We chat to Mark Duncan, Commercial and Marketing Director within the yachting industry and get an insight into the current superyacht scene.
What is regarded as being a ‘superyacht’ and how big is the yachting industry?
A ‘super yacht’ is generally regarded as those yachts above 24m (79ft) although with the ever-increasing size of many new yacht launches (the average yacht length in the 1980s was 28m, today it is closer to 45m) this may soon change to 30m (98ft) and above.
The superyacht world is composed of just over 6,000 yachts of which just over 1,400 are made available by their owners for guests to charter each year. On average around 2,000 yachts are offered for sale with prices ranging from €1m or €2m to over €450 million.
As a whole, yachting as an industry is estimated to generate around €24 billion euros a year. It involves over 6,000 companies providing everything from design, construction, crewing, yacht management, registration and legal services, yacht charter, yacht sales and purchase, surveying, naval architecture, refits, IT and AV technology, paint, maintenance, marketing, events and a host of other services. The industry employs over 130,000 land-based staff and over 30,000 crew.
Owners of superyachts come from all corners of the world and from many walks of life with the USA, UK and Western Europe accounting for a large share of the market closely followed by Russia and the Middle East. A new and upcoming generation of owners is also being seen from South America, Asia and India.
What are the top things to take into consideration when you are looking to charter or purchase a superyacht?
Chartering is probably the easiest way to enjoy all that a superyacht has to offer not only for onboard facilities, dedicated crew service and water toys but also for visiting and experiencing some of the most amazing destinations that only yachts can reach.
It is like being in the best 7* hotel in the world except the chef and hospitality are there just for you and your guests, and the view from your window can change every day if you want it to.
Many regular charterers do eventually decide to buy their own yacht. The search for your perfect yacht and the process of purchasing it should be and often is an exciting and rewarding one provided it is approached with some expert and experienced guidance. This would normally come from a Yacht Broker who can not only guide you on which yachts for sale best suit what you are looking for and how you intend to use it, but equally inform you on their pedigree, background, associated costs, various alternatives on how to purchase, crewing and operational advice and, of course, help negotiate the very best purchase price for you.
How do superyachts differ from each other?
Different yachts offer different experiences. Sailing Yachts are particularly enjoyed by owners and charterers who revel in the experience of being at sea, feeling the wind in their hair, often getting involved in the actual sailing of the yacht and frequently taking part in some of the many regattas around the world where owners really do enjoy the chance to get together to compare notes and experiences.
Motor yachts, which account for 80% of the market, appeal to a slightly different owner or charterer. They tend to offer more interior space, many more facilities such as gyms, media rooms, cinemas, spas and multi-dining options and a considerable amount of home comforts and opulence. Some are made for speed, others for slightly gentler cruising.
Some, such as explorer yachts, have the capacity to cruise for weeks without needing to refuel or provision thus opening up the far reaches of the world to owners and guests, whilst others are geared towards perhaps slightly less ambitious, but exceptionally popular, cruising in the Mediterranean or Caribbean. Catamarans offer two hulls, great space and safety.
Again, when it comes to choosing your preference for charter or for purchase, your Broker will guide you on all the advantages or inconveniences of all the options open to you.
What are the hottest destinations to look out for?
The Mediterranean remains the single most popular and rewarding destination for owners and charterers. From the French and Italian Rivieras to the Spanish coast, Sardinia, Greece, Croatia and Montenegro, the area offers a wealth of different cultures, sites, landscapes and activities.
The Caribbean also remains an attractive winter proposition with St Barths, the BVIs, St Vincent and most recently Cuba proving popular. And for those searching for something a little different, northern Europe, particularly Norway, the Middle East, around Dubai and Oman, South America and Asia all offer a stunning alternative.
What kind of features are available on the most high-end superyachts?
It all depends on the yacht, its size and how the owner expects to enjoy it, but for many, a helipad is a very practical feature, for example, a submarine or a fully kitted out beach club with extensive diving gear, lounge area, swim platform and water toys area. State-of-the-art pools and Jacuzzis are often de rigueur, as is a fully-equipped gym with a view, a spa and massage centre, 3D cinema, games room and all the latest water toys – from seabobs and jetskis to waterslides and inflatable sailing yachts.
Have there been any major recent technological advancements in the industry?
Yachting uses and incorporates some of the world’s leading technology and R&D covering everything from hybrid engines for increased efficiency and environmental protection, to extensive developments in the use of carbon and glass for design and performance and, of course, state-of-the-art communications technology.
One very new introduction is the use of Virtual Reality in the design and building of new yachts for clients. I have worked very closely with VR specialists to develop fully immersive programmes that allow owners to walk through their, as yet, unbuilt yacht so they can take decisions on all sorts of design or build issues based on their ‘real’ experience of being virtually onboard. This can save a significant amount of time, money and heartache for owners because it reduces considerably the risk of having to make expensive change orders once the yacht is already in build.
Can a superyacht ever be a good financial investment?
Don’t think of your yacht as an investment in money terms, but as an investment in the quality of life for you, your family and your friends. Yachts do not generally increase in value unless they are particularly historically or technically unique or sought after. You will of course need to factor in the operational costs of running your yacht in terms of your crew, maintenance, repairs, berthing, fuel and various taxes and charges. And again, a quality broker will guide you on those costs before you buy. Some owners, as I noted earlier, do make their yachts available for charter when they are not using it and this can be a very efficient way of recouping some of the outgoings, keeping your crew in good shape and equally adding some extra value to your yacht when you come to sell.
What does the future of the superyacht industry hold?
Yachts provide a truly unique chance for those who have the ability to afford it, to get away from it all with the people they most care about. Yachts allow you to see parts of the world many will never have the chance to experience and enjoy. For those reasons, they are very often the reward for all the hard work and the sacrifices owners and guests make in their professional and personal lives. So I believe there will always be an important demand and requirement for luxury yachts and the experience they deliver.
Certainly, the number of new yachts being ordered and launched continues to grow as does their size and the complexity of how efficiently they run and perform and what they have to offer their owners. There is increasing interest from new markets such as India, Asia and South America as the number of UHNWIs grows every year. Today, it is estimated around 6% of all those who can afford to savour yachting at its most bespoke actually do. As you can imagine, we are keener than ever to keep up our conversations with the other 94%.
Thank you for your time today Mark.