DESPITE the continued reports of a difficult market for selling private static caravans and lodges, a number of recent caravan and holiday park transactions has proven there is still confidence in the sector.
Well-appointed parks in popular locations continue to attract interest, and the recent sale of Riverside Holiday Park, in Wooler, and River View Caravan Park, in Barnard Castle, are testament to this.
Sanderson Weatherall has a longstanding knowledge of both parks, having advised their previous owners.
We are firmly of the view that these successful sales are not only down to their current and future trading potential, but also thanks to the sound infrastructure already in place that will minimise any major capital expenditure in the short-term future.
Over the past 12 to 18 months, several of our clients have taken proactive steps to increase occupancy and sales.
Their creative strategies to entice and retain customers have included investing in extra facilities and services beyond the norm.
Examples have ranged from top-end purpose-built fitness and leisure facilities, to the less capital intensive though equally popular options such as nature trails, hot tubs and free Wi-Fi. In addition, the rising popularity of UK ‘staycations’ has resulted in many reporting an upturn in revenue from hire fleets and short-term touring bookings and this trend looks likely to continue throughout 2012.
Looking ahead, cash will remain king as is the case with much of the commercial property sector.
A purchaser’s ability to raise finance remains one of the key factors in determining the number of ‘realistic’ applicants for any property offered for sale.
Parks with established and sustainable trading histories are the most saleable, and while underperforming parks with vacant bases and/or significant development potential do attract interest, the pool of buyers is generally restricted to those with funds already in place.
The caravan and holiday park sector has maintained a reputation for being an attractive option during recessionary periods, where the secure income from private pitch fees remains the core foundation for many businesses.
Interest from cash-rich operators seeking new opportunities and the increasingly impressive offerings to add value to the customer experience will continue throughout the next 12 months.
:: Adam Burkinshaw, partner, leisure, for and on behalf of Sanderson Weatherall LLP, 0113 221 6102.