Boat membership and fractional ownership schemes
Whatever size of boat you'd like to own, however deep your pockets, sometimes it doesn't make sense to buy your own boat. Many people are converting to new fractional owner schemes that allow members increased flexibility and remove most of the hassle-factor of owning a boat.
There's a growing trend in all sectors of the industry, from canal boats to superyachts, for commercial operators to offer fractional boat ownership and membership schemes for new, fully-managed yachts. These offer the advantage that everything concerned with running the boat, including marina fees, plus professional maintenance and cleaning, is entirely taken care of by the management company. In general, the boats also tend to be somewhat better equipped than most privately-owned vessels. So when it comes to buying a boat, it's definitely an alternative worth considering.
Two different business models tend to be in use. In one, each member has an equity stake in the boat. With the other, one person owns the vessel, while the others pay a monthly fee for the right to use it for a certain number of days. Prices for the latter start at a few hundred pounds per month for a new 32ft vessel. This equates to roughly the same as the marina fees you would pay if you owned the boat outright, and are very substantially less than the cost of a bareboat charter for a similar vessel.
Of course, there’s nothing new in principle about sharing the ownership of a boat, that’s been happening for many generations among friends, family and club members (see our piece on partnerships and syndicates). However, it’s more recently that companies have made this easier for individuals that don’t already know each other. Yacht Fractions was one of the first operators in this field, making it easy for individuals to buy a boat get together, while making sure each understood had the knowledge and support needed to chose a suitable syndicate for their needs, and that they had the protection of a proper legal contract.
Many more companies – such as Smart Yacht – are offering this kind of facility now, particularly for larger yachts, generally above 55ft, that are looked after by a professional captain. This gives owners the confidence that their boat is well looked after, will be fully prepared for each visits and eliminates the time overhead of organising and supervising work that needs to be done to the vessel.
This type of arrangement with a large yacht also enables the vessel to be offered for charter when not being used by her owners. Smart Yacht, for instance, claims that relinquishing one-quarter of your time on board for this purpose will cover your share of normal annual expenses, leaving the capital costs of the vessel as your only expense.
Boat membership schemes
Those wanting to sail smaller boats should look at some of the growing number of schemes that offers managed yachts through fractional ownership or gym style membership. The pathfinder in this sector was SailTime, and franchise-based organisation that started in the unlikely location of Austin, Texas in 2001 and now operates in more than 60 locations in Europe, the USA, Caribbean and Australia.
Each boat is shared by seven members and one owner member, who get up to 42 days of sailing a year for a fixed monthly fee. Unlike chartering, each time members sail it's on the same boat, although provision exists for members to sail elsewhere in the world on SailTime craft, including the Mediterranean and Caribbean. Owner members buy a brand-new boat and then receive a monthly income, in addition to free use of their vessel for the 42 days per year, while the company pays the maintenance and operating costs of the boat.
It’s easy to see the advantages of this type of system, especially for those who have limited time available for boating: as well as saving a significant amount of money compared to owning and looking after a boat yourself, your time on the water is maximised and any problems are someone else’s responsibility. Other benefits frequently include training and familiarisation, as well as social programmes.
Given the attractions of the concept, it’s no surprise that many people are opting for this way of boating and that a growing number of companies are joining the market place. As a result, there is an increasing diversity of boats available, enabling you to choose the boat that best suits your needs each time you go afloat, whether it’s a RIB or a 40ft cruiser-racer.
Choosing a company
With gym style membership schemes it’s a good sign if the company is open and welcoming – you should be able to spend enough time to be certain that you’re buying into a subscription that suits you. It’s also important to thoroughly investigate proposals at the outset if you are to hold equity in a vessel and ensure your money is protected if the company fails.
As an owner you should have your stake in the vessel registered, so that it’s clear that it’s not a company asset that can be requisitioned by the company’s creditors in the event of it failing. What happens in the event of the company failing should also be a consideration for membership clients, although with the sums of money paid monthly being very much smaller there’s a (relatively low) limit on how much you might loose. Similarly, you need to know how easily it is leave your contract. Non owners who pay a monthly fee generally have to commit for 12-months, while some owners may sign a three to five-year contract, with options to withdraw by giving six to 12 months' notice.
Fractional boat ownership options
(1) BCBM Boat Share
(3) Pure Latitude
(4) RIB Shack Marine
(7) Smart Yacht
As well as Fractional boat ownership clubs, you can always buy a boat as a partnership with a another person or a syndicate.