Life of luxury at sea luring rich once more

THE world’s superrich are returning to the high seas and the number of luxury yacht sales has hit its highest level since the financial crisis after a spike in demand from US and Russian tycoons.

Superyachts — pleasure boats more than 24m in length — have been slower than other sectors of the luxury goods market to bounce back from the financial meltdown in 2008.

However, demand from international billionaires has started to pick up over the past 18 months as sellers become more realistic about price, according to yacht-makers and brokers.

The longest vessel to hit the sea so far in 2014 is Italian shipbuilder Fincantieri’s 140m Victory, the ninth-biggest in the alltime list of mega-yachts.

The boat is spread over seven decks and is said to have six pools up to 8m in length as well as a floodable internal garage for its tender — a small boat that takes passengers to shore.

“Buyers are more sensible now,” said Chris Cecil-Wright, a yacht broker for 20 years. “There’s a general move towards ‘less is more’. People are going for quality boats rather than just the biggest.”

Even so, a typical superyacht can command a price in excess of $150-million (about R1.6-billion) and boast several gymnasiums and swimming pools, as well as a hydraulic swim platform or “beach club” on which children can pretend they are at the beach.

There were 221 sales of super yachts in the first half of 2014, a rise of almost a third from the same period a year ago, according to figures from Boat International Media. That represents a 66% rise from the 74 yachts sold in the first half of 2009, the bottom of the market.

Separate figures show the new-build market is picking up. According to Superyacht Intelligence, 360 yachts are being built this year, although that is still well below the 2008 peak when the order book reached 587 yachts.

One broker, Fraser Yachts, said this week that it had sold its fifth yacht in just 10 days during the summer period, normally a quiet time for sales. Edmiston, a UK-based luxury yacht broker, sold five yachts in five weeks during June.

Phillip Holden of Bluewater, a French brokerage, said sales were up in all areas at his company. “We are moving ahead of pre-recession numbers and forecast good growth over the latter half of 2014.”

The improved outlook will come as a relief to yacht-makers, many of which were almost crippled by the financial crisis. Lots of companies have been acquired by new, often Chinese, buyers in recent years.

360 yachts are being built this year, although that is still well below the 2008 peak

Last year, Dalian Wanda Group, China’s largest commercial property and entertainment conglomerate, bought Sunseeker from its Irish private equity owner, FL Partners, in a £300-million (about R5.4billion) deal. It follows the purchase by Shandong Heavy Industry of luxury yachtmaker Ferretti in 2012.

A re-emergence of wealthy USbased buyers, traditionally the biggest market for sales, has helped to boost the industry.

European buyers have yet to return and the outbreak of the conflict in Ukraine has seen some Russian buyers disappear.

Although the number of sales has increased over the past year, many in the industry say prices are well below pre-crisis levels.

China has often been touted as the next big growth market for yachts, but a lack of infrastructure such as marinas, coupled with restrictions on inland migration, has stifled appetite. — © The Financial Times, London