October 2020

Sanderson Weatherall would like to congratulate all park owners and operators who have stepped up the challenge and done a superb job of reopening their parks and businesses following what have and continue to be very challenging times. This hard work has paid dividends with the majority of operators we have spoken to reporting a brisk trade with strong occupancy and bookings across all accommodation types from tents, tourers and glamping units to statics and exclusive lodges. 

Undoubtedly this has in part been driven by a huge pent up demand from holidaymakers finally being able to take a holiday after enduring a lengthy lockdown, though we consider it is also reflective of the fact that our holiday and caravan parks offers a very attractive option for ‘open air’ holiday in spacious and beautiful surroundings, a pre-requisite for a safe holiday environment.  We are aware there have been issues to mitigate with many parks unable to offer the full range of services and amenities that would ordinarily be provided including the restricted operation of bars, entertainment and leisure facilities, although it is clear that this does not appear to have dampened demand.

As reported in our earlier summer update we had already witnessed a robust return of caravan sales following the opening of show grounds in June and it is pleasing to report this has continued, enabling many operators to make up, and in some cases exceed, lost ground on sales forecasts following the enforced period of closure. 

As we write indicators for 2021 look very positive for these trends to continue in our sector with many parks having a head start on letting bookings with a substantial pipeline of holidays transferred from 2020. With many airlines and tour operators forecasting a slow return to pre-covid levels, this also provides a positive and real opportunity for further growth in the UK market.

Sanderson Weatherall have continued to see the demand for parks significantly outstrip their supply with existing and established well funded operators seeking opportunities for expansion in the sector. Compounding the demand we are also seeing a number of new entrants and private equity/investor backed operators seeking to gain a foot hold. 

Sale volumes of parks are undoubtedly lower than in previous years although Sanderson Weatherall have continued to transact sales of holiday and residential parks during and post lockdown across all types of park. This has included sales of properties to new entrants in the market from as little as £500,000 to individual parks achieving well in excess of £10M. 

There is an increasing demand from operators looking to sell wanting to ensure discretion.  We have successfully agreed sales on a number of parks that have been offered on a discreet and confidential basis, where the lack of supply, exclusivity of opportunity and carefully targeted approach that we have managed has led to competitive interest between the most active and acquisitive purchasers in the market resulting in a very lucrative outcome for our clients. 

Looking to the future and noting some caution, it cannot be ignored that the global pandemic has already and will continue to have a significant impact on the UK and wider global economy. As we write this local and regional lockdowns are continually under review. With numerous job cuts to date and unemployment on the rise we face continued uncertainty for some time to come. Whilst the caravan and holiday park sector provides a very attractive and robust business model in these uncertain times, potential head winds cannot be ignored; increased unemployment and a reduction in disposable income could impact parks in the future. We believe a flexible and adaptable approach to traditional business models will be the order of the day.

We are already seeing evidence of banks tightening their lending criteria, and in some cases their overall appetite to lend. Outside of the private equity market the sector has traditionally been funded, very successfully, by the main high street banks, though as lending criteria change we see real opportunity for challenger banks and alternative funders to compete for a share of the market which will be buoyed by the traditional resilience the sector offers in uncertain times. There are undoubtedly exciting, though challenging times ahead.

Get in touch

Since lockdown Sanderson Weatherall have successfully acted for clients across a range of caravan parks. To date we have agreed sales in excess of £60M which have successfully transacted or are in solicitors hands, with a large proportion of these being confidential sales. If you wish to speak to us regarding the potential disposal of your park business, we would be delighted to speak with you in strictest confidence.