Demystifying Third-Party Management with Rafael Correa of Bluewater - The Leaders in RV Resort, RV Park & Campground Management

Welcome And What We Unpack

Speaker 2 0:05

Welcome to the Outdoor Hospitality Podcast. I am your host today, Shari Heilala, and with me I have Rafael Correa, a very dynamic leader in the industry from Blue water. And we're going to take a deep dive into third-party management services and kind of demystifying some of the myths about it, what Blue water does, how to choose a third-party manager and make the most of it, as well as a few other fun things in the industry. So welcome, Raphael.

Speaker 1 0:40

Shari, it's always such a pleasure to see you. Thank you so much for having me on and for the warm and very generous introduction. I appreciate that.

Speaker 2 0:48

Well, it's an honor to have

Rafael’s Unusual Career Path

Speaker 2 0:50

you. What I'd love to hear first is a little bit of your background and how you got into the industry, as well as a little bit of your role at Blue Water.

Speaker 1 0:59

Yeah, no, thank you very much. So been in the industry now for 14 years. My background is in accounting, my undergrad is in accounting. Went to go work at a big four accounting firm out of college to test my medal. It was a fun experience. It was really awesome to work with such talented people with just incredible pedigrees. And it really kind of proved to me that that I belonged, right? That I could hang with some folks like that. That I was, you know, everybody's kind of unsure of themselves coming out of college. And when I met the people that I was going to be working with, I was super intimidated. I was like, oh man, am I am I in the right place? Did they hire the right guy? Raphaelity. Yeah, yeah. Oh, yeah. It's it's real. It happens. It happens to all of us at the end of the day. And so, but it was an awesome experience. And then from there, I went to go work in a family business. I did actually left accounting entirely, went into sales. We were we had two businesses in the family business. One was a we were a defense contractor primarily. And so we did parts for the US military, whether it was parts for assault rifles, parts for armoring tanks, parts for mortar systems, all really kind of high precision machine CNC parts, which was a really fun business that my grandfather was in, my dad was in. And so I joined that business, but I joined actually in a sales capacity for a sister business that we were in, which was selling automation equipment to the poultry industry.

Speaker 2 2:15

Ah, I did not know that.

Speaker 1 2:16

That was crazy. Yeah, like totally two worlds. But you know, we're here in Ocean City, Maryland, which is the eastern shore of Maryland, Delaware, Virginia, here. This little peninsula that we're on is like the highest density of poultry production in the whole world. Yeah, little known fact. But so, you know, Purdue is based here, and so it was kind of natural to kind of get into that industry with the machining background that we had and then the opportunity. My dad's just like a an incredible inventor. He's got like 28 patents to his name. I mean, he's just one of those people that you know sees what other people don't see. And it was really interesting. And so he developed this technology that actually vaccinates chicken eggs before they hatch. And so I was, he was the head salesperson, it was growing. And so he brought me in to be kind of trained at his hand for the sales side. And so it was great. I got to travel the world. I was in, you know, Japan, South Korea, Brazil, France, Spain, you know, selling this equipment internationally because the poultry is an international business. And so just got some great experience kind of out in the field. You know, this I was young, single, didn't have any kids at the time. So it was like the perfect job for me. And then slowly but surely, like that business got traction. And then I really got into the operations side of the business, really enjoyed that side of it. It kind of brought back some of my accounting experience, got into some ERP implementation, which was super fun.

Speaker 2 3:33

Emergency response program? Is that what that was?

Speaker 1 3:36

No, enterprise resource planning system. So like accounting and finance, but it's like the system that you're basically our entire these manufacturing companies run on, right? It's what keeps the bills and materials and manages the work orders and all that kind of good stuff. All of it ultimately flowing back into the numbers. And so ultimately became the you know lead operations person there. And then some opportunities presented themselves. My dad was able to exit that business. And so I was kind of looking for my next opportunity.

Bluewater’s Pivot Into RV Resorts

Speaker 1 4:03

And that's where a friend of mine introduced me to Jack and Todd Burbage. And they had a real estate development company. They have been very successful local real estate developers and are just breaking into the hospitality space. You know, Blue Water for as big as it is today, we started with one campground and one hotel. When I got here in 2014, we had the one campground which was Castaways. Now it's called Sun Outdoors Ocean City. And then we were building our very first hotel, which was a Fairfield Inn and Suites on Shinkateague Island, Virginia, which is famous for these wild ponies that they have there. And because it's a NASA launch facility right around the corner there, too. Yeah. So ponies and rocket ships. Like, why not? Why not? You know, it's like tanks and chickens, and then rocket ships and ponies. That's like the story of my life is just this like dichotomy of things that make it interesting. And then so I came in as the CFO and it was real small. We were like a five-person shop, really focused on kind of you know, transitioning from what they did before, which was like subdivisions, shopping centers, commercial retail, like you know, very hyper-local real estate development into this hospitality side of the business. And, you know, we fell in love with RV resorts, right? The hotels were great and we enjoyed it and we learned a ton about what it means about institutional level hospitality management, working with brands, working with brand standards, what it what it means to run a hospitality asset, because it's unlike other real estate, it's an operating business more than it is real estate, right? And so we learned a ton in there. And and we very early on were cross-pollinating ideas both ways, right? So great ideas from the great disciplines and and and best practices from the hotel were we brought to our RV project.

Speaker 2 5:47

So when did when did that transition from just hotel to RV? So what year are we talking?

Speaker 1 5:52

So we are now time-wise, they bought that property in 2008, was when they bought that. So around that time is when they bought what was the original castaways. I joined the organization in 2012.

Speaker 3 6:06

Oh, got it.

Speaker 1 6:07

And so the interesting part is they bought that what became castaways with the idea of making it a subdivision, another waterfront, beautiful subdivision that they were famous for in the area. But in, you know, that was right before the housing crash. Right. And so the financial crisis housing crash. So you couldn't give away a home lot. It was a very dilapidated trailer park at the time, waterfront. Like pristine real estate just was a trailer park. And so Jack and Todd pivoted, which is kind of like their marquee, is that they were just so there's always been very dynamic and creative. And so they envisioned an RV resort that they would want to go to. You know, when they vacation, they love the Bahamas, they love the Caribbean, the British, the BBIs, British Virgin Islands. And so they came up with a concept for an RV resort that was totally inspired by, you know, the BVIs and the bohemian colors, right? And so the corals, the teals, and just the different spin. We used to import $25,000 plus dollars of palm trees every year. Because they die here in year-round. But we would import palm trees every year just to give it the vibe, right? And so people fell in love with it. It took off like a rocket, you know, out of nowhere. We got an opportunity to meet sun communities. They ended up buying the property from us, and that spawned a long-standing relationship with Sun communities that we still have today, you know, managing 16 of their most transient assets. Yeah. And and that partnership also led to really explosive growth for us as a company. And so we started with one, and then we did one in the county to the south and one in the county to the north, one in Delaware, one in Virginia, and then we did a couple more, and it kind of just kept expanding, you know, very organically into the RV space. And we also grew our hotel portfolio. Today we have eight hotels as well, and we love that business, but we really love the outdoor hospitality RV side of the business. And, you know, by a lot of good luck and a lot of hard work, we've kind of been able to build a position in the space that allows us to really define kind of where the direction that it's going, especially now that there's a lot of institutional capital that's kind of coming into the space and expressing an interest, you know, even beyond the sun communities of the world. You know, it needs more structure, it needs more discipline, it needs to kind of evolve into this next evolution of what it's going to be as an industry. And we have the really kind of the honor and the opportunity to be a part of defining where it's going. And that's super exciting for us.

Speaker 2 8:33

For sure. So, you how many properties? You've got the eight hotels, and then how many RV resorts and how many are owned by Blue Water versus managed?

Speaker 1 8:43

So there's about 73, I think, total properties under management. Eight of those are hotels, like I mentioned earlier. About 12 to 13, I lose count, are Blue Water owned, either through ourselves or some sort of joint venture. And then the balance is all third-party managed. So there's a total of 64, soon to be 65 RV resorts under management as of today.

Speaker 2 9:11

That's huge growth in a short period of time. Yeah. It's amazing.

Speaker 1 9:16

We don't let any grass grow under our feet in our water.

Speaker 2 9:20

And you recently just took on a pretty sizable portfolio with Spacious Skies.

Scaling With Spacious Skies Partnership

Speaker 2 9:26

How long ago was that? Yeah. Maybe we could talk about that as it relates to their transition from owner management and to mystify a little bit of that and how how you looked at it and how you how you won that contract and are adding value. Tell tell us a little bit about that.

Speaker 1 9:44

Absolutely. I mean, Allie and Eric Rasmussen are just tremendous people. And I think that it's pretty undeniable that for people that came into the space and invented out of thin air a brand, right? That is really well put together, really feels like something that customers can can emotionally connect with for the RBN. Like she didn't a better job than I think anybody has, right? In creating a portfolio and a brand and and they scaled quickly, right? 15 properties in very little order. Like that's a lot. And I know from firsthand experience, like how hard that actually is. And so the reality I think sets in that you can't be great at everything, right? And this is true for everybody, right? Is that and they were great, they built a great brand, great marketers, they were great at acquiring assets, but it's hard to be that great at all those things and also keep the day-to-day up and build the infrastructure around what it takes to run a 15 property portalio in an operating intense asset class. And so at some point, I think they've, you know, made a decision internally like what's the best use of our time and energy, right? And where do we create the best value for this brand and for our investors? And I think that's what led to ultimately exploration. We had a great relationship for years before that, just chatting and always sharing and collaborating. And, you know, I love doing that with people that, you know, that aren't my clients even because I learn, right? The one thing about Blue Water is we have zero ego about what we do. We're proud of what we know, we're proud of what we accomplished, but we are never, never too big for our britches where we can't learn something else. And that's one of the things that, you know, is starts with the top down, really. That's Todd's like MO. That's how he lives his life, is without an ego.

Speaker 2 11:23

It's good.

Speaker 1 11:24

And it perpetuates through the entire organization.

Speaker 2 11:26

Especially in an industry that keeps changing. Because once you think you know it, the the dynamics change.

Speaker 1 11:32

So and the the pace of that's even picking up more now with AI and PMS systems and you know what people are empowered with as far as information anymore. So yeah, I, you know, to wrap up the spacious skies thing, you know, we we went on a process of kind of having a real honest conversation earlier this year about what that might look like as far as management. They interviewed a couple other management providers, as I always encourage people to do, right? Like I've I've you choose me, I want you to know what your options are. And and they ultimately settled that we were kind of the right match. And I, you know, I never want to say Blue Water is the best, but I like to say Blue Water is the best for its clients, right? And and more importantly, is that you have a match with your management company, with your goals, your objectives, your asset type. I think those are all important. Like, and there's some great management companies out there now. And it's not like it used to be five years ago when there were no real players that understood it. There's some, there's some really competent operators out there today that you can get the benefit of their scale, right, without having to reinvent the wheel and really focus on what you're really good at, right? Which is, I think, the opportunity for people that are still trying to self-manage and they're building a portfolio. Is that, you know, what where do you really add the most value? And is it in the management like of the day-to-day? Or is there somebody that you could lay that off to, guide that, lead that with your vision, right? And then really focus on the things that add value to yourself, your investors, and where you really differentiate yourself.

Speaker 2 13:01

So what do you think made Blue Water the right match for spacious skies?

Speaker 1 13:06

I think that what we brought to the table was a probably more than anything, is a is an is an appreciation for the brand, right? And the fact that we work with multiple brands and know how to leverage multiple brands. So we have a large portfolio of Sun Outdoors assets. When Sun launched their kind of very RV-specific brand, we've embraced that and supported that. I think we manage like eight or nine KOAs, right? And so we understand and appreciate that brand and its value and win that when it makes sense for certain assets. Jellystone, right? The that brand experience as well, that is is totally unique and different and targets a completely different customer than a KOA and has a different kind of makeup of its revenues and and that uh is unique in its own right. And so HTR, we manage that portfolio, and that's its own, its own brand that's growing, you know, similar to Spacious Skies. And so that that kind of diversity of brand experience, I think is ultimately what made us the right fit for them because we can adapt our operating system, our blue water operating model to merge and really fuse into the brand vision of whatever brand we're working with. And I think that's a unique element, a unique aspect of working with Blue Water.

Why PMS Choice Matters Most

Speaker 14:24

Hello, listeners. I wanted to share a quick story. I recently started to help a client set up their three properties, two RV resorts and one glamping resort. And they wanted me to help roll out their new tech stack. And at the center of that is the PMS or the property management software. These clients decided to go with storable new book, and thank goodness they did because the property management software is the nucleus of everything that you'll set up: your website, your social media, your bookings, your cleanings, everything. And it really handles the entire process from both the front customer-facing side as well as the back end and coordinating cleaners and things like that. So it's, you know, setting up your photos and your pricing and your dynamic pricing and revenue management and your unit information and ensuring a smooth and customizable shopping cart experience to ensure a high conversion rate with your customers. And then they have all these great automations. It can send texts and emails to your guests before they arrive on the day they arrived or after to get feedback and reviews. And you can track all your financial performance. And then it also helps with the back end and analyzing your data. I honestly couldn't be happier with the experience. If I called the New Book helpline, I get an answer right away with someone who can help me with like three or four standing meetings each week with different members of their teams to set up the different capabilities and softwares. We're even using them to set up these property websites. We're using them for digital marketing services and SEO. And honestly, it has been excellent. So I chased down Storable New Book to ask them if they would be sponsors of the podcast because I really believed in their product. Fortunately, they were willing. So they are today's sponsors. So if you're unhappy with your PMS or you're launching a product and shopping, definitely give them a call. They'll give you a free software demonstration. And if you let them know that you came from the Outdoor Hospitality Podcast, they'll give you 15% off your new book signature subscriptions. Can't recommend storable new book highly enough. Go check them out. Thanks.

Speaker 2 16:24

That makes a lot of sense.

Picking The Right Third-Party Manager

Speaker 2 16:26

Well, so people out there, many of our clients, many listeners, choosing the right third-party manager is feels like a daunting task to many. And if you could walk through how you would approach choosing a third-party manager, obviously that can that can vary widely depending on what your what your outdoor hospitality business is. But but how do you make those critical decisions and judging who's right for you and feel confident and know that they're gonna bring the value for the cost that it brings to your bottom line?

Speaker 1 17:06

No, that's a great question. And it's something that we're hearing. I spent a lot of time answering questions around that for operators that are getting to the point of wanting to explore it. And everybody has a different reason, right? Sometimes it's about being able to focus on what you're really good at, right? And that's, you know, like the Spacious Skies team, it's about prioritization and focus. And so that was why that partnership made sense. Sometimes it's a family that doesn't have a next generation that wants to take over, or it's a family that's tired, right? And it's this is an exhausting business to be in. And sometimes there's, you know, the lack of separation between your employees and your guests, and you're in it, right, every single day, hard to see the force through the trees, that you can burn out, right? And it's not atypical for people to burn out or, you know, just feel like, you know what, I've done my time, I've done my part to get this to a certain point, and and I need to enjoy my life, right? And again, these options I don't think were terribly available for people, people that really specialized in this asset class.

Speaker 3 18:07

Yeah.

Speaker 1 18:08

You know, for some people, it's it's institutional investors that love the asset class, want to be in the space, but understand and appreciate that that they don't, they don't want to have the learning curve, right, associated with it. So all of those, I have I have examples of all of those in our portfolio. And so your motivation is probably the first thing that when I'm trying to sort out if we're a good match for each other, is that you know, we want to understand kind of what's driving your motivation for wanting to explore third-party management. So I think that's kind of like step one is like understand your why. Like, why do you really want this? Because that's the first thing that I'm gonna want to know, right? Because I want to know that I'm gonna solve that for you, right? Because if we're if we don't start with that basic kind of common ground understanding when we're exploring this option, then it's kind of a, you know, a waste of everybody's time in a lot of ways. And so the why is I say, I would say the number one. Know your why. I think second is gonna be more kind of like does that that that manager have the reach or the proximity, right? Are they already operating in your markets or in that state or in that region of the country? You know, one of the things that first things I did when we started talking to the spacious skies team is I did an analysis of how far every spacious skies property was from something we already managed, right? Number one property, number two property. And then we found out that, you know, using my my great friend Claude, who can do this type of math real quick, we found out that we were an average of 92 miles away from the every property that's spacious skies, some closer, some further, but on average it was 92 miles away. And so it was like, oh, that's that's an hour and a half on average from us to get from one property we already are to one of their properties.

Speaker 2 19:47

For knowing each other, that's kind of like a nice kind of boots on the ground, backup resources, that kind of stuff, right?

Speaker 1 19:54

Exactly. And so, and then look at the breadth of experience that they have, right? RV parks run a gigantic spectrum, right? Everything from like full service resort with F and B and water slides and a water park that maybe is open to the public, even selling tickets and a zipline, all the way through like a long-term stay, you know, it could be an affordable housing alternative or just a truly like long-term stay seasonal park. Like the the flavors, right, and the spectrum is is gigantic. And so making sure that the person you're partnering with has expertise and kind of where you land on that spectrum, right? And and talk to references. Like any manager should be able to point you to three or four people of their clients to be like, you know, and I I told one of my clients once, I said, tell them the good, the bad, and the ugly, right? Like I want them to know what they're getting into. Like that's what's going to make for a good relationship. Like, you know, tell them where I messed up and then what how I handled it, right? Because I think that's more just as important as what I do well is is is where I where my team or us didn't meet the standard and how we responded, how we reacted to that. And that's one thing I'm really proud of. Like, are we perfect? Absolutely not. Have we dropped the ball or made mistakes? A hundred percent, right? Anybody who tells you any different is lying.

Speaker 3 21:11

Yeah, for sure. For sure.

Speaker 1 21:13

But the more important thing is how did you react to that? How did you recoup? How did you change your process? How did you do corrective action? Right. I come from the world of defense contracting and it's ISO 9000 and like quality assurance. And it's all about like five whys. Like, how did that why did that happen? Well, why did that happen? And digging to the root cause and then addressing that process or addressing that person or or system, and then make sure you rebuild from there, right? And so that's that's just kind of the way we work. But yeah, I think you know, making sure that you're paired with a partner that understands what it is that your park, what your park is, what its objectives are, I would say that's kind of like probably step one, step two.

Speaker 2 21:54

I think I had one client say that he he looked at the reviews of The properties that a property management management company had. And it wasn't just the reviews, but how they handled them and if they were responding to them and how they responded. Do you think that's a good idea for people to a good benchmark or one benchmark?

Speaker 1 22:16

100%. Yeah, 100%. Like a manager that's not watching, responding, paying attention to reviews, right? They're asleep at the wheel. So, like, I, you know, I I don't I don't know any of my counterparts that aren't paying close attention to that. I mean, we're in a guest service business. You got to be in it. And I think it's a great thing to look at. It'll tell you a lot. I always like to say don't look at things in a vacuum, though, right? And and always ask for context because there's different variables at play, right? Because sometimes you're working with a client that you have brought the suggestions like, hey, we really need this. This is what the guests are asking for, but the capital may not be there, or that may be something that's planned for next year that it's got to wait for. And so, you know, context is important, but I think it is a super beneficial way to evaluate a partner. I've actually had somebody, you know, do those analytics on us, like, all right, show me the pre and post-blue water review situation, right? And I'm good with it because I know that that's something that's very high on our radar and our kind of the things that we monitor and watch. I mean, that's that's right at the top of the list.

Speaker 2 23:16

And yeah, going back to the whole geography geographical competency or proximity issue, that that that is a big question I

On-Property Leadership And Support Bench

Speaker 2 23:25

think people deal with. You know, if you've got a park in Florida, do you need a management firm that's based out of Florida? And if your full-time manager calls in sick, what happens if your third-party manager is up in up on the northeast? So what would what what would you say to that?

Speaker 1 23:43

Up on high. I heard that term the other day. It came from up on high. Came from corporate. These are common terms I hear. No, I think that the reality is, right, in in third-party management, is that, you know, are you supposed to be a substitute for on-property leadership? Right. And that's a philosophical question. And my position on that is no. You know, because it's such an intimate guest experience thing, the GM of that property or property manager, or whatever their title is, like that person needs to be the champion of the on-property experience and champion of the guest. And they need to build a team underneath of them, right, that also shares that responsibility and vision. The role of the management company is absolutely like if the manager goes down, like has a health incident and they're going to be gone, you know, more than just a couple of days, it's more like, hey, I got to go take care of mom or I got to, you know, something that's gonna take them out of commission that they have to go prioritize because it's, you know, they're their family, right? Or a or a GM doesn't work out, right? They just weren't meeting the standard. Yes, the management company's responsibility is to fill that gap, and that should be seamless and completely, you know, painless to the owner. And and we the way we solve for that is we have regional operations managers that can sit at that desk and fill that gap for a period of time, but we also have what's called task force GMs. And so these are folks that are fully trained on our systems and tools and can be deployed to a property that needs temporary leadership for an extended period of time. There's also companies that provide that service as well, if you're, you know, if if you don't have it, if you don't have the depth to do that on your own. But most importantly, is like that is the management company's responsibility. Second, then this is, I think, an important differentiation of kind of where management gives you leverage on property, is that if you hire a management company, what you're able to, what they take off of the GM's plate, paying the bills, managing HR, filing sales and use tax and occupancy tax forms, tracking your permits and licenses, all of that is handled by the corporate office. All of that's being handled and taken off their plate. So when we think about a Blue Water GM, a Blue Water GM is responsible for three things, right? And it's like number one is their team, is like, is your team aligned, motivated, right people in the right seat? You know, are do you are you supported by the right group of people? Number two is the guest. Not because the guest is second place, but because these people deliver for the guests. These the team and for the guests. And so you have to prioritize your team. Second becomes the guest. And third is the PL, right? Is like the controllable expenses that a GM is really responsible for, which is typically going to be, you know, schedules, right? Payroll, labor hours, those things, supply ordering, you know, repairs and maintenance, being on the preventive maintenance side, staying ahead of things before they become a real expensive problem. Like the things they can control, right? To have an awareness of them and have the toolkit to manage those things. But because we as the management company have removed all of this additional burden from them, they can be very present on the property, very hyper-present. And that's how we're going to deliver a level of guest service that, you know, I never don't ever kid an owner operator who comes to me and be like, I'm there every day taking care of every employee and every guest. Like that's hard to replicate. I don't care who you are, right? Like a truly committed owner operator, like you can't simulate that. That's real, right? But you can create an environment where you can get pretty dang close if you find the right GM and they have the right support and the right motivations, and they can be present on property for the team and for the guests. Like that's that's a recipe for success, right?

Speaker 2 27:32

Yeah, it goes back to what you said originally, where you you can't be a hundred percent the best at every single thing you're doing in operating your property. So you take those tasks that that you do well and and to support the operations and allow the owner to really excel at what they do best on site and something.

Speaker 1 27:53

Absolutely.

Speaker 2 27:54

What would you say is the biggest operational value add that that Blue Water or or another management company could provide as a as a value driver?

Marketing And Revenue Management Engine

Speaker 1 28:07

I I would tell you that the thing I think we are exceptionally competent at is the revenue generation function, is driving demand, right? And I think it's something that's at the top of everybody's list today as Transi and RV has gotten really soft. And also as the complexity around marketing, around distribution, all of those things have only gotten more sophisticated with the entrance of AI and how AI impacts research and guest research and being found as a an option for them when they're traveling. So all of that is like going, it's and it's evolving at a pace that's just wild. Property management systems are evolving at a like at a new pace that I've never seen before in my life.

Speaker 2 28:49

You told me it keeps you up at night.

Speaker 1 28:52

It does. It does, but it's like in a good way, right? It's in an excitement of what is to come and the way we're going to be able to serve our guests in the future. It's it's like, can we hurry up and get there? Right. It's like that kind of loss of sleep for sure. So, anyway, that's that I think that revenue generation function, because it's so sophisticated and because of the comment you made that we've kind of been bouncing back and forth on, is you can't be good at everything, is that it takes people that are dedicated to those disciplines to do it really, really well, right? And if you're an owner operator or if you're a small portfolio and you don't have the resources to dedicate people to those functions, like you're probably leaving money on the table, right? And that's one of the benefits of a managed company at the scale that Blue Water has achieved, is I have exceptional people that work in that. And that's all they live and breathe is the marketing and the revenue management. But what we make sure, right, because I could have the best revenue manager in the world, the best marketer in the world. But if they're not in tune with the property and the vibe, right, and the guest, like they could be just shooting, you know, randomly in the wrong directions. And so what we do is we create this collaboration environment. We call it the trifecta, where you have the GM, right, who's supported by the regional operations manager, that operations arm. We have the revenue management arm, and we have the marketing arm. And those people are in a constant dialogue, right? And where the revenue manager is getting and the marketing people are getting the boots on the ground intel, right? And the perception, like really understanding the guest through the eyes of the GM. The revenue manager is the person who is the absolute expert in the PMS system that they're running. They know all the ins and outs, all the tricks, right? They understand what the pricing is of the competitive properties that you might be competing against. They're keeping tabs on the pace every single day because they're living in the spreadsheets. And then you have the marketing person, right? Who's really understanding what is the guest data telling us? Who's stayed with us in the past? How do we leverage email marketing to activate past guests? How do we find where our new guests are coming from, right? What markets do we need to be dropping ads? What's the best way to spend these dollars? And so each one of those is bringing their absolute expertise and collaborating on a strategy and executing on a strategy for that asset, right? And so because we create that ecosystem, that environment, and then we support them with the tools and the professional development for each of their respective functions, like we're able to deliver a result that's very hard to replicate on your own, right? And I think that is the that's value number one. Value number two is the one I mentioned earlier, which is how we can remove so much of the on-property burden so that GM can be hyper-present, right, for their for their guest. And so I think those are the two massive leverage points that if you find the right manager, they create for your property or your portfolio.

Speaker 2 31:42

Very well, very well explained. I feel like you've explained that a few times before.

Speaker 1 31:47

I give it a this is the stuff I think about all the time.

Speaker 2 31:51

So I I think measuring value number, reason number two that you described is probably a little a little more qualitative. But do you have metrics that you give your clients to measure that value add?

Forecasting Discipline And Measurable Value

Speaker 2 32:06

How does it look?

Speaker 1 32:07

Absolutely, right? I mean, it's with the it's a measure everything environment here in Blue Water. There's never enough data, and especially now in this age of AI where you have the ability to cut it up, analyze it, and get insights from it that maybe you didn't even know you needed. It's a track everything attitude here as much as we can, right? Reasonably, and that it's going to be, you know, really actually provide valuable insights. But, you know, we the way we work, right, is uh with an incredible amount of discipline around budgeting, forecasting, and then financial reporting, right? And this discipline, I think, is super important. Like if you're looking for a property manager, you want to be able to, they need to be able to demonstrate to you that kind of financial discipline and not only in just saying what happened, but how does that inform what's going to happen? Right. And one of the things that we do here at Blue Water for every client is we're not only delivering your financial package every month, but I'm also telling you what the next 90 days looks like, right? And not just at the top line, but all the way through the bottom line. So we forecast all of our properties and we say, all right, based on our pace, based on what we see happening, here's where we think top line comes in. And accordingly, here's how we're planning to manage our payroll expense, our repairs and maintenance, whatever the case may be. And here's what your bottom line should look like. And then I internally am measuring how accurate I am every single month, right? And refining the process because we want to have that 80, like at the revenue side, I want to be within, you know, 3, 4% of what I said it was going to be. And on the bottom line, I want to be within like, you know, within 10% of where I wanted to be. And so, and too good, like if I beat it, if I smoke it, like that's not good either. Right. Because that you you need real information. So you need it, and it's that iterative process that's also very hard to do if you're just your own owner operator, right? It's very hard to kind of like take the time to just sit there and like think through all that. But because ours is done through a team and through a network of people that all have their respective specialties and disciplines, and all that comes into like this one plant, it's manageable, right? Everybody's just putting a piece of that into the into the pot that tells you a story, and then we're measuring our each of our respective contributions and how well we project it. And that's the thing about expense management is that it's already too late if you're looking at last month's financials. Like it already happened, that's done, right? It's the discipline of looking forward and making a plan and doing that every month. Planning and then replanning and then replanning and then replying. The budget's great. It's an important thing, it's an important step. It's really setting the overarching goals and business plan for the year. But it's that step of forecasting and reforecasting is where the true expenses, because when a GM has to sit there and say, all right, here's where revenues are coming in, here's where my where I think expenses are gonna be. And then we have certain what we'll call flex and flow metrics, right? So for every dollar we're over budget, we want to see, you know, 50% of that minimum coming through to the bottom line, right? And same thing if we're missing budget, like I want to mitigate through expense control, right? That if I'm missing budget by $100, that I'm gonna at the bottom line, that only translates to $50 because I was responsible about my expenses. Right. And, you know, you can't control them all. There's a lot of fixed in there, but for everything that's controllable, we're flexing and flowing. Flowing meanings getting more of the over the beat to the bottom line. Flex meaning mitigating the miss at the top line, right? Through the bottom line. And so that's how we really add a lot of value, I think, for our clients and demonstrate the value of a management company.

Speaker 2 35:37

Hello, listeners. This is Sherry Halala, founder of Sage Outdoor Advisory. If you're launching an outdoor hospitality project like Lamping, we can help. We offer feasibility studies and appraisals. What that means is we look at your specific market and proposed business offering and complete an in-depth analysis to make sure that your planned business will be profitable. Getting a second opinion on your proposal and forecasted financials is critical to understand before you spend years of your time and hundreds of thousands of dollars. This is particularly important if you are looking to raise money for your project from a bank or private investors. They are going to want to see this type of deep dive analysis from an independent third-party specialist in the industry. We at Sage have completed well over 250 feasibility studies and appraisals in outdoor hospitality in North America in the last four years so we understand what it takes to bring a project from concept to reality. If this sounds like it could be helpful to you, you can go to our website, SageoutdoorAdvisory.com and schedule a call with our team. While you're there, check out our proprietary glamping database map too. Thanks. Now back to the show. I think that's huge. I think that having the discipline and structure in place to look at that on a routine basis has to be has to be a huge value add. Just, you know, I'm not running a campground as my business, but as a business owner, I know every day I walk up, I wake up and just attend to the fires. You're not, you know, you're that's that's how you're built to make sure you've got all the urgent things taken care of. And and you could spend three months just doing that and not not working on your business and the vision of the business and and managing it that way. So maybe I need you guys to help me.

Speaker 1 37:14

A new division of Blue Water.

Park Models As A Growth Lever

Speaker 2 37:16

Yes, yes. So switching gears a little bit, it it may not be widely known to everybody that Blue Water has a significant park model manufacturing business. I I took note when you when you developed and offered the park models on water, because I'm a huge fan of everything on the water. But how did that start? What do you offer? What can you share for our listeners?

Speaker 1 37:43

Yeah, yeah. So the name of the company is called Great Outdoor Cottages. It's a completely separate entity from Blue Water. It's a what we can refer to as a sister company, you know, with common ownership. But Todd and I saw a tremendous opportunity. You know, park models has have always been in the Blue Water business plan for our own portfolio. Park models have always been a major value lever, right? One of my one of the best parts about this industry is that you can manipulate the inventory season after season to drive growth, drive revenue, drive profitability. You know, in the hotel business, once you build a hotel and you know, you have this number of kings and double queens, that's all you're ever going to have, right? You can't play with that inventory. It's not true in our world, right? You can take a regular RV site and make it full hookup. You can make it a full hookup premium site with a patio, right? With a dog pen and or, you know, what that RV site, I'm like, hey, I go to the GM, like, why does this site have such low revenue? I was like, oh, there's this tree here, it's super hard to back into. Like, you know, everybody's dealt with this stuff. And so, oh, well, let's put a park model on there, right? So we don't have to worry about backing in and out all the time. And park models, as we know, are RVs, right? By definition, by, you know, they're titled vehicles. And so I don't have to go pull permits, right? It's just a matter of like, oh, I'm dropping this park model in, in most jurisdictions, at least. And so, because they've been such a big part of our value add strategy, and it's also introduced a whole new client to the RV and campground world, somebody who doesn't have an RV, but you know, I'm a big proponent of the fact that RVs, a park model and an RV, can provide an amenity set and a community and a fun little place that your kids can openly ride their bikes around and be safe in, that a short-term rental will never provide, right? And in a hotel business, it's like, you know, we're providing a, like I said, the sense of community that doesn't exist in hotels, right? Hotels, people don't talk to each other. They avoid eye contact in the hallways. Like in the RV world, like everybody's like, hey, how are you doing? Where are you from? Want to come over for s'mores tonight? Like it's it's a vibe, right? And so that vibe is something that I think, you know, people that are not RVers that are discovering, plus you in the park model, you're typically getting a full kitchen, probably a couple bedrooms. You know, the value is tremendous, right? When you compare it against short-term rentals or hotels. And so people are discovering that. And with the improved distribution where we can sell these things along Airbnb or you can sell these things on Booking.com, people like are discovering it, they're falling in love with it. And this year, the you know, 2026 that we're in, where Transi and RV has been very sluggish. Vacation rentals have done great. They have right, it's been good and it's been kind of one of our saving graces this year. And so we saw that kind of opportunity many, many years ago, and we had an opportunity to partner with some folks that knew the business, which I think was the best thing that we did is that didn't try to learn everything there is to learn about you know, a couple of developers, me and Todd, trying to figure out what it is to be a manufacturing company. Like we were smart enough to know that we didn't know what we didn't know, but there was a team of people that didn't have that experience, you know, 150 years of collective knowledge of how to do it. And so we stood up a company and we were our first big customer, obviously. And then that's gonna expand it into now, they've built a really beautiful reputation for themselves for doing a very high quality product. You know, we're not at the low end of the, you know, if you want the cheapest park model that's just gonna kind of meet the needs, but it's probably gonna fall apart in a couple years, then you know there is a wide variety of quality out there, park model market for sure. And so we we like to play on like, you know, you get what you pay for side of the spectrum. We want to make sure that the value is there. We're very value-oriented. We're not doing something that's premium for the sake of being premium, but you know, we try, we have a spectrum where we're always trying to meet the guests that or the customers' needs. But I think the the important thing about a GOC cottage and kind of one of the distincting distinct factors about it, and because of its collaboration with Blue Water, is that when we started designing park models, like our flagship models, is that we were very conscientious to be like, this is what it means to maintain them. This is what it means for housekeeping, right? And so when we're making design decisions, the operators finally had a voice at the table, right? And and a big voice, right? And so we were able to really influence that thought process. And so not only these park models really well built, but they're built with housekeeping in mind. They're built with maintenance in mind, because that's the reality, right? And everybody loves the sexy part of a park model that looks cool and sells well and like the idea is very, very romantic. But the reality is it's something else you got to maintain, it's something else that you got to take care of year over year. And so, and that housekeeping is one of your major cost drivers. And so, if it's an inefficient, if it's hard for them to put the sheets on or get, you know, move from unit to unit or navigate within the unit, that's money, that's cost, right? And so we're really proud of what we've accomplished together. And they've built some beautiful units, and we've done some really fun stuff where like we were able to really find creative solutions by creating dynamic park park models. And and I'll give you one specific example is that we have a beautiful property in Shinkatique, back to my wild ponies and rockets, right? Island. And we bought this amazing piece of property. It has like a half mile of waterfront on it. And, you know, if you're in this business long enough, you know, if you have a waterfront RV site, that thing is gonna sell all day long and it is going to people are gonna pay a premium for that, right? And these are RV sites that'll do, you know, 15, 20,000, 25,000, sometimes $30,000 a year in an RV site, right? So why would you put $80,000, $100,000 park model on it if you can do $30,000 with nothing on it?

Speaker 2 43:21

You're gonna tell us.

Speaker 1 43:22

But we knew that there was you knew that we knew that there was an opportunity here for park models too. So it's like, how do we balance this? And so what we ended up doing, and we made the mistake, and like I'll tell you, like, you know, we're not flawless here at Blue Water. Like, we put park models on the front of the waterfront, and then we had the RV sites, and we were like blown away by how well the R V sites were doing. We're like, oh my gosh, we need more waterfront RV sites, but there's no more waterfront. And so, and the cabins were doing well, and so we came up with this idea of a rooftop deck park model, cost us a little bit more, right? But we were able to put it in the second row or even the third row, and you have a third. 360 view over the RVs, you got tremendous water views. And those units were doing the same revenue as a waterfront park model, right? On a annualized basis. So what we did is we said, you know what? We'd be better served to move these waterfront park models interior to the worst performing interior sites, because it's still a park model and it'll still do pretty well, even interior. We get all these waterfront RV sites back and we add more rooftop cottages to the second and third row because they get the same revenue as a waterfront. And so because of our collaboration with GOC, we are able to imagine this and execute this plan. And that's the beauty of GOC is that because we're not like, you know, a public traded high volume, you know, pushing out of a ton of park models, is that we can get really specific to a guest's needs, a customer's needs, and deliver a solution that's tailored to them. And I'm that's what I'm probably most proud of of those guys is their ability to kind of really collaborate with the guests and deliver a product that delivers for that property.

Speaker 2 44:56

Yeah. And it's it wouldn't be the same answer for every property, right? Because seasonality is going to factor into it. Because one of the benefits of a park model is that it can work in during seasons that maybe somebody isn't as inclined to be traveling in their RV. But it sounds like in this case, the the math worked in the favor of keeping the RVs waterfront and that that's pretty brilliant for the for the rooftop deck.

Speaker 1 45:24

So yeah, and it was worth, I mean, did they cost us a little bit more? Absolutely. But when you weigh that against the additional revenue you're getting from the waterfront RV site, I mean it just the math, the math checks out.

Speaker 2 45:35

How many different park models, styles, sizes do you offer?

Speaker 1 45:40

I think they have some core models, like they have a catalog of like the stuff and a lot of it's stuff that we've co-developed together, which is why, like I said, they're really kind of thoughtful with the operator in mind. But they've done a lot of custom projects, right? If you're coming in and you want 10, 15 park models, like and you have a very specific vision, you know, they'll help you bring that to life. But we have our kind of mainstays and the things that we know are tried and true for Blue Water. And that's kind of one of the nice things, too, is that if you're a campground owner and you're like, oh, do I do a one-bedroom? Do I do a two-bedroom? Like, you can go get a blue water model, right? And it's like, you know, that's a proven asset. We we get the benefit of all my mistakes, please.

Speaker 2 46:18

No, I think that's huge. Cause I mean, uh we we have clients who say, you know, if they're gonna do 40 units, why don't they figure out how to manufacture a park model because the costs are keep keep increasing? And my answer is, yeah, I'm sure you could figure it out, but you know, there's a lot going to be a lot of learnings around the along the way. And I think your point about considering operations alone is huge, in addition to, I'm sure Yeah, know what you're good at, know where you really differentiate and add value and spend your time there.

Speaker 1 46:47

Like that's kind of one of my core tenants in in life and in my decision-making kind of framework is that like, am I gonna like what do I not know? And and how can that come bite me? And what do I what where is it that I do know that I could spend that same time and energy, right? Because that's a resource we only have so much of and and get more value out of it.

Speaker 2 47:05

That's why I hire someone to clean my house, because I'm not very good at that. Me doing. Um one little nugget I'd like to share with the audience about park models. I mean, those of us in the industry know this, but one of the unique benefits in certain states of implementing park model cabins versus stick built is how personal property tax for businesses is is assessed. So Wisconsin, for instance, is a state that recently did away with personal property tax for businesses. So when you're projecting what your what your total tax, annual tax bill is gonna be on your property, it could be significantly less if you choose a park model. But you got to be careful how that's a great point.

Speaker 1 47:51

And the same applies for insurance, right? Most of the time, they're like these are not gonna be insured under your property policy, they're gonna be under what's called like an inland marine policy. So it's another important consideration. I think you're absolutely right. Property taxes and insurance are very different for park models and then depreciation, right? Like if you're a business owner, the bonus depreciation that you can realize and save money on taxes, I mean, it's a giant offset for the cost of those park models. So another huge consideration and advantage of park models.

Speaker 2 48:19

I

Becoming An AI-Native Service Company

Speaker 2 48:20

agree. So one thing is that that's in almost every podcast episode or every business discussion is talking about AI and and how how we're leveraging it. And it's a it's a challenge for us every day to make sure that we're keeping up and and and using it to our advantage. For scheduling podcast recording sessions, for instance. How how are you looking at AI? How's your company looking at it? What what's what's the strategy there?

Speaker 1 48:50

I don't think it's any secret RAF loves AI, right? I've been pretty vocal about my, you know, and I started my journey, I AI journey very late. I just started earlier this year, honestly, and really kind of throw myself into it and to see kind of where I am and where the industry is and where AI is just from the beginning of this year is just wild. But the way we are thinking about AI at Blue Water is really focused on how do we deliver our services more efficiently and more effectively for our clients, right? Like that is where there's a huge level up. And and I have fallen in love with this idea. And, you know, there's not exactly a playbook for it yet, but I'm reading everything I can read about it, and I really want to learn and and and drive us toward this concept of being an AI native service company, you know, service company that is tasked by their clients to deliver a result, but leverage AI at a high level to do it more effectively and more efficiently than humans could do it by themselves, and have that deeply ingrained into our workflow, into our process. And so, this concept of an AI native service company, you know, there's some information now, just now starting to really be published about it, people thinking about it, private equity looking to invest in opportunities that are AI native service companies. And I'm I'm obsessed with this idea because I do think that that's where the evolution is for service-based companies like ourselves, is to find the next gear by leveraging AI. I I caution, right? I think it's super important that we embrace this technology, but we need to embrace it safely, right? And especially when you're in a role like Blue Waters, where we're handling an incredible amount of customer data. And when I say customer data, I mean our clients, the owners of these parks, you know, their financials, their information. We're handling an incredible amount of PII of our on-property guests, right? All of this is sensitive information that we are the steward of. And so making sure that we're implementing AI in a smart and structured and disciplined and secure way is paramount to its success, right? And so one of the things that we're doing, you know, we've created a data classification framework, for example. So, you know, every type of data that Blue Water handles falls into a class one, two, three, or four bucket. And it's, you know, one of the big checkpoints if anybody's using AI and Blue Water is to first ask themselves, what kind of data am I handling? Right. And what are our policies around that specific class of data? Class one is publicly traded, publicly available information. That's research. You know, a lot of that's the marketing stuff that they can just go research on with anybody, right? It's publicly the class two is going to be just a little bit more sensitive, blue water specific, right? Class three is going to be the stuff that only a few people are allowed to use AI with, right? Like, and and with very specific guardrails and controls. And then class four is like, do not use ever, not ever, no way, ever, right? Which is gonna be your PII, your human resources, you know, staff information, all that stuff. So, like that creating that framework has helped us to really kind of have a very conscientious use of AI here internally. Also, we are just hired a new director of AI implementation that is starting with us here, and we're very excited because they bring a depth of knowledge. You know, we understand RBE's campgrounds, but they're bringing a depth of knowledge of security, safety, databases, database architecture scaffolding, right? Things that are well above my page. That's so critical, though.

Speaker 2 52:22

Yeah.

unknown 52:23

Wow.

Speaker 1 52:23

You have to be thinking about that stuff. And so when we're talking about AI, we're talking about enterprise level, not solopreneur, right? The solopreneur, there's a lot of amazing tools out there, but I have to, I can't do that here at Blue Water because of the stewardship that I have of client and guest information. And so we're being very intentional about how we are rolling out AI. Now, you know, do most of my team members have claw licenses to help them with their day-to-day knowledge work? Absolutely. And we're seeing breakthroughs every single day where people are doing a deeper level of analytics. They are bringing more polished and well-thought out presentations, right? They have a thinking partner, right? The way we describe it in Blue Waters, you everybody's getting a $20, $30 a dollar a month mega smart intern, right, that knows nothing. They're the dumbest and the smartest person all at once, and you're responsible for its output, right? And and it's fun to watch because you know, people will come back and be like, hey, look at this. Look what I did, look what I made. And it's like it's snowballing, right? And this is what's super fun to see is this creativity snowballing. And there's certain people that are taking it and running with it. And I love it. And so we're having fun with like getting familiar with and learning AI, and then in the background, really setting a foundation, right? And I think that's the other important piece of this is a foundation to build from. And that foundation of our data, you know, being clean and organized and, you know, ready and accessible in the right places with the right access controls. And then also our knowledge base, like, what is it that Blue Water knows that is so unique and special in our experience, right? And our data, right, that is going to inform our ability to deliver higher levels of service for our clients. And so that is the foundation for any strong AI implementation as I'm learning, as I'm reading.

Speaker 3 54:08

You're right.

Speaker 1 54:09

And so we're being really intentional on all of those fronts and not just rushing into the build, right? Where it's plan first, you know, build second.

Speaker 2 54:18

I think that speaks a lot to your organization that you're looking at it that way. It's clear that if you're gonna be competitive and service industries going forward, you have to leverage it. You have to have a strategy. It's changing so fast, it's easy to feel like you have to rush to implement it all, but it's a moving target. And I'm sort of in the spot right now, you know, obviously it's my job to drive our RAI strategy and to make sure it's implemented in a consistent, safe way and that our our data remains reliable. But I'm in the mode where now Claude can do so much that I'm spending more time looking at what Claude's suggesting and telling me to do. So it's improving quality, but I now have to get to the step of where it's actually improving efficiency. So it's it's a lot to think about.

Speaker 1 55:08

It's a as a thought partner, it's a it's it's such a tremendous asset. And like if I want to like shortfuse my learning curve about something I never knew before, like it's an amazing tool for that too, right? You can become dangerously knowledgeable about just about anything with the right questions, the right queries, and and and so I'm embracing this with open arms, right? Also keeping, you know, it's not without my concerns too. Like, you know, I think just yesterday GPT dropped their newest model, and yes, there's there's some things that are very exciting, but also slightly terrifying about what its capabilities are, and so I'm not oblivious to that side of it either. And it's something that I also keep my ear to the ground on and and and embrace. And I one of we we created we have our own guiding principles here at Blue Water, and but we also created a set of guiding principles around the use of AI, right? And one of those guiding principles specifically is anything that makes what we do feel less human is a bad use of AI, right? The minute a guest feels the AI or feels the lack of sincerity or feels the lack of connection, that means we're not using it in the right way, right? And so that's one of our core principles of our AI implementation that we keep, you know, tabs on, right? Is it like, are we using it to enhance the guest experience or is it making it feel less personal, less intimate?

Speaker 2 56:32

A lot of people do not want to have that feeling and know that they're talking to or dealing with AI. It needs to be needs to feel authentic, I think, in hospitality.

Speaker 1 56:42

So there's there's a delicate balance, right? I mean, I think the consumer today is also, you know, we all are a creature that follows the path of least resistance, right? So like if I can get the answers I need for a reservation or questions I have answered about a campground through a chat bot that saves me a phone call, like, yeah, I like that, right? It's made my life, it's reduced friction in my life, not added friction. But if I want to talk to somebody because I have a concern and I'm frustrated and I need an answer from somebody who cares, like you're if you put AI in front of them, you're you're asking for uh for a pretty sweet review and we've written.

Speaker 2 57:23

We've all been on the other end of that and how frustrating that is.

Speaker 1 57:26

Yeah. And so you have to be, you know, aware of like where is it adding value and where is it taking away and be super intentional in how we leverage it.

Speaker 2 57:35

Great point.

2026 Demand Shifts And Rate Strategy

Speaker 2 57:36

Before we wrap up and the ask of the audience, I want you to talk about the industry organization involvement. But yeah, let's let's touch base real briefly on the state of the industry and and where we think it's heading. You've got a great purview into that with the portfolio of properties that you own and manage. What are your thoughts?

Speaker 1 57:56

Yeah, so I mean, I've been actually on the phone this week with a lot of my multi-park counterparts out there. And, you know, I love the relationships that we have with each other where we can chat and kind of compare notes at a high level and think strategically together. Whether that's the Jenkins organization, Team Outsider, KCN, Sean Vadrin and the Four Points group, like CRR, Horizon Hospitality, like all these guys are just tremendous industry leaders that I, you know, really value their insights and opinion. David Ross over there at R Journey and Rachel, you know, all these people are just, we have we're we're we're blessed with a lot of amazing people in this industry. And so I'm you know flattered to be among them and and honored that they take my call. And so we, you know, in comparing notes, we're all kind of feeling the same things. Uh add Toby in that. Toby and I had a great conversation this week over at KOA. And so, and so I think everybody's kind of feeling the same. An interesting conversation that Toby and I had that I think is poignant is that people maybe, you know, what we're seeing is occupancy is down, rate is holding to up, by and large, for transient, and which is leading to us overall being down. And the transient RB customer, there's a lot of pressure, whether it's fuel costs, whether it's the rising cost of life. A lot of people have pivoted more into long-term stays, which are, you know, people start doing the math on all the trips they were going to take, or do I just pay this one fee and just have this one kind of like summer home this year at this one beautiful park that I love? And, you know, seasonals are up, right? Seasonal long term's up, transient's flat to down, VRs are up. But overall, I would say that, you know, when you put all that together, we're we're flat to down as an industry. Some people are up slightly if you're, you know, depending on the market that you're in and your historical client base. And so, but by and large, I think that's the general trend that we're seeing. And and Toby and I had a you know a really great conversation about it. And, you know, one of the things that she's a proponent of, and I don't disagree with, right? It depends on the property, is that do we need to revisit pricing, right? And revisit pricing because dropping your price doesn't necessarily mean you're dropping your revenue, right? Because it could be appropriately offset with occupancy that ultimately gets you a better net result. And so as an industry and with the rising cost of everything, do we have an opportunity to make ourselves more attractive by actually lowering rates strategically, right? Not broadly, not across the board, but strategically lowering rate to bring back the idea of affordability of this vacation and really reinforce that, right? I don't think it's gone per se, but I think to reinforce the idea of it is to really like come up with really attractive rate packages at the right times of year that make camping wildly affordable for your guests. And I think that these are the types of things we need to be thinking about, this idea and other ideas. Because the reality is, I don't think any of us really know where the transient customer is going. And I have a lot of conversations with my counterparts in the RVIA and the RV Dealer Association. And we all have the same concern of where is the RV consumer and where is it going? And I don't think any of us really, really knows, right? But we all know we have to find another gear, right? And that kind of is why I'm I'm a big proponent of now is the time more than ever to be a part of an industry organization, to be a part of and collaborate with your local RV dealers. Like we need to coalesce and and come at this strategically because we all share the same customer, whether you're a manufacturer, you're a dealer, or you're a campground. We all share this unique this this customer and we need to promote the lifestyle collectively and as a unified front because I don't want to wait or hope, because hope's not a strategy that the RV consumer comes back. And so now's the time more than ever to work together.

Speaker 2 1:01:42

I this is a you know just a segment of the industry, but touching back on AI, I've been I've been so excited about the advancements of being able to work from the road, just even when I'm out on the on the field and what you can do with voice automation to actually really kind of be productive while you're driving. So my hope is that that will become a bigger driver for growth for people that that do work and RV at the same time, because that's evolving super fast.

Speaker 1 1:02:15

It's making making me consider the mobile, you know, nomad, you know, remote worker. The the world is only facilitating, although the the the come back to office is a real thing. Yeah, it's never, you know, remote work is not gone, right? Will will the workforce rebalance? But remote work is here to stay. I don't care you know what you say. And in some places, it's been a huge advantage to get the right people that you need, depending on what your situation is.

Speaker 2 1:02:42

Yeah, and then touching on the affordability concern, I will say that for most of our feasibility studies when we're looking at RV resorts, you know, years ago it was hands down. You you do a paved site, you accommodate the big rigs, you know, luxury amenities, but that is very few and far between on feasible these days, depending on the market and location. So I've had a lot of discussions of people with, you know, why not why not become the the good the good to very good quality but more affordable RV resort? You can have gravel roads and gravel paths, but make them level and make sure you have the amenities that people want. You don't necessarily need a 90-foot-long space by 40 feet long. You need a good variety because the the trends in in RV sales growth and what people are driving is changing. What do you see on that end in terms of, I mean, I I know it's location and market specific, but what are your thoughts on that?

Speaker 1 1:03:51

I mean, I guess if the question is like, if I was building an RV resort today, like how would I build and what would I look for? Right. I think that's kind of to rephrase it. And, you know, first off, to me, it's about demand drivers. It's like, why do people want to be there? Right. And if if you're on the, especially on that resort end of the spectrum or the highly transient end of the spectrum, like those demand drivers have got to be solid because there's more competition than ever. RVers have more choices, they have better tools to research their choices. So, you know, you better have some solid reasons that people want to be there, whether it's the property itself or the location that the property sits, or some combination of the two, which is the best scenario, right? I would tell you, I would prioritize comfort and like quality of sites over density. I think that, you know, we've made that mistake ourselves a couple of times where we prioritize density and maybe went with a smaller site type than we should have gone with, versus really prioritizing sites that are easy to get in and out of, you know, roomy and comfortable for the slide-outs. You know, those are the things that I think people value and look for more than ever. And I think it explains why, you know, these the campground views of the world and these people that have all these video tour services that are out there are because people are looking for that like ease of access. Does it have room for all my stuff? Like, am I, you know, am I gonna get my hard-earned vacation time and dollars? Am I gonna get the most out of from this property? And those video services do a great job of kind of removing that mystery, right? And so I think that that building, you know, high-quality roomy sites, building good amenities, I think that's more important than like having all paved sites, or more important than having all paved roads, even. Those are the, I think those are the things that customers value, in my opinion. I think those are the nice to have. But what they really want is easy in and out access. They want great amenities, they want great access to the things that they want to do. And paramount to all of that is they want a clean, you know, campground that has good vibes that's doing the basics really, really well. And so that's what I think the guest now and kind of the timeless things that they're always gonna want. But yeah, if I'm building a campground, I'm looking for the Values or the the reasons people want to be there and and how accessible and comfortable the sites are themselves for the guests.

Speaker 2 1:06:08

Great advice. Great advice.

Advocacy, Associations And Next Steps

Speaker 2 1:06:10

Well, now wrapping up, do you have any asks for the audience? Anything you think that is meaningful?

Speaker 1 1:06:19

I would tell you that if you're listening to this and if you've gotten this far, one, thank you.

Speaker 2 1:06:23

Yes, thank you.

Speaker 1 1:06:24

Two, I would really encourage, right? And this is something I'm pretty vocal about. I I serve on the OHI, which is the outdoor hospitality, the National Association for Campgrounds, private campgrounds in the country. I serve on the executive committee there on my second year board member.

Speaker 3 1:06:40

Thank you for that.

Speaker 1 1:06:41

And I'm I've become deeply passionate about advocacy for this industry because just like any business that, like, you know, you look at AI and how fast it's growing and its popularity in data centers, you see the scrutiny, right, from regular the regulatory scrutiny that follows the growth and success of that industry. Our industry is no different, right? It has gotten wildly popular in the last few years. So we need to anticipate that the scrutiny and the regulatory regulations around what we do today are only going to increase, right? It's just a natural progression of things. And so having a great advocacy for this industry at the national and state level, I think is more important than ever, right? And also making sure that we're collaborating with our partners at the RVIA and the RVDA, right? To make sure that we are the dealers association and the manufacturers association, again, that we're addressing our customer in a way that is helping to bring them back and bring more people into this way of life. And so I, if you're not a member of your state association, join. If you're not a member of the national association, join. You know, there's so much value that you get, and there's great benefits associated with membership with the associations. But more importantly, you become part of a community and there's strength in numbers, right? And especially when something pops up or pops off, you're going to be grateful to have this. It's insurance, right? I like to think of my association memberships as a very cost-effective insurance because if something goes sideways and I need support down in, you know, Capitol Hill, they're going to do it, they have the machine to go do that for me. Whether I'm in Texas with Taco or Wisconsin with Waco or New York, you know, Florida, Alabama, North North and South Carolina, like all of these tremendous associations, state associations that are out there, they do a great job at the state level. And OHI does a tremendous job at the national level. And for states that don't have strong associations, like that's that's where you can, that should be your default. And so, and they work together, they collaborate together to make sure that we are looking out for the interests of campground owners across the country. So whether you're a vendor or a supplier, I mean, there's no better way to build a network in this industry than through OHI. And so really encourage folks to go out, become a member of your national organization, of your state association, and participate and be in there and have a voice and get to know the people that are advocating for you.

Speaker 2 1:09:05

I love it. And a good place to start if you want to join OHI is to come to the OHCE conference in Fort Worth early November. Yeah, it's always Yeah, Fort Worth.

Speaker 1 1:09:15

We're going to Texas. Everything's bigger in Texas, including OHCE this year. So I'm super excited for it. I can't wait. And then if you're listening to this and you know, please stop by, introduce yourself. I'd love to meet you.

Speaker 2 1:09:27

Well, perfect. So that's one way to get in touch with you if you're at the conference. So if someone wants to reach you otherwise, how can they do that?

Speaker 1 1:09:37

Yeah, sure. I mean, you can reach me on my email. My email is R-C O R R E A. It's just R Korea at B W D C. That's brava whiskeydeltacharlie.com.

Speaker 2 1:09:48

I like how you put whiskey in there. Good job. Well, Rafael, thank you so much for spending all this time today with us. I think you've you've given listeners a lot to think about, really good insight, inspiration, all the above. So thank you.

Speaker 1 1:10:06

Well, appreciate the opportunity and appreciate your leadership in the industry and everything that you're doing.

unknown 1:10:11

Thank you.