Affordable Yachting: Is It Really Possible?
On this podcast, PartVu Xchange Talks Boating host spoke with Bob Denison, the president and founder of Denison Yachting.
The boating business runs in Bob’s veins. His grandfather Frank founded Broward Marine, his father Kit launched Denison Marine, and Bob followed suit with Denison Yachting. Bob’s time in his family’s businesses provided him with many experiences that helped him to understand the inner workings of the yachting business. From working as a laborer in the yard to spending a weekend on a megayacht, Bob was exposed to many different aspects of the industry.
Today, Denison Yachting’s principal business is comprised of yacht brokerage and charter services. In this episode, Bob and Tonia discuss affordable yachting and the inner workings of yacht brokerage.
Can you tell us a little bit about affordable yachting and how Denison Yachting serves the yachting industry?
Bob: When you start talking about affordable yachting, many people think that term is an oxymoron, but it’s not, so I’m glad we’re going to dig deeper into the subject.
There are twenty-two Denison Yachting locations up and down the east and west coasts of the United States, as well as an office that we just opened up in Monaco. For example, we’re in most major boating cities like Annapolis and Charleston.
We have a team of about one hundred seventy people, including brokers, marketing professionals, and support staff, who come together each day to try to make buying and selling a boat or yacht easier for everyone involved. Our business model is similar to a real estate broker, so if you’ve ever bought or sold a home, you have a relatable process for comparison and understanding.
We have systems in place to make the process of buying and selling a yacht feel less stressful and safer for all involved. We aim to make the process as enjoyable and safe as possible.
In addition to brokerage, we also do many things to support the yacht ownership experience, like yacht management and maintenance. Finally, we also include yacht charters as part of our business offerings.
In a nutshell, our business is built to serve the yachting community as a whole. We’re built to serve almost every facet of the yachting experience.
What can you tell us about the fascinating world of megayachts?
Bob: The population of megayacht owners is growing, a byproduct of wealth accumulation and technological advancements. For example, in the past, some potential yacht owners might have shied away from ownership because of the potential for seasickness. Now, there are advancements in stabilization technology that make it easier for people to be on the water without as much fear of feeling sick while enjoying time on a yacht.
What’s the difference between a large boat and a yacht?
Bob: There’s not a set difference between the two. In the past, the delineating factor was size. Traditionally, anything bigger than twenty-four meters long may have been classified differently, but now, it’s mostly an arbitrary distinction.
Opinions vary about classifications. Brokers and those in the industry have different ideas about the variations in size between boats, yachts, megayachts, super-yachts, and even Giga yachts. There’s no clear-cut definition of the varying sizes.
In terms of affordable yachting, is it possible to find pre-owned yachts for under a few hundred thousand dollars?
Bob: You might not find a super-yacht for that price range, but you could certainly find a larger boat in the sixty or seventy feet range that’s a little older for under a half million dollars.
However, the initial cost is not always the most important thing to consider. A potential buyer must understand the purchase outlay in conjunction with the lifetime cost of ownership. Having a solid understanding of operating costs is paramount to the process of buying a yacht. Fuel consumption, insurance, dockage, crew, and other incidentals warrant careful consideration.
Owning a yacht isn’t necessarily a good investment in and of itself. The primary purpose of ownership is to establish a platform to enjoy your friends and family. The ongoing cost of owning a yacht is not small, but chartering is a great way to offset some of those expenses. Good charter programs are a great way to recuperate some of the operating costs of yacht ownership.
Is a yacht charter similar to placing a house on the Airbnb platform?
Bob: It’s similar to buying a vacation rental to place on Airbnb, with one big difference. When you have a house on a rental program, you have guests in the home without any supervision, so things can happen that are out of your control. On the other hand, many yacht owners have crews that care for their assets while serving guests so crew members can keep a close, watchful eye on things to ensure that the owner’s assets and possessions are properly cared for.
What are the annual operating expenses for a three hundred thousand dollar yacht?
Bob: A few variables are involved, but a general rule of thumb exists for ongoing maintenance and operating expenses. Generally speaking, an owner can expect to spend between ten and twenty percent of the yacht’s value on expenses.
How can someone find a quality yacht on the lower end of the budget spectrum?
Bob: My biased but sound advice is to use a broker. Much like any other large purchase, it’s wise to use someone who understands the market and has experience dealing with the intricacies of the buying process.
There are good websites to help start the process of searching for a yacht. Yachtworld.com and boatsforsale.com are both excellent places to start. Our site denisonyachtsales.com is also a great resource for anyone interested in finding their next yacht.
How can a broker help in the yacht-buying process?
Bob: Working with a good yacht broker and surveyor are two pieces of the puzzle that can help buyers save time and money. Brokers are equipped to help throughout the entire buying process. They can help answer many questions. For example, does it make sense to register the yacht offshore? What about flagging issues? Which insurance or finance options are there? When is the deposit due? Where does the survey take place?
A broad range of questions and issues can arise throughout the yacht-buying process. Brokers can be a buyer’s best ally to sort through the myriad of issues that inevitably arise.
What is important to consider to avoid the potential pitfalls of buying an older yacht?
Bob: Sometimes, people can get seduced by an older yacht that looks pretty on the outside. However, the systems are what warrant special attention. Bilge, air conditioning, electrical systems, plumbing, and other things like that are very important parts of a boat that need to be checked out thoroughly before buying. Also, someone who knows and understands the ins and outs of engine operation needs to inspect the engine room.
What kind of yacht charters are available?
Bob: There are a lot of different types of charters for various budget levels. One of the yacht charter market’s hottest segments is multi-hull charters, especially in the Caribbean. Another hot market is “off the beaten track” charters in Alaska, Antarctica, and other remote locations.
Some of the most affordable and popular charters are bareboat options, where you don’t have a full-service crew. Those charters are best for someone who is very comfortable with boating and knows what they are doing.
Charter trips are spectacular. They’re once-in-a-lifetime experiences that will create memories that will last forever. However, it no longer becomes a once-in-a-lifetime experience after taking a trip. Most people who charter a yacht find a way to repeat the experience.
Are there locations that are more economical to visit on a charter trip?
Bob: It’s partially based on where you live. For example, I live in South Florida, so it’s more affordable for me to visit a place like the Bahamas or the Caribbean because it doesn’t take much to get there.
I hesitate to say that there are “good deals” out there because these trips are still relatively pricey, but there are ways to look for better pricing. On the low end, most trips will start at thirty or forty grand per week and can top a million dollars on the high end of things.
Many people spend quite a bit of money on traditional vacations. They book first-class flights, lodging, adventure excursions, and dining experiences. By the time all is said and done, they’re hitting pretty big numbers for traditional vacations. A yacht charter is an alternative way to spend time with family and friends, with costs similar to a lavish vacation.
How does your team help people plan a yacht charter experience?
Bob: We have a team of charter agents across the country, from Seattle to Ft. Lauderdale and London to Monaco. Our team has in-depth knowledge of the market and boating options. So, we are very good at listening to the needs of our clients and matching them to the best possible charter trip.
For more information on the yacht buying process or charter options, visit denisonyachtsales.com or call them at 954-763-3971. Denison Yachting also has a fantastic youtube channel with yacht walk-throughs that will blow your mind.