One of the things DW and I have been talking about lately is buying an RV park/campground.
I see campground ownership as a highly flexible form of landlording. Very diversified, easy to get rid of bad tenants.
Some links to get you started ...
http://arniemarge.tripod.com/campground.html
http://ownakoa.com/campgroundsforsale/questionnaire.htm
http://www.parksandplaces.com/pages/cam ... -sale.html
http://www.rvparkstore.com/
http://www.rvparkstore.com/rv-parks/719 ... -rumney-nh
http://www.rvparksale.com/rv-parks-for-sale/31.html
As far as I have been able to tell prices start around $250,000 with options few and far in between and end at several millions.
Such a park could house many projects like ERE software developers (unless people have stopped talking face to face), workshops ("Learn how to weld, Learn how to build a foundry, ...), (ERE) snowbirds, a site for constructing tiny houses in bulk, a boat yard (if located on a river, lake, or creek, and if nicely located it could even provide the location or focal point of ERE city.
We could cater to a variety of people, simply by changing the amenities of the campground.
1) The ERE community (it's easy to move out and protect your precious independence and we don't have to agree on how to split the toilet paper fairly)
2) Tiny house people/minimalists in general.
3) Regular RV campers (this will probably constitute the majority of the income ... the first two groups will be on long term rent agreements like monthly or seasonal).
I(&DW) will either do this alone or prefer an equal partner or two. Most obligations would be easy to split, e.g. with three partners, each do 10 days/month collecting rent checks, cleaning toilets, and checking people in and out of the ground. Investments could even differ, e.g. if you go in with 1/15 of the total investment, you'd have to work one weekend/month---maybe a convenient getaway?
I don't see "splitting" as being nearly as hard as splitting work-reward in a startup where people may feel they're working harder than others because it's hard to compare e.g. research to development.
Financially, I see this as a way of diversifying out of the financial markets and getting into small business ownership. The upside is more control and more profit. The downside is getting more locked into a particular investment and being subject to regulatory risk.
Buying an RV park/ERE City/Tiny House Village/Self-sufficient compound w income
Interesting. Would you consider silent partners? I'd be curious about putting up some of the money, enjoying the space and using the grounds in the winter. With that comes no labour input, however.
A division of labour is a VERY, VERY difficult arrangement. As part of my local real estate investment club, this topic has arisen many times. It would be wise to have a labourer and investors kept separate. Perhaps you might also consider simply hiring out the work to an in-house "management company."
People define hard work and equality differently. While you might be "on" for 10 days, that doesn't mean person A will work as hard as person B or do all of their mandate.
Usually, it's best to have one person do all the work and put up non of the money and the rest put up the money and non of the work.
A division of labour is a VERY, VERY difficult arrangement. As part of my local real estate investment club, this topic has arisen many times. It would be wise to have a labourer and investors kept separate. Perhaps you might also consider simply hiring out the work to an in-house "management company."
People define hard work and equality differently. While you might be "on" for 10 days, that doesn't mean person A will work as hard as person B or do all of their mandate.
Usually, it's best to have one person do all the work and put up non of the money and the rest put up the money and non of the work.
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jacob
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"Usually, it's best to have one person do all the work and put up non of the money and the rest put up the money and non of the work."
That kinda sounds like how "democracy is the worst form of government except all the others that have been tried".
I'm open to suggestions though. Why is labor and capital best kept separate?
That kinda sounds like how "democracy is the worst form of government except all the others that have been tried".
I'm open to suggestions though. Why is labor and capital best kept separate?
Unless people are exactly the same, they'll define work differently, have different expectations as to what needs to be done, and what should be done.
Personalities can clash too. Money is just money, it doesn't care, or have feelings, it doesn't get tired.
One person investing money is putting up past work as a guarantee and one person is putting in present money in the form of labour. Both ways are equitable. The only concern is the labour isn't met and the deal falls apart. In that case, the labourer could be replaced as a condition of the agreement.
There are simply too many reasons why shared labour can fail. Two good friends could probably split the chores, but unrelated people with no experience working together probably won't fair well.
Many partnerships fail eventually.
Even working with my brother can be (and is) trying, and we share 50% of our genes and benefit equally and are otherwise on the same page as to the overall goal of the business. However, there's always some form of conflict that needs to be resolved.
How many true, even partnerships, exist in current large corporations where labour is split?
I've done enough partnerships to know how they can work, but also how they can fail. In the long run, I think they will all fail, but can be scabbed together in the short run to create great success.
Work based partnerships work when there is a shortage of cash and when skills of one person compliments that of another to create a sum total larger than the individual parts. My brother and I have this arrangement, but there's always conflict when we decide who is doing harder work, more work or adding quality work to the arrangement. If we could do renos as efficiently separately, we'd probably do that. However with years of adjustments we've managed to find common ground and learn to back off at the right times. Would this have worked if we weren't related? Probably not.
Personalities can clash too. Money is just money, it doesn't care, or have feelings, it doesn't get tired.
One person investing money is putting up past work as a guarantee and one person is putting in present money in the form of labour. Both ways are equitable. The only concern is the labour isn't met and the deal falls apart. In that case, the labourer could be replaced as a condition of the agreement.
There are simply too many reasons why shared labour can fail. Two good friends could probably split the chores, but unrelated people with no experience working together probably won't fair well.
Many partnerships fail eventually.
Even working with my brother can be (and is) trying, and we share 50% of our genes and benefit equally and are otherwise on the same page as to the overall goal of the business. However, there's always some form of conflict that needs to be resolved.
How many true, even partnerships, exist in current large corporations where labour is split?
I've done enough partnerships to know how they can work, but also how they can fail. In the long run, I think they will all fail, but can be scabbed together in the short run to create great success.
Work based partnerships work when there is a shortage of cash and when skills of one person compliments that of another to create a sum total larger than the individual parts. My brother and I have this arrangement, but there's always conflict when we decide who is doing harder work, more work or adding quality work to the arrangement. If we could do renos as efficiently separately, we'd probably do that. However with years of adjustments we've managed to find common ground and learn to back off at the right times. Would this have worked if we weren't related? Probably not.
I should say that work/work partnerships can be successful, but the odds are stacked against them.
Investor/work relationships are more likely to succeed and if they fail are more easily remedied.
It's a lot easier to sell off a share of a (successful) business than to find a suitable work partner to replace a failed worker.
When only one partner is responsible for the work they know exactly what their job is. All of it. So there's no squabbling about who should do what, which can end up as a daily argument.
Investor/work relationships are more likely to succeed and if they fail are more easily remedied.
It's a lot easier to sell off a share of a (successful) business than to find a suitable work partner to replace a failed worker.
When only one partner is responsible for the work they know exactly what their job is. All of it. So there's no squabbling about who should do what, which can end up as a daily argument.
I don't really see a problem with Jacob's suggested arrangement. Any objections raised seem to equally apply to any arrangement, including work/work partnerships, work/money partnerships, and money/money partnerships.
The work side of the business is basically a fungible service. You can hire a third-party to perform the service. You can hire a partner to perform the service. You can mix and match.
Either way, you may or may not like their performance. Either way, you may have to find a replacement for the person performing the service.
One advantage of having a partner perform the service is that you can get it done for less than minimum wage. You can pay the partner from the partnership funds, or in equity.
Another advantage of having a partner perform the service is that they have a large personal stake in the outcome.
The work side of the business is basically a fungible service. You can hire a third-party to perform the service. You can hire a partner to perform the service. You can mix and match.
Either way, you may or may not like their performance. Either way, you may have to find a replacement for the person performing the service.
One advantage of having a partner perform the service is that you can get it done for less than minimum wage. You can pay the partner from the partnership funds, or in equity.
Another advantage of having a partner perform the service is that they have a large personal stake in the outcome.
"One advantage of having a partner perform the service is that you can get it done for less than minimum wage."
You summed up the problem right there!
If you can hire it out for minimum wage, then why burden the partnership with it and why would you pay your partner "much less than minimum wage?"
In my experience, hiring out the work TO the partnership is a better deal AT fair market value. Everyone puts in equal money and can bid on doing the work FOR the partnership. Thus, they get a fair kick at both sides of the deal.
Just having a "personal stake in the outcome" is not enough to ensure everyone does their fair share. People work toward their inherent personal potential no matter what is to gain. Plus within every system there will be cheats who get their "personal stake"/cake and get to eat it too. This is when problems arise.
I always highly recommend that everyone work toward their own dreams and kick back benefits to those people's who's interests align with theirs. And this is always what happens anyway.
You summed up the problem right there!
If you can hire it out for minimum wage, then why burden the partnership with it and why would you pay your partner "much less than minimum wage?"
In my experience, hiring out the work TO the partnership is a better deal AT fair market value. Everyone puts in equal money and can bid on doing the work FOR the partnership. Thus, they get a fair kick at both sides of the deal.
Just having a "personal stake in the outcome" is not enough to ensure everyone does their fair share. People work toward their inherent personal potential no matter what is to gain. Plus within every system there will be cheats who get their "personal stake"/cake and get to eat it too. This is when problems arise.
I always highly recommend that everyone work toward their own dreams and kick back benefits to those people's who's interests align with theirs. And this is always what happens anyway.
Chris, I know you like to push people's buttons. Nothing you just said lends credence to your assertion that "Usually, it's best to have one person do all the work and put up non of the money and the rest put up the money and non of the work." In fact, now you are saying "Everyone puts in equal money and can bid on doing the work FOR the partnership." Are you just being argumentative here?
Ha. No. There are many ways partnerships can work. Splitting something arbitrary on a volunteer basis isn't one of them.
Bidding on the work on a fair market rate is fair. There's nothing arbitrary about that.
If you can hire it out for cheaper outside of the partnership, so be it. If someone inside the partnership wants to do it cheaper than fair market value, then they win the bid.
You just can't force someone to do something they aren't willing to do. So if/when the partnership fails how will you keep the business going without dragging the entire system down?
Sell your share of the business...that's easy and the system can continue until a new buyer is found to cash the vacating partner.
Sell your share of the work...not so easy, takes time to find the right fit, (business dies, or the rest of the partners suffer) while paying out a dividend to the cheat.
Hire someone else...that's easy so long as it can be done at fair market value.
I would highly suggest that Jacob just for it with DW and sell space to other EREs. If someone wants to work for free rent, go for it.
To keep risk lower, you might sell shares to other EREs. IMO, selling to EREs is a bad market strategy, rather opening it up to the larger share of the world would be much more profitable. ERE's aren't exactly going to reach deep down to pay for rent.
As a social experiment, fine.
If you think I'm full of shit, go for it. It will turn out just as well as the partners get along and this will be a crap shoot. No matter how much paper work you have, you'll still come up short in some respect.
I wouldn't label myself an optimist, so I'm just spelling it like I see it.
If I really wanted to push someone's buttons then I'd get personal, but I don't know anyone on here from anyone else.
Bidding on the work on a fair market rate is fair. There's nothing arbitrary about that.
If you can hire it out for cheaper outside of the partnership, so be it. If someone inside the partnership wants to do it cheaper than fair market value, then they win the bid.
You just can't force someone to do something they aren't willing to do. So if/when the partnership fails how will you keep the business going without dragging the entire system down?
Sell your share of the business...that's easy and the system can continue until a new buyer is found to cash the vacating partner.
Sell your share of the work...not so easy, takes time to find the right fit, (business dies, or the rest of the partners suffer) while paying out a dividend to the cheat.
Hire someone else...that's easy so long as it can be done at fair market value.
I would highly suggest that Jacob just for it with DW and sell space to other EREs. If someone wants to work for free rent, go for it.
To keep risk lower, you might sell shares to other EREs. IMO, selling to EREs is a bad market strategy, rather opening it up to the larger share of the world would be much more profitable. ERE's aren't exactly going to reach deep down to pay for rent.
As a social experiment, fine.
If you think I'm full of shit, go for it. It will turn out just as well as the partners get along and this will be a crap shoot. No matter how much paper work you have, you'll still come up short in some respect.
I wouldn't label myself an optimist, so I'm just spelling it like I see it.
If I really wanted to push someone's buttons then I'd get personal, but I don't know anyone on here from anyone else.
Ok, I see that you are down on partnerships in general. Assuming a partnership (i.e. Jacob may not want to finance the endeavor or have the available cash to go it alone), there's no reason the partnership can't have partners do some or all work. It's not really any more complicated than having a third-party do the work. Either way, you have to find the right person for the job, make sure they are doing their job, and compensate them in some way. If it doesn't work out with a partner, hire someone else... this is no harder than replacing a crappy management company.
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jacob
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"I would highly suggest that Jacob just for it with DW and sell space to other EREs. If someone wants to work for free rent, go for it."
I was thinking something like that earlier (while at the ERE meetup). The partnerships are on an equity-basis with a profit split.
I could retain 51%. I'm certainly open to full control+free money+profit sharing.
The danger [to the 49% others] is that I start making decisions that would benefit management (me) more than the shareholders... you know, like any kind of publicly traded corporation these days. How to avoid that? Getting into board of director style arrangements, where the manager must be substitutable? Writing out regulations?
I will admit I'm interested in some form of control. Otherwise I could just be invested in the secondary [stock] market.
How is the manager compensation determined? Fixed? Relative to last years income (a bonus arrangement). It's easier to determine "employee-labor" cost/wages on the open market. That would probably be something like ~$10/hour.
Maybe no manager is needed? I'm not so sure about this---that decisions can be made from people who are rarely/never present.
(I'm just throwing things out there. No organized thoughts above.)
I was thinking something like that earlier (while at the ERE meetup). The partnerships are on an equity-basis with a profit split.
I could retain 51%. I'm certainly open to full control+free money+profit sharing.
The danger [to the 49% others] is that I start making decisions that would benefit management (me) more than the shareholders... you know, like any kind of publicly traded corporation these days. How to avoid that? Getting into board of director style arrangements, where the manager must be substitutable? Writing out regulations?
I will admit I'm interested in some form of control. Otherwise I could just be invested in the secondary [stock] market.
How is the manager compensation determined? Fixed? Relative to last years income (a bonus arrangement). It's easier to determine "employee-labor" cost/wages on the open market. That would probably be something like ~$10/hour.
Maybe no manager is needed? I'm not so sure about this---that decisions can be made from people who are rarely/never present.
(I'm just throwing things out there. No organized thoughts above.)
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jacob
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Conversions may be a possibility. From the campround sellers' (<=- conflict of interest) websites I get the impression that building a campground from scratch (lots of electric work, water, and sewer systems) costs quite a bit more than simply buying a "used" campground.
Also, having talked to _one_ campground owner, permitting is a lot harder than it used to be these days.
Also, having talked to _one_ campground owner, permitting is a lot harder than it used to be these days.
Anyone could buy out the other person's share (any random person or it might be offered to existing partners first) at anytime subject to the partners finding a buyer. This simplifies things immensely. Also being able to pay labour out is subject actually earning some form of income, which would be low at the start.
I like partnerships, but they need to be structured properly and fairly.
51% ownership for an onsite works fine. In this situation, it would work well. Then the rest of the partners can be silent but reserve a space to visit/camp/park plus enjoy income.
The cost to enter can also be subject in an uneven split where the primary shareholder 51% (Jacob) puts in less than their equal share of money to compensate for their labour.
There would need to be some form of mandate to protect the shareholds from the 51%'er from running it to suite (as mentioned). Perhaps there would need to be some payout 10% or thereabouts whereby everything possible would need to be done to achieve it. Most people would be happy with a 8-10% or higher payout and wouldn't want to sell off their share. Having a depressed valuation will make their share difficult or impossible to sell.
I like partnerships, but they need to be structured properly and fairly.
51% ownership for an onsite works fine. In this situation, it would work well. Then the rest of the partners can be silent but reserve a space to visit/camp/park plus enjoy income.
The cost to enter can also be subject in an uneven split where the primary shareholder 51% (Jacob) puts in less than their equal share of money to compensate for their labour.
There would need to be some form of mandate to protect the shareholds from the 51%'er from running it to suite (as mentioned). Perhaps there would need to be some payout 10% or thereabouts whereby everything possible would need to be done to achieve it. Most people would be happy with a 8-10% or higher payout and wouldn't want to sell off their share. Having a depressed valuation will make their share difficult or impossible to sell.
I would consider being part of this if Jacob is "in charge" with 51%. I did not see this working if several people came together all thinking they would get to do anything they want without having to listen to anyone.
I could put in up to $30k pending what that might include. This amount could go up approx. $10-20k/year until it actually happens. I could do more, but would prefer to not get into tax deferred funds beyond filing a 72t.
I would desire to live on site (in my own trialer/hut) and would prefer physical labor over the more social work aspects of the RV park...but I will work on being more outgoing;) I imagine we will all be fighting for the hands on stuff vs. manning the office! Hopefully, Jacob, you won't mind working the office since you can do it while you are adding workshops to the website and comments to the forum:)
I know all the people who do not have preexisting conditions will likely want seperate health insurance, but it might be good to see what a group/business plan would cost if many people become part of this. Eventually, we will all get old and likely develop "conditions". I can see health insurance skyrocket for the individual who cuts his toe off while chopping wood.
I am leaving for the extended weekend so I will not be able to respond until later if you have any questions about my possible involvement.
I could put in up to $30k pending what that might include. This amount could go up approx. $10-20k/year until it actually happens. I could do more, but would prefer to not get into tax deferred funds beyond filing a 72t.
I would desire to live on site (in my own trialer/hut) and would prefer physical labor over the more social work aspects of the RV park...but I will work on being more outgoing;) I imagine we will all be fighting for the hands on stuff vs. manning the office! Hopefully, Jacob, you won't mind working the office since you can do it while you are adding workshops to the website and comments to the forum:)
I know all the people who do not have preexisting conditions will likely want seperate health insurance, but it might be good to see what a group/business plan would cost if many people become part of this. Eventually, we will all get old and likely develop "conditions". I can see health insurance skyrocket for the individual who cuts his toe off while chopping wood.
I am leaving for the extended weekend so I will not be able to respond until later if you have any questions about my possible involvement.
The airstream-only lot looks pretty interesting. One space is asking about $5k (and some are >$30k). I wonder what makes the difference -- do different lots include non-equal shares of that park? The spaces rent for ~$800/mo, so the $5k-$30k can't get you "free" living -- there must be a significant HOA fee on top of that.
Also, it's in Minnesota -- do they close during the winter?
Also, it's in Minnesota -- do they close during the winter?