Case Study · Arizona · RV Resort & Campground · USDA B&I
RV Resort Feasibility Study, Arizona — A USDA B&I Worked Case
This is how our independent feasibility study company and consultant team analyzed a ground-up snowbird RV resort underwritten to a USDA Business and Industry guaranteed loan, from seasonal winter-visitor demand read per site through the debt-service coverage the agency and lender must document. It is an anonymized composite of a typical engagement of this type — not a specific client deal — set on a rural desert gateway corridor in Arizona.
A ground-up snowbird resort on a rural Arizona gateway corridor.
A sponsor came to our feasibility study company with a ground-up outdoor-hospitality project and a USDA Business and Industry lender that needed the projected cash flow independently tested before it would commit. The subject is a new roughly 130-site destination RV resort with twelve rental cabins, a clubhouse, a pool, and a camp store, on a desert gateway corridor in a rural Arizona county whose host community sits under the 50,000-population line that defines USDA rural eligibility.9 The revenue model is snowbird-led: a strong winter-visitor peak from November through April, a lighter transient shoulder, and a deliberately conservative summer trough.
Because an RV resort is an owner-operated going concern rather than passive real estate, the lender's question is not “what is the dirt worth” but “can this specific park generate the seasonal site nights, cabin nights, and ancillary revenue to service this specific loan.”14 USDA is also more prescriptive than most programs: under 7 CFR Part 5001, a feasibility study prepared by an independent qualified consultant is required for a guaranteed loan over one million dollars to a new entity, which is exactly what a ground-up B&I deal is.10 Our scope was the independent demand, occupancy, competition, and debt-service analysis that supports that credit.
Seasonal snowbird visitation, read per site.
The demand read starts with winter-visitor households and drive-to snowbird routes, not an annualized occupancy applied to a site count. The Arizona desert Southwest is one of the country's deepest inverse-seasonal markets: a strong winter peak and a summer trough, with an annual and seasonal-heavy revenue mix.
Site revenue is the primary value driver, and in a snowbird market it is set by the winter season, not by a flat year-round rate. North American camping households sit just over 52 million, above pre-pandemic levels but no longer growing, so the correct posture is to underwrite to normalization rather than to the 2020–2022 boom.12 Within that national frame, a destination resort earns on a seasonal curve: snowbird sites let for roughly $400 to $1,200 a month across a four-to-five-month winter, premium transient nightly rates run $60 to $150-plus in the shoulder, and ancillary revenue from the camp store, cabins, laundry, and activities realistically contributes 10 to 25 percent of the total.67 On the winter-visitor base, the snowbird-route capture, and the resort format, the model supports a blended stabilized site revenue near $13,100 per site — a defensible mid-to-upper placement within the roughly $8,000-to-$15,000-plus per-site range rather than a peak-rate extrapolation.
| Demand driver | Basis | Supported figure |
|---|---|---|
| Winter-visitor base | AZ desert-SW snowbird corridor; 52M+ N.A. camping households2 | Rising seasonal captive base |
| Peak season (Nov–Apr) | Snowbird monthly $400–$1,200/site; high winter occupancy7 | ≈ 90–95% site occupancy |
| Shoulder (Oct, May) | Premium transient nightly $60–$150+7 | Moderate transient capture |
| Summer trough (Jun–Sep) | Desert heat; limited transient + hosts | Low occupancy, reserve-covered |
| Blended RV site revenue | Snowbird-weighted, ~$13,100/site × 130 sites6 | ≈ $1.70M/yr |
Snowbird rate and seasonal-occupancy logic grounded in the Arizona desert-SW market read and RV-park revenue economics; see sources 6, 7, and 11. Figures are illustrative of the engagement type.
A thin resort set on a corridor of aging snowbird parks.
Five competing parks sit within a reasonable drive, but the standing set is mostly older, annual-heavy, amenity-light product; the nearest true resort-quality competitor is well off the gateway corridor. The subject fills a resort gap rather than splitting a saturated trade area.
| Competitor | Format | Sites | Distance | Read |
|---|---|---|---|---|
| Park A | Older snowbird park | 180 | 4 mi | Annual-heavy, dated, no cabins |
| Park B | Basic RV / MH mix | 90 | 7 mi | Value-led, thin amenities |
| Park C | County / public campground | 60 | 9 mi | Dry / limited hookups, demand generator |
| Park D | Small transient park | 45 | 12 mi | Seasonal, no resort amenities |
| Park E | Destination resort | 220 | 24 mi | Full resort; rate benchmark, off-corridor |
Competitive set surveyed for the engagement; anonymized. Announced and permitted supply was scanned, not just the standing set; outdoor-hospitality data is not organized by MSA, so every read is corroborated deal-by-deal. See sources 5 and 11.
Only one competitor offers genuine resort amenities, and it sits 24 miles away, off the subject's gateway corridor — a weak defender against a new full-hookup resort with cabins, a pool, and a clubhouse on the winter-visitor route. The nearer parks are annual-heavy and amenity-light; annual-dominated Arizona parks in fact trade more like manufactured-housing communities at lower cap rates, which tells you they are managed for stability, not for the transient and cabin upside the subject is built to capture.11 A rigorous study does not stop at the standing set: because the sector has no CoStar equivalent and no metro-level cap-rate series, we scan announced and permitted new sites and corroborate the capture forecast against traffic, attraction visitation, and competitor rate sheets rather than a single vendor feed.5
Arizona: a winter-visitor economy on a rural USDA spine.
The state backdrop is a tailwind for a seasonal snowbird resort, tempered by the summer trough. Arizona holds roughly 7.6 million residents, but the demand that matters here is the winter visitor, and the site that matters is rural — where the capital is USDA-first.
Arizona is not one market but three that move on different clocks: an oversupplied-but-digesting metro Phoenix, a smaller and more balanced Tucson, and a USDA-eligible rural remainder of border counties, tribal lands, retirement enclaves, and gateway-tourism towns.12 A snowbird RV resort belongs to the third Arizona. The desert Southwest is a classic inverse-seasonal market — a strong winter peak and a summer trough — anchored by established snowbird hubs around Phoenix, Yuma, and Apache Junction, with an annual and seasonal-heavy revenue mix.11 Yuma and the rural remainder run a pronounced winter-visitor peak that is best underwritten on monthly, not annual, occupancy, and the northern gateway corridors toward the Grand Canyon and Sedona carry their own durable leisure demand.12
The offsetting reality is the calendar. A desert resort carries year-round fixed costs against a revenue base concentrated in five winter months, so the feasibility test turns on whether stabilized cash flow covers a highly leveraged basis under conservative occupancy — not on an optimistic annualized rate. The capital routing, by contrast, is a clear advantage: for a rural, owner-operated park, USDA Business and Industry guaranteed loans route through the USDA Rural Development state office in Phoenix, and the rural remainder, tribal lands, and border counties are heavily USDA-eligible — USDA announced $117.5 million across rural Arizona in a single recent tranche.13 B&I is, in practice, the single most-missed routing in Arizona, and it is the natural home for a rural outdoor-hospitality going concern.9
Why a rural gateway corridor carries a resort.
Drive-to snowbird routes, winter-visitor demographics, proximity to a destination attraction, and rural eligibility all point the same direction, and the corridor position converts that demand into site nights.
The trade area draws a well-defined winter-visitor population — retirees and seasonal travelers on established snowbird routes into the desert Southwest — whose stay lengths and spend are far more legible than a general leisure count. Parks within a 30-to-60-minute drive of a major attraction consistently outperform remote locations on both occupancy and rate, and the subject sits inside that band relative to a regional desert-and-gateway draw, which is precisely why the model credits a resort-quality capture rather than an average one.6 Land basis on the rural corridor is a fraction of metro Phoenix, which is what lets a full-hookup, amenity-rich build pencil at a defensible per-site cost.
Geometry and eligibility do the rest. The host community sits below the 50,000-population threshold, so the site is USDA B&I-eligible — the decisive routing fact for a rural park — and the corridor position places the resort on the going-in side of the snowbird flow rather than behind it.9 The one factor a disciplined study refuses to wish away is the summer trough: desert heat compresses June-through-September demand to a fraction of the winter peak, so the model funds an off-season reserve and sizes debt to stabilized coverage, not to a peak-season run-rate.8
The USDA B&I guaranteed structure.
Total project cost lands at $10.5 million. Because the park is a rural, owner-operated going concern in a community under 50,000, it routes to a USDA Business and Industry guaranteed loan rather than to agency multifamily, which excludes pure RV resorts outright.
| Cost component | Amount |
|---|---|
| Land & entitlements (desert gateway parcel) | $1.30M |
| Site work, roads, grading & drainage | $2.65M |
| Utilities & 130 full-hookup pads (30/50-amp, water, sewer) | $2.35M |
| Rental cabins (12 units) | $1.15M |
| Clubhouse, pool & recreation amenities | $1.30M |
| FF&E, camp store & laundry | $0.55M |
| Soft costs, design & contingency | $0.75M |
| Working capital, reserves & USDA guarantee fee | $0.45M |
| Total project cost | $10.50M |
Site-and-utility development of about $5.0M across 130 sites (~$38,500/site) sits within the $15,000–$50,000 per-site all-in band; cabins, amenities, and land are additive. See source 6.
| Item | Figure |
|---|---|
| USDA B&I loan (75% of cost) | $7.88M |
| Borrower equity injection (25%) | $2.62M |
| Term / amortization | 25-year amortization |
| Illustrative rate | ~8.5% |
| Annual debt service | ≈ $761k |
Structure per USDA B&I conventions under the OneRD rule (7 CFR Part 5001): rural (50,000-or-fewer population), up to $25M, guarantee up to 80%, 25-year amortization, feasibility required over $1M. See sources 9 and 10.
Two percentages sit in this structure and must not be confused. The first is loan-to-cost: the USDA B&I loan is sized at 75 percent of the $10.5 million project, or $7.88 million, against a 25 percent equity injection of $2.62 million — an above-baseline injection appropriate to a ground-up going concern with a seasonal ramp. The second is the guarantee: USDA guarantees a share of the lender's loan — up to 80 percent for loans of $5 million or less, stepping to 70 percent between $5 million and $10 million — so this roughly $7.88 million facility carries a 70 percent USDA guarantee that protects the lender, not the borrower.9 On a 25-year amortization at an illustrative 8.5 percent, annual debt service is about $761,000 — the number the projected coverage has to clear. The study exists to support exactly that, tested against an independent read of seasonal demand rather than the sponsor's own projection, to the five components 7 CFR Part 5001 requires: economic, market, technical, financial, and management feasibility.10
Feasible and bankable, on a graded seasonal ramp.
The stabilized model builds revenue from three streams — RV sites, cabins, and ancillary — nets an operating-expense ratio inside the sector's 50-to-70-percent band, and carries the coverage to a stabilized 1.55x over an 18-to-24-month lease-up.
| Line | Basis | Amount |
|---|---|---|
| RV site rental (130 sites) | ~$13,100/site blended, snowbird-weighted6 | ≈ $1.70M |
| Cabin rental (12 units) | ~$150 ADR × seasonal occupancy7 | ≈ $0.33M |
| Ancillary (store, laundry, activities, propane) | ~17% of total revenue7 | ≈ $0.42M |
| Total revenue | Site + cabin + ancillary | ≈ $2.45M |
| Operating expenses | Labor, utilities, R&M, insurance, property tax, management, G&A (~52%)6 | ≈ ($1.27M) |
| Net operating income (NOI) | Total revenue less operating expense | ≈ $1.18M |
Operating-expense ratio near 52 percent sits inside the 50-to-70-percent band typical of the sector; site rentals plus cabins provide roughly 83 percent of gross, with ancillary at about 17 percent. See sources 6, 7, and 8.
| Year | Stage | NOI | Debt-service basis | DSCR |
|---|---|---|---|---|
| Year 1 | Ramp (18–24 mo lease-up) | ~$723k | Fully amortizing ~$761k (I/O bridge + reserve) | 0.95 |
| Year 2 | Building | ~$989k | Full amortizing ~$761k | 1.30 |
| Year 3 | Stabilized | ~$1.18M | Full amortizing ~$761k | 1.55 |
DSCR computed as NOI divided by the period debt-service obligation. A credible seasonal ramp projects gradual occupancy over 18 to 24 months rather than high day-one occupancy. See source 8.
The stabilized 1.55x coverage is the figure the agency and lender document, and it clears a conservative coverage floor with real headroom. By Year 2 the project already covers fully amortizing debt service at 1.30x. The Year 1 figure of 0.95x is intentionally below 1.0 — it is the ramp year — which is exactly why the structure carries a funded debt-service reserve and an interest-only bridge through the seasonal lease-up: the reserve and bridge cover the ramp, and permanent, fully amortizing coverage is measured once the resort reaches its supportable winter occupancy. Crediting peak transient rates and high stable occupancy at the same time, or modeling mature-resort ancillary margins on day one, is one of the most common ways these outdoor-hospitality pro formas fail review; the ramp here is deliberately graded.48
On the equity side, the $2.62 million injection earns growing levered free cash flow — negligible during the ramp, building to roughly $360,000 a year once stabilized and net of a furniture, fixtures, and equipment reserve for cabins, amenities, and utility systems. The exit is valued on a going-concern basis, not a leased-fee cap rate: a resort is an owner-operated business, and capitalizing a Year-10 stabilized NOI near $1.35 million at a going-concern overall rate around 8 percent — consistent with resort-quality, annual-heavy Arizona parks trading tighter than the roughly 9.3 percent 2024 sector average — implies a gross sale near $16.9 million, and roughly $9.9 million of net equity after selling costs and the outstanding B&I balance.514 Holding occupancy and rate to a normalized rather than a boom trajectory, the blended result is an illustrative levered equity IRR of about 19 percent over a 10-year hold.1
Verdict: financially feasible and bankable. On independently derived seasonal demand, a stabilized 1.55x DSCR, and a ~19% levered equity IRR, the projections support the USDA B&I guaranteed credit.
Independent demand, seasonal occupancy, competition, and DSCR stress.
The engagement was scoped the way a USDA credit committee reads it, to the five components 7 CFR Part 5001 defines: economic, market, technical, financial, and management feasibility. As an independent feasibility consultant, our role is to test the sponsor's projection against the market, not to restate it — the value of the deliverable is precisely that it carries no stake in the outcome, which is also the independence the regulation requires.10 We modeled occupancy by period — peak, shoulder, and off-season separately — rather than blending a single annualized number that would hide the seasonal curve, and we held the transient and annual streams apart so the pro forma does not credit peak nightly rate and high stable occupancy at once.
The coverage analysis was then stress-tested. We ran the debt-service coverage against winter occupancy and snowbird-rate downside — the two variables a seasonal desert resort is most exposed to — to confirm the credit still holds when the peak compresses. One scope boundary is worth stating plainly: as the feasibility consultant, we reference, but do not perform, the NEPA environmental review a USDA B&I loan requires; that is a separate environmental professional's engagement that runs in parallel to the study.9 That combination — independent seasonal demand, occupancy by period, competition, and a stressed DSCR on a going-concern basis — is what lets the agency and lender rely on the file.
Underwriting an Arizona RV resort for a USDA B&I loan? Start with the feasibility study.
Feasibility Study Company prepares independent RV park and campground feasibility studies for USDA Business and Industry, SBA 7(a) and 504, and conventional credits, built to the coverage standard your agency and lender must document. A methodology briefing walks through the seasonal demand, occupancy, competition, and DSCR analysis behind a case like this one, calibrated to your corridor and format.
Request a methodology briefingData sources and dates.
The deal figures are illustrative of the engagement type; the market data that grounds each dimension is real and sourced, drawn from our standing Arizona, RV Park & Campground, and USDA Rural Development analyses and the primary authorities they cite.
- RV Industry Association (RVIA) shipment data and RV RoadSigns forecast (ITR Economics), Summer 2026: wholesale shipments of 600,240 units (2021 peak), 313,174 (2023 trough), 342,220 (2025), and a 314,000-unit 2026 median (down 8.2 percent); the leading demand indicator normalized above pre-pandemic levels but no longer growing, as compiled in the firm's RV Park & Campground analysis.
- KOA 2026 Camping & Outdoor Hospitality Report (12th annual; Cairn Consulting Group; released April 14, 2026), via SGB Media: over 52 million North American camping households in 2025, above the 42.0 million of 2019 but below the 58.5 million 2022 peak.
- IBISWorld, Campgrounds & RV Parks (NAICS 72121): US industry revenue of $10.9 billion in 2025, up 2.5 percent, across roughly 16,200-plus private parks and 1.3 million campsites.
- Equity LifeStyle Properties (ELS) and Sun Communities (SUI) disclosure (FY2024–FY2025): ELS derived 91 percent of revenue from annual sources as of December 31, 2024, and Sun has converted nearly 7,000 transient RV sites to annual since 2020; transient revenue can fall 9 to 10 percent in a single year even as annual income grows, so peak transient rate and high stable occupancy must not be credited together.
- Parks & Places, via RVBusiness (December 2024): a 9.3 percent average cap rate across 21 parks sold in 2024, with average time-on-market of 8.8 months; broker and analytical ranges of 8 to 12 percent, resort-quality destination assets at 6 to 8 percent, and EV/EBITDA of 4.0 to 7.0x; the sector has no CoStar equivalent or metro-level cap-rate series.
- Loan Analytics / MMCG and Innowave Studio (2024–2025): revenue per site of roughly $8,000 to $15,000-plus, development cost of $15,000 to $50,000 per site all-in, utility line items of $5,000 to $15,000 per site, and the 50-to-70-percent operating-expense band; parks within a 30-to-60-minute drive of a major attraction outperform remote locations.
- Feasibility-study-consultant.com, RoverPass, and RJourney (2025–2026): transient nightly rates ($35–$90 standard, $60–$150+ premium), annual and seasonal snowbird rates ($400–$1,200/month), and ancillary-revenue share of 10 to 25 percent.
- Financial Models Lab (2025): site rentals producing 80 percent-plus of gross income, weekly DSCR tracking against fixed debt service for seasonal operators, and a credible ramp projecting gradual occupancy over 18 to 24 months rather than high day-one occupancy.
- USDA Rural Development, Business & Industry (B&I) program under the OneRD Guaranteed Loan rule (7 CFR Part 5001, effective October 1, 2020), via MMCG and Business Finance Depot: guarantees up to 80 percent on loans up to $25 million ($40 million select), rural (50,000-or-fewer population), 25-year amortization, a feasibility study required over $1 million, and NEPA environmental review; standard guarantee tiering steps to 70 percent for loans between $5 million and $10 million.
- USDA feasibility requirement, 7 CFR Part 5001: a feasibility study prepared by an independent qualified consultant is required for a guaranteed loan greater than one million dollars to a new entity or an entity conducting a new activity, evaluating the economic, market, technical, financial, and management feasibility of the project.
- Firm RV Park & Campground regional monitor, Arizona / Desert Southwest read: snowbird-retiree demand, a strong inverse-seasonal curve (winter peak, summer trough), snowbird hubs around Phoenix, Yuma, and Apache Junction, an annual and seasonal-heavy revenue mix, and annual-heavy parks trading more like manufactured-housing communities at lower cap rates.
- U.S. Census Bureau, Vintage 2024 Population Estimates (Arizona approximately 7.6 million); Arizona Office of Economic Opportunity population projections (several rural counties projected to lose residents); Yuma and the rural remainder characterized by a winter-visitor peak best underwritten on monthly occupancy, with Flagstaff/Sedona a Grand Canyon gateway market.
- USDA Rural Development, Arizona State Office, Phoenix: B&I and other guaranteed credits route through the Phoenix state office, with the rural remainder, tribal and reservation lands, and border counties heavily USDA-eligible; $117.5 million announced across rural Arizona (November 2023).
- Sage Outdoor Advisory and BBG (MHC/RV appraisal practice), 2025: RV parks valued as going concerns (real estate plus FF&E plus business), the income approach on a going-concern basis and a ten-year discounted-cash-flow for a proposed property, and allocation among real estate, FF&E, and business value under USPAP Standards 7 and 8.