Copake KOA Campground - Copake, NY
Cathy and Gary Reinard were readying their Copake KOA Campground for an April 2010 opening when a violent microstorm wiped out the park’s entire electrical system six weeks before the first campers were set to arrive. The couple ran up $161,000 in credit card debt to repair damage to roadways and campsites, and to upgrade the park’s electrical infrastructure.
They'd bought the 60-acre campground eight months earlier by assuming a non-performing loan with a high rate of interest. That high-interest debt, coupled with the high-interest credit card bills they had recently accumulated to help cover the $575,000 in damage caused by the storm, prompted the Reinards to seek alternative financing. But the couple owned campgrounds in Cooperstown years earlier and were all too familiar with the vulnerability and tight margins of such a seasonal business.
"Campgrounds are considered a risky portfolio, but we found a bank that believed in us," Cathy Reinard said. Campsites typically generate revenue during camping season only, but many of the families that visit Copake KOA rent year-round sites that they pay for over seven months during the off-season. "That gives us great cash flow in the winter," Cathy Reinard said.
Recognizing those and other benefits, Salisbury Bank partnered with The 504 Company in a $2.4 million deal that allowed the Reinards to refinance the five loans they took out so their company, Copake Camping Resort Inc., could purchase and make improvements to the Copake campgrounds, as well as pay off the 12 credit cards they used to pay for storm repairs. The refi consolidated their monthly payments to two, from 17.
"The campground was in such such poor condition when we bought it that it was no longer listed in campground guides. This really opened up a lot of opportunities for us," Cathy Reinard said. The 504 project included $240,000 to build a garage and pond, add more cabins, expand infrastructure and increase capacity to 250 campsites.
John King, vice president of the 504 Company, has been camping since childhood. He immediately recognized the Reinhards' skills in the industry. "I knew they had what it takes to be successful in the camping business. Gary handles all aspects of the physical plant. Cathy is on top of the staff and generating income from peoples' pleasant camping experience," he said.
The campground has exceeded revenue and profit projections for the last two seasons. It was also honored with the KOA Founder's Award for each of 2012, 2013 and 2014. The prestigious award means that Copake KOA is in the top 10 percent of all KOA campgrounds for client satisfaction.
"The Reinhards took a rundown campground and created an award-winning, beautiful, clean, camping experience for their customers, thereby giving a great value," said David Wright, vice president at Salisbury Bank.
Copake KOA qualified for the refinancing through the Small Business Jobs Act's 504 Refinance Loan program. The program, administered through the SBA, allowed small businesses to lock in long-term, stable financing, with a goal of protecting jobs and hiring additional workers.
Copake, a town in Columbia County, has lost jobs in recent years. Reinard says local retailers and other vendors in the small community benefit from campers who travel to town to buy food, gas, clothing and souvenirs.