The formula
Effective gross income − operating expenses = net operating income.
That is the whole thing. The disagreements are never about the arithmetic; they are about what belongs on each side of the minus sign.
The revenue side
- Long-term and annual site rent
- Seasonal and monthly site rent
- Nightly and weekly site revenue
- Park model and cabin rental income
- Park-owned unit rent
- Storage income — boat, RV and vehicle storage is often overlooked by sellers
- Laundry
- Propane
- Store, firewood, ice and vending
- Utility reimbursement or billback where the park bills residents for metered use
- Late fees, guest fees, activity fees, pet fees
A buyer normally works from effective gross income — collected revenue, not scheduled revenue. Sites that are vacant, sites occupied by a family member for free, and rent that never actually arrives all reduce it.
The expense side
- Property taxes
- Insurance
- Payroll, payroll taxes and benefits, including seasonal staff and hosts
- Management, whether third-party or an allowance for owner labor
- Water — purchased water, or the power and maintenance to produce it
- Sewer service, septic pumping and wastewater system maintenance
- Electricity, including common areas and any master-metered sites
- Trash and recycling
- Repairs and maintenance
- Landscaping and grounds
- Pool service and amenity upkeep
- Reservation software, internet, telephone, credit card processing
- Marketing and listing platform fees
- Professional fees, licenses and permits
- Often a replacement reserve, expressed per site or as a percentage of revenue
Excluded: mortgage principal and interest, depreciation, owner's personal expenses run through the business, and one-time capital projects.
The adjustments sellers don't see coming
- Owner labor. If the park runs on unpaid family effort, a buyer adds a realistic management and payroll cost. On a small park this single adjustment can move NOI meaningfully.
- Below-market long-term rents. Sometimes upside, sometimes an entrenched situation that is hard to change. Buyers rarely underwrite full market rent on day one.
- Free or discounted sites. A resident manager, a relative, a long-time friend. Each one is real revenue the buyer would collect or would have to replace.
- Deferred maintenance catching up. A park where repairs have been postponed shows an artificially low repair line; a buyer normalizes it.
- Insurance and tax resets. Both can change after a sale. Buyers underwrite the expected figure, not last year's bill.
- Seasonal expense timing. A trailing twelve-month window that clips a summer or a winter distorts everything. Full years only.
Building an NOI a buyer can trust
The strongest thing you can hand over is a simple twelve-month grid — revenue by category and expenses by category, month by month — that ties to your bank deposits and your tax return. It does not need to be produced by an accountant. It needs to be honest and reconcilable. Sellers who provide this consistently get faster, firmer conversations and fewer surprises during due diligence.
Educational information only. This page is general commentary about buying and selling RV parks in Arizona and is not legal, tax, engineering, environmental, appraisal or accounting advice, and not an offer to purchase. Requirements vary by property, county, municipality and water provider, and they change over time. Confirm anything that affects your property with the applicable Arizona agency and with your own attorney, CPA and licensed professionals.