Super-yacht for sale, one formerly carefree owner

A host of boats are on the market, offered by a select group of brokers whose clients can pay £50m or more for a yacht moored in Monaco or Monte Carlo. There they entertain corporate contacts and throw parties where Hollywood actors rub shoulders with politicians and sports stars.

They include the Ultima III, owned by US investor Ron Perelman, once the world's richest man, who made much of his estimated $11.5bn fortune taking cosmetics manufacturer Revlon private in 1985 and has since bought and sold stakes in comic book publisher Marvel Entertainment Group and film-maker Technicolour.

Yacht broker Edmiston is selling the 190ft boat, which boasts eight "staterooms", accommodation for 16 guests and a Jacuzzi. Perelman has entertained actress Gina Gershon, who played fashion designer Fable in TV series Ugly Betty, and director and producer Penny Marshall on the yacht's lengthy sun deck in recent years, but like many investors, he has seen his wealth fall as the US market plunged. The Dow Jones index of leading shares fell by 33.8% in 2008, its worst performance since 1931.

The Ultima 111 is priced at over €50m (£47.7m) by Edmiston, which is also one of several brokers advertising the Lady Christine, owned by Conservative party donor Irvine Laidlaw. Laidlaw sold his conference business IIR for $1.4bn, and put the 182ft yacht named after his wife on the market last summer with a price tag of €45m. Others on the market include the Phocea, the largest sailing yacht in the world until 2004, which was bought by Mouna Ayoub, a French socialite of Lebanese origin who made a fortune from real estate. Ayoub refitted the boat with opulent oak panelling and handmade furniture from Viscount Linley's London showroom. She bought it 12 years ago from disgraced French politician Bernard Tapie, reportedly funding the $17m (£11.7m) cost by selling a 112-carat diamond bought by her ex-husband following their divorce. The yacht is for sale for an undisclosed price.

Other boats on the market include the Enterprise V, a 167ft yacht with a diving pool and fitness room, which used to be the corporate yacht at marketing company Amway and now belongs to the company's co-founder Richard De Vos, who also owns the Orlando Magic basketball team. It is on the market for $22.5m.

The Maltese Falcon, owned by American venture capitalist Tom Perkins is also for sale. One of the largest privately owned sailing yachts in the world at nearly 290ft, it can be bought for €115m. It has been on the market for months.

The Excellence III, owned by American car dealer Herb Chambers, whose leading top managers at his eponymous chain of showrooms used to be invited on board to watch films in its private cinema, is also for sale though broker Moran Yacht & Shop for an undisclosed sum.

Not every owner is selling because of falling share prices or declining profits. De Vos also owns a smaller yacht, a 130-footer, and Chambers reportedly took possession of a larger boat in July. The Excellence III may simply be surplus to requirements, but like other parts of the luxury goods market, yachts are not immune to the economic slowdown. Last month British yacht-maker Fairline revealed 275 redundancies, a few months after introducing three-day weeks for employees at its manufacturing base in Oundle, Northamptonshire, saying: "The ongoing global financial and economic conditions continue to affect demand for luxury products across many industries and regrettably, Fairline's products are not immune from these effects." It had already shed 90 jobs in September, reducing its workforce to 1,000, but its chief executive Dereck Carter managed to remain upbeat.

Carter said: "The downturn in the market will pass and we anticipate that towards the end of 2009, increased levels of activity are likely to materialise as the market begins to recover and as we bring new models in development to market."

Donald Starkey, the designer behind "giga-yacht" Everest, currently under construction in Fort Lauderdale, Florida, will be hopeful Carter is right. At 656ft, Everest will be longer than two football fields and have five decks serviced by two lifts, a helipad, a submarine and 17 apartments. It is scheduled for completion in 2010, according to the sales prospectus. By that time, the world economy may finally be emerging from a long slump. If not, Everest may be on sale at a discount, although given its $500m price tag, even a 50% reduction would prevent all but the richest buyers making an offer.

Merijn de Waard, founder of website Superyachttimes.com, said: "There are more big boats for sale now. I think there will be a price correction. That is logical because there is less demand."

He added: "In the past, very large yachts have sold quickly because there were a lot of people who wanted a yacht instantly and had the cash to buy them. But many of the shipyards that build these boats have orders until 2012, so they can afford to survive without any new orders for a few years."

They are a luxury only the wealthy can afford, but as global recession looms, some of the world's wealthiest businessmen are offloading the multi-million-pound yachts that bestow super-rich status on their owners.

source:
http://www.guardian.co.uk/business/2009/jan/04/recession-super-yachts

Yacht builder cuts 17% of jobs

Up to 250 let go with drop in demand

New Jersey's largest boat-building company, Viking Yachts, laid off as much as 17 percent of its work force this year in what could be the biggest downsizing since the 1990-91 recession, coupled with a federal luxury tax that decimated the Bass River boat works.

From a recent peak of 1,400 workers, the company has shed 210 to 250 positions in several rounds since March, said Peter Frederiksen, Viking director of communications. Escalating fuel costs earlier this year were one factor, and the deepening global economic malaise has reduced domestic and international demand for the company's distinctive sport fishing and motor yachts.

"Some people are furloughed, which means they will be brought back when there's work," Frederiksen said.

People who have lost their jobs range from fiberglass workers, who lay up plastic and resin to build hulls from 45 feet to 82 feet in length, to some 20 administrative office staffers who were laid off in the summer. Out-of-work employees can still use the company's on-site health services, Frederiksen said.

The company's 600,000-square-foot production plant on the banks of the Bass River was expanded this year with completion of a 130,000-square-foot addition. Production had expanded in recent years to as many as 108 vessels annually, priced from around $1 million to $4.5 million each, according to the company.

For a time, the weakened American dollar and international exchange rates made Viking vessels an attractive choice for European buyers, and the company's foreign sales climbed to 30 percent of its business from 10 percent, "but it doesn't have the momentum it once had," Frederiksen said.

The National Marine Manufacturers Association is hearing anecdotal accounts "that estimate business is down about 30 percent for powerboats," said Ellen Hopkins, director of marketing communications for the group.

The association runs boat shows around the country, and the harsh climate, ironically, is helping to book display booths, Hopkins said: "People are scrambling to exhibit because they're not getting traffic at their showrooms."

The layoffs don't come close to Viking's crisis of the early 1990s, when the company went from 1,500 to 80 workers at one point and closed a Florida factory. In the years since, Viking founders Robert and William Healey diversified the privately held family company, which has interests in real estate, technology and energy.

"We're trying to manage this the best we can," Frederiksen. "From the luxury tax in '91, we knew we could never do it with boat building alone."

The company's new flagship 82 Convertible and other boats will be taken to the Miami International Boat Show in February in search of potential customers, he said.

"The fact is, boating has always been a cyclical business," Frederiksen said. "Eventually, we'll come out of this."

Viking is a major employer for southern Ocean County, and the layoffs and other job losses in recent months are contributing to a surge in need among area families low on cash.

Dan Hartmann, past president of the Tuckerton Area Inter Church Food Pantry, headquartered in a former garage next to the Little Egg Harbor Community Center on West Calabreeze Way, said there has been a tremendous increase in requests for food.

"In the past few months, it's almost doubled," Hartmann said. "Where we used to get 115 families, some months we get 200 to 230. There has been a tremendous increase at all levels. Even working families are having a hard time."

His wife, Anna, the current president of the food pantry, said she went straight to the food pantry Monday morning, even though the pantry is only open from 2 to 4 p.m. weekdays, except holidays.

"We are inundated," she said. "We are still feeding them. We had 230 families in October. We're still making Thanksgiving baskets."

Sectors of the boating industry began to feel a slowdown in 2007 as real estate markets stalled in what had been high-growth regions, and increasing fuel prices tipped the scales further.

New England-based builder Albin Marine halted production suddenly at its Rhode Island facility last year, citing high material costs and a decline in home equity among would-be buyers of its midsized motor cruisers.

Along with fuel prices this summer came the credit crunch, drying up financing for all but the best-rated borrowers. The National Marine Bankers Association canceled its annual December lending workshop in Fort Lauderdale, Fla., citing "existing market conditions and the economic hardships our industry continues to endure."

The early 1990s boating recession was intensified by imposition of a 10 percent federal luxury tax on high-end boats, such as those built by Viking. Robert Healey organized what became a national campaign to win repeal of the tax by 1993, and the brothers' continued investment in keeping the company alive enabled Viking to retool and surge back into the market.

"Bucking the tide is where you find success in today's world economy," Viking Executive Vice President Pat Healey wrote in the current issue of Vahalla, the company's twice-yearly magazine for Viking owners. "We appreciate your business and are doing all we can to hold pricing, despite ever increasing costs for raw materials, machinery, overhead and labor."

Healey said the launch this month of the 82 Convertible — the biggest boat in Viking's 44-year history — "continues our commitment to launch at least one new model yearly and sometimes more."

source: app.com

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Rory Vanucchi
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http://waterfrontlife.blogspot.com
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Superyachts sink in value as crunch bites

Luxury yachts in Monte Carlo harbour, Monaco. Photograph: Graeme Robertson

They were the ultimate status symbol of the boom years, coveted by billionaire businessmen who wanted to show off their wealth, but the value of superyachts is plummeting as the credit crunch really begins to bite.

Many owners are being forced to sell their boats as their other assets fall, and dealers are slashing prices as the market slows.

Some bargains are on offer, according to dealers, including the 164ft Alibella, which boasts a helipad and marble fixtures and fittings finished with gold trim, and is now available for just €24.5m (£21m) - an huge €9.5m discount - if a buyer can come up with the cash within a month.

Edmiston, a London-based yacht brokers, says it was delivered to its anonymous owner six months ago, but they are now seeking a quick sale. An email sent to clients by William Christie, a broker at the company said: "The owner will sell at this massively reduced price if the deal can be completed within 30 days."

The Alibella can accommodate 14 guests in six cabins, but cheaper second-hand yachts are also available. The 163ft Thunder B, which has a seven-metre swimming pool, is now available for €13.7m, down from €18.9m and the asking price on the 146ft Candyscape has also been slashed, from €15.5m to €12.9m. The interior of the boat was designed by Candy & Candy, the upmarket property developer owned by brothers Nick and Christian Candy, and boasts a saloon with a giant entertainment system, including a pop-up flat-screen television.

The 150ft Midlandia, meanwhile, has been reduced in price from €27m to €19.9m. It comes with bullet-proof glass and an outdoor cinema; perfect for a security-conscious film buff with a few millions to spare.

link to the original post: Superyachts sink in value as crunch bites

source: guardian.co.uk


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Rory Vanucchi
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www.LasOlasLifestyles.com
www.FortLauderdaleLiving.net

Boat sales not completely sunk

While attendance may be down at the 49th annual Fort Lauderdale International Boat Show and boat sales have run into choppy seas, some positive signs persist for both the show and boat sales across South Florida.

The show, which ran Oct. 30 through Nov. 3, saw a 4 percent decrease in attendance from last year for all of the days of the show, excluding the final Monday, a show spokeswoman said.

Show Management, the managerial agency, did not immediately provide exact headcounts for each day or final figures. The spokeswoman estimated that between 130,000 and 140,000 people attended last year.

Sales figures may not be available until a week after the show ends, but the general outlook was positive, according to Show Management COO Andrew Doole.

However, the show's projected economic impact, which includes hotel bookings and restaurant sales, has been revised from $720 million to $650 million.

The financial crisis caused some concern for vendors and show organizers, he said. Still, “I think everybody here is pleasantly surprised at the crowd we’ve got.”

The crowd was relatively steady, thanks to increased marketing efforts abroad. The show targeted Russia, the Middle East and South America, in particular, Doole said. The result: a 15 percent increase in international attendance.

International attendance was helped by the fact that many new marinas have been built in Central and South America and the value of the U.S. dollar, which, until recently, had declined against many foreign currencies, Doole said.

“The boats here are a bargain at the moment,” he noted.

While the dollar and the soft market for smaller boats have caused many price tags to drop, not every boat is a bargain. Some brokers and builders said the megayacht sector –those boats longer than 80 feet and often priced in the millions – are selling just fine.

“Under 100 feet or under 80 feet, those guys are dying,” said Tim Johnson, a broker at International Yacht Collection’s Fort Lauderdale office. But, since most of International Yacht Collection’s boats are “well above” 100 feet and its clientele is extremely affluent, the company’s business is steady, he said.

“People ask me on a daily basis: ‘Isn’t the price of fuel affecting your business?’ Oh, give me a break,” Johnson said.

Mike Dickman, director of marketing for HMY Yacht Sales in Dania Beach, said that most of HMY’s boats are in the mid range – 45 feet to 80 feet – exposing them to more market pressure than the biggest boats. Still, early sales from this year’s show forecast a better year than last, he said.

The credit crunch may make financing a boat more difficult, but it didn’t play a large role, said Frank Herhold, executive director of Marine Industries Association of South Florida. However, it could impact lower-end sales where the industry is seeing a slowdown, he said.

“My gut feeling is [getting financing is] a little bit tougher but it’s there,” Herhold said. “I haven’t had dealers tell me they lost a sale because they couldn’t get financing.”

At any rate, the high-end deals are mostly cash, he noted.

South Florida Business Journal reported data in late September showing that new boat sales here declined 26 percent for the first half of 2008 compared to the same period in 2007.

The decline is a large concern for the marine industry, which has an estimated $13.5 million impact on the region and accounts for more than 150,000 jobs.

source: south florida business journal - by Bill Frogameni


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Rory Vanucchi
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