Put in: Marinas are tightly-held across Sydney, mostly by private owners. Photo: Rick StevensThe Woolwich marina has been placed on the market at a time when demand for berths is on the rise as more people look to invest in pleasure craft.
Marinas are tightly-held across Sydney, mostly by private owners, with the exception being the d’Albora at the Spit, which is owned by the listed Ardent Leisure group.
In its half-year report to December 31, 2014, Ardent Leisure, said the Marina division recorded total revenues of $11.2 million for the period, in line with the prior year.
The earnings before interest, depreciation and amortisation was $5.1 million, reflecting a 2 per cent increase on prior period EBITDA.
An operating margin of 56.5 per cent was achieved against prior period margins of 55.7 per cent and was assisted by an overall improvement in portfolio occupancies to 85 per cent.
While a marina berth starts at about $1 million in the key Sydney Harbour berths, dry docks and regional centres are providing returns of more than 8 per cent per annum.
Agents have said there has been a rise in demand to own such a property as a landlord and rent the berth to boat owners, in a similar way to a commercial or residential asset.
Jeff Moxham and Rod Smart of Ray White are advising on the Woolwich sale, and said there are 270 berths, generating an income of about $417,000 per annum. Mr Moxham said there was a potential fully-leased income of about $671,000 per annum.
The vendors, Greg and Liz Newton, have owned the marina for the past eight years.
“Increasing demand and limited supply of Sydney Harbour marinas has strengthened demand for pontoon berths and waterfront marina use land,” Mr Moxham said.
“This property will almost certainly sell to a marine enthusiast.”
The Woolwich marina currently operates under a new 40-year lease, from April last year, with the NSW Roads and Maritime Services, and has vessel maintenance facilities on site. The deal also includes the adjoining apartment.
Mr Smart said there was also potential for other residential development.
Brock Rodwell of Ray White Marine said overseas and local investors are expected to view the site, particularly those in the yachting business.
The director of metropolitan investments at CBRE, Tim Grosmann, said recently that marina assets are typically pursued by sophisticated investors – rather than small-time investors – especially given the complexities involved in this style of property.
“Marinas are generally located on leasehold rather than freehold land and the leasehold periods are typically around 30 years, so it’s vital to have a good knowledge of the fundamentals,” Mr Grosmann said.
“We typically find that these types of properties are acquired by sophisticated investors who have some form of involvement in the maritime industry.”
The near embargo on the large-scale marina development in Sydney has also led to a scarcity of berths, which agents say has fuelled the price rises in recent years.
Additionally, marinas are facing increasing barriers to expansion and in some instance even repairs and upgrading of facilities.
According to industry figures there are more than 800,000 boats registered in Australia, with a further 100,000-plus not registered, being under repair or renovation.
Mr Rodwell said a recent survey of the marina industry showed that it provided permanent and casual employment for 15,900 employees (excluding contractors) and generated gross revenues, including rents, of $1.65 billion.
This story Administrator ready to work first appeared on Nanjing Night Net.