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Why
Dockominiums? Why convert working marinas to dockominium resorts.... Dockominiums, Rackominiums, Resort Marinas and Waterfront Properties can be a smart investment alternative for today's informed buyer. High demand and limited availability have historically provided the perfect scenario for a solid investment opportunity. When underdeveloped properties with the right ingredients for conversion to resort marina, dockominium or rackominium can be obtained at a reasonable price.... substantial returns on investment can be realized over a typically short period of time. Value Proposition for Boaters: In many areas, the value proposition for the prospective slip buyer is very attractive. In some instances, cost of ownership can equate to a monthly mortgage payment that is comparable to a current monthly rental amount and in some instances even less. In exclusive areas of high demand and extreme slip scarcity such as Ft Lauderdale or Key West, the cost of ownership less likely to equate to a lower monthly payment based on capital outlay alone. The property values have appreciated so rapidly that the rental market is typically 2 to 3 years behind. The value in such areas will have to be derived from a combination of equity, appreciation, tax benefits and rental income (if desired). In any case, there are generally more compelling reasons to own, than to lease real property. In over 90% of the U.S. and Caribbean market, the rate of appreciation for wet and dry slips; and ability to build equity is abundantly clear. Additionally, the typical dockominium/rackominium mortgage is between 10 and 20 years, with much less capital going towards interest than a conventional 30-year home mortgage. Depending on how an indvidual uses the property, the interest on the mortgage may also be deductible providing even greater value. Loss of Inventory: Thousands of slips and racks have been lost in the past several years from the Gulf Coast of Texas, north east to Chesapeake Bay and to the furthest southern boundaries of the Caribbean. Along with the slips and racks that have been lost, so have the services and amenities that surrounded them, never before has the demand been greater for full service dockage. Security & Public Access: Rebuilding or expanding marina facilities and converting them to private ownership insures that a marina "dockominium" facility will remain a "marina" in perpetuity. It is removed from the prime marketplace of potential future developers. It would be extremely difficult for a future developer to come up with a business model that could afford to buy out each individual boat slip or boat rack owner so that the property could be redeveloped for another purpose. While nothing is impossible, it is highly improbable and is one of the best strategies for protecting marina properties and insuring public access to the water. Typically, 40% to 50% of a dockominium / rackominium marina's slips are owned by investors who lease their slips to the public and receive the rental income and appreciation in a later sale. There is always public access in a privately owned "subdivided" marina. Restricted Development: With increased and highly restrictive local, state and federal regulations controlling the development or expansion of new marina slips is improbable or impossible in some areas and a very long and expensive process in others. The prospect of marina development in most dense population areas is already predominantely limited to the redevelopment of existing marina basins restricting the supply of docks. Deed Restricted Communities: In recent years, it has become a common practice for developers, home owners associations and town boards to regulate the use of private lands through deed restrictions. The most typical form of deed restriction is focused on maintaining asthetically pleasing neighborhoods to keep property values strong. Most of these restrictions are storage or appearance related... they may not allow the storage of RV's and boats on residential property and they may not allow certain colors of exterior paint or may restrict certain types of fences and structures such as storage sheds. With more and more people moving closer to coastlines, deed restricted communities that do not allow the storage of boats, trailers and RV's greatly increases the demand for alternate boat storage facilities. Coastline Residency Trend: Up until the mid 1960's when the nation was industrialized, waterfront property had a negative connotation... usually dirty, ugly, contaminated industrial property. As the nation became more environmentally responsible and industry was pushed away from our waterways the transformation began. The push to waterfront living has been fueled by the revitalization of waterfront property, our nations' affluence, the love of water dependent recreation and the abilities of more families to participate in ownership of personal vessels. Demographers have long predicted that 80% of the country's population will live within 50 miles of a coastline (inlcuding lakes) by the year 2020 (A).
How we develop our properties.... Newly acquired marina properties are converted to individually owned slips and racks. Amenities and services are added to create world-class marinas and an environment conducive to long-term ownership. The marina properties are professionally managed, landscaped, artistically lighted and as complete a recreational amenity package as the property can support. Unlike many of today's typical waterfront developers, where recreational waterfront property and working marinas are developed into their maximum density of residential condos; where restaurants, mechanical services and recreational amenities are eliminated and public access to the water is restricted through privatization of its facilities....our strategies are much different and much healthier for the developed property and the surrounding community. This does not mean that all residential waterfront developments are undesirable, but one should be sensitive to the value and continuity of each project. It is not too difficult to find a southern luxury waterfront condo development that now occupies the land that once supported a working marina AND whose units are primarily owned by first-time investors instead of the people who they hoped would be living there. Local boaters are typically priced out of these developments and not enough attention has been given to meeting the needs of the market they thought they were buidling for. In these cases, accompanying boat slips while badly needed by the community, in some instances are even unoccupied. We believe that a marina without quality services is like pancakes without the syrup.... Properties that are privatized and without services quickly lose the ambiance and functionality that made them desirable, appealing locations to begin with. Whenever a marina or marina services are lost to privatization, the very industry we are serving and are trying to preserve, is adversely affected. Jobs are lost, the community is alienated, boaters are displaced and the problem for the industry is exaggerated. While this is a factor in driving property values higher and higher - we do not feel it to be in the best interest of the communities that they are in, nor to the future of recreational boating. We believe our strategy provides a better solution and value for everyone. Our goals are to substantially improve the quality of services and amenities for each property we purchase or CO-venture. We strive to make each property a world class "destination" worthy of its slip owners, condo owners and transient guests. By developing a full service boating "community" the local tax base is broadened, skilled labor jobs are preserved, public access is protected and good will in the community is affected. At the same time, the marina will continue to thrive and prosper as an active participant and provider to the boating community at large. Each marina contains various income centers such as restaurant, lounge, retail space, service centers, transient dockage, etc. that can be owned by the marina association, retained by the marina partnership or sold on the open market. A beautified, thriving marina with quality services, a pleasant atmosphere and a good reputation, is a place that boaters like to be. That equates to healthy revenues and high occupancy rates. It is a community that will make the most sense to consider ownership in if value and income potential are important.
Footnotes:(A) http://www.thebrunswicknews.com/front/286076207861488.php Marina Owners - Developers - Investors Visit our main website at |
