Fractional Or Shared Yacht Ownership Done Right!

Ownership Redefined For The Sharing Community!Fractional yacht shares Imagine owning and sailing your own luxury catamaran for less than 20% of what conventional yacht ownership or bareboat charter would usually cost you! 

That is exactly what this program is designed to do. It gives you the opportunity to enjoy the benefits of yacht ownership for a fraction of the cost of conventional ownership. Shared yacht ownership is exactly what it sounds like—you buy a share or fraction of a yacht. It is not a time-share where you only purchase the rights of usage for a certain amount of time and end up with nothing when the term expires. With shared ownership you legally own the fraction of the asset and hold the title to the yacht.

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Unique Ownership Programs For Large Luxury Catamarans

Large sailing catamarans offer excellent yacht ownership opportunitiesWe have mentioned before that catamarans are getting bigger. The number of yacht buyers who have purchased large catamarans in the past five years has increased and there is no sign of this trend slowing down. But with these big boats come a hefty annual holding cost.The catamaran owners are therefor all trying to find a way to reduce the cost of ownership.

Many, if not all of these catamarans are in some type of business arrangement. The basic idea is that the boat is operated as a business, which enables the owner to reduce the cost of ownership through the use of available tax advantages and income from charter to pay for the boat. Here are a few good examples of how you can reduce the costs of owning a luxury yacht.

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Pros & Cons Of Yacht Charter Management Programs

choosing a Yacht charter Management program is a carefully made decisionYacht charter management is a good way to reduce the cost of a boat and also offset the cost of yacht ownership. If you and your family are sailors and want to explore different parts of the world,  owning a boat in a charter fleet can be a very fun and rewarding experience. To make it a successful endeavor, we recommend that the yacht owner be informed and involved in the management of their boat.

New vs Used Catamaran

The one question we get a lot is: "Should I buy a new boat and place it into charter management or buy a 5-year old boat that was phased out of charter management when I am ready to go cruising". That is a fair question and can be easily explained. 

Usually your timeline will determine if you should buy a new catamaran and place it into charter. If you have 2-5 years before you will go cruising full time, doing a charter program is a good way to own the boat that you actually want and help pay for the boat with charter income. By the time that you are ready to go sailing, your 5-year old charter boat will be worth 60% of the original value of the boat, exactly the value of what you will buy someone else's 5-year old charter boat for, give or take. So, why would you give up a new boat, five years of worldwide sailing and 40% of income? It makes no sense!

Pros Of Owning A Charter Boat

  • Pride of ownership
  • Warranties in place on all equipment 
  • The boat will generate income and will pay 40%+ of the mortgage over 5 years.
  • 5 years of sailing (8-12 weeks @ between $4,000 - $20,000 / week value)
  • Phase out program ensures a fair outcome at the end of your charter program
  • You sail away with a known quantity. You know the sailing and maintenance history of the boat that you will go cruising on.

Conclusion: If you have the time and the financial means, it makes total sense to buy a charter boat sooner instead of waiting five years and then buy a five-year old charter boat.

Charter Yacht Program Types: There are different types of management programs offered by the charter industry, but the two most popular programs offered by most charter companies are the "Guaranteed Income Program" and the "Performance or Income Sharing Program". Both these programs have their pros and cons and the boat owner has to figure out what will work best for their particular situation and plans. Charter Programs In A Nutshell>>

Risk Assessment: The main aspects to consider for the boat buyer when choosing charter management programs are their risk tolerance and possible need for tax benefits. That will dictate, to a large degree, if a guaranteed monthly income with less risk, involvement, and liability vs the Performance Program with higher revenues, but more personal involvement, may be a better fit for you.

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Large Catamarans - How To Own & Operate Them

Over the last several years we have represented a number of buyers who have purchased large catamarans for personal use and who have placed their yachts into different charter programs.

It seems the current trend in catamaran ownership is to go bigger! Most of our owners of catamarans over 50ft, place these catamarans into one of several crewed charter programs. The basic idea is that the boat is operated as a business, which enables the owner to reduce the cost of ownership through the use of available tax advantages and income from charter to pay for the boat.

We have sold large catamarans of different brands, of which the more popular ones are Bali 5.4, Catana 70Lagoon 52Lagoon 620, Lagoon 77, Lagoon 78, Fountaine Pajot Saba 50FP Ipanema 58FP Alegria 67, Sunreef 50, Sunreef 60Sunreef Supreme 68, Sunreef 80, Sunreef 80 Power, Tan 66, Xquisite X5 Sail, and Voyage 500. All our owners in these programs have successfully created small businesses and achieved their ultimate goals.

 

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Charter Yacht Management Programs: Do The Numbers Work?

boat buyers seminarDifferent charter yacht management programs work for different people. We have just completed the first Live-Aboard Boat Buying Seminar of the season and while we all had a great time, it was all serious business! Attendees, Bruce & Holly and Jack & Reenie, had very different yacht ownership interests, but one of the underlying themes of these seminars is always: “How do I offset yacht ownership costs?

Part 1: Guaranteed Income Program

Ownership in a charter program can provide solutions to the financial and practical disadvantages of traditional private ownership. It really is an easy option provided you go into it with the right expectations and goals.

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