Market Intelligence — 2014

Posted February 15, 2019 in Company by Janine St.Denis

Lloyd Werft’s 377-foot/115-meter LUNA, launched in 2010, was the largest yacht sold in 2014. Lürssen’s 367-foot/112-meter PALO ALTO, set for delivery in 2017, was the second largest sale and Corsair Yacht’s 296-f00t /90.1-meter NERO, launched in 2008, was the third largest yacht sold last year.

In 2014, the total combined meters sold tallied in at 19,180. The top builders of 2014 were Sunseeker, with 38 yachts sold, Feadship, with 16 yachts sold, and Benetti, with 15 yachts sold. 2014’s sale of LUNA as largest yacht sold trumps 2013’s largest yacht sold — Freire Shipyard’s 241-foot/73.60-meter PEGASO — by whopping 136 feet.

“As the bull market enters its sixth year in the U.S., we see that yacht sales continue to increase,” says Northrop & Johnson CEO Kevin Merrigan. “Yachting is echoing the real estate and luxury markets’ numbers, exhibiting good health, even as new inventory continues to come onto the market.

As I have been preaching, this does not mean that yachts are selling at a premium. To the contrary, the prices have simply have found a stable bottom at market value. This trend is likely to continue for the short term, until inventory starts to shrink. In certain segments of the market, we are already seeing this reduction in inventory, but, in our opinion, there are many good opportunities in the marketplace waiting for a buyer to take advantage.

The number of days on market before the yacht is sold is going down, and the difference between sales price and asking price is shrinking. Not only are market forces at work here, but also smart sellers are paying attention to properly locating, maintaining and pricing their yachts for maximum resale return.

The new construction market is showing advanced signs of what is to come soon in the brokerage market. Aggressive shipyards, like Benetti, are fully booked with business into 2017. The Dutch yards also are doing extremely well with limited opportunities. Interestingly, the U.S. yards could use a boost, especially as their efforts are being thwarted by the constantly strengthening dollar. With the euro below $1.20 versus closer to $1.40 early last year, the U.S. loses her monetary competitive advantage on the larger yachts.

My crystal ball says that prices will continue to firm and more yachts will come off the market than in 2014.  New construction will further tighten this year and shipyards will be in stronger negotiating position. If the Russian economic/political climate stabilizes, we will see an even stronger surge of the above momentum. Price of oil overall at the current levels will continue to help buyers as inflation is kept in check and buyers whose wealth is tied up in that industry are not currently in a position to rejoin the yacht market.”

The first three weeks of 2015 have already produced 17 yacht sales, including Feadship’s 193-foot/58.82-meter CALIXE, Defoe Shipbuilding Co.’s 167-foot/51-meter RS EDEN, CMN Yachts’ 161-foot/49-meter MIM, Palmer Johnson’s 144-foot/43.93-meter FOUR WISHES, Westport’s 130-foot/39.6-meter GUSTO and the list goes on. With success so soon into the New Year, there is a great deal of evidence that 2015 will indeed overshadow 2014’s records.

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