Yacht business bounces back after credit crunch: €525,000 weekly charter fee for flagship vessel Axioma
Mark Duncan, commercial director of the super and mega yacht company, Yachting Partners International, also says that the costs of crewing and maintaining a yacht works out at ten percent of the sale price per year.
How much do your clients spend on superyachts?
The superyachts we sell range from €1m to €90m. This depends on the model and size, but also the yacht’s condition and history. The typical entry point for new owners tends to be around the €7m mark, with the twenty-four to forty metre range of vessel accounting for seventy percent of all yacht sales. The costs of crewing and maintaining a yacht works out at ten percent of the sale price per year. In terms of charter, prices range from €30,000 to €600,000 per week. One of our flagship vessels, AXIOMA, charters at €525,000 a week.
Is it better to buy a brand new yacht or a pre-owned one?
Most people buy yachts with leisure in mind rather than as an investment. If you really can’t find a pre-owned yacht to suit your needs, build it. Buying pre-owned, however, means you don’t have to wait two or three years to receive your yacht; you can have it within six to twelve weeks. Another problem is that new yachts depreciate quickly. They commonly lose fifteen percent of their value for the first two years and another ten per cent for each of the next three years.
Do UHNW invest in yachts?
The cost of maintaining a superyacht, particularly a large one, means that most UHNWi’s will only have one. However, some UHNWi’s will look to invest in a number of vessels and charter them out. On average, an owner will only spend four to five weeks on their yacht a year so there are an increasing number of owners who are chartering their yachts. Approximately 1,400 of the world’s 6,000 superyachts are available for charter, and doing so provides revenue to help cover running costs and keeps the crew active.
Give us your three best tips for buying a yacht.
To know whether you are getting good value or not you need to know the background of the yacht. Price reductions, no matter how enticing, should be treated with caution as they might be hiding a problem. Secondly, always focus on the interior rather than the exterior. Just because a yacht has pleasant exterior aesthetics doesn’t mean this adds anything to its value or practicality. Once you are on board the outside is irrelevant. Be clear on why you are buying the yacht and base the features and your other decisions around this. Finally, treat buying a yacht as a normal business transaction. If you approach it from this perspective, then there is plenty of room for negotiation.
Are prices holding for super or mega yachts?
In the fall-out from the financial crisis, supply outstripped demand, bringing down prices. But last year, for the first time since the global meltdown, demand outstripped supply and so prices are slowly edging up again. Last year, yacht sales totalled €3.2 billion worldwide.