Superyacht berths to ‘command premium prices as demand exceeds supply’

Mike Stones
By Mike Stones September 13, 2019 10:31

Superyacht berths to ‘command premium prices as demand exceeds supply’

Berths for big superyachts will increasing command higher prices. Pictured is OneOcean Port Vell at the Spanish city of Barcelona.

Superyacht berths at popular locations are likely to command higher prices in the years ahead, as demand outstrips supply, according to the manager of one Spanish luxury yacht marina.

Competition for berths for the biggest superyachts will become particularly fierce, Ignacio Erroz, manager of OneOcean Port Vell, in central Barcelona, told Superyacht Investor.  “With a large number of superyachts currently under construction in shipyards around the world, it will not be long until the number of superyachts exceeds the number of berths in premium locations, especially for +80-metre yachts, inevitably generating a supply and demand imbalance,” he said.

That will lead superyacht owners and operators to consider locations other than the most popular homes for superyachts, such as the South of France. The south coast of France is traditionally regarded as a location where owners are guaranteed to generate high berth profits with marina spaces frequently sold at prices above that of the initial investment.

£12 million in the 1990s

Reflecting the extent to which demand is outstripping  supply, a 30-metre berth in the South of France that cost £225,000 in the 1970s was later sold for £12 million in the 1990s when demand outstripped supply, according to James Munn, sales and charter broker with Northrop & Johnson.

Notwithstanding Erroz’s vested interest as manager of the Barcelona Marina, he considers its location will become increasingly attractive for luxury yachts. “The strategic location of Spain, set between the cruising grounds of the Western Mediterranean and the Caribbean, combined with the world-class services and facilities of marinas such as OneOcean Port Vell, makes the city an extremely attractive homeport location for owners, captains and crew,” he said.

As the only port in the Mediterranean in a city-centre location, OneOcean Port Vell offers an investment opportunity for ultra-high net worth individuals (UHNWIs), he claimed. Located a five-minute walk from the centre of Barcelona, the port was said to offer superyacht travellers the best of both worlds – the proximity of a beach holiday and a vibrant city.

‘Rental revenues of the leased yachts’

“At marinas such as OneOcean Port Vell, which is home to some of the Mediterranean’s largest berthing spots, we expect to see the value of these berths grow,” said Erroz. “This, coupled with the possibility of obtaining a return on investment through the system in place at OneOcean Port Vell, which shares the rental revenues of the leased berths with its owners, makes the marina an attractive investment opportunity for UHNWIs.”

With superyachts subject to special EU tax scrutiny, Erroz identified tax advantages linked to using the marina for luxury yacht maintenance. “A major draw for the marina, OneOcean Port Vell is one of only a few European marinas allowing tax-free servicing for minor maintenance work. That is a major draw to non-EU superyachts undergoing repairs and maintenance who can benefit from tax exemption on berth fees, works, supplies, tools, spare parts, and a selection of approved support services.”

Meanwhile, this summer the EU Commission decided to target tax breaks offered in the Italian and Cypriot yacht industries. Its decision raised key questions about superyachts’ tax liabilities, addressed by Superyacht Investor last month.

“OneOcean Port Vell is one of only a few European marinas allowing tax-free servicing for minor maintenance work,” claims Ignacio Erroz.
Mike Stones
By Mike Stones September 13, 2019 10:31

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