Campgrounds can be genuinely profitable: well-run parks routinely produce owner cash flow in the range of 25% to 40% of gross revenue, which puts them among the stronger segments of small commercial real estate. Whether any specific campground hits that range depends on location, the mix of sites, how long the operating season runs, how aggressively the owner develops ancillary revenue, and how much debt the property carries. The U.S. camping and outdoor hospitality market is projected to reach roughly $16 billion in 2026 and grow at about 7.6% annually through 2033, so demand is not the problem. Execution is.
What the Numbers Look Like on a Typical Park
Industry accounting data shows an average campground grossing around $560,000 in annual revenue and netting roughly $140,000 to $220,000 in owner cash flow, with the higher end reflecting the value of onsite housing. Return on invested capital for established parks runs in the mid-to-high teens.
The 25% to 40% cash flow range is wide for a reason. An owner who lives onsite and manages the property personally keeps far more than an absentee owner paying a management company. A park bought at a reasonable multiple of income throws off cash; one bought with debt sized for occupancy the property never hits does not. Same industry, very different outcomes.
Where the Revenue Comes From
Site rentals are the base, and what you can charge tracks directly with what the site offers.
- Primitive tent sites bring in the least, typically $15 to $40 per night at private campgrounds. Public parks charge even less, which caps pricing anywhere near state or federal land.
- RV sites with electric, water, and sewer hookups run $55 to $90 per night at most private parks, with premium locations near coastlines or national parks pushing past $100.
- Glamping units and cabins commonly range from $100 to $300 per night, and high-end glamping resorts push past $400. They earn the most per night and also cost the most to build and maintain.
- Seasonal leases (typically five to seven months) lock in fixed income regardless of weather or midweek vacancy. Many parks fill 20% to 40% of their sites this way to create a stable floor.
The operators who separate themselves from the break-even ones lean hard on ancillary revenue. Onsite convenience stores selling firewood, ice, and basic supplies carry high margins because guests will pay a premium not to drive into town. Bike, kayak, and paddleboard rentals add up quickly through peak season. Coin laundry and dump station fees for non-guest RVs round out the secondary streams. Parks that develop these lines can add 15% to 25% on top of base site rental revenue, and that increment is where a middling operation turns into a strong one.
What the Expenses Look Like
Operating expenses typically consume 50% to 55% of gross revenue at a stabilized park. The main categories:
- Utilities. Electricity, water, and sewer are a substantial monthly bill, especially at full-hookup parks. Properties on septic rather than municipal sewer face pumping costs of $300 to $700 per tank per service call, and a busy park may need multiple systems pumped several times a season.
- Labor. Front desk, groundskeeping, maintenance, and housekeeping for cabins and glamping units together usually make up the single largest expense line. Seasonal hiring helps, but finding reliable seasonal workers is a chronic problem.
- Insurance. General liability and property coverage for a small to mid-sized park typically runs $2,500 to $5,000 a year. Parks with pools, playgrounds, cabins, or adventure activities can expect $10,000 or more, driven mostly by guest-injury exposure.
- Maintenance and grounds. Gravel road grading, bathhouse upkeep, fence repair, landscaping, and pest control never stop. Deferring this work degrades both the guest experience and the resale value, so experienced operators treat it as fixed cost rather than discretionary.
The expense that catches new owners flat is infrastructure replacement. Water lines corrode, electrical pedestals fail, and septic drain fields eventually reach end of life. A capital reserve of 5% to 10% of gross revenue keeps these costs from becoming emergencies. Skipping it is one of the reliable ways to turn a profitable park into a distressed one.
Seasonality: The Biggest Threat
In most of the country, seasonality is the single largest risk to profitability. National averages show annual occupancy for RV parks around 60% to 70% during operating months, with full-hookup sites averaging about 68% and rustic tent sites closer to 25%.
The trap is that many northern parks can only operate six to eight months a year, but property taxes, loan payments, insurance, and basic upkeep continue for all twelve. A park hitting 80% occupancy from May through October can still lose money if fixed costs drain reserves during the five months it sits empty.
Operators attack this from several angles. Warm-climate parks court snowbirds who book monthly winter stays at reduced rates, creating baseline income during otherwise dead months. Fall festivals, holiday light shows, and group retreats extend the effective revenue season on both ends. Even cold-climate parks generate off-season income by hosting ice fishing groups, snowmobile clubs, or winter RV and boat storage. Every additional week of meaningful occupancy goes almost entirely to the bottom line, because the fixed costs are already covered.
Parks that struggle financially usually share the same traits: short operating seasons with no shoulder-month strategy, under-investment in the amenities that justify premium pricing, or acquisition debt sized for occupancy levels they never reach.
What It Costs to Get In
Buying an existing park is the faster path to revenue, and it is not cheap. Stabilized parks with strong occupancy and modern infrastructure typically trade at capitalization rates around 8% for higher-quality properties and 9% or higher for older parks needing capital investment. A park producing $200,000 in net operating income might sell for $2.2 to $2.5 million on that math.
Building gives you more control over layout and infrastructure but requires patience. Development costs typically run $15,000 to $50,000 per site depending on the level of infrastructure. The major line items:
- Land runs $1,000 to $10,000 per acre depending on location and desirability. Heavy brush clearing and grading adds $1,500 to $15,000 per acre.
- Electrical hookups run roughly $1,500 to $2,500 per site for standard 30/50-amp service.
- City water connections run about $1,200 per site. A well costs $5,000 to $12,000 and serves multiple sites.
- A quality bathhouse adds around $20,000, and a camp office runs $15,000 to $80,000 depending on size.
A new campground typically requires $100,000 to $2 million in total startup capital, with most viable private parks landing between $300,000 and $800,000. SBA loans are a common financing tool for both purchase and development, but lenders want a credible business plan with realistic occupancy projections rather than best-case ones.
The Regulatory and Tax Costs That Move the Margin
Local zoning sets a hard ceiling on how much revenue your land can produce. Density caps of 10 to 20 sites per acre are common, and setbacks of 20 to 100 feet from property lines and roads can cut into buildable space significantly. Complying requires professional surveying and engineering before you lay out a single site.
Health department rules add another layer. Water supply regulations typically mandate minimum gallons per day per campsite, periodic water quality testing, and distribution system pressure standards. Waste disposal rules may force commercial-grade septic or a municipal sewer connection, either of which is a five-figure capital investment. Enforcement varies enough between jurisdictions that what passes in one county may not fly in the next one over.
If you are buying undeveloped land, a Phase I Environmental Site Assessment typically costs $2,200 to $4,000 and will be required by any lender. If it flags anything, a Phase II with soil and groundwater sampling can add $10,000 or more. Former agricultural land with pesticide history and parcels near old industrial sites carry elevated risk.
On the tax side, property taxes are the biggest fixed tax cost because these businesses require large tracts of land with permanent improvements, and every capital upgrade you make to attract guests increases the assessment. Most jurisdictions also impose a transient occupancy tax on short-term stays that campgrounds must collect and remit, typically 5% to 15% of the nightly fee. Store sales and equipment rentals may trigger separate sales tax obligations, so an owner often maintains parallel tax accounts for lodging and retail.
Most campgrounds operate as pass-through entities, so business income flows to the owner’s personal return. A single-member LLC is treated as a disregarded entity for federal tax purposes; a multi-member LLC defaults to partnership treatment, with each owner reporting their share on Schedule K-1.1Internal Revenue Service. Limited Liability Company (LLC)
Depreciation is one of the more valuable tools available, because so much of a park’s value sits in depreciable improvements rather than the land itself. Land cannot be depreciated, but most campground infrastructure qualifies as 15-year property under the Modified Accelerated Cost Recovery System, including roads, driveways, parking areas, utility hookups, drainage systems, fences, and lighting.2Office of the Law Revision Counsel. 26 USC 168 – Accelerated Cost Recovery System Water, sewer, gas, and electrical distribution systems also qualify for 15-year recovery. Bathhouses and offices depreciate over longer periods (27.5 or 39 years), but a cost segregation study can reclassify components into shorter-lived categories. For a park with $500,000 or more in improvements, the first-year tax savings often justify the $5,000 to $15,000 cost of commissioning one.
So, Are They Worth It?
For an owner who buys at a sensible multiple, keeps debt in check, treats infrastructure reserves as non-negotiable, and actively develops both ancillary revenue and the shoulder season, campgrounds compare favorably to most small businesses on both cash flow and return on invested capital. The industry’s growth trajectory is real, and the tax treatment of the physical assets is genuinely favorable.
The parks that lose money almost always trace back to the same short list: overpaying at acquisition, running a short season with no plan to extend it, skipping the amenities that justify higher nightly rates, or letting infrastructure fall behind until a failure forces the issue. Profitability in this industry is not automatic. It is a function of the operator, and the numbers reward the ones who treat it like the operating business it is rather than a passive real estate hold.