How does a 17 year old buy a million dollar RV park? Find out in this incredible interview with Jared, as we dive into his inspiring journey of mentorship, ambition, and making the impossible, possible!
Jared’s journey into the world of real estate investment began with a clear understanding of what he didn’t want. Despite having the financial backing to attend college, he realized that traditional education wasn’t for him. Instead, Jared saw college more as a trade school, one that didn’t align with his interests. He had tried a variety of jobs in high school, from bookkeeping to woodwork and machine shop. However, it was his father’s passion for investments that caught his attention. Through his father’s guidance and network, Jared discovered our mentorship program and he decided to pursue commercial real estate investing.
How a 17-Year-Old Bought a Million Dollar RV Park
Jared’s first deal is a distressed RV park located in the Sonoran Desert, Arizona. With about 140 sites, we bought the park for a million dollars with a seller-financed deal—meaning no banks were involved. It’s a five-year deal with the seller and one investor outside the family provided the down payment. Although not performing well, the park has a 3x upside potential, making it a tremendous value-add opportunity. The strategic plan to turn around the park is threefold:
- Introducing new management and optimize operations.
- Implementing new marketing strategies to attract tenants.
- Adding sought-after amenities to elevate the park’s appeal.
Our goal is to transform this distressed park into a high-performing asset within five years, turning it into a 16 cap rate deal. At the end of five years, Jared plans to refinance the property or invest in another property using a 1031 exchange. This incredible journey, however, wasn’t without its challenges. Let’s dive into his inspiring story and see how Jared turned his dreams into reality.
Meet Jared: Ambitious 17-Year-Old Investor
Peter: Welcome, everybody. Thank you for joining us today. I have a very special guest with us, Jared, a 17-year-old who bought his first RV park. Good morning, Jared.
Jared: Good morning, Peter.
Peter: Thank you so much for being here. I know you just closed and you’re in the middle of everything, so I appreciate you taking the time and pressing the pause button to be with us. I know as a business owner now, there’s no such thing as a stopping, there’s just a pause button, right? You’ll soon learn that, if not already. So, thank you for being with us, Jared. In my intro I mentioned a 17-year-old who bought an RV park, so I want to just dive into all that in this interview here. Let’s start off with you sharing a little bit about yourself.
Jared: Well, I’m actually 18 now, but I was 17 when we closed. I live in Phoenix, Arizona, and both my grandfathers moved here in the seventies. My family has been here ever since, and I love Phoenix. I’m not leaving here.
I do a lot of different things for fun: I rock crawl my Jeep, I love working on my Jeep, I play music, adventure, adrenaline sports, rappelling, hiking, and mountain biking. And then weird stuff like I rappelled off the city center building in downtown Phoenix. Also, I stayed overnight in a tree house in Oregon, and we rented a ‘86 VW bus to cruise around Alaska. And so that was a lot of fun.
Peter: That is cool. And with your dad, right?
Jared: Yeah, that’s with my family.
Why Real Estate Investing?
Peter: That’s awesome. Jared, when joined our program and when you closed your deal, you were 17 years old. And when you first came in, it got me thinking, “Why isn’t this young man who, finished high school, not wanting to go to college like a normal 17-year-old?” You know, go to college, get a job, things like that. What made you want to go this direction towards being an investor instead of taking the traditional route?
Jared: I always knew that I did not want to go to college. Everybody goes to college and it doesn’t really profit a lot of people the way I see it. I believe it should be treated like a trade school. And I knew that I didn’t want to do anything that was what college had to offer. So that ruled it out. I didn’t know for sure what I was going to do. I started my first real part time job at 13 and I was keeping books for two different companies, and I learned two things there; how to keep books and that I did not want to be an accountant.
So, after a little bit of that, I started working at a trade company doing woodwork and bookkeeping. That was for about 2 years, and I moved on to a machine shop to try out. I always knew I wanted to work construction or cars but wasn’t sure which. So, I went to a machine shop, and I was there 6 or 8 months and learned very quickly that was not what I wanted to do.
So, after that there was a couple of months where I was trying to figure out what I was going to do. During that time, my dad (who’s always had his investments in order, generally on the business or stocks side), showed me some of the different investment possibilities in real estate. And we started diving into it and one thing led to another. I said, I might be interested in doing this for a living. And so, my dad’s an EOS Implementer, basically it’s a business coach who teaches people how to operate their business and how to get their systems in place.
Obviously, he believes in the power of coaching, and he’s passed that on to me. So, one of the first things we started doing was looking for a coach and through my dad’s network, we found you Peter. Probably the biggest “aha” through all of that is that real estate is like buying and selling little businesses. And like what my dad does and what you do Peter, the more you can get them to run on systems so you don’t have to give them attention, the more you can take on so that you’re running more properties and therefore more money.
Jared’s Million Dollar RV Park
Peter: Great, thanks for that. That’s brilliant. So, let’s do the fun stuff. Let’s jump into the deal, the RV park. You found this property online. Share with us a little bit about the deal, the price, how you financed it, why you like it, the upside, your exit strategy. Please share that with us.
Jared: Yeah, so it’s a 140-unit park; I believe we’re running with that number.
Peter: Yeah. Initially, we counted 120 or 121.
Jared: It was advertised on 1 20 and then there was some more research. There are sites all the way up to 126 and then there’s a couple other sites, A, B and C. We thought maybe it was 131, but then after I built out the rent roll, seeing numbers all the way to 141, and then there’s overflow parking on top of that. There’s a lot of discrepancy on that. So, we’re running with 140.
Peter: Yeah, that awesome. Please continue.
Financing
Jared: Anyway, so we bought it for $1,000,000. The seller ended up financing most of it. We’ve walked in with 4.5% interest only on 75% ($750,000), then a friend carried the other $250,000 at 9% interest only. Both are interest only. I would not usually recommend going in fully financed, but I feel this one is a little different because there is so much upside opportunity. There is low occupancy during the summer, and it’s right at the break even point. It’s running right there. So, if you can pop even two or three more people, the numbers start skyrocketing.
Peter: Let’s stop there for a second. It’s a million-dollar purchase price. You put down $250,000 with an investor, right? An investor put that in for you guys. And then, from my understanding, three months later, there’s another $250,000 due. Then there’s a total balance due at $500,000 financed over the total of five years at 4.5% interest only payments. That’s a fantastic interest rate in today’s market. There’s nothing like that out there. And then the park is distressed, it’s way underperforming. Why is that?
Upside: Strategies for Turning Around the RV Park
Jared: The seller didn’t manage it right. I’m not sure why. There may be a couple different reasons, but it’s clearly management inefficiencies. It’s right in the center of town so there’s no reason for it to be. There’s a park next door that’s running 70 or 80% during the summer, which is terrible time to be there. It’s very hot. It’s ten or so degrees hotter than Phoenix.
Peter: So, day one, you’re walking in breaking even. And then after that, it’s nothing but upside, right?
Jared: Yes.
Upside #1: Increase Occupancy
Peter: Let’s discuss the upside. Upside number 1 is to increase the occupancy. You and I spoke this week about giving your staff a bonus if they were to reach a certain level and that’s going well. So, you’ll be cash flow positive even more. What other, upside do you have? I think there was a propane project, right?
Upside #2: Propane Dispensing
Jared: Yeah, so we’re installing propane dispensing. I’m not sure it’s either two or three other places in town that sell propane and there’s only one in town that delivers. So, we’re going to install a delivery route and we’re going to try to get other parks on board with it. There’s a lot of open market space for that.
Peter: What’s the potential dollars wise to, for something like that?
Jared: I don’t know. We estimated our numbers conservatively because that’s the way to go. We’re hoping for $20,000 in profit over the year and we believe that’s doable. There’s a park down the street that just sold in July for $1.8 million, almost double what this park is. It only has 33 sites and it’s the one that sells that delivers propane. And it was advertised as a 19 cap so there’s something with that propane. I think I looked through the numbers and he was running about 50% of his business on propane sales.
Upside #3: Installing Meters and Billing Back Electrical
Peter: That is huge. So, we have immediate rent upside just increasing occupancy and we have the propane potential. That’s fantastic. What other potential do we have? I believe that you are converting some of the pads to have their own meters.
Jared: Yeah. There are those 3 different paths to possibly doubling the NOI between a combination of all 3. We’re trying to double the NOI because we know they’re not all going to perform at best. So that’s our goal with it. The metering, it was running the seller into the ground. It’s the only park in town that does not bill back for electrical so we’re installing meters and billing back now.
Peter: And you were able to get to seller during your negotiations to connect to city water, so that’s done. That’s huge.
Jared: Yeah, and it also has a brand new well that was put in right before he connected.
Upside #4: Adding Amenities
Peter: That’s great. What other upside do you have? I believe you’re going to add a few amenities to make the park more fun, right?
Jared: Yeah, so we’re billing it as the “funnest” park in Courtside. We just hired someone to run activities. That’s her full time job. We’re trying to build a sense of community and a fun park. There’s no reason to go out there and just sit in your trailer and watch TV. There are things to do so we’re trying to create a fun place to live during the winter.
Peter: What type of amenities are you thinking about adding?
Jared: We haven’t entirely decided, but we’ve kicked around adding a community center because that’s a big one that’s not actually present on the park. We’ve thought about maybe putting in an above ground pool, just kicked it around things like that. It’s definitely going to be something big. We’re actually having the tenants vote on it, so the tenants opinions are definitely going to weigh in on the decisions.
Upside #5: Reduce Management Expenditures
Peter: Any other upside you can think of?
Jared: There’s a little bit of more out of just to be squeezed out of the management. So sometimes they’re spending too much on silly things.
Peter: Sure, with an owner that’s checked out, 80 years old with another park down the street; this park is neglected. Yeah, you will find a bunch of management inefficiencies and you’ve discovered them day one.
Proforma
So, in your estimation and, be conservative, once you get all of these things implemented, the upside potential is what? You bought it for a million and then over the next couple of years, you’re going to stabilize it with all the new amenities and the higher occupancy. What is it worth around in a couple of years?
Jared: We’re hoping to get it to $3 million.
Peter: 3 million! That’s fantastic! And I saw your cash flow projections, just incredible, where the cap rate was well above 15% and you’re just being conservative there. We’ll look forward to that.
Jared: Yeah. We we bought it at a 6.5, 7 cap. We didn’t buy it for the cap rate. Obviously, that’s a decent cap, but it’s not amazing. We’re expecting to sell or refi at a higher cap rate.
Asset Management
Peter: Absolutely. Jared, what’s your day to day? What are your day to day duties on this park?
Jared: I will be facilitating the property manager, just making sure that everything’s running smoothly. There’s on site management, it’s not 3rd party. I took on employees, so I’ll be running those employees.
Peter: We gave you a document called “The Plan” and we’re meeting later today to execute the plan because every property needs a plan to be successful. So, a lot of work ahead of us, but this is an amazing project. Regardless if you are 17 or 18 years old, this is an awesome project. I just want to commend you for that.
Jared: Thank you.
Exit Strategy
Peter: Sure. What is your exit strategy? Is it to buy and hold, refinance, sell 1031 exchange?
Jared: I don’t know. We have all those options in our pocket right now, and we haven’t decided. We’re going to run through at least the first year and we’ll start figuring it out. But those are all valid possibilities. We have all of our options open still.
Overcoming Challenges
Peter: I’ve been with you the whole time managing this transaction and I know there are a couple of challenges here. There always are. What are one or two challenges that you can share and how you got over them.
Challenge #1: Working with the Brokers
Jared: So probably the biggest challenge was working with the broker. The broker was supposed to be on our team. It was actually a team of 2, man and a woman, that were supposed to be on our team, and it definitely didn’t feel like it.
Later, I talked to the seller, and we were discussing a simple thing on the phone, just us two. And he asked his secretary, “Hey, what’s the name of that lady?” And she mentioned the lady broker’s name. And he goes, “No, not our broker”. I picked that up pretty quick, you know what I mean?
Peter: Yeah.
Jared: They at best they didn’t do their job top notch.
Peter: I totally agree. They did not have your side of this transaction. Frustrating for me as a coach, right? We need their help to get this deal closed. There was a challenge number two. What was that?
Challenge #2: Dealing with the Seller
Jared: Challenge number two was dealing with the seller himself. I think that this was a tax write off. I think that’s the reason that he neglected it because he’s not a stupid guy. He knows how to play the game, and he was pretty slick about playing it. He played dumb for two and a half months. Two or three weeks before, even contract, we started poking our nose around the deal, you know how that goes. And one of the first things we asked for as a rent roll. And he’s like, “Oh, I don’t have it. I don’t have it. Here’s the best I got.” And it was pretty pathetic. So, we’re like, okay, we’ll try to work off of this. And I stayed on him the entire time through due diligence, like, hey, we need a clear rent rolls.
“Oh, I don’t have it. I don’t have it.” Then about two or so weeks before close, I sent over a rent roll for rent settlement that I had put together based off my site visits and talking with the property manager. I sent that over and the number was too high for him. He thought it should be lower. So next day he sends back a rent roll that’s got everything on it and where my rent roll is wrong. Next day! So, he had the rent roll, he just didn’t want to give it to me.
Peter: Sure. And throughout this transaction, we kept finding things like that. In my opinion, I figured, he knows Jared’s 17 years old and I’m going to take advantage of him. But he had no idea you had a coach and your dad behind you.
Jared: That’s right. And a couple of times since we were dealing through the broker, I think one time I scared the broker. I got on his tail a little bit. He was trying to offer excuses and stuff and I just got up front with him and he didn’t talk to me for a couple of days. He talked to my dad, so he wasn’t too impressed.
Advice for Aspiring Investors
Peter: Yeah, you got to stand your ground. Jared, our channel here is mainly for beginners and intermediate, some advanced, and I know some of them want to do what you’re doing. What advice would you give them on just getting started in this business?
Jared: I’d tell them “Just do it”. I don’t particularly buy Nike’s, but I definitely buy their slogan, so you’re never going to do it if you don’t just do it. Definitely get a coach, but even if you have a coach, you can still hem and haw. You just got to do it.
What’s Next for Jared?
Peter: Great advice. Just do it. Our last question here, what’s next for Jared? You closed on this park, we have a lot of work ahead of us. What happens after that?
Jared: As far as work goes, I’m going to spend the rest of the year diving into this park just trying to get it to run top notch, as smooth as it can without me. So that way, next quarter, which would be the first quarter of 2025, I want to put my next deal under contract.
Peter: What does that next deal look like, Jared?
Jared: I have no clue, something that the numbers work. It might be an RV park. Definitely there’s an argument for that and I will be a lot more interested in RV parks at this point. I can still go after an apartment complex or something like that. If the numbers work, it’s all about the numbers.
Peter: Yeah, it is. Well, Jared, this is an amazing interview. I appreciate you taking the time share with us your inspiring story, and you’re an amazing young man. I just want to congratulate you for getting this done and we’re with you the whole way. We have a lot of work to do but we’re going to get there.
Jared: And thank you guys. You guys have been a huge help, and I would not be here without you or my dad. My dad’s trying to get this to be my thing, but he’s still he’s very much involved.
Peter: All right, Jared, you enjoy the rest of your day. Thank you for being with us and we’ll be talking soon.
Jared: Thanks, Peter.
Questions or Comments? Text PETER to 833-942-4516.
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