(a) just 23, and Midwest Business Finance Corporation is current holder of 58 of those 504 loans, worth $34.6 million, which makes one certified development company the gatekeeper for most Minnesota campground purchases. BankVista holds 5 small 7(a) loans totalling $240,000. Franchise affiliations are 4.4% of loans.

Clean losses, seasonal risk

Minnesota's 42 campground loans with FY2017 to FY2021 disbursements show a loss floor of 0.00% so far, matched at the five-year mark; with so few loans in the group, a single failure would move it. Cancellation stands at 7.6% of FY2017 through FY2024 approvals, or 8.9% at the ceiling. Volume rose to 20 approvals in FY2022, worth $12.5 million, then fell to 4 in each of FY2024 and FY2025 before 7 in FY2026.

What a Minnesota campground study must test

The record sits in the northern lake counties: Otter Tail holds 12 approvals, Cass and Crow Wing 11 each, Saint Louis 9, and Beltrami and Itasca 6 apiece. A feasibility study has to test a season that may run only from late spring to early fall, so occupancy must be measured by site type and month, with seasonal and transient sites separated. On cost, septic, well and electrical capacity, which can limit expansion, need testing, along with deferred maintenance on cabins and docks. Coverage must be tested on the cash a short season produces, after the owner's living draw, with a weather stress case. The appraisal must separate land, improvements and any cabins or store, and rest on comparable campground sales. On coding, SBA files a full-hookup RV resort and a tent campground under the same industry, so the Minnesota figures here cannot tell them apart.