Selling Cakewalk hasn’t been quite as easy as her name would suggest.
The 86-meter luxury super-yacht with six sundecks, a baby grand Steinway & Sons piano and vast Italian marble his- and- hers’ bathrooms has been on the market for three years. To ease the task, her sellers gave her pride of place last week at the Monaco Yacht Show and dropped her price to 119 million euros ($151 million), a fifth less than in 2011. The bait may work.
“The market is moving again,” Jonathan Beckett, Chief Executive Officer of brokerage Burgess, said in an interview on deck. “We’ve got a number of interested parties.”
The discount on Cakewalk and renewed hope for a sale illustrate the cyclical nature of the yacht business, which is intimately linked to the fortunes of the world’s biggest spenders. After a protracted slump that followed the 2008 financial crisis, the market for the biggest boats is improving, shipbuilders, brokers and outfitters said at the annual trade fair in the sun-drenched Riviera city state.
The drying up of new-yacht orders during the downturn was followed by a period of lower prices and even fire sales for second-hand, mid-range models. The adjustment to Cakewalk’s asking price indicates that even the top end of the market wasn’t spared. The tide is now turning with shipyards boasting new orders for the biggest models and prices hitting bottom.
“The U.S. market is coming back,” said Robert Moran, president and founder of Moran Yacht & Ship based in Fort Lauderale, Florida. “It went very quiet for a while because it wasn’t seen as being politically correct to own a yacht but these guys are back.”
This month, he brokered an agreement for a 112-meter super- yacht code-named Project Palo Alto to be built by Lurssen Werft GmbH for a “long-time charter client.” With two helicopter landing pads, a 12-meter swimming pool, four tenders and a submarine, the deal has helped make this year “a record” in terms of sales for the brokerage, he said.
The yacht industry works hard to keep transaction prices and owners’ names secret. While Moran declined to discuss the identity of the person behind Project Palo Alto, the Californian city name evokes present or past ownership of super-yachts by Silicon Valley tech billionaires like Microsoft Corp. co-founder Paul Allen’s 126-meter Octopus and Oracle Corp. founder Larry Ellison’s 138-meter Rising Sun.
The number of super-yachts sold during the first six months of 2014 rose 35 percent compared with the same period last year, according to figures provided by brokerage Camper & Nicholsons International to Bloomberg News. In dollar terms, the increase was 29 percent to $2.1 billion.
Last year, 159 orders were signed for new boats compared with 152 the previous year and 141 in 2011, according to the brokerage.
It tracks shipyards as well as the business of buying, selling and chartering motorized and sailing yachts measuring more than 24 meters.
For the biggest models, shipbuilders remain cautious about an upswing in the market because of political uncertainty in Russia and the Middle East, from where owners of some of the world’s largest boats hail. What is certain is that super-yachts are becoming more super-sized.
Of the top 10 largest in the world as tracked by Superyacht Times, seven were delivered over the past decade, including the 180-meter Azzam, the record holder. Half were built by Lurssen, which has made this market a specialty. Others, like Italy’s closely held Azimut-Benetti moved into building boats stretching more than 80 meters to hang on to customers.
“Now we have three under construction so that’s proof it’s a growing market,” Vincenzo Poerio, CEO of Benetti, said in an interview in Monaco. He estimates about 10,000 people worldwide could afford to buy one of these floating mansions and about 700 are currently “interested in yachting.”
Among the top three largest super-yachts on display this year in addition to Cakewalk was 85-meter Solandge. Delivered by Lurssen last year, it can be chartered for $1 million a week plus expenses. A tour of both proved yachts, like homes, reflect the personal taste of their owners.
The bling of Solandge’s 16-meter gilded “Tree of Life” sculpture lit by more than a thousand bulbs set on glass flowers was in stark contrast to Cakewalk’s classic wood panelling and Wedgewood dining settings. The curtained “cuddle” bed near the upper-deck bar and columned Garden of Eden-theme master suite also set it apart from the nautical feel of Cakewalk’s Mexican mermaid mozaic.
“There are only a handful of people worldwide who at any one time are actively looking to build the biggest boats,” according to Robert Tan, sales manager of Oceanco, the Dutch shipyard that built the 91.5-meter Equanimity, the largest yacht on display at Monaco this year.
By the close of the Monaco show, Cakewalk was still on the market.