THE MULTIHULL COMPANY Newsletter

In This Issue

Analysis of the New and Used Catamaran Market

The Annapolis Boat Show

DYC's Annapolis Boat Show Specials

DYC Opens Base in New Caledonia

Life as Explained by an MBA Student

Dream Yacht Charter North America Announces Fantastic Annapolis Bareboat Charer Specials

Dream Yacht Charter North America is pleased to announce exciting charter specials available to clients at the Annapolis Boat Show on October 8 - 12.

All new charter clients will receive 30% off all bareboat charters booked at the show, and 15% off all bareboat charters booked by October 31st. For more information, read below.

Featured Multihulls

2006 46' Dolphin 460 $599,000

2007 82' Nautitech Cabin Charter €850.000

2007 73' Executive 73 $2,400,000

2010 65' Dolphin Day Charter 650 €950.000

2006 60' Fountaine Pajot Eleuthera $1,500,000

2008 60' Fountaine Pajot Eleuthera €895.000

2004 57' CNB Lagoon 570 €750.000

1997 56' Fontaine Pajot Marquises $599,000

2005 52' Catana 52 €875.000

2001 50' Horizon 50 €450.000

1992 48' Privilege 482 $399,000

1999 47' Catana 471 €355.000

2010 47' Catana 471 €399.500

2007 46' Custom Catamaran $295,000

2005 46' Dolphin 460 $550,000

1998 46' Fountaine Pajot Bahia $345,000

1998 46' Fountaine Pajot Bahia €200.000

2003 44' Dean 440 Space €325.000

2001 44' Privilege 435 €340.000

2001 43' Catana 431 €300.000

2001 43' Fountaine Pajot Belize $182,000

1996 43' Nautitech 435 €199.000

1998 42' Custom Woods Nimbus 42 $175,000

2003 41' Lagoon 410 S2 $229,000

2001 41' Lagoon 410 €250.000

2005 41' Lagoon 410 €224.000

1988 40' Condor 40 Trimaran $135,000

1996 40' Norseman/Voyage Norseman 400 €139.000

2007 40' TRT 1200 CR and GT catamaran $350,000

1997 38' Fountaine Pajot Athena $199,000

2001 38' Fountaine Pajot Athena €147.000

2003 38' Leopard Owner Version €164.500

1995 37' Lagoon $145,000

1974 36' Custom Piver Lodestar 36 $13,500

2007 36' Jaguar $266,000

1995 35' Cross 34 $75,000

1994 35' Walter Greene 35 $123,000

2008 34' Performance Cruising Gemini 105MC $179,500

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Hitting Bottom: An Analysis of the New and Used Catamaran Market

By: Phillip Berman, President, The Multihull Company

Flying back from the Cannes Boat Show, as our team had already started to prepare for the Annapolis Boat Show, I was pleased to see that our economy appears to be bouncing back. How well I recall preparing for Annapolis last October as the stock market was plunging, wondering if anyone would show up at all. So much has happened since then in the catamaran market that it can be difficult for buyers and sellers to keep track of the current trends. So here are the trends as I see them today:

THE NEW CATAMARAN MARKET

Catamaran builders over the past year have experienced the most significant contraction on record. The vast majority have had to cut back production by as much as fifty percent in order to survive. The good news is that the new catamaran market has begun to move, but most of the growth remains in the high-end market, catamarans over 50-feet. At Cannes, where Couture is De Jour, one could not help but be struck by the large number of new mega-cat entries. Fountaine Pajot has launched a new 65, Lagoon a new 62, there were two new 70-footers launched by Boutique French shipyards, and there was a new 58 footer from Hong Kong. And of course Sunreef and Privilege were also at the show with their lovely 60 and 70-footers. All of these yachts were selling for no less than 1 Million Euros, or about 1.4 Million Dollars. But most of them, well equipped, were 2 Million Euros and up. What has obviously occurred is that the high-end market has seen the smallest sales contraction not only because there are still plenty of high-end buyers with cash, but because builders would prefer to sell two to five large cats a year rather than twenty smaller ones to earn the same profit.

The other thing I've noticed is that many of the buyers for these big cats are converting from power yachts. They are drawn to the new fly bridge designs and the interior luxury they are used to, as well as the stability and economy of operating a large catamaran compared to a motor yacht. Most of these buyers are employing a full time captain and crew to operate and maintain their catamarans as many of them, quite honestly, have little or no sailing background.

That is not to say that the major builders have abandoned the middle-market entirely. At Cannes, several new smaller entries were introduced. Fountaine Pajot brought forth the new Lipari 40, Lagoon a new 40, Catana introduced the new Catana 41 and 47, and Outremer exhibited for the first time their new 49 footer.

What has become obvious, however, is that the middle to upper-middle class market that had been so strong over the last decade in both Europe and America is getting squeezed a bit in the new catamaran market. Unless you have at least $500,000 to spend you will likely not be getting a new catamaran, unless it is very small. The builders are increasingly catering to the very wealthy to make up for the shrinking market in smaller catamarans.

THE USED CATAMARAN MARKET

The market was limping along until May of this year, but has picked up with a vengeance over the past several months as brokerage buyers have stepped back up to grab the few remaining bargains from motivated sellers. Sadly, for American buyers, the weakness of the Dollar against the Euro and many other currencies is making it harder and harder for them to purchase the catamaran of their dreams. Many Americans are having to get smaller boats than they want, or lower quality boats, as brokerage prices in Dollars are trending up, rather than down, especially for owner version cats 42-feet and up. Our brokers are now servicing a wide range of foreign buyers who are coming to America to take advantage of our weak currency. Aussie's, South Africans and Europeans are all ready and willing to cross oceans to take advantage of better deals.

So where is the brokerage market headed? I suspect that what we are experiencing now is a strong up-tick that will level off a bit in a few months. I believe the recent flurry of buying activity is coming from the serious sailors who are not going to postpone their happiness or allow fear to get in the way of their dreams. They sat on the sidelines to see where things would shake out, and decided that the market had hit bottom and it was time to buy. And to some extent I think they are right. It is the same reason I recently bought a condominium in Ft. Lauderdale for our company. If we are not at the bottom, I think we must be darn close to it.

All this said, the only buyers in the market are buyers who want a good deal, expect a good deal (Not, forgive me, that many buyers know exactly what that is, hence the 40% offers we get that always go nowhere). Catamarans that are overpriced are not moving. To the Aussie or the European, the Dollar sellers are looking very attractive now. To the American, who is perhaps not well schooled in the catamaran market, the prices just appear to be going up. They are not going up in Euros, but they most certainly are going up in Dollars because a catamaran, as I have long counseled, is very much a floating Euro.

Do I see us moving towards a seller's market in the near future? No. Do I believe we have hit bottom? Yes. And that bottom has settled, as I predicated some months back, about 10% off what catamarans were selling for 12 months ago. As regards X-charter boats, this market remains softer, due to an oversupply of four-cabin, four-head boats that are not strongly sought after by personal voyagers.

If you are an American, keep a careful eye on the Euro. If the Dollar slides even more, and inflation kicks in, plan on paying more for a new or used catamaran in the months ahead. If you are a foreign buyer, beware that there are a limited supply of Dollar sellers and that those who have already priced their boats properly are selling them rather quickly now. Inventory in the United States and the Caribbean, at least for clean owner version cats, is thinning out already. This may, over time, exert upward pressure on brokerage prices.

If you are a European seller, and have not lowered the price of your boat, do not expect it to sell anytime soon. If your yacht broker is not advising you to lower your price, plan on keeping your boat for awhile. At the present time European sellers are losing the American buyer and therefore a significant buying pool for their yachts. The catamaran market is global, and wise buyers will happily cross oceans to pick up the best deals.

Hoping to see you at Annapolis, and wishing you the very best,

Phil Berman
President, The Multihull Company

The Annapolis Boat Show

The Annual Annapolis Boat Show is right around the corner. The show opens on October 8th and runs through the 12th. Look for The Multihull Company red and white tent on Dock C. On display in the water will be a 2007 Catana 50. Phillip Berman, Alexis de Boucaud and Darrel McDaniel of the Florida