Note: I am not a broker or agent. This post is based on my own research of looking for camp real estate for approximately 15 years. This post is merely to provide guidance to sellers on how to appropriately price their property to procure a quick sale and to buyers on reasonable prices to pay for camp properties.
I have been involved in the research of camp, school, church, and residential care centers, among other types of properties for approximately 15 years. I have reviewed some of the camp offerings on this site and would like to chime in a little bit in regards to what I have learned over the years. Disclaimer: I haven't visited any of the sites listed here on the ACA message boards and therefore can not comment on the pricing being offered. Disclaimer 2: I'm just throwing out my thoughts, based on my experiences. You as a buyer or seller can have vastly different thoughts and opinions, and that is OK. I provide this information solely so that sellers can have an idea of a price to sell at for quick sale. No seller should want to wait for someone to buy, all while sinking more money into a deteriorating property.
The first thing I notice when a camp or other similar special purpose property is put up for sale, it is often listed for too high of a price. The prices generally come from the current owners who think the property is worth a certain amount, sometimes based on expected rebuild cost, or a realtor that doesn't know the first thing about such properties, and has no idea how to price the property. Consider a property in Massachusetts that was originally listed at 3.2 million and ultimately sold for $800,000. It doesn't seem all that unusual to start out at far too high of a price, only to wind up selling several years later for 25-50% of original price.
Unless you are super lucky, which would probably be due to a great location, you will never be able to sell a property for the rebuild cost. Why would someone buy a used facility that would require extra renovations to meet their needs when they could build brand new, to exact specifications, for the same amount? The only reason they could possibly do so is if they needed a property right away. In the camp world, that never happens.
But what if the camp is profitable? Several years ago I viewed a camp facility listed for $1.5 million. The camp was profitable and the structures were reasonably kept up, so it should be an easy $1.5 million sale, right? Wrong. The property was completely paid for so there were no loan expenses and there was minuscule profit as is. The loan on the purchase would add considerable expense and be quite some time before the new owner would be able to recoup costs. Unfortunately, the only entities who can make such investments are large organizations, but these organizations are generally not seeking to purchase special purpose property such as camps. Most who are seeking property are not-for-profit organizations or individuals who have a dream of owning a camp, neither of which tend to have a lot of money to invest. Based on the sale prices I've seen of other similar facilities, the location of the camp, and bearing in mind that the new owner was potentially also purchasing the business, I'd expect the camp to sell for approximately $750,000-$800,000. Another facility, also listed for $1,500,000, which was based on rebuild cost, which is currently non-operational and smaller, I can't see selling for more than $300,000 or $400,000.
So how should a seller decide how much to sell for? This question varies from camp to camp. However, my best suggestion is to consider how much you paid for the camp. Prices for rural properties such as camps do not incur significant changes in value from year to year. Renovations, unfortunately, generally do not add a whole lot of value. If you happen to have a recent appraisal (not tax appraisal), you can also use that as a launching point, but if there are few comp sales in the area, even that can be hit or miss. Don't be surprised if you can only get 75%, or even 50% of appraisal value. However, if you price it right to start, you can perhaps experience a quick sale at or near asking price.
Conversely, a buyer should tread carefully when searching for a camp property. Make sure that you can break even after all operational costs, which includes loan expenses, renovations, maintenance, insurance, utilities, staffing, supplies, taxes, etc., to name just a few. Never buy without getting an appraisal. Banks will generally require the appraisal for any type of property, and won't lend to you unless you are coming in under appraisal value. As banks are generally not familiar with special purpose properties such as camps, it can be all that much harder to get a loan, so you'll probably need to come in quite a bit under appraisal for a bank to offer a property loan unless you can put in a significant down payment. If you can get owner financing on good terms, this would be ideal, however we have found most sellers are not interested in owner financing or require 40%, at minimum, up-front. Banks will likely also want at least 40% down-payment, if they are willing to lend to you at all.
Here are some recent sales I'm familiar with, but did not represent. None of these properties were in operation at the time, so costs are for property only, not the business:
Massachusetts, 70+ acres, 28,000+ sq feet, mostly in good condition. Original asking price, $3.2 million. Final sale price, $800,000
California, 15 level acres (rare!), 19,000+ sq ft in turn-key condition with excellent road frontage and popular mountain tourist village nearby. Original asking price, $2.5 million. Final sale price, $800,000
Vermont, 14+ acres, 42,000+ sq ft in modern, turn-key condition with excellent road frontage, built in 2000, large town and popular ski slopes nearby. Original asking price, $2.8 million. Final sale price, $1,000,000
Texas, 70+ acres, campground in turn-key condition with lake, high ropes course, pool, newer buildings, etc. Original asking price, $675,000. Final sale price, $675,000
Oregon, 50+ acres 48,000 sq ft in turn-key condition. Stunning, well-maintained structures in Northwestern architecture. Original asking price circa 2010 is unknown. Price in 2016, 6 years after original listing, was lowered to $1.5 million. Final sale price, $975,000
North Carolina, 15 acres, over 40,000 sq ft. Appraised at 3.4 million, original asking price $2.75 million. Last asking price $875,000. Not sure what actual sale price was, but assume at or lower than $875,000.
Massachusetts, 12 acres, 28,000 sq ft. Originally listed for 5.5 million in 2009, then 2.995 million. Sold for 1.2 million in 2016. Currently back on market for $2.990 million.
Georgia, 195 acres, 15 acre lake, former Hidden Lake Academy, Originally listed for 10.5 million and lowered to 6.5 million1
. Sold for $3.175 million after foreclosure. 2
Georgia, 25,000 sq ft on 15 acres. Appraised at over 1.5 million. I originally became knowledgeable of this property when listed at $995,000. Last listing price known was $399,000. Unknown sale price.
Virginia Intermont College. Listed for $15,000,000, sold for $3,300,000.
All the above, except the Texas camp, were for sale for prolonged periods of time. Had they priced the property more appropriately to start, as the Texas property was, they would not have had to incur the years of upkeep costs that go along with owning a property.