The first in the proposed fleet of fractional yachts, is the SD92, a 27.65m motoryacht from the Italian yard’s semi displacement range. Persuading brokerage firms of the viability of fractional ownership is now the company’s focus after the yacht’s Miami Yacht Show debut this year. CEO of Sanlorenzo Americas, George Jousma was invited to speak to the Florida Yacht Brokers Association (FYBA) this month and director, Philip Burroughs is also speaking at another FYBA event in August.
San Lorenzo Shares needs five owners to launch the yacht – it has already secured one with one more due to be confirmed it says - and the company wants brokers on board to secure the immediate interest for SD92 and long term interest in the programme.
Burroughs said, “We have been booking time to visit broker firms to further educate them on the business model. In these meetings, we are focusing on how to identify the right client for fractional and how to present the concept [to the brokers'] clients.”
That ‘typical’ or ‘right client’ may not be the one that first springs to mind. A New York Times article, ran on 5 July, said the preponderance of fractional schemes around now is triggered by the many reasons owners find ‘not to buy a boat’ including maintenance worries and fuel costs.
Broker, Bob Anslow, at the FYBA conference said, similarly, that he sees fractional ownership as a choice for pragmatic owners wanting to maximise their holiday time, not necessarily for those who can’t afford to buy.
“Fractional appeals and it’s not necessarily for the economics solely, but the logical point of view. You own a yacht – but you’re still wanting to ski in Aspen, travel to Polynesia or wherever – you have other things you like to do for hobbies or that your children do. And in reality, how many weeks a year do you use the boat?”
Burroughs agrees. His target Sanlorenzo Share owner will be “the individual or family that can afford to buy their own yacht, they just don’t have the time available to justify the purchase.”
There are potential downsides, however, similar to the problems reported on charters where some guests have not treated the yacht as the owner would wish. Anslow said fractional was particularly vulnerable to this issue of maintenance and care, with multiple owners all strangers to one another, with different interpretations of how a yacht should be treated and maintained.
“The partners aren’t friends; maybe one of them is a bit harder on the boat, [walks around in] shoes, crazy parties – the care and condition is the captain’s job. We see this issue with jet [fractional] programmes – some CEO puts his kid on a hop ride back on the plane, he starts blowing some weed and the captain puts the plane down and all of a sudden the guy has a 250,000 dollar fine for cleaning.”
“You really need to have a confident captain who can also command authority,” he underlined.
Burroughs remains optimistic the (hardly new) model is still relevant and interesting for today’s owner and believes the support of the brokers will help power it forward:
“Fractional provides a separate product for [brokers] to market alongside of full yacht marketing and ultimately (and hopefully) will increase revenue.”