Demand for super yachts up despite downturn

Signs of a slowdown are a little less evident where upscale boats bob in the sun at the Sentosa Cove marina.

Luxury yacht charters for corporate events and wedding banquets may have fallen 10 per cent over the last few months, but demand for super yachts has risen, said Mr Brian Werner, general manager of the One Degree 15 Marina Club.

"Ironically, there are financial institutions that are requesting larger vessels - they want yachts that can handle 50 to 200 people in the water and there are not too many such yachts in Singapore or in Asia at this time," he said.

The club works with all the major banks here, which like to arrange classy seafaring experiences to reward their private banking clients and woo wealthy customers.

The super yachts in the fleet - those that are at least 25m to 30m long - have helped offset slower bookings in the mid-range segment, where other corporate clients have become "more price-sensitive", said Mr Werner.

"As corporations do need to tighten their belts, unfortunately the first thing that goes is usually (the budgets for) team-building, dinners and dances, those types of events."

The wedding and banquet business has also dipped, he said: "Young couples getting married are shopping around more than they ever have for their venue, with budgets and pricing in mind.

"We've had to adjust menus and pricing, just like any of the other hotels and restaurants are having to do today."

Nevertheless, One Degree 15 Luxury Yachting has doubled its charters every year since 2012.

The club business has also held its own, thanks to some outstanding demographics.

One Degree 15 Marina Club, which sells a marina lifestyle across the region, has a self-imposed limit of 4,000 members, 55 per cent of whom are directors or owners of their own businesses.

Six in 10 members live in properties within the central district, on top of earning $100,000 or more a year. At least one in four members is an expatriate.

And there are larger trends than the business cycle that are driving the yachting business here, said Mr Werner.

One trend is the rise of Asia's newly rich. Another is the transfer of wealth from the first generation of entrepreneurs to a second generation that is more willing to splurge.

"That transfer in wealth is just starting; we haven't even hit the tip of the iceberg yet," said Mr Werner.

A version of this article appeared in the print edition of The Straits Times on October 12, 2015, with the headline 'Demand for super yachts up despite downturn'. Print Edition | Subscribe