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January February 2020 Marina World

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MARINA LEASES Med market hit by lack of uniform fee policy The Mediterranean landscape of marina concessions is highly varied, reflecting both political and economic dynamics. In Italy, writes Donatella Zucca, the situation is Kafkaesque. “Unfortunately, almost every country has its own model. This brings many challenges to marinas and the industry as it makes competition unfair,” says Martinho Fortunato, chairman of the ICOMIA Marinas Group (IMG). “In very general terms, state owned marinas usually have an advantage over private marinas as they do not have to pay rent to a landlord. And, if they pay, the fee is much lower than what private concessions pay.” “In my opinion, rents should be made up of two fees – a flat fee that’s normally low and a fee based on the total turnover of the marina. The best examples follow this rule,” Fortunato continues. But different – and widespread – practices for rent value determination can cause serious problems. “Marinas are very long term projects and tend to pass through periods of growth and of recession. So, all the ones that are based solely on fixed fees or high financial responsibilities will not succeed for the concessionaire. If the responsibilities are very high, bad results that hit the marina in periods of recession will risk the operation of the marina.” Concessions can be revoked if economic recession makes them nonviable or if the tax burden becomes too great. “Both scenarios have a huge impact on local economies, employment and tourism,” Fortunato stresses. “And they normally take many years to overcome and lead to deep rooted infrastructure problems.” Although unexpected rent increases can be imposed during the life of a concession, in countries such as Italy, France, Spain, Greece, Turkey and Croatia the state cannot unilaterally modify the amount of the annual fee as this has been based on a pre-agreed investment plan. “The rental fees are fixed according to the surface area occupied by the investor and can only be modified in accordance with inflation during the life of the concession.” Basically, as Italian Marinas Association - Assomarinas - president Roberto Perocchio confirms, the most widespread practice in the Mediterranean is to establish rents Marina di Punta Ala, like others in Tuscany, has succeeded in obtaining a review of its concession fees. based on square metre area and then ask potential investors what kind of investment they want to make. The best proposal, in terms of quality of project or other factors, wins a multiyear concession for the area in which work will be carried out. The concessionaire is the manager and the tenant. “In the recent tender for Marina Alimos in Athens, Greece the concession fee focused on the type of investment Luciano Serra: but there “Politicians should start thinking of yachts are isolated as privately owned incidents, masterpieces and such as in the not just the assets of Balearics, where possible tax evaders.” auctions have been held to give the concession to the highest bidder,” Perocchio explains. “In Turkey, 50% of marinas are for sale and their management has been rendered uninviting by a weakening local clientele and reduced overseas visitors, and in France concession fees have not only risen but also reduced in length.” In Italy, due to confused politics and economics, state concession fees have risen by four to five times the original cost. This enormous increase has even affected marinas with established long term contracts and has put at least 20 facilities at risk. Among those affected is Marina di Rimini, which has a 50-year concession with the Ministry of Transport that started in 1999. To cover 10 ha (24.7 acres) of water and 6 ha (15 acres) of upland, the concessionaire invested €40 million and paid an annual rent of about €80,000. “The value is in line with the concession deed which stipulated that the more improvement work we did the less we paid,” says marina director and managing director Giovanni Sorci. “However, in 2007 the government reversed the concept – the more we built the more we had to pay. The ‘reform’ equated tourist ports with bathing establishments and didn’t take any preagreed contracts into consideration.” “The result was that, as from 2007, we had to pay €360,000 a year plus - January/February 2020 33

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