Commissioned by a Russian billionaire and ultimately delivered to a powerful, Middle Eastern family, the 110-meter Radiant did more than just mezmerize anyone who sees it. Its build and subsequent sale became a breakthrough public case and enlightened many as to the actual costs in building a megayacht and the processes of selling one.
In early 2004, the late Boris Berezovsky, one of Russia's most influential billionaires, set out to build a 110-meter yacht at Lurssen to be called Darius. After some negotiation, Berezovsky decided to build the yacht, which would cost him €148,540,000, which were payable by installments plus interior fitting costs.
Whereas the size and volume of the yacht is impressive, the most fascinating element of Darius' story lies in the fact that due to public litigation that followed, it became actually known, how much does it cost to build a 110 meter superyacht at Lurssen, a figure that had previously only been estimated and hypothesised. Understandably, every project of this scale is different, however, even a range was difficult to obtain at the time.
As the economic crisis hit, Berezovsky was unable to pay his seventh installment of €23,890,421 in May 2008 and decided to put the yacht on the market as a yacht that was still in construction. The Russian billionaire then contacted brokerage firm Edmiston to sell the yacht and a target of €300 million net of commission and fees was set for the sale.
Whereas in today's economy selling a yacht for nearly double its original building cost may seem to be unreasonable, at the time, it was a common occurrence. Yachts that were ready immediately were considered more valuable than those that still had to be built. This led to many speculation builds and an era of yacht flipping that was sunset by an oversupply as of the early 2010s. In the megayacht market this still exists as one would have recently seen with the sale of the 134-meter Serene to a Saudi Prince for an amount higher than building costs by Russian billionaire Yuri Scheffler.
As is common in the yachting sector, Edmiston contacted Merle Wood, another powerful yacht broker, to help them find a buyer for the 110-meter yacht still under construction. In turn, Wood contacted the captain of a yacht owned by the Al Futtaim family for him to offer this deal to his employers. The captain agreed to do this, asking for a €3 million commission should the deal go through.
Whilst such a number may appear unreasonably high for a simple introduction, it is common in the yachting industry, which works mostly on commission, to have every middlemen involved in the transaction get a percentage of the deal. In this case, €3 million would equate to less than one percent of the total, advertised sales price. For the sale of smaller yachts, brokers routinely take a 10% cut of the total amount.
In July 2008, the Al Futtaim family decided to seriously consider a purchase of the yacht, which led to Edmiston meeting with Berezovsky and agreeing on a 2.5% commission if a net price of €300 million was achieved. After visiting the yard, the Al Futtaims, however, decided that they would rather not deal with brokers and that they would rather deal directly with the owner.
In situations with such high sales prices, it is not uncommon for sellers and buyers to want to deal directly with each other as opposed to with brokers and save on fees. When the broker was the one to introduce the client, this becomes, however, more complicated as to how commissions should be given out. A case that the Darius sale set a precedent for.
At the end of August, the Al Futtaim made an offer of €210 million for the purchase of the yacht. After negotiations, the final price went up to €240 million. By October the deal was closed and the €240 million paid. As these negotiations were held directly between the buyer and seller, Berezovsky decided that Edmiston was not entitled to a commission, a point with which the brokerage firm did not agree.
As a result, Edmiston initiated proceedings in UK courts in 2010, through which the details of the construction and sale of Darius became known, shedding a light as to how such processes take place. In July 2010, UK courts ruled that Edmiston was in fact entitled to a commission of €7,2 million, ie 3% of the sales price. An amount, which Berezovsky appealed.
In trying to assess whether a 3% commission was a fair market rate, more interesting evidence from the yacht brokerage world emerged. Berezovsky had also engaged YachtZoo and Royal Oceanic to find buyers for Darius at rates of 3% and 2.5% respectively. It was also disclosed that a commission of 4% was paid for the sale of Pelorus, a sistership to Darius, which sold for $150 million in October 2003.
The proceedings helped clarify for the industry as a whole the effective broker commission on the sale of larger superyachts, as opposed to the common 10% on the sale of regular sized yachts in the sub €10 million range. On the sale of the 78m Princess Mariana, for example, a 4% commission was paid. In the end, the court agreed to a 2.5% commission for Edmiston for a total of €6 million on the sale of Darius.
A close sistership to the 110-meter Pelorus, famously acquired by Roman Abramovich, Berezovsky's former business partner and the 110-meter Ona, built for Alisher Usmanov, Project Darius remains one of the most significant yachts on the water to this date. The series built on this 110 meter platform remains one of the most successful and emblematic for the German shipyard, which has since been able to build even larger yachts.
Few elements are known as to what amenities Darius, or Radiant as it is now named, has on the inside. Exterior photos show a helipad up on the aft of the yacht's fourth deck as well as an extensive lounging area aft of the yacht's third deck. A beach club and swimming platform can also be found aft of Radiant's lower deck.
Historically one of the most influential and powerful Russian oligarchs, the late Boris Berezovsky started his business career selling Soviet-made cars and foreign cars in 1989 after initially working in scientific research. He first built up an equity in Russian car producer, AvtoVAZ and later gained control of ORT Television, one of Russia's most popular television channels. Together with prolific yacht owner, Roman Abramovitch, he acquired a majority position in Sibneft, a Russian oil company, which constituted the bulk of his net worth.
Valued at $3,3 billion by Forbes, Abdulla Al Futtaim is the owner of the Al Futtaim Group, which is operated by his son, Omar. The exclusive distributor of Toyota and Honda cars in the UAE, it also owns the country's largest insurance company, Orient Insurance.
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Italian builder Overmarine Group has announced the sale of the fifth hull in the Mangusta 110 series. The previous one had been sold to a European client back in 2017 and successfully launched in the beginning of 2019.Mangusta’s Commercial Director Francesco Frediani stated:This sale is the result of great teamwork. The Owner is an American who already knew our brand but fell in love with it while spending his summer holidays in the Mediterranean Sea. Mangusta’s network closely cooperated and played a vital role in this important achievement.Mangusta 110 boasts an extensive flybridge that is able to house a second helm station. The main deck has a forward lounging area and a vast space aft with a spa tub, which may be converted into a sun pad. The semi-customizable interior layout offers accommodation for up to nine guests across four staterooms.The vessel is powered by MTU 16V 2000 M96L engines, which push her to a maximum speed of over 33 knots. Her limited draught of 1.70 meters meanwhile makes her very suitable for the havens of Florida and the Bahamas, where cruising in shallow waters is essential. The vessel comes with water-jet propulsion, enabling her to glide elegantly and noiselessly on the water. Furthermore, there is a gyroscopic stabilisation system on-board, ensuring comfort both at anchor and when cruising, as well as at lower speeds. Easy to manoeuvre by joystick, the yacht is fitted with the dynamic positioning function, to maintain a set position by interfacing with the GPS system and the anemometers installed on-board. The second control station lays on the sundeck.The fifth unit of the series will feature a typically American layout. The Shipyard’s Interiors Department is already working with the owner to select furniture and décor. The completion and delivery are expected in 2020.
November 20, 2019
When one intends to buy a yacht, sooner or later they will come across yacht brokers. A bad broker would opt for selling their yachts by all means, while a good one could even dissuade a customer from buying a vessel instead. Yachts’ maintenance costs sometimes are so high, that it might be easier to confine to chartering. Still, in any case, it is important to first try several different yachts on charter before buying your own.The largest international brokers such as Burgess, Fraser, Moran Yachts & Ship, Edmiston and several others act as central agents of the «best» yachts: they manage them, select the crew and sometimes oversee the construction. However, one can book a yacht even through a small company, if it has the appropriate certification. Below, you will find 9 significant steps to consider prior to buying a yacht.#1. Define the goalFirst of all, one has to define answers on such questions, as: why they need a yacht, where they are going to use it, whom they are planning to invite on-board, whether there will be children among the guests and many other issues. That is where the information about a customer, his or her tastes and lifestyle matters. A good broker would have a detailed conversation with a potential buyer, even asking some rather personal questions. Ideally, they should spend with a customer several days to understand how they dress, what kind of car they have, where they prefer to have dinner, how social they are etc. Those things are crucial as a yacht represents a continuation of her owner’s personality. Like your own home, it may or may not be suitable for parties, sports, the presence of children, it may be chamber or large-scale, high-speed or slow-moving, with or without a helipad. Dozens, if not hundreds of details, will affect the final choice, and the cost here is by no means the main criterion. After all, you can find a yacht at a comfortable price, but she may not suit you at all.#2. Set the styleFirst, it is important to understand whether you need a sailing or motor yacht, since these are two fundamentally different styles of yachting. Usually, those who prefer to be closer to the water, lead an active lifestyle on the yacht, delve into the nuances of management, seek to obtain a captain's license and are interested in sails. Those people in the first place can be called yachtsmen. On the contrary, motor yachts, even the fastest ones, are floating boutique hotels, where the owners will be served at the highest level. As to sports racing yachts, they are not generally suitable for recreation.It should be noted that in the sailing segment, not all yachts are the same. For example, superyachts above 40 metres, produced by such builders as Perini Navi, are not inferior to motor yachts either in design and comfort, or in high-technology equipment. They might even outperform motor yachts of the same size in price. #3. Consider your lifestyleHow and with whom do you want to spend time on a yacht? For parties, one would need large open spaces, and it would be nice to have a Jacuzzi or a pool with a backlight. Naturally, a yacht must come with built-in audio and video systems and wireless Internet. For gambling, you would need a special zone. If you like cooking, a yacht should have a specially equipped separate kitchen. If you plan to invite parents to the yacht, you need to make sure that there is a VIP suite on-board. If the yacht has three or more decks, older people will need an elevator. If you have children, the system of fences is crucial so that they do not fall overboard or on the lower deck, plus a cabin for the governess should be provided, etc.#4. Think over your activityThere can be many different nuances, but there is something that almost everyone pays attention to: a garage with tenders and water toys on a yacht. You would need a tender in any case. Furthermore, it is good to have the yacht equipped with everything for diving, snorkelling, water skiing, "sea-beans", jet skis and other toys. Many yachts also come fitted with a fitness deck, which usually comprises a gym, massage room, hairdresser, sauna and hammam.#5. Choose the right crewNaturally, owners of yachts assemble the crew according to their own requirements, and the crew is not less important than the yacht itself. Not only should they be sociable people with an understanding of the service, but they should also meet special requirements. For instance, it is important to consider whether a cook is good on a yacht and what exactly he or she can cook. A professional broker would be aware of such things as if there is a massage therapist, yoga and diving instructor on-board and what languages the team speaks. A broker would either know the invited crew members personally, or do a decent research on them in advance. #6. Get directionsIt is important to decide whether you are planning to live on-board during your vacation. For example, if one has a villa in Forte dei Marmi and wants to take a short trip to Corsica for a day, a small 50-60 foot open class yacht or a yacht with a flybridge, with a speed of 30-40 knots. At the same time, if you plan to go on a cruise from Saint-Tropez to Portofino, to Corsica, Sardinia or Sicily and back, then for a two-week trip you would need a comfortable yacht of at least 30–35 metres. If the group is big, the size has to be even larger. The speed of such yachts will make only 11-17 knots. However, low speeds save fuel: megayachts making 30 knots per hour require hundreds of thousands of EUR a year for fuel. In addition, high speeds even on the best yachts might not be comfortable: noise and vibrations increase, and it becomes difficult to talk and walk. If you plan to take the yacht from the Mediterranean to the Caribbean for the winter period, she should boast a transatlantic power reserve, to complete the journey without refuelling. And if you are thinking about traveling around the world, you need not only a large cruising range, but also an Explorer class yacht, which can operate under different weather conditions. To cruise to the Far South or North, you need an Ice-class yacht - although not an icebreaker, she would not be subject to collisions with small ice floes.#7. Choose a hullYacht hulls are mainly built of steel, aluminium and composite. Almost all major European yachts builders rely on steel or aluminium, while in American and Asian yachts (except for the largest yachts) composite is used, since it is a lighter material that is easier to care of; it is not subject to corrosion. However, the composite is not suitable for all operating conditions. Owners of megayachts relate to it without reverence: a 50-metre composite yacht would already be an exceptional case. #8. Estimate expensesA yacht should not be taken as an investment, it is a luxury item and not more than that. Moreover, her cost drops by 10% per year. About the same amount should be saved for yearly operating costs, such as parking and repairing expenses, crew salaries and taxes, not to mention fuelling. Meanwhile, if several years ago green yachting was considered uneconomic since environmental options increase the cost of the yacht, now yachting enthusiasts have concluded that eco-yachts save fuel, and, therefore, are cheaper to operate.Step 9. Set the timelineA fully-custom superyacht of above 35 metres, will take up to four years to be built with such yards as Lürssen, Abeking & Rasmussen, Feadship or Oceanco. A faster option is always a semi-custom-yacht of the same size, where a standard hull is used, and the interior is created on-spec for the owner’s needs. Such yachts take about 2.5 years to build and they are 30% cheaper. In that niche, the most famous shipyards are Dutch Amels and Heesen. Serial yachts of up to 100 feet in size would confine your choice to one of 3-5 typical interior options. However, there are many good yachts on the market that the owners sell after 2–4 years of operation, simply because they want a new one Such vessels with clear and proven seaworthy properties can be acquired immediately.The difference in the price of yachts even for one niche is so great that it makes no sense to focus on it. Everything depends on the interior materials, technical options, the name of the designer, and the class of the shipyard. For example, the cost of a Feadship yacht might be twice as large as a Turkish yacht of the same size. Nevertheless, Feadship will far less fall in price over the years.
November 20, 2019
Part of the Ferretti Group, Italian builder CRN has unveiled interiors of its new 62-metre superyacht concept M/Y 138. The vessel born out of collaboration among CRN, Dutch studio Omega Architects (the exteriors) and Pulina Exclusive Interiors, is now under construction at the yard. The hull composition of the new model will feature sporty lines in the signature of Frank Laupman, who is the head of Dutch design studio Omega Architects. One of the key trademarks of the 62-metre is her distinctive zest for the on-board lifestyle.The superyacht will come with sophisticated wall décor. The generous living and dining areas, as well as the owner’s suite and the cabins will reflect an enlightened contemporary living concept, enhanced by chic details, premium materials and a colour palette of very natural tones. Meanwhile, the large windows, such as the 180° glazing in the owner’s suite, flood every room with natural light.The metal hull and superstructure of the new vessel have been already completed, and the ship has now been moved to another location for the interior outfitting, starting with systems and equipment (pipes, cables and insulation), ahead of installation of the furnishings and décor begins. Construction of the 62-metre is running on schedule for delivery in 2021. Besides, CRN is also currently constructing another three fully custom yachts – CRN M/Y 137 (62 metres), CRN M/Y 139 (70 metres) and CRN M/Y 141 (60 metres).
November 19, 2019
Mischief, the 54-meter Baglietto, is now available for charter in Sydney through Ahoy Club. This follows the yacht being transported from the Mediterranean earlier this week. Mischief becomes the largest commercial yacht ever imported into Australia.Photo by @sxmlukeNews of her transport to Australia follows Ian Malouf, her Australian owner, purchasing a 73-meter yacht in 72 hours at the Monaco Yacht Show. His new Lurssen, Coral Ocean is set to continue its charming history and charter excellence through Ahoy Club in the Med after a new refit."It will be the largest commercial superyacht ever brought into the country" commented Ian Malouf. "Mischief will show what seven-star service is all about. It's a good addition to Sydney Harbour."54-metre superyacht was launched in 2006 by Italian shipyard Baglietto and was regularly refitted, with the latest in 2018. With newly painted French Navy hull and white boot stripes, her racy lines cuts a sleek form on the water. Her interiors are just as special - the dramatic use of white reflective surfaces accented with blues and blacks gives her a real sense of identity.Malouf’s interest in yachting goes beyond yacht ownership. Last year, together with his daughter Ellie, after four years of preparation they launched Ahoy Club, a digital marketplace of yachts for charter allowing users to book any yacht, anywhere in the world, for the best possible price by reducing commissions through an improved tech stack, that instantly presents users with the choice of over 3,300 yachts available for charter worldwide. Ahoy also handles yacht sales with reduced fees.Earlier this year, Malouf took his vision for simpler charters and more affordable prices to private aviation, co-founding Central Jets The web platform lets users book flights at direct pricing from owners through a simple €199/month subscription. This has allowed users to save up to 50% per flight. The company guarantees the lowest priced jets in the market.
November 19, 2019
Early on Saturday November 16th, properties at Fort Lauderdale went on fire, leading to destruction of two superyachts, the 49-metre Lohengrin and 32.6-metre Reflections. According to Fort Lauderdale Fire Rescue, the estimated loss from the fire is over $20 million. The city fire marshal reported, the fire broke out at around 4.43am, with loud explosions waking up residents. Allegedly, the blaze started on-board Lohengrin and spread to a neighbouring Reflections. It is understood that the two yachts were under maintenance and refit work at the time of the fire.Reportedly, around 100 firefighters from several agencies were called out to the blaze. Many cellphone videos spread on social media witnessed flames going out, with huge plumes of smoke in the air. However, the fire brigade managed to bring it under control.At the moment, no injuries have been reported. It is known , that the four crew members of Reflections were staying at an Airbnb for the weekend.Fort Lauderdale Battalion Chief Stephen Gollan called the yachts destruction “the biggest fire loss in Fort Lauderdale history.” The cause of the fire remains unknown, with investigation to be conducted.Handout/Fort Lauderdale Fire Rescue/TNSIf the fire does not appear intentional from the video materials though, it might be difficult to detect exact source of the fire due to the extent of damage, fire officials said.Officials from the Environmental Protection Agency also arrived on site on Sunday with view on environmental damage, “to control and contain contaminants into the water,” Gollan said. One of the concerns now is to prevent fuel leakage into the river. However, no active leaks were reported on Sunday evening.M/Y LohengrinLohengrin was built by Trinity Yachts in 2007. She features exteriors by Geoff van Eller and interiors by Scott Carpenter. She offers accommodation to up to 11 guests across 5 cabins. In January 2019, she was sold asking $12 million.Reflections was built by Christensen in 1997 with a GRP hull and superstructure. She can accommodate 8 guests across 4 cabins with an interior design by Merritt Knowles and an exteriors by Setzer. In 2016, she was sold asking $4,295,000.M/Y ReflectionsSun Sentinel media reports, the owner of Reflections, Chip McElroy, was present at the fire scene with his family. He has owned the yacht for over three years and has made many family trips to the Caribbean aboard. Reflections had sailed two weeks ago and was in the Fort Lauderdale marina for annual repainting.
November 18, 2019