Fractional ownership is an exciting commercial proposition. While it has been around for decades, in recent years it has enjoyed a boom in popularity as an accessible, simple way to own a share of an expensive asset along with a number of like-minded people.
It’s all down to a global cultural shift that has seen multiple sectors moving away from long term ownership to fast, lower cost ways to enjoy experiences. It’s a distinct Millennial thing, too. Younger people are less able and willing to own an expensive asset but they’ll gladly pay to rent the same experience. Yacht share is also increasingly popular with retired people, being such a simple and hassle-free way to enjoy the very best in sailing on board a fabulous luxury craft.
Luxury yachts have traditionally been owned by the privileged few at huge expense. Along with the high purchase price there are significant ongoing costs associated with the yacht’s upkeep, including mooring fees, maintenance, insurance and guardinage. Fractional yacht ownership not only substantially reduces your initial financial outlay, it also offers great savings on ongoing operational expenses. It doesn’t compromise your use of the yacht, its size or calibre, nor does it expose you to the risks and inconvenience you potentially get when owning an entire yacht yourself.
No more waiting for that elusive dream. Fractional yacht syndication means you can grab the moment right now, and enjoy owning a luxury yacht without spending a fortune buying it outright. One day you might buy your own yacht. For now, you’re happy to enjoy all the thrills, excitement and fun without taking such a big financial risk. It might even turn out you don’t enjoy sailing one bit – in which case you can sell your share or transfer it to someone else. At least you haven’t wasted enormous amounts of money finding out!
Fractional yacht ownership – Welcome to the sharing society
This is how it works. You simply pay for the time you spend on board, and somebody else pays when they’re on board. The portion of the yacht you own can vary from 10% to over 50%. It’s an approach that’s as sleek and modern as the yachts themselves, providing you with much better asset management.
Because an independent professional generally handles the management of the yacht, fractional owners are free to enjoy themselves, with no detailed management issues to handle. Every owner is free to use their share of the yacht according to the terms of the syndicate agreement. You don’t even need to meet your fellow co-owners unless you want to. If you prefer, you can remain completely anonymous.
This is not a timeshare!
This is very different from a timeshare. With timeshare you don’t actually own a share of the asset. You only buy the right to use it for a set time. When it expires, that’s that. You’re left with nothing. Fractional ownership provides you with title papers reflecting your fractional ownership. If you want to sell or transfer your fractional ownership, you’re welcome to do exactly that.
The advantages and disadvantages of fractional yacht share
There are plenty of advantages to fractional yacht share. Your investment in time is less than it would be owning your own yacht outright. Our fractional arrangements include yacht management, so you don’t have to source contractors or find people to handle maintenance in the yard or at an unfamiliar port. And because the cost is split between the owners, your share of the maintenance bills is a great deal less than it would be if you owned the entire boat. Since fractional yachts are well-maintained and regularly serviced, the value of your share should hold steady compared to an average yacht.
You can choose to use a different yacht of a similar value in a different location, to make up for time lost because of the weather or maintenance. And because fractional yachts are often sailed to and from different ports, you can sail to new locations when you and your fellow owners fancy a change.
How about the downside? Some larger fractional yacht shares require crew, which takes control out of your hands and means you can’t sail the craft yourself. If your co-owners want to move the craft to a port you’re not interested in, the majority win the day, potentially moving the yacht somewhere you don’t want to go. The co-owners can sell the boat when the majority of them want out, dividing the proceeds. And maintenance issues can shorten your allotted time on board in exactly the same way as they can when you own the boat outright. That’s why it’s important to check and agree the contingency plans laid out in your agreement.
Your time on board is pre-set, which means you can’t decide to go sailing on a whim. On the other hand some fractional yacht ownership agreements have a first come, first served rule during unscheduled time where there’s no maintenance going on. Lastly the yacht décor is out of your control, as are the fixtures and fittings, and you can’t customise the yacht. None of this seems particularly onerous when you look at the advantages.
Join a fast-growing trend – Modern fractional yacht ownership
These days fewer people are getting into boating thanks to a lack of time and difficulties justifying the huge cost of self-ownership. When you’re only out on the water a few times a year, the cost of each trip soon begins to look untenable. Yacht share gives people the chance to own a brand new craft without the hassle of maintaining it, at a price that makes a lot more sense in terms of the time you actually spend on board.
Between 2016 and 2018 0.22% of the population owned a sailing yacht. A decade earlier it was 0.26%. Research by British Marine reveals how the number of people aged 16 – 34 who are enjoying sailing is on the up after a long fallow period. It looks a lot like yacht sharing is making boating more accessible than ever to a new generation of yacht lovers.
Would you like to explore more about fractional yacht ownership? How can we help you today?
