A 45-Pad Glamping Resort in Garfield County, Utah: A USDA Business and Industry Model Study

Model study: an illustrative feasibility analysis built on public data for Garfield County, Utah; not a client engagement.

Project summary

All figures in this table are model results.

The credit question

A lender does not need persuading that people visit Bryce Canyon: the park counted 1,967,367 recreation visits in 2025 under a new counting method [1]. The question is narrower. Can 45 canvas, dome and cabin units, built on raw land in a county of 5,256 residents [2], open on schedule with their own water, wastewater and power systems, sell enough unit-nights in a seven-month season to carry about $738,000 a year of amortizing debt service, and still cover that debt if visitation keeps falling?

Five things must be true for a yes.

1. Eligibility. The project must fit the B&I rules: a tourist and recreation facility in a rural area, owned by an eligible borrower, with eligible uses of funds [3].
2. Capital. As a new business with construction, the borrower must meet the 7 CFR 5001.105(d) equity test at closing, and must keep enough cash for the winter trough [3].
3. Infrastructure. The water right, a public water system, a state-approved wastewater system and a power extension are approval paths in their own right, and any one can delay opening by a season [4], [5].
4. Demand. The market evidence must support the occupancy and rate assumptions after the 2025 drop in reported Bryce visitation, which was mostly a counting change but partly a real fall [1], [6].
5. Coverage. Debt service coverage, defined in the rule as EBITDA less reasonably expected replacement capital expenditures divided by principal and interest [3], must clear the lender's threshold by Year 3 with room for stress.

Unsourced figures appear in the assumptions table with a reason, not in the narrative as fact.

Location and county economy

Garfield County is small and seasonal. Private land near the park gateways is limited, so land cost, access and water rights weigh more here than in most rural lodging deals; the model's land price is an assumption for an appraisal to replace.

Population. The county added 169 residents in five years and lost 65 in the latest year [2]. The resort does not depend on local households for revenue, but it does depend on them for labor, so a flat resident base is a staffing constraint, not a demand driver.

Housing. More than a third of the county's housing units are vacant units held for seasonal, recreational or occasional use [7]. Some are likely short-term rental competitors, and together they explain why staff housing is scarce; the model carries a $72,000 Year 1 staff housing allowance.

Income. Median household income is below the state and national figures [7], although the SAIPE estimate rose from $47,638 in 2020 to $72,381 in 2024 [9], [8]. Local spending will not support the resort; visitors will.

Employment. Accommodation and food services account for 45.4% of private employment even in the March survey week, before the season starts [10]. A resort here hires as the season opens in spring and lays off as it closes in autumn, so peak-month wage pressure is built into the expense ratios.

Access. A site between the park junction and Tropic sits on the county's main gateway road; a site farther east trades cheaper land for thinner traffic. A site study should add the state's current traffic counts for the segments that serve the parcel.

Market analysis

Demand drivers: two national parks with different shapes

Bryce Canyon is the county's anchor. Capitol Reef, farther east, is the second park on the same touring route.

Sources: [11], [6], [12], [13], [1]; 2026 changes computed from the monthly reports.

The 2025 Bryce figure needs careful reading. Beginning with 2025 data, the park counted only unique passengers entering by shuttle, where it had previously counted total shuttle boardings. Under the former method 2025 would have been 2,437,461 visits, 2.4% below 2024 [1]. Most of the reported 21% drop is therefore a counting change. The 2026 comparison is like for like, because both years use the new method, and it shows a further 6.6% decline through October [6]. Capitol Reef, with no shuttle change, is down 3.2% through October [13].

Some of the decline is therefore real. This model study has no primary source for the mix of domestic and foreign visitors, but exchange rates, air capacity and federal visitor policy are outside any local operator's control, and a gateway lodging market can lose demand quickly when they move. The downside scenarios treat a demand shock as the primary market risk.

Seasonality

Sources: [6], [13], [14]. Room tax is by month distributed (December 2025, then January to October 2026), which lags the month of stay.

April through October produced 82.5% of 2025 Bryce visits and 82.2% of Capitol Reef visits; December through February produced 7.6% at Bryce [6], [13]. September was Bryce's peak month in 2025; Capitol Reef peaked in May, with September second [6], [13]. Room tax distributions swing 7.3 times from the weakest month to the strongest [14]. The model's calendar follows: tents operate April through October, domes mid-March to mid-November, and only the cabins year-round. For borrowers with seasonal cyclical cash flow, the rule also asks for a projected operational cash flow analysis on a quarterly basis [3], shown in the revenue section.

Lodging and room tax evidence

The room tax series is the most direct public evidence of lodging demand. Dividing the 11 distributions by the 4.50% rate gives about $75.4 million of taxable room rent [14], [15]. The figure is approximate, because distributions lag stays and a rate change would affect the earliest months, but the scale is clear: roughly $75 million to $80 million of rent a year, concentrated in five months.

No public source used here reports glamping, hotel or short-term rental rates for the corridor, so the model's blended Year 1 ADR of $318 is an assumption for a premium en-suite product, and the stress tests cut ADR as well as occupancy. Guests at an unincorporated site pay 12.92% in sales and room taxes [16]; the pro forma shows revenue net of them.

Existing supply and pipeline

No public count of glamping units exists in the data used here. Rezoning activity is the visible pipeline: a 2020 county planning commission agenda carried a conditional use permit for a short-term rental, RV park and glamping use and three zone changes to Resort Recreation [17]. The pipeline is real but unquantified. The model assumes about 120 competing glamping and cabin units in the gateway area by 2030 and absorbs them through 66.7% stabilized occupancy and a three-year ramp.

Demand method: fair share and capture

A fair-share test needs a room inventory the public data do not give, so the model uses two capture tests built on sourced totals and stated assumptions.

The two demand estimates, about 472,000 party-nights from visitation and 471,500 room-nights from room tax, rest on different assumptions, and their agreement is the useful signal. A 1.6% capture of Bryce-generated overnight demand is modest for 45 units. A 3.2% share of county room revenue is less modest, because the resort is priced well above the modelled county average. Rate, not volume, is where the forecast is exposed.

Forecast and key assumptions

The stabilized monthly pattern below drives revenue. It follows the Bryce calendar: a soft April, a strong June, a midsummer dip and a September peak [6].

Site and technical

Site requirements

The modelled site is 30 acres of private land with access to SR-12 between the Bryce junction and Tropic: room for 45 well-spaced pads, a lodge cluster, a service yard, a wastewater field with reserve area and well setbacks. On a wildfire-prone plateau the site also needs a second egress and fire-flow storage.

Zoning and permits

The model assumes a rezoning to Resort Recreation plus a conditional use permit, the path seen on county planning agendas [17]. Which of the units the county's glamping rules cover, whether the nine cabins need a separate approval path, and the district's density and setback standards remain open items for the county planning office.

Water, wastewater and power

Each system has its own approval clock, and the water right change and the wastewater approvals can be protested or delayed outside the borrower's control. A lender should make them conditions of closing, not of opening. The budget assumes an engineered, state-approved wastewater system, not septic tanks; dropping on-site laundry would not change that at this design flow.

Construction approach and schedule

Utilities, roads and the lodge are conventional site construction; tent platforms, dome kits, bath modules and cabins are factory-built and set on prepared pads. That shortens the critical path but concentrates risk early: if the well and wastewater system are not approved and built by spring, the units have nothing to connect to.

A 12-month build across a high-plateau winter works only if earthwork and utilities finish before freeze-up. A few weeks' slip in summer 2027 can cost the 2028 shoulder season, which Scenario B quantifies.

Development budget and sources and uses

All construction costs are assumptions in 2027 dollars, to be replaced by a fixed-price bid before commitment. The 10% hard-cost contingency is an illustrative assumption, and it is the minimum a lender should accept before a fixed-price bid replaces the estimate. Separately, if the note guarantee is issued before completion, the rule requires evidence of sufficient contingency funding to handle unforeseen cost overruns without seeking additional guaranteed assistance [3].

Interest incurred during construction, guarantee fees and a permanent working capital term loan are eligible uses of B&I proceeds [3]. The debt service reserve is nonetheless equity-funded, so borrowed money is not protecting borrowed money.

Revenue build and operating expenses

Unit mix and ramp

Rooms revenue is 77.5% of the total; food and beverage is a breakfast-and-evening service for guests, not a destination restaurant. Occupancy is measured against available unit-nights, which exclude closed months. Against 45 units times 365 nights, stabilized occupancy is 46.1%, and a memo comparing the file with hotel benchmarks should say which denominator it uses.

Expense structure

About $660,000 of the stabilized expense base is fixed, and that fixed base makes the winter quarter negative. The reserve matters because the rule defines debt service coverage as EBITDA less reasonably expected replacement capital expenditures [3]. Canvas, liners, decking and soft goods wear out in years, not decades. The 4% reserve, about $2,930 per pad a year, is deducted before coverage is measured.

Quarterly cash flow, stabilized year

Q2 and Q3 produce 84.2% of revenue. With level monthly payments the borrower is $307,678 behind at the end of March even when stabilized, slightly more than the $300,000 working capital reserve. The rule says payments must be amortized to maximize successful repayment "and may vary by type of business or cash flow" [3], so a schedule collecting principal from May through October removes most of the trough. A small seasonal operating line covers the rest.

10-year pro forma

Year 1 is the first 12 operating months from April 2028. Debt service in Year 1 is interest only.

Expenses grow 3.0% a year, property tax 2.0% and insurance 5.0%, so NOI margin drifts from 30.2% in Year 3 to 29.2% in Year 10. The retention fee is deducted before coverage because the lender may pass it on to the borrower [3].

Debt structure under the program

Guarantee percentage and fees by loan size

The maximum B&I guarantee is 90% of eligible loss, but the agency sets the percentage each year, and fee rates are published annually in the Federal Register [3]. The FY2026 notice set 85% for B&I loans under $5 million and 80% for $5 million to $25 million, a 3.0% guarantee fee, a 0.55% periodic retention fee and a 0.50% fee for issuing the loan note guarantee before construction completion [20].

Two timing points matter. First, a Federal Register search on November 11, 2026 found no FY2027 notice; the newest is the FY2026 notice of March 9, 2026 [21]. The FY2026 rates apply to loans obligated in FY2026 [20], so a 2027 obligation will carry whatever the FY2027 notice sets. Second, the rule allows a reduced guarantee fee, on the lender's request and within annual limits, where the project is in a county with an unemployment rate 125% or greater of the current national rate [3]. Whether Garfield County meets that test depends on the unemployment data and measure the agency applies at obligation, and this model study does not rely on it. The FY2026 reduced fee is 1.0%, with a 0.50% retention fee and an 80% guarantee [20], a $119,152 saving at closing on this loan. The model does not take it.

Equity injection and its basis

The borrower is a new business under the rule: in operation for less than one full year, or not yet at full operational capacity or stable operations [3]. A new business with construction whose lender asks for the note guarantee before completion must show 25% balance sheet equity (debt to equity no higher than 3 to 1) or a borrower investment of 25% of total eligible project cost; other new businesses need 20% balance sheet equity or a 25% investment [3]. Equity must be cash or earning assets on the borrower's balance sheet and cannot include appraisal surplus or bargain purchase gains [3], so contributed land counts at cost, not at appraised uplift.

Here the minimum would be $3,103,083, 25% of cost. The model injects $4,965,333, because the program minimum does not produce acceptable coverage:

Total cost differs slightly by row because financing costs scale with the loan. The program floor is not a sizing tool: at 25% equity stabilized coverage is 1.02x. Holding the loan under $5 million earns an 85% guarantee and near-2.0x coverage but needs $7.2 million of equity. Of the structures tested, 60% is the largest loan that clears 1.30x by Year 3.

DSCR and break-even

Coverage is computed under the rule's definition, with the retention fee also deducted: NOI after reserve, less retention fee, divided by principal and interest [3].

Debt is still paid at 57.6% stabilized occupancy, nine points below plan, which is a reasonable margin of repayment capacity. The margin above a 1.25x covenant is thin: a 2.5% occupancy miss breaches it. A 1.15x trailing 12-month covenant from the end of Year 3, with a cash sweep into the reserve below 1.25x, fits the file better. Year 1 does not cover interest, so the reserve is a condition, not an option.

Returns

Returns are the weakest part of this file. Stabilized NOI yields 8.0% on total cost, while debt costs 8.50% plus a 0.44% effective retention fee, so borrowing lowers the equity return from 7.5% to 5.8%. The rule asks the lender to consider whether the project will result in "sufficient returns to investors to ensure successful repayment of the guaranteed loan" [3]. A thin equity return is therefore a credit fact: owners who earn little defer capital spending or sell early. A lower rate, through the reduced fee or a fixed rate on the guaranteed portion, would help more than any operating change.

Sensitivity and stress tests

DSCR, Year 3: interest rate against occupancy

DSCR, Year 3: ADR against occupancy, at 8.50%

Each 100 basis points moves stabilized coverage about 0.10x; a 10% occupancy miss moves it about 0.23x. Market risk outweighs rate risk. An 8% ADR miss at plan occupancy gives 1.13x.

Downside scenarios

Scenario A, about twice the like-for-like 2026 Bryce decline [6] plus a price cut, takes coverage to 0.82x; the loan would then depend on the reserve and guarantors. Scenario B: if snow, smoke or a late opening cost April and October for the canvas units, coverage falls to 0.99x. Scenario C: at 10.50% the project still covers 1.12x, so a rate cap is cheap insurance. Scenario D applies an illustrative 12% cost overrun; financed with debt, it cuts coverage to 1.16x, which is why the contingency evidence rule [3] and a fixed-price contract matter.

Program compliance

Part 5001 is cited from the GovInfo annual edition revised as of January 1, 2026 [3]. The most recent amending document identified is the OneRD Guaranteed Loan Regulation rule published December 11, 2025 (90 FR 57351) [22]; any later change should be checked before commitment.

Collateral

When the appraisal includes going concern, the going concern value must be deducted from the reconciled market value before discounting [3]. For lodging that deduction is material and leaves discounted collateral just above the loan, so cash flow and guarantors, not collateral, carry this credit.

Risks and mitigants

Model determination

On the evidence assembled here, the modelled project is financeable with conditions as a 60% loan-to-cost B&I credit. It is not financeable at the program's 25% minimum equity, where stabilized coverage is 1.02x.

The case for the credit is real. Bryce Canyon drew about two million recreation visits in 2025 even under its stricter count [1]. The county's room tax distributions imply some $75 million of taxable rent over 11 months [14], [15]. The modelled resort needs about 1.6% of the overnight demand Bryce alone generates to stabilize. At a 60% loan-to-cost the project covers debt 1.31 times by Year 3 and can absorb a nine-point occupancy miss before coverage falls below 1.00x.

The case against it is also real. Like-for-like visitation is falling [6], [13]. The season is short, and the winter quarter loses money every year. Collateral coverage after the going-concern deduction is only 1.05x. The equity return is below the cost of debt. A lender should not approve this file on the strength of the national park name.

The conditions a lender would likely set:

1. Cash equity of at least 40% of total cost, injected before any loan funds, with no appraisal-surplus credit for contributed land [3].
2. An equity-funded debt service reserve of at least $360,000, held until two consecutive years at 1.25x or better.
3. An approved water right change application, the state wastewater approvals, the rezoning and conditional use permit, and a power extension agreement, all before closing [4].
4. A firm fixed-price construction contract, independent construction monitoring with certified draws and evidence of contingency funding, if the note guarantee is requested before completion [3].
5. A seasonal amortization schedule that collects principal in the operating months, plus a seasonal working capital line [3].
6. A 1.15x minimum DSCR on a trailing 12-month basis from the end of Year 3, with a cash sweep into the reserve below 1.25x.
7. A 4% replacement reserve funded monthly, consistent with the rule's coverage definition [3].
8. Guarantees from each 20%-or-greater owner at least equal to their share of the guaranteed loan, and evidence that the operator has run seasonal lodging at this scale [3].
9. An independent feasibility study acceptable to the agency, an appraisal with prospective value and going-concern deduction, and a sizing re-run on the FY2027 fee notice [3], [21].

With those conditions the file is a coverage-based credit that depends on the guarantors in the downside. Without them it is a bet on a quick return of visitation.