July 2010 Market Report

Although July marked the start of the traditionally quiet summer season, activity in the market remained brisk, with a number of notable brokerage sales, and no less than 30 new yachts joining the superyacht fleet following their deliveries to their new owners.

Chart 1: Market activity in July 2010

Brokerage Sales

July 2010 saw 16 superyachts over 24m sold, all of them motor yachts, at asking prices totaling €278 million, up 56% compared to July 2009 when 24 sales were reported at €145 million.

Chart 2: July 2010 comparison with July 2009

The cumulative total of sales so far this year is just short of €1.5 billion (based on asking prices) against €882 million in the equivalent period last year.

Chart 3: 2010 YTD comparison with equivalent period in 2009

At the time we commented that July 2009 was marked by the sale of smaller, older yachts, and it’s worth noting that last month’s figures were boosted by the sales of the 90m Lauren L asking €65 million and Lürssen’s 65m Katie Sue II (now Solemates) also asking €65 million.

Full details of the yachts sold in July 2010 can be found in Table 1 below.

Superyachts sold in the 50-70m size bracket continue to dominate the market, with 15 sold so far this year against only four in all of 2009 and six ultra-large yachts over 70m have so far been sold compared to four in 2009.

		More analysis, including a variety of sales trackers, is available in the Brokerage Sales section of Market Intelligence.

New on the Market and Price Reductions

Despite the sales of 16 yachts last month, another 26 came on the market, fuelling the glut of yachts available. It’s clear that it will take some time to clear this enormous overhang of supply over demand and until then prices will remain fluid, as is demonstrated by the fact that we counted 34 price reductions in July 2010.

New Orders, Launches and Completions

July saw five new orders placed, the most notable a 67m Sea Axe support vessel from Amels. We counted 12 launches, led by Nobiskrug’s 68.15m Sycara V, and no less than 30 completions as new yachts were delivered to their owners, the most so far this year.

Full details of new orders, launches and completions are available in Market Intelligence.

A Broker’s Perspective

We asked Kevin Merrigan, President of Northrop and Johnson in Fort Lauderdale for his opinions on the current market: “After my recent visit to the South of France, I came away feeling encouraged by the activity around the major marinas in Monaco, Nice, Antibes, and the like. Busy with charters and their owners, the crew were enthusiastic, and troubled economies seemed to have faded to a secondary concern around the dock. This is a welcome change from the atmosphere of 2009 and is reflected in the momentum exhibited in this year’s sales figures through July. Sellers are getting much more serious in their pricing, and buyers are taking advantage of an aggressive marketplace.

“Given that the summer is historically slower for yacht purchases than the fall, I see this as an excellent sign for the impending boat show season which is kicked off in Monaco in September. The Monaco Yacht Show is sold out, and the Fort Lauderdale International Boat Show is very crowded. Buyers who are shopping and sellers who are serious will join us at this year’s major shows, and we look forward to meeting with you all.”

A Builder’s Perspective

Given that Heesen Yachts signed four new build contracts in 2009 and a further five already in 2010, we thought it timely to ask for the views of Fabio Ermetto, Director of Sales & Marketing at the yard. Says Fabio, “We all know that the facts of September 2008 changed our industry forever. 2009 was a tough year but still many companies managed to avoid very rough seas thanks to the order book signed up during previous years. I do believe that 2010 has been and will be the most challenging year, because companies need new orders to keep going and in this environment it is very difficult for minor companies to offer enough security to a buyer.

“The same problem of not being reliable enough applies to some major companies in difficult financial situation and unfortunately we all can see the consequences. There are definitely less buyers around but these are in general more experienced and demanding. In my opinion the result of this situation is that the main shipyards with a track record of quality yachts and investing in their organization will take even a stronger market leading position.”

A Buyer’s Perspective

An experienced yacht owner who keeps a close eye on the market as he’s looking to buy his next superyacht comments: “The Westship 106 is a nice boat. About 12 of them were built, but in any case there were seven of them on the market at the time of the Miami Boat Show this year. The best of them was a boat called Primadonna. She was in the show at $3.5 million while the others were all listed at around $2.6 to $2.9 million. None was selling and two had been listed for almost two years.

Primadonna‘s owner basically said bring offers and he took one at $2.4 million. Now the market value was determined – it was not $3.5 million, it was not $2.5 million, it was $2.4 million for the very best of the fleet, so what happened? Three others sold within 30 days! The market value had been determined and the owners took their lumps and sold.”

 

Table 1: Superyachts sold in June 2010

The following sales were reported by brokers in July 2010:
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Candyscape 44.70m Benetti € 6,950,000 Edmiston & Company Edmiston & Company
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Cecienne 26.48m Canados € 2,990,000 Ocean Independence Ocean Independence
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Elandess II 47.00m Heesen € 29,000,000 Burgess / Merle Wood & Associates Burgess
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		High Chaparral 49.99m Feadship € 31,000,000 Camper & Nicholsons International Hyde Yachts
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Import III 26.00m DeBirs $2,498,000 Oceanstyle Generation Marine
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		INXS 32.30m Lazzara $4,700,000 Allied Marine HMY Yacht Sales
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Jariya 25.48m McMullen & Wing $4,850,000 Fraser Yachts The Marine Group
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Katie Sue II 60.00m Lürssen € 65,000,000 Moran Yacht & Ship Moran Yacht & Ship
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Lauren L 90.00m Cassens Werft € 65,000,000 Burgess / Edmiston & Company / Peter Insull’s Yacht Marketing Edmiston & Company
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Makarena 29.50m Bilgin € 1,100,000 Thierry Voisin Thierry Voisin
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Millennium 37.30m Heesen € 8,900,000 Ocean Independence Ocean Independence
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Mitsi 29.00m Peri Yachts € 4,100,000 Peri Yachts France Peri Yachts France
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Outback 58.90m Austal € 26,800,000 Edmiston & Company / Merle Wood & Associates Edmiston & Company
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Predator 108 SE 33.00m Sunseeker € 7,000,000 Sunseeker Germany Sunseeker China
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Pure White 34.11m Arno € 5,900,000 Fraser Yachts Edmiston & Company
		Name: Length: Builder: Asking Price: Listing Broker: Buyer Broker:		Sanlorenzo Alloy 40 40.00m Sanlorenzo Withheld Ocean Independence Ocean Independence