Is there a shortage of finance? – Superyacht Investor 2018
Too few banks are financing yachts – this is a sentiment shared by almost everyone in the industry, including banks.
Everything — including new builds, transactions, equity investments — needs investment, but there are only a select few big players in yacht financing.
Superyacht Investor invited four of these banks to the Superyacht Investor London stage to ask about why there is such a shortage of investment.
One of the biggest problems comes from the clients themselves. The average yacht buyer does not want to give the information that banks require to offer financing.
“All the clients we have don’t want to share more than they have to, but the banks need to know the clients’ creditworthiness, what they do, and tax compliance” – said Michel Buffat of Crédit Suisse. “I will not deal with clients who do not have a reputable tax-compliance history.”
Andrew Blundell from Close Brothers also notes that customers tend not to know much about the industry when coming into buy. “They are often unaware of how much they need to spend, even on a small yacht,” he said. “I looking for a professional client who is seeking to learn more about the industry before investing.”
Money is still going into superyachts, banks are seeing good demand for transactions in America, Western Europe, and Russia.
“Demand is also good in Russia” Michel Buffat added. “Around 50% of deals we close are with Russian buyers.”
Delegates think the biggest growth in financing demand will come from Western Europe over the next few year.