How to Underwrite an RV Park Deal in 10 Steps

August 12, 2026 · RV park investing, explained

Public domain, via Wikimedia Commons

This is for anyone looking at an RV park or campground deal and trying to figure out if the numbers actually work, not just whether the seller's pro forma looks good. Underwriting a park properly takes a few hours per deal once you have a template built, and it will kill most of the deals you look at. That's the point.

What you need

• Trailing 12-month profit and loss statement, ideally trailing 24 or 36 months
• Current rent roll with site type, rate, and length of stay for every occupied site
• Site count broken down by type: full hookup RV, partial hookup, tent, cabin, storage
• A spreadsheet model or underwriting template built for RV parks, not a generic multifamily one
• County tax records for assessed value and tax history
• Local occupancy or STR data if the park has cabins or short-term sites
• A capital expenditure checklist covering utilities, roads, pads, and park model or cabin condition
• Debt terms from at least one lender who actually does RV park loans

Step by step

1. Pull the trailing financials, not the pro forma. Sellers and brokers will hand you a projected number that assumes full occupancy at market rate. Ignore it for now. Get the actual trailing 12-month P&L and, if you can, three years of tax returns or financials. You want to see what the park has actually collected, not what someone thinks it could collect.
2. Rebuild the rent roll by site type. Break the park into full hookup, partial hookup, tent, and any cabins or park models. Long-term RV sites, transient RV sites, and monthly tenants all behave differently and should never be blended into one average rate. A park that looks 90% occupied but is mostly $400/month long-term tenants is a different business than one running 60% occupancy at $55/night transient rates.
3. Normalize revenue. Strip out one-time items like insurance settlements, PPP funds, or a single large storage contract that might not renew. Look at revenue per available site per month, sometimes called RevPAS, so you can compare this park to others you've underwritten regardless of size.
4. Rebuild expenses from scratch. Sellers routinely underreport payroll, especially if they or family members work the park unpaid or underpaid. Add a market-rate manager and enough staff to actually run the property. Common categories to check line by line: payroll, utilities, insurance, property tax, repairs and maintenance, marketing, and management fee, typically 4% to 10% of revenue if you'll hire a third party manager.
5. Calculate current in-place NOI. Revenue minus normalized expenses, before debt service. This is your starting point, not the exit number. Many parks show cap rates in marketing materials calculated on the seller's pro forma NOI rather than actual NOI, so redo this math yourself every time.
6. Underwrite your value-add plan separately. If your thesis involves adding sites, converting long-term tenants to transient, building cabins, or adding storage, model that as a distinct phase with its own capex, timeline, and lease-up assumptions. Don't blend year one stabilized numbers with year three projected numbers in the same cap rate calculation.
7. Estimate capex and deferred maintenance. Walk or have someone walk the property and check roads, pads, electrical pedestals, septic or sewer connections, water lines, and any structures. RV parks are infrastructure businesses. A rough range for deferred maintenance on a tired 40 to 100 site park runs anywhere from $150,000 to over $1 million depending on utility systems and site count. Get real quotes where you can rather than guessing.
8. Test debt terms against realistic NOI. Run the deal at the actual quoted rate, amortization, and loan-to-value from a lender who does RV parks, not a generic commercial estimate. Check debt service coverage ratio at both current NOI and year-one stabilized NOI. Most lenders want to see 1.25x or higher, and if your deal only clears that at your optimistic year-three number, you have a financing problem, not just a return problem.
9. Build a return summary with conservative exit assumptions. Use a terminal cap rate equal to or higher than your entry cap rate, not lower. Model cash-on-cash return year by year, not just an average, since RV parks with heavy value-add plans often have thin or negative cash flow in year one. Sensitize the model: what happens if occupancy comes in 10 points below plan, or if one utility repair costs double your estimate.
10. Compare against your minimum return threshold and walk if it doesn't clear. Decide your minimum acceptable return before you start underwriting a specific deal, not after. If the deal only works using the seller's assumptions or requires everything to go right, pass. There will be another deal.

Where this goes wrong

The most common mistake is underwriting off the seller's pro forma instead of actual trailing financials. This inflates purchase price and NOI expectations before you've even started, and it's how buyers end up overpaying by 10% to 20% without realizing it.

Second is underestimating payroll and management costs, especially on parks where an owner-operator has been running things themselves for years, sometimes for free or close to it. Plug in real staffing costs and margins compress fast.

Third is treating deferred infrastructure work as a minor line item. Septic systems, well capacity, and electrical service upgrades can run into six figures and take months to permit and complete in some counties. Buyers who skip a real capex assessment often find this out after closing, when it's their problem instead of a negotiating point.

Fourth is blending long-term tenant revenue with transient revenue in the same rate assumptions. These are different customers with different price sensitivity, different turnover, and different seasonality. Averaging them hides risk.

Fifth is ignoring seasonality entirely. A park that does great numbers June through September might be nearly empty from November through February depending on location and climate. Trailing 12-month numbers smooth this out, but your cash flow model needs to reflect the actual seasonal pattern or you'll misjudge how much reserve capital you need.

When to stop and call someone

Underwriting the deal yourself is reasonable and worth doing. Where you should bring in outside help: environmental and septic or well capacity questions need a licensed engineer or environmental consultant, not a guess based on how the water looks. Zoning and entitlement questions, especially if your plan involves adding sites or changing use, need a local land use attorney or the county planning department directly. Loan structuring and personal guarantee terms should go through a lender experienced specifically with RV parks and campgrounds, since terms vary widely from generic commercial real estate debt. And if you're raising capital from other investors to do the deal, get securities counsel involved before you solicit anyone, not after.

If you want a second set of eyes on a deal you're underwriting, or want to see how these models get built in practice, that's the kind of thing we work through with investors at Invest With Zac.