Brokers around the world may differ slightly when it comes to evaluating the trending market for luxury megayachts, but they all can agree on one key fact: value remains the most influential factor. That may seem like an obvious statement, but according to Curtis Stokes, the president of Curtis Stokes & Associates in Fort Lauderdale, Fla., six years ago the market was controlled by less conservative perspectives. That all changed in September 2007, however, when evidence of a liquidity crisis surfaced, and with news of an impending global financial crisis just around the corner, Stokes saw an immediate change in the market. “It felt quieter,” he recalls of the annual Monaco boat show held that year. “Everyone clammed up and took a wait-and-see approach. Every broker that you spoke to back then felt the same thing.”
According to many dealers, the luxury yacht market has dipped significantly since then, but some, like Jamie Small, a sales broker for OceanStyle in Mallorca, have started to see a turnaround. Based on market reports, 13 yachts in the 40-to-50-meter range were sold last quarter across the industry, which Small believes is the strongest segment of the market right now. Conversely, he says that only 11 new yachts in that range came to market, which marks the first time in years that sales in a given category have outpaced the number of new offerings. Even so, Small acknowledges that those yachts are still viewed as a depreciating asset and that only the boats in the very best condition are changing hands. Even then, he says that current owners routinely are selling for as much as 30 percent less than their original asking price.
According to some dealers prospective yacht owners are sacrificing speed and performance for maximum living space.
Debbie Beere, the president of Dbeere Yachts in London, hasn’t brokered many sales where negotiations have been that extreme. If anything, she’s witnessed more owners refusing to sell. “People have a lot of cash at the moment and the worst problem that we’ve had is owners not accepting the offer,” she says, adding that for the past two years, buyers have been fixated on what they perceive to be good values—even to the point of deemphasizing the importance of the builder. That being said, she points to the Dutch boatyards as the pinnacle of the industry and the brands that have maintained the most value in recent years.
Most dealers agree prospective buyers are lured to the secondary market for significant savings over new builds.
Stokes concurs, and says that Feadship, Lurssen, and Abeking & Rasmussen are the leading European firms when it comes to new builds, adding that the 50-plus meter range is the healthiest segment of the market because those models were never overbuilt. Small also has witnessed a growing disinterest in high-speed, performance yachts, and says that prospective buyers today are looking for yachts with maximum living space (not to mention reduced fuel costs). “If you’re going to pay the berthing rate, you might as well get the tri-deck because you get more space and more bang for your buck,” he says. “You can get a lot of boat for your money in the 30-to-45-meter market.”
Yacht broker Curtis Stokes who is selling this 40 meter motoryacht says that his sales and inquiries are picking up which suggests a turnaround in the market could come sooner than some brokers think.
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