Day 4: COVID Changed Outdoor Recreation And It s Not Reversing

And welcome to day 4 of the Boat and RV 100 series. I'm Joe Downs with the Storage Moguls, and today I'm showing you why the COVID-era outdoor recreation boom wasn't a spike. It was a one-way door that permanently expanded the demand base for boat and RV storage. This isn't theory. We've watched it play out across our own markets. And if you want to build the complete boat and RV operator framework with AI-powered tools, head to storagemoguls.ai. It's our new community. It's free to join. We've got GPT tools, multimodal learning across every storage vertical and niche. And that's exactly why we built Storage Moguls, because we wanted a community, a network made up of real people, actual operators, or people that want to become operators just like you. That's why you're watching this. We're made up of the husband and wife team, the 2 neighbors who partnered up, or the brother-in-laws who have been kicking around an idea for a while. Or the solopreneur who decided to stop playing small and looking for a way out of that W-2. Nobody's here selling you a fantasy from a stage either that they haven't stood on in years. And we're not just preachers behind a microphone. We're a network that actively evaluates real deals. This is what we do. We talk about acquisitions under that $3 million, $2 million, $1 million, $500 grand, things that are deals that are financeable, digestible, the kind of deal that someone with a W-2 and a serious mindset can actually close on. And we're about real results. Members in our community are becoming storage moguls, not someday. They're becoming them now. But you can start for free if you're on the someday path. It's just, we're going to push you a little. I promise you. All right, back to today, because the question I get most often from investors looking at this vertical is, Is this a COVID thing? Is this a spike? Is this for real? Are people really going to be in the boat and RV business or recreation for a while? Well, let's settle that. First question every skeptical investors ask when they look at the boat and RV is, again, is this just a COVID thing? And then the next follow-up question I get is, didn't everyone just rush out and buy boats because they had nothing else to do during COVID That is a fair question, but the answer is no. And let me show you why, because the nuance matters. Boat and RV ownership was on a steady upward trend from 2005 onward. That's long before COVID COVID didn't create the demand. It brought millions of new participants into outdoor recreation faster than any marketing campaign possibly could have. And when travel reopened, those participants didn't stop. They'd already bought the boat or the RV. They'd already taken that camping trip. The behavior was now established. The demand dipped slightly from the COVID peak, and that's real. Then it returned to the preexisting trend line and continued to climb from there. That's what structural demand looks like. Not a spike, it's a staircase. Here's the behavioral reality behind the data. Outdoor recreation is a one-way door. When someone discovers they enjoy taking a boat out on a Saturday, that's not a phase. When a family takes their RV trip across the country, they don't come back and decide it wasn't worth it. They come back and they start looking at bigger RVs. I've watched this play out across multiple markets. Golf club memberships exploded during COVID but they've stayed elevated. RV parks and campgrounds saw occupancy surge during COVID and then the new participants became regulars, not one-timers. Short-term rentals in outdoor recreation markets like the Poconos, where I own some houses, absolutely took off during COVID and they haven't given it back. Those aren't anomalies. They're the same behavioral pattern playing out across every outdoor recreation category. COVID exposed millions of people to activities they'd never tried. A meaningful percentage of them found something they loved. Those people don't stop and their boats and RVs need somewhere to go. Here's how the demand curve actually played out and why it matters for how you think about this investment. From 2005 to 2019, there was a steady upward trend, consistent growth, not explosive, not cyclical, just a reliable climb in the number of boats and RVs owned in this country. 2020 to 2021 or '20 to 2022, depending on the state you lived in, COVID acceleration. For sure, demand surged. Millions of new participants, new boat and RV purchases at levels that hadn't been seen in decades. '22 and '23, there was a slight dip as travel reopened and people had other options again. This is where the skeptics say, see, we told you it was a bubble, but they were wrong. 2024 and beyond, the demand returned to the long-term trend line and continued to climb. That's not a spike, that's a staircase. Each COVID wave of new participants landed on a higher step and stayed there. That's the distinction that matters for investors. A spike reverses, a staircase doesn't. I want to ground this in what we've actually watched happen too, because this isn't just national data, it's what we've seen across our own markets. Again, golf club memberships before COVID a lot of private clubs had waitlists that moved slowly. During COVID they became nearly impossible to get into, and they've stayed that way. People who found golf during COVID kept playing. They didn't stop when other entertainment opened. RV parks, the facilities and markets we track, saw occupancy levels during '20 and '21 that most operators had never experienced. The families who discovered camping as, as a COVID alternative didn't abandon it when Disney opened back up. They came back the next summer. And again, markets like I just mentioned, the Poconos, short-term rental markets around lakes and outdoor destinations took off and haven't given back the gains. Demand for outdoor recreational experiences has permanently stepped up. And the boat dealers in our target markets, when we do market research, which starts with a dealer conversation, as we've covered earlier in this series, we're not hearing about a post-COVID hangover. We're hearing about consistent demand, full waiting lists, and customers who are still buying and still looking for storage. Here's the long-term implication that most investors miss when they look at the data. The people who entered outdoor recreation during COVID who bought their first boat or their first RV between 2020 and 2022, those people are going to need storage for the next 15 to 20 years. Think about the life cycle. In year 1 or 2, they figure it out informally. They store at home maybe, or at a marina or at a friend's property. Then they get the HOA letter, or they, or they want a bigger boat that won't fit in their driveway, or they get tired of looking at it in their driveway, or they realize that's not the best place to store it, or they deal with theft, or the storage arrangement they have stops working. That's when they show up at your facility, and when they do, they're sticky. Boat and RV storage tenants with established routines stay for years. They tell their friends, their friends buy boats and RVs. And they need storage too. The COVID cohort is still working its way through the early stages of this lifecycle. A storage demand for those participants is going to keep building for the better part of a decade. The wave isn't behind us, we're still in it. So what does all this mean for investment timing? Well, the COVID cohort of new participants hasn't fully hit the storage market yet. They're still working through the early lifecycle stages. The peak demand impact from that wave is still ahead. Supply takes 18 to 36 months to respond to demand signals. Operators who are underwriting deals and entering markets today will be stabilized and cash flowing before meaningful new supply arrives to compete with them. Generational transfer is adding another wave on top. Baby boomers own a significant chunk of the boats and RVs in this country. As those assets transfer to the younger owners, who will use them for decades, you get a second demand wave layering on top of the COVID cohort. HOA bans keep accelerating. Every new ordinance restricting home storage adds forced demand to existing facilities permanently. And institutional capital still hasn't arrived in force. The operator advantage window, the window where practitioners like us who understand this asset class and can acquire and operate without competing against REIT capital, is open, and it will be for a little while longer. But it won't stay open indefinitely. Bottom line, COVID was an accelerant. The fire was already burning. Boat and RV ownership was on an upward trend for 15 years before the pandemic. COVID didn't create that trend. It poured fuel on it. And when the fuel burned off, when travel reopened and people had other options, fire didn't go out. It just burned at its normal rate from a higher starting point. That's the answer to, is it just a COVID thing? No. COVID added participants. Those participants stayed. The structural demand story was true before COVID It became more true during COVID and it remains true now. All right. Tomorrow, day 5, we're adding the next demand driver to the stack, HOA bans and municipal ordinances, because it turns out that local governments have been inadvertently building your waiting list for you. And the trend is accelerating. Folks, please like this video and subscribe so you never miss the moment when a structural demand shift is still in its early innings. Like right now. And finally, share this with someone who needs to understand the difference between a trend and a structural shift before they pass on this vertical. They might thank you later. And remember, COVID was the accelerant, not the cause. The demand story in boat and RV storage started in 2005. I'd argue before that actually, and it's still climbing. The investors who understand that are positioning now before the window closes. 4 more. ways to maximize your self-storage facility or learn about new storage verticals, you should consider joining the Storage Moguls at storagemoguls.ai. StorageMoguls.ai. Why .ai? Because we're an AI-powered community and you can start for free and level up at your own pace. And if you register soon, I think we might have some free GPTs left for you that we built and we use ourselves. So remember, folks, If boat and RV storage is what brought you here, which would be strange, usually it's self-storage, but welcome. Wait until you learn, see, and understand and evaluate all the other verticals to make it that much more exciting. Join us at Storage Moguls and we'll transform you from someone interested in boat and RV storage to a storage mogul that your friends will start talking about. See you tomorrow.