A fare share: a different approach to boat buying

Boat/US Magazine, Sept, 2004 by Dick Thompson

Going Strong In Florida

Pas says he reviewed the successful operation of Fractional Yacht Management, Inc. of Melbourne, FL, before setting up his program--including the information on their Web site. Fractional Yachts offers more affordable models than Great Lakes BoatShare, such as a share in a 2003 Wellcraft Martinique 3300 for $18,575 down and $276 a month, compared to BoatShare's $603 monthly charge for its 42-footer.

"Money is not the issue with fractional ownership, time is," said Fractional Yacht Management owner Mark Casburn. "All of our customers can easily buy their own boat outright, but don't have the time to provide upkeep or the desire to worry about security."

Programs For the Rich and Famous

Having a 42-foot boat on the Great Lakes is neat but at the other end of the spectrum are the megayachts offered by YachtSmart of North America head-quartered in Arlington, VA, or Monocle Management LTD of Fort Lauderdale, FL.

YachtSmart's shares in a 2004 Azimut 85 are already sold out. A single share of this $4.2 million vessel went for $425,000. "Shareholders put $125,000 down and finance the rest," said YachtSmart's president Jonathan Metcalfe. "We have 30% of these owners already committed to moving up to our new offering of a 35-meter Italian built Benetti yacht. Money is definitely not an issue with our buyers, quality time on the water and not at the dock is."

Monocle on the other hand, has a 237-foot Asante Wavepiercer with 20 staterooms for $1.75 million per share. You get the full run of the yacht for one week and the extra staterooms come in handy when you want to take along a dozen or so friends. The annual operating expenses are split among the fractional owners--this can be a tidy sum when all the operating costs are considered. All of these yachts come with a qualified crew, a chef, and plenty of water toys.

Tough Business to Start Out In

Fractional ownership has not been fully embraced by the maritime industry. It can be a very risky business. William Mirguet, who started Drake YachtShares in 2002, regrettably had to suspend his operation last February because of limited capital. "It's simply too expensive to educate the public through advertising, and I wasn't getting much help from the editorial media. Nevertheless, I firmly believe the drawbacks of fractional yacht ownership pale in comparison to its benefits and eventually will become a mainstream approach to boat ownership. The economic savings and ease of use are too compelling for it not to eventually succeed," he said.

RELATED ARTICLE: Before You Buy Into A Fractional Yacht Plan

* Make sure that the company is offering a variety of yachts to select from so that you are not forced to buy a share in a boat that is not completely right for you.

* Some companies move the yacht's location and cruising range to fit the seasons--Chesapeake in the summer and Florida in the winter. Check that cruising plans are convenient for your needs.

* Ensure that any deposit is held in escrow until all shares are purchased. Set a time limit for refund if shares are not purchased within a reasonable time--consider a six-week limit.