Marina Prices

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glazell

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Essex
disneyvilla-usa.com
In these challenging financial times our east coast marina has offered existing berth holders a discounted long term contract of between 2-5 years.
A discount of 15% off 2009 rates fixed for up to five years payable in advance has been offered with vat @ 15% on the whole lot.
On the face of it this seems a good offer a discount off this years rates, no price increases for five years and with low interest rates on cash accounts even paying in advance isn’t that painful.
Having called a few other marinas of choice I found that all had waiting lists and none were offering similar deals.
But I wonder with the economy nose diving will we see gaps in marinas appearing, prices on hold or even dropping in the future.
As with fixed rate mortgages there is an element of gambling on the future but the lure of a discount and the guarantee of no price increases it seems tempting.

Are there any other marinas out there offering incentives?

Will watch this space with interest /forums/images/graemlins/ooo.gif
 
Sounds to me like they are trying to increase short term cash flow.
Under current conditions I would be inclined to keep cash in my own pocket.
 
Sounds good to me so what if they go belly up what are they going to do close the marina I dont think so, it will be sold as a going concern and the new owners wont want to upset there customers will they. also pay by credit card then they have a laibility also
 
Depends on the terms. If you just become an unsecured creditor then it depends on your view of the long term financial stability of the owner. If, however it is held in a client account to be released on an annual basis, or if it is in the form of a debenture then it may be worth considering. Clubs like the one I belong to often offer this kind of deal, but usually secured by a debenture so that you rank above other creditors. However, a members club almost by definition is more secure than a limited liability company.
 
If you can pay by credit card you will have some protection. However you have to ask why are they offering a deal that others aren't-personally I would be sceptical about handing large amounts of cash to any organisation at the moment and that includes the banks!
 
15% over five years isn't that a great deal - work out the compound interest rate over 5 years say at 5% which is your cost of the money
 
Look at it from the marina's point of view to assess the value:
it has to make 15% a year on your payment to square the discount. Its overdraft rate will be not less than 8% even 10% so two thirds of its discount to you is already covered by financing savings. The remaining 5% can be regained on investment in bonds - easily.

And over the next 5 years the national interest rate will surely rise higher - delivering yet more value to the marina from your up front deposit - yes?

The VAT advantage is potentially of value to you - VAT could well go to 19% on resumption of full rate next January - or in July 2010 when the next government opens the books and take a deep breath!

So, it's giving you nothing really in return for your risk - from its point of view. Whereas you can get 10% on corporate bonds now on your payment which, rolled up, gives you a saving of very little against the risk - it all swings on the VAT saving.

How do you feel now?

It's not crooked, but it's not a pot of gold either. And whatever anyone tells you, 5 years is a very long time for the deal to stay watertight. If there's a change of ownership at the marina, your unsecured deposit is 99% gone the way of the tide! AND if you change your plans, what chances you'll get a refund of the unexpired payment?

PWG
 
Our marina is one of seven large marinas owned by the group most of which are full up including ours. I will be looking into whether the marinas are individual businesses with separate liabilities or are they under a single company.
If paying by credit card would this give us protection should the company go into administration in the future.
If sold as a going concern would the new owners be obliged to honour the extended contract.

I think there are two main reasons for offering this deal are –
1. Raising capitol without paying high lending charges at the banks.
2. Securing future business with customers.

It does make sound business sense too offer long term contracts and is not necessarily a sign of desperation. But if the leisure marine industry capitulates and the worst happens my main concern would obviously be the loss of our money and or our mooring.
 
Hi

Marinas with ques and full up- Yup full up but as quoted to me by a manager of a full one 'my main job is collecting money'apparantly an increasingly heard response is you can have it when my boat is sold! Me thinks many will surprisingly suddenly find spaces come May time and they will be at special prices by June!
 
Quote:
If paying by credit card would this give us protection should the company go into administration in the future.

If sold as a going concern would the new owners be obliged to honour the extended contract.
_____________________
You may have seen that repayment on credic card debts is becoming more tortuous by the day as the volume of claims increases. Still a viable strategy, yes, but not straight forward at all.

Obliged to honour the payments already made? No, as you suspect. Likely? probabaly - for shoter term commitments. But again recognition of the right may have to be argued for - not the essence of a leisurely day down at the marina office being passed from pillar to post, you might think!

And if you move marina, best to do it on your terms and at your leisure than with shouts of protest and threats raining down on you!


PWG
 
If the business

goes into administration you'll be an unsecured creditor, in line after the bank, and Tax authorities to get your money back - and any purchasers of the business are at liberty to not honour your contract.

The decision should be based on how viable the business is and if its bank is forcing the issue.
 
why ?

dont do it you are always going to be on the losing side as others have said things change.
I think mooring fees have been hyped to the max and later this year things are bound to change
I'm suprised that no company has not given boat owners a much cheaper option some thing like the yank option, some boats are hardly used so why not have a storage yard from which boats are taken to and from when required, so a boat would be brought to the water for the customer and once used taken back to storage but in storage with much cheaper relevant fees

cheers
Mick
 
I was rather thinking of putting it on the credit card for S75 protection and paying it off in the interest free period-not using the credit card for financing it!
 
Many people are often very late in paying both yard bills and berthing costs. It is almost a tradition in the marine industry.

The credit crunch is only going to make things even worse than they are now. Perhaps an awful lot worse. Who know's ?

It seems that your marina has made a logical decision to try and overcome this. But other contributors on this thread have convinced me that the deal is still not tempting enough yet.

I personally have paid up for a year in advance via credit card so I know I can go sailing . Food for the next twelve month's may have to be an optional extra.
for a year.
 
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