Middle East yacht owners upgrade to larger, more luxurious boats

Leading industry players from the local and international yachting industry, in Abu Dhabi for the 3^rd Abu Dhabi Yacht Show (ADYS) which runs until March 26 at Yas Marina, confirmed today that there is a shifting trend towards larger yachts within the industry, with the Middle East continuing as one of the most courted buyer markets for larger scale yachts.

Speaking at the Middle East Superyacht Briefing which launched the ADYS show schedule on Thursday morning, Erwin Bamps, COO of UAE-based shipyard Gulf Craft said the Global Order Book 2011 indicates the greatest demand for superyachts is in the 70-100ft category which saw a 34% increase in number of orders in 2011 versus 2007, a year with a very similar number of global yacht orders.

Comparisons show that the superyacht segment has come out of the global economic slump in a much stronger position, showing only a 25% decrease in order numbers from a 2009 peak, as opposed to a 60% drop in smaller yachts in the 45-70ft category.

According to Bamps, the move from smaller yachts to increasingly larger sized vessels in the region – moving from 40 footers up to 50 to 70 footers and above – “represents a natural trend to upgrade among superyacht owners in the Middle East, and this presents a huge opportunity for the region’s superyacht market.”

Bamps continued, “Gulf Craft’s new yacht concepts, such as the Majesty 123 and Majesty 135 were developed keeping in mind this shifting demand for larger sized yachts. The market is clearly headed in this direction and we are investing in the capacity to build larger sized vessels.”

Constantinos Constantinou, President & CEO, Art Marine agreed that data on recent sale transactions supports the claim that bigger yachts are more in demand. “Sales are trending towards the larger segment,” said Constantinou. “In terms of both unit sales and in terms of the length of yachts sold –global brokerage market data indicates that there is an increase in transactions at the larger end of the scale.”

“Today, the smallest yacht in the list of the world’s top 100 largest yachts is 226ft – there is a definite upward movement in length,” he added.

The increase in Ultra High Net Worth Individuals globally, as well as in their average wealth spells further good news for the superyacht market. “There is a certain amount of wealth fatigue in the UHNWI category – having reined in spending over the past few years, the market is loosening up again, the rich are once again looking to spend,” said Constantinou.

The high concentration of wealth in the Middle East continues to place this region in the spotlight in terms of potential superyacht buyers. “Seven of the top ten superyachts in the world currently belong to Middle East owners, almost all of whom are private owners or members of royalty,” said Constantinou.

“More importantly, 28 out of the top 100 largest superyachts are owned by Middle Eastern customers. This is a tremendous indication of the concentration of wealth in this region. We are starting to see a broadening in the region’s yacht owners’ market beyond the realm of royalty, which is a positive indicator of the regional industry’s future,” he said.

This growing market is exactly who exhibitors at the 3^rd Abu Dhabi Yacht Show will be hoping to reach out to over the three-day show, with several big-name players in the superyacht business, including Oceanco, Luerssen, Westport, Abu Dhabi MAR, Nobiskrug, CMN Yachts,  Edmiston, SanLorenzo, and Sunseeker, Gulf Craft, Art Marine, Luxury Sea Boats and Sea Pros present at the show.   

“The Abu Dhabi Yacht Show offers an unparalleled opportunity to reach out to the Middle Eastern buyer at home,” says Andy Treadwell, Managing Director of Informa Yacht Group (IYG) organisers of ADYS. “The show offers a platform for major stakeholders in the industry – from yacht builders, buyers, service providers, registration, insurance and regulatory companies, tourism boards and marina developers – to come together and discuss what the regional client desires and needs and how the industry can move forward. Many conversations that begin here will lead to actions that send waves across the industry in the months to come,” he added.  

ADYS is held under the patronage of His Highness Sheikh Mohammed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, and is sponsored by Abu Dhabi Tourism Authority (ADTA), with Yas Hotel as the official hospitality partner and Blancpain and HSBC Private Bank as the show’s Platinum sponsors. 

The Abu Dhabi Yacht Show 2011 takes place from March 24-26 at Yas Marina. Show timings run daily from 3pm to 9pm. For more information on event schedules and highlights, please visit www.abudhabiyachtshow.com.