18 Apr 2012
LYBrA takes shape
The Large Yacht Brokers Association (LYBrA) has been meeting to finalise its bylaws, logo and structure, and has confirmed that the organisation will be open to membership.
“Five companies founded LYBrA and we’re in the process of opening up membership,” Jonathan Beckett, CEO of Burgess and LYBrA’s inaugural president confirmed. “We could potentially have 10 to 20 companies in the association.”
The association, which formalises an existing informal relationship between the superyacht industry’s “big five” brokerage houses—Burgess, Camper & Nicholsons International, Edmiston, Fraser Yachts and Ocean Independence—is inviting other large brokerage houses to join, if they meet the criteria.
Brokerage companies that want to be considered for LYBrA’s potential membership must:
- Be registered as central agent for at least two years
- Have had for sale at least 10 yachts exceeding forty meters in the last two years prior to an admission request
- Manage chartering of at least 10 yachts exceeding thirty meters in the last two years prior to an admission request
- Be proposed by two members of the Association and be approved by the Managing Board.
“We’re keeping it restricted to the large corporate brokers so that it’s a manageable size, but an influential group,” Hein Velema, CEO of Fraser Yachts and one of LYBrA’s architects said. Non-members will be in a position to be proposed to the board as soon as LYBrA have finalised their association’s internal paperwork (logo, fonts, business cards, application forms, etc.), expected within the next couple of months.
LYBrA has been set up as a powerful vehicle for the big brokerage houses to lobby regulators, governments and the yacht market on regulations, tax and other issues that affect the brokerage industry.
Velema was also involved in the set-up of the Superyacht Builders Association (SYBAss), so had the experience of bringing the industry’s top competitors to the same table. “We used that experience to do a similar thing for the brokerage world,” Velema says.
The Association has chosen the Monaco-based Eric Blair, of the Eric Blair Network, as Secretary General of LYBrA. “I’ll try and keep everything together—not always easy,” Blair said when reached by phone. “My main goal is to maintain the association’s momentum to satisfy the members, and to make sure we have enough communication between all the members, which is not always easy because they’re obviously all competing with each other. But they have these common issues, which they all have to deal with, so we’ll focus on those. I’m not involved in the brokerage business, so I have distance and a view on the issues which can be quite useful.”
As CEO of Burgess, Beckett has seen the brokerage business grow from the days of small brokerage houses with three employees and an annual overhead of €200 thousand to today’s situation where the biggest brokerage houses cost €15 or €20 million to run. “The interests are different, and we’re faced with different problems,” Beckett said. “The idea of LYBrA is to bring the biggest companies together and to act as a forum to discuss the problems we’re facing and the future.”
LYBrA will work with the Mediterranean Yacht Brokers Association (MYBA), and has no interest in dismantling the structures they’ve established for the marketplace. “The whole charter market would not exist as it does today if MYBA hadn’t been set up the contracts and rules,” Velema said. “They did the same with sales by setting up the central listing, which has provided common practice, and therefore much more transparency. Brokers and owners really benefitted from the establishment of a structured brokerage business through MYBA.”
“MYBA is limited in it’s abilities however, as it’s an association of individual brokers," Velema continued. "LYBrA is an association of the biggest brokerage companies, and we’re looking to the future in terms of building systems and processes that will benefit everyone. We very much endorse the way the charter and brokerage businesses are structured under MYBA’s guidance, and that’s not something we want to change, because we think it’s very important that there is one way of working. When there’s transparency, buyers are more confident to engage in the purchase of a very expensive yacht asset.”
The key difference between MYBA and LYBrA is the perspective of the members. With LYBrA’s members being solely the heads and owners of the largest brokerage companies, supporting the development of a new boat show, for instance, takes on a different priority. “An individual broker would love to have another boat show because it provides him another platform to show his boat. But LYBrA members will point to the fact that they each spend considerable sums on exhibiting at the major boat shows around the world year on year and yet the returns on these investments are not impressive. Regardless of the returns, some shows hold a pivotal place in the yachting calendar, of course, and the Monaco Yacht Show is one of the most important and is well supported by LYBrA. The point is that more boat shows are not better—which is a very different perspective from that of individual brokers.”
Brokerage listings and sales numbers from SuperyachtIntelligence.com suggest that six further brokerage houses could meet one of the membership criteria—having had for sale at least 10 yachts exceeding forty meters in the last two years prior to an admission request. These are Northrop & Johnson, Merle Wood & Associates, Moran Yacht & Ship, International Yacht Collection (IYC), Yachting Partners International (YPI) and Yachtzoo, which could bring LYBrA membership to 11.
Undisclosed listings and sales, if taken into consideration, would likely enlarge this list.
NB: Yachtzoo has a company policy of non-disclosure on all yacht sales.
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