Flagship: Is Russian yachting on the rise?

Yves Le Marquand
By Yves Le Marquand January 11, 2021 12:18

Flagship: Is Russian yachting on the rise?

Three oceans, 11 time zones, 147m inhabitants. Russia is the largest country in the world. As well as the oceans it has 11 seas and over 100,000km of inland waterways, yet it occupies just 2% of the marine shipbuilding market. Add to that the country has delivered just 24 superyachts from 11 yards with the most recent launch taking to the water back in 2015.

Russia’s expansiveness and decentralised nature has been a barrier to growth in superyachting and maritime industries across the board. Superyachts seldom visit Russia. In the past 12 months only 27 superyachts with reliable AIS navigation technology visited their territorial waters according to VesselsValue. French waters saw 1,288 visits in the same period.

On the other hand, in the above 60m category Russian ownership is second only to the US at 14% of total fleet VesselsValue told Superyacht Investor. From the fleet of yachts that are above 60m length overall (LOA), of which there are 447 live units, VesselsValue have information for 259 off which the estimations are based.

Add to that, since 2000 the average Russian citizen is 1.8 times richer. Just last December, PwC and Swiss bank, UBS, reported a total of 102 billionaires in the country. The fourth wealthiest cohort in the world behind Germany, China and the US.

There is certainly potential for growth in Russian yachting Kirill Razumov, development director of the Fort Constantin Yacht Club (pictured below) told Superyacht Investor. Both at the smaller end and for superyachts. Razumov is a member of the Fort Constantin club, located in Kronstadt, 50km from St.Petersburg.

“2020 was really good for us [the club], business wise. Despite the fact that due to the Spring lockdown official navigation on water started much later than usual, in June, but we had a full house, no free places. Now we are offering winter storage and also have lot of clients.”

Borders remain closed

Due to the pandemic borders were closed and remain so. For Razumov this is both good and bad. “Bad because no boats have arrived from abroad. Usually we have about 400 boats crossing the border a year. That is not much, of course, but something. We want many more! There are about 10,000 boats visiting Helsinki or Tallinn, which are the closest Baltic cities, every year.”

On the other hand border closings have increased the growth of “inner tourism”, including yachting. People are opening “Russian yachting” for themselves, instead of charter in Turkey, Croatia, Montenegro, Greece.

Razumov added: “In some price segments there is growth of sales, because boats are the perfect and unique combination of the isolation and leisure. Yachting infrastructure is growing in some places.”

The first lockdown hit hard in some areas. Petr Mikhailov, founder, MarineLab, producer of cruising catamarans and motor boats in steel and wood up to 22m, told SYI: “The spring was bad we lost all orders. People did not understand the situation and how it would develop, but the demand was restored by the end of the summer. And in autumn the sales raised dramatically due to the fall of the ruble.”

‘Wait and see attitude to Covid’

For Mikhail Extremalov, founder, First Yachting Group, a Cranchi dealer, told SYI: “A lot of clients have taken a wait-and-see attitude to Covid-19. I was sure that prices would fall, especially in the brokerage market, but in the beginning prices went up and clients began to buy everything that we had, both new and brokerage, and demand exceeded supply. This trend continues till now. Not just in Russia but across Europe as well.”

Despite Russia having the potential to succeed currently the lack of infrastructure is holding back growth. Razumov conducted a survey on the issues in Russian yachting. They ranged from non-developed berth and coastal infrastructure, too few marinas and a lack of a fuel filling station network to a lack of technical service bases, poor waterway navigational equipment, insufficiently developed water legislation and a lack of charter.

Investments are being made, for example the Yacht Club of St Petersburg has just completed its new marina in a developing business district which will also house the Gazprom headquarters. The marina has 2.5km of berths, is 5m deep at its shallowest, a slip over 90m in width and can accommodate 40m yachts.

Closer to home for Razumov another marina capable of housing 500 boats will be included in the Island of Forts project. This development will see the regeneration of a number of forts that were built to defend the island of Kronstadt and St Petersburg from 19th century Swedish invasion. It is due for completion in 2025.

‘Gave rise to domestic yachting’

Razumov said a source told him that 2020 has certainly been a disastrous year for charter activities abroad. “ [But] On the other hand, it gave rise to the development of domestic yachting. I personally know many who took a boat on charter in Crimea for the first time this season. With the partial opening of the borders, the charter sector and the fleet in the Russian Federation will grow.”

As for this own opinion — he said it is hard to say. There is a lot to work on but there is definite improvement Razumov concluded. “Yachting itself is becoming more and more popular – due to the growing trends for ecological and healthy lifestyles, and a need for isolation. Hopefully the situation will change more but it is changing already. We are waiting for open borders, that will bring boats from abroad.”

At a time when personal space is at a socially distanced premium perhaps the world’s largest country can at last press home on its spatial advantages. After all, even when the Black, Caspian and Baltic Seas are busy, with 23,397miles of coastline you are spoilt for choice.

Yves Le Marquand
By Yves Le Marquand January 11, 2021 12:18

Superyacht Insight

Sign up for Superyacht Investor Email Insight

* indicates required