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November December 2018 Marina World

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The magazine for the marina industry

Stand 05.200 Full range

Stand 05.200 Full range of floang systems Marine Dock Drive on Dock Roto Dock www.dockmarine‐ dockmarine gmbH A‐3435 Neusiedl, Hauptstraße 13 • Tel. +43 2272 729 29 • office@dockmarine‐ •

MARINA MANAGEMENT & INVESTMENT Brett Bolton Optimising an asset class property If managed correctly, marinas can be a sound investment. Brett Bolton of Coriolis Marine gives pointers on what to look for when buying, operating or preparing to sell. Surely, running a marina can’t be that much different to running a pie shop, hotel or car park? Although I wouldn’t try to guess what challenges are involved in those businesses, I do know that I would never look at any marina and assume I know everything there is to know about that business or the market it attracts. Marinas are quite a unique asset class as they are typically operated on government land or seabed, have strict permitted use zoning requirements, sit in an aggressive environment and have many business facets. These may include wet berths, dry storage, haul-out and service, retail and marine tenancies, hotels, and food and beverage offerings. Each of these elements is a business in its own right and requires different techniques and approaches if all the opportunities are to be maximised. The most successful marinas are usually those that can tie all the elements together to coexist and enhance each other. If you are lucky enough to operate a freehold marina, you are off to a great start as the number one risk in your business – tenure - is eliminated. Having mostly operated marinas through a head lease on government land, I know first-hand how this issue can continually jeopardise your business through rent reviews, end of lease renewal or change in government policy. Without certainty around tenure and rent payments, it is difficult to hold property valuations, obtain funding and reinvest in the property. From an investor’s point of view, investing in a commercial or residential development on freehold land is a much easier and lower risk proposition than owning and operating a leasehold marina. In simple terms, building developments have a lot more known factors, fewer community and environmental objections, and you can cash in on your investment in a reasonably short timeframe. Marinas are typically longer holds as making changes through the government approval frameworks and building up the business can take time. Why bother owning a marina I hear you ask? Barriers to entry is one answer. Once you have one, you will typically have a sound income that can’t be threatened by a competitor popping up next door without notice. New greenfield marinas in established populated areas are becoming more and more difficult to get off the ground as any vacant waterside land is being quickly rezoned to residential as governments or private owners cash in on residential developments. And one thing that also often gets missed in the blinding headlights of the dollar signs, is that smart planning principles that activate the waterfront for public use such as marinas, deliver great community outcomes and can greatly enhance the unimproved or improved land values. Facilities such as Scarborough Marina (above), one of Brisbane’s premier boating hubs, benefit from sound management. Right: good and not so good? Well presented docks make for happier customers and give a better impression if you are trying to sell the marina. - November/December 2018 47

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