The housing crunch has bumped up the appeal of modular housing in many quarters, with the rapid pace of delivery making it ideal for temporary worker housing, urban centres grappling with homelessness, and – in an upscale version – hotels.

Some of the same factors are driving the appeal of manufactured housing parks, a low-cost housing option for close to 60,000 households in B.C. and the asset of choice for many new investors.

A case in point is Lakeview Terrace, a 22-pad manufactured home park overlooking Okanagan Lake in Summerland, which sold in May for just over $2 million. Geared to seniors, the park has changed hands on a regular basis as owners have stepped in, enjoyed the cash flow and traded up.

“Lakeview sold two years ago for $1.6 million, now it’s $2,050,000,” said Bill Summers of Lighthouse Realty Ltd. in Abbotsford. “It’s making $100,000 a year, so [the owners] were doing really well but now they figure all their relatives have huge parks so they’re going to go big, too.”

The gain in value is attributable to the steady revenue the parks generate and the upside in rents through turnover, especially in those geared to residents 55 years and older.

Lakeview’s lowest rent is $456 a month for a pad, but incoming tenants face rents of $650, an indication of how the market is changing.

The parks usually pay for themselves in 10 to 15 years but with rent increases, Summers says anyone who holds onto them will see “pure cash flow.”

Yet the affordable price versus multifamily units in town makes them an appealing housing option.

“The way housing is right now, parks are just a really good opportunity,” said Alan Johnson, vice-president with the Unique Properties Group at Colliers. “That’s why guys buy them; they’re just good long-term investments.”

But investors don’t have to buy the whole property. Some simply buy a unit, rent the pad, and lease them.

The park in Fernie had a model that sold for $290,000 and rents for $2,500 a month, including the $400 pad rental.

The landscape of campgrounds and recreational vehicle (RV) parks across B.C. continues to evolve in 2024 as investors eye these properties for their recreational value and redevelopment opportunities.

Listed for about $7.5 million, Beachcomber RV Resort in Central Saanich on Vancouver Island is a waterfront RV park and campground on nearly 10 acres in two land titles. The property—listed last summer at $8 million—includes 60 seasonal RV sites and a walkable beach. Its upper level, partially in the Agricultural Land Reserve (ALR), features a 1,176-square-foot house on a bluff with potential for single-family home redevelopment. The forested bluff rises from sea level to the upper bench, transitioning to agricultural land.

“There’s a corner of the upper property that’s in the ALR,” said Mark Lester, senior vice-president with the Unique Properties Group at Colliers International. “It shouldn’t affect the development of that upper portion because residential is permitted in the ALR.”

The RV park is on a lower terrace at sea level near a swimmable area. It’s not in the ALR. The site includes a 1,223-square-foot, two-bedroom caretaker’s home and resort office.

“There’s a huge opportunity for somebody to acquire it and actively work it, market it, and put some investment into it,” Lester told Western Investor. “What makes it unique is its waterfront.”

Beachcomber has operated seasonally for years under a renewable temporary use permit. Designated destination commercial in Central Saanich’s official community plan (OCP), the property can be rezoned to accommodate tourist commercial development, such as cabins or a boutique resort, per the OCP. Current zoning allows for luxury residential development.

Lester said RV park and campground sellers have higher expectations of values based on sales activity before and during the pandemic.

“Values went up during COVID and expectations haven’t fallen in a manner that corresponds to rising interest rates since then,” he explained.

As interest rates rose, the market softened, prices fell and sales slowed. According to Lester, higher interest rates, inflation, and ongoing global geopolitical issues have affected buyer perceptions and real estate risk profiles.

“We haven’t really seen the market turn back,” he explained. “A lot of people are sitting on their hands waiting for something to happen. I think expectations with the RV parks that I’ve seen are still up there. They’re harder to leverage.”

Agassiz-based Re/Max Nyda managing broker Freddy Marks said real estate deals are rare but more remote properties like Escott Bay Resort at Anahim Lake, which sold April 26 for $1.2 million, are “smoking deals” that have much to offer buyers.

“If they look at resorts and RV properties, there are great deals out there if you compare that to residential or other kinds of investments,” said Marks.

Located 325 kms west of Williams Lake, the 6.4-acre property features a 6,000-square-foot log lodge with a licensed dining room. The property includes 14 campsites spread over two service campgrounds, more than 1,000 feet of shoreline, a four-bedroom log chalet, several cabins, an equestrian area, boat dock, two RVs, boats and paddle board rentals.

Developing a pipeline of parks

Pathfinder Ventures Inc. (TSX-V:RV), a publicly listed company which launched Pathfinder Camp Resorts in 2021, has locations in Parksville, Fort Langley and Agassiz. The Fort Langley-based company recently announced plans to develop an RV park in Osoyoos with about 120 RV sites on six hectares (15 acres) of leased land on Osoyoos Lake. Currently working toward profitability, Pathfinder plans to offer pre-sales of new RVs and seasonally leased sites in Osoyoos this summer and be fully operational in 2025.

“This is going to be an opportunity for an RV owner to have more of a cottage-like experience,” said Pathfinder founder and CEO Joe Bleackley.

Pathfinder also recently announced plans to expand east with the right of first refusal and an agreement to manage four RV parks in Ontario and one in Nova Scotia. The resorts are mainly seasonal vacation properties with a short-term tourist component.

“By the end of this year, we hope to be operating at least nine RV parks,” Bleackley said, noting that Pathfinder is also eyeing Alberta resorts. “We’re looking at taking over management of specific parks where there is an opportunity to own in the future.”

Bleackley said there’s a shortage of RV parks in Canada, and he’s optimistic about growing demand.

“Because we have multiple locations, we’re creating a brand and an experience,” he said. “One day, we hope to be the Hilton of the campground space.”

Diversified approach

Located near Kelowna on Ellison Lake, Holiday Park Resort has 570 fully serviced leasehold and rental RV sites and 117 condos, both leasehold and timeshare. The 26-hectare (64-acre) resort doesn’t allow camping, but it has full-time security, pools, hot tubs, a recreation centre, equipment rentals, laundry facilities, a library, pickleball courts, a gym and a sauna. It’s also working on adding new amenities, including charging stations for electric vehicles (EVs) and e-bikes.

“We’ve got a big combination of people that have subleases here, we’ve got time share usage, we hotel out our condos,” according to the resort’s president and new owner Dawn McLaughlin.

Raging Okanagan wildfires were a major challenge last summer for the resort, which turned 40 in 2023.

“We had to basically close the resort down to any external people because the fires came within about a kilometre of us,” recalled McLaughlin, who has worked at the resort for 18 years, most recently as controller.

The resort was not part of a nearby evacuation but has taken precautions such as replacing combustible cedar hedges with metal fencing.

Falling outside of B.C.’s new provincial short-term rental restrictions, the resort has recently seen more customers staying longer term, largely due to the housing crisis and affordability issues.

“There’s a lot of people that have tried to downsize and purchase RVs to live in themselves or for rental purposes,” said McLaughlin.

“Softer season” predicted

Joss Penny, executive director of the British Columbia Lodging and Campgrounds Association (BCLCA), predicts a “slightly softer season” compared to summers during the pandemic. About 60 per cent of bookings comes from British Columbians.

“We’re seeing a definite change in booking patterns,” explained Penny. “Those booking patterns are a wait and see because of the wildfire seasons we’ve had.”

While BCLCA members currently report about 65 per cent booking—a decrease of about nine percentage point versus last year—Penny expects an increase to a typical 75 per cent occupancy this summer, but that will depend on wildfires.

Potential floods, cooler weather, inflation and fuel prices have also led to lower bookings, according to Penny, who added that the Bank of Canada’s recent interest rate cuts need time to take effect.

“We anticipate that in ’25 and ’26 we might see more of the same as what we’re seeing now,” he said.

During the pandemic, BCLCA members saw business increase about eight per cent over previous years, with most customers from B.C. and Alberta.

Changing demographics and expectations, such as more EV usage, are some of the new challenges, according to Penny.

“We’re seeing a move away from baby boomers being the largest group and moving toward Gen Z and millennials being the largest group of people that are camping. Their expectations are totally different when it comes to connectivity on Wi-Fi,” he said.