I sincerely hope the tax deal between President Obama and the Republicans becomes law and includes the 100% expensing provision for business assets purchased in 2011. This is my Christmas wish! Earlier this week, the President announced confidently that he had reached a deal with the Republican leadership to extended the Bush tax cuts. The deal included a provision to allow businesses to deduct 100% the cost of certain capital goods in full in 2011. This will dramatically help my fractional yacht share business - let me tell you why.
First, an explanation of capital goods, depreciation, and expensing. Capital goods are typically large expensive items that last a long time - such as Cat tractor, or a new assembly plant. Normally, a business expenses or writes-off these purchases over time using a depreciation schedule. So, even though you write a check today, it normally takes years to expensive these items. A write off is simply an expense that offsets income. These assets are depreciated over 5, 10, 20 or 30 years depending on the type of asset. A yacht purchased for charter service is considered "10 year" property and expensed over a 10 year period.
So, here is the good news for the American economy; if businesses are allowed to deduct expenses in full in 2011, they are far more likely to buy stuff in 2011. It takes people to build stuff and that means more employment and, I predict. the beginning of the end of this "great recession".
For Signature Yacht Shares, the ability to write off a business asset would be huge! Instead of waiting around for the "all clear, everything is going to be OK with the economy signal", our yacht owners will likely buy new yachts in 2011 to take advantage of the expensing provision. To be clear, not all yacht purchases will qualify. Only those purchases used in a legitimate business enterprises such as Signature Yacht Shares.
The President described the deal as a "frame work" and says it will be up to the partisan rascals in Congress to create the law that outlines the details of the provision. But, if my Christmas wish comes true, I will wake up earlier Christmas morning, turn on CSPAN, and discover that 100% expensing has become law! Alleluia - there is a Santa!
Saturday, December 11, 2010
Monday, April 26, 2010
Fractional Owners have Bigger Boats
Part 5 in a series of Articles of the Advantages of Yacht Shares
By Matt Condon,
President of Signature Yacht Shares
All things are not equal when comparing fractional yachting to going solo. Fractional owners generally have bigger boats. But, does size really matter?
Many people think of fractional yacht share as a cost-saving alternative to buying and maintaining a boat exclusively. However, a key advantage of fractional is you can own a substantially larger boat for the same dollars. As an example; you can own a share of a 3-stateroom, 58’ Motoryacht worth more than $2,000,000 for about the same cost as a 35’ Express Cruiser. Signature Yacht Shares of Destin, Florida, offers unlimited use of a Viking Yacht for about the price of your typical Sea Ray runabout. The larger yacht has more amenities, is more comfortable to stay aboard, and offers a smoother ride in rough seas.
Larger boats may be safer boats too. For the price of a single engine center console, you can own a fraction of a twin engine boat like the 29’ Regulator or the 32’ Regulator. Twins are considered far safer than a single engine when running offshore. And, for the price of a gasoline powered boat, you can own a share of a safer diesel powered 39’ Tiara Yacht. Bigger boats also have more robust machinery and advanced redundant safety features. As an example: on the 58’ Viking there is a manual engine control system that kicks-in should the electronic controls fail. This kind of peace of mind is priceless.
Not all mariners are old salts. You may discover more friends and family members willing to go boating with you on your larger fractional yacht because they feel safer and more comfortable.
Fractional yacht owners enjoy the benefits of a larger boat for the same or less cost than going solo on a much smaller boat. The additional safety, comfort and prestige are all benefits of owning a larger yacht fractionally. So, the next time you see the yacht of your dreams; don’t assume the owners are wealthier than you, because if it is a fractional yacht, they may be just a little bit smarter.
Thursday, April 15, 2010
Tell Your Banker "No Thanks!"
And say goodbye to that 20-year boat loanWith fractional ownership
Part 5 in a Series on the Advantages of Yacht Shares
By Matt Condon, President
Signature Yacht Shares, www.signatureyachtshares.com
Boat buyers like to negotiate but, really, who wants to pay too much? Buying a boat brings out the best negotiator in all of us - it’s your chance to be like Donald Trump and make the deal of the century. Take it from an industry insider, no matter what price you pay, you are going to pay too much if you take out a 20-year loan. Let me explain.
What a 20 Year Boat Loan Costs
If you take out a typical $100,000 loan at 6.99% for 20 years, that means you not only pay $100,000 for the boat, but will pay another $85,000 in interest. Even if you aren’t financially savvy, it’s clear that this is just plain stupid. Bankers have enough of your money, why give them more? There is a better way. Fractional yachting allows you own a share of a yacht outright for about the same as a typical down payment.
Keep Your Balance Sheet Clean
The 20 year boat loan may negatively impact your finances in more ways that just paying too much. It adds a very large long term liability on your personal balance sheet and another mortgage on your credit report. If, instead, you used your down payment to pay cash for a yacht share, you will save big time. Even if you decide to finance a yacht share purchase, your payments will be so low that your credit limit is hardly touched.
Fractional Ownership Saves in More Ways Than One
Sharing a yacht may not be for everyone, but it has some definite financial advantages. It costs less to buy, less to maintain, and a lot less to own over time. So, my advice to boat buyers is this; “quit worrying so much about the sale price of a boat and instead focus on the total cost.” You may discover that fractional yachting is a compelling alternative. And, in the process you get to tell your banker “no thanks!”.
Thursday, April 1, 2010
Be Green On The Deep Blue Sea
How fractional yachting conserves resources
Part 2 in a series on the Advantages of Yacht Shares
By Matt Condon
President of Signature Yacht Shares
Think about it. The vast majority of boats sit moored in marinas unused for weeks on end. A boat is used on average about 20 days per year according to Boating Industry magazine. They report little variation from region to region. Florida boats lay idle about as much as boats on the Great Lakes. Each vessel takes a substantial amount of non-renewable resources to produce. Does it make sense to expend 100% of a resource to utilize it only 10% of the time? Is shared yachting a more environmentally friendly way to own a boat? Absolutely!
Boats and yachts were constructed of wood - a naturally regenerating material. Starting in the mid 1960s, boats are now constructed of fiberglass, which is a form of plastic made of glass strands and resin. Resin is produced from oil. It takes a lot of plastic to produce a 40’ boat.
A typical fractional ownership arrangement has eight users per boat. So, there are eight people utilizing a single asset instead of eight separate boats. The savings in natural resources it takes to build these boats adds up quickly. If only one boat is built for fractional ownership instead of eight, approximately 100,000 pounds of plastic is saved - that’s about the same as three million plastic water bottles!
There are other resource savings too. Most yachts have two massive diesel engines, each weighing several thousands pounds and made from iron and an assortment of other heavy metals mined from the earth. Yacht share saves the need to produce 14 engines. That in itself is an 85% savings in natural resources.
The yacht share form of ownership is better aligned with the way we live today. It saves money and conserves resources for the future too. So, next time you have the urge to get out on the deep blue water, consider going green and go fractional.
Part 2 in a series on the Advantages of Yacht Shares
By Matt Condon
President of Signature Yacht Shares
Think about it. The vast majority of boats sit moored in marinas unused for weeks on end. A boat is used on average about 20 days per year according to Boating Industry magazine. They report little variation from region to region. Florida boats lay idle about as much as boats on the Great Lakes. Each vessel takes a substantial amount of non-renewable resources to produce. Does it make sense to expend 100% of a resource to utilize it only 10% of the time? Is shared yachting a more environmentally friendly way to own a boat? Absolutely!
Boats and yachts were constructed of wood - a naturally regenerating material. Starting in the mid 1960s, boats are now constructed of fiberglass, which is a form of plastic made of glass strands and resin. Resin is produced from oil. It takes a lot of plastic to produce a 40’ boat.
A typical fractional ownership arrangement has eight users per boat. So, there are eight people utilizing a single asset instead of eight separate boats. The savings in natural resources it takes to build these boats adds up quickly. If only one boat is built for fractional ownership instead of eight, approximately 100,000 pounds of plastic is saved - that’s about the same as three million plastic water bottles!
There are other resource savings too. Most yachts have two massive diesel engines, each weighing several thousands pounds and made from iron and an assortment of other heavy metals mined from the earth. Yacht share saves the need to produce 14 engines. That in itself is an 85% savings in natural resources.
The yacht share form of ownership is better aligned with the way we live today. It saves money and conserves resources for the future too. So, next time you have the urge to get out on the deep blue water, consider going green and go fractional.
Wednesday, March 24, 2010
39' Tiara added to Signature Yacht Shares Fleet
39' Tiara Yacht Joins Signature Yacht Shares Fractional Fleet
Signature Yacht Shares is proud to announce the addition of “Mr. Casey”, a fully outfitted 39' Tiara Convertible to its fleet of fractional yachts managed by the company. The Tiara is based in Ft. Myers Beach at the popular Salty Sam’s Marina and operated by Capt. Dennis Pellicci. Members of the Signature Yacht Shares network have reciprocal access to all boats in the fleet which include a 29’ Regulator, 32’ Regulator, and 58 Viking.
The 39 Tiara Convertible is the perfect "all purpose" yacht. Fish, cruise, or just enjoy time at the dock with your friends - the 39' does them all well. Her cabin layout features an island bed forward for the master with a cozy bunk room for the kids or visiting friends. Plus, the open salon is perfect for relaxing or entertaining. The oversized and air conditioned flybridge features dual Release Marine helm chairs and a large forward facing bench seat.
The crisp and rugged exterior is contrasted by a soft and luxurious interior appointed with sumptuous leather and teak. This beauty screams to be taken out for a private get-away from the world or a romantic weekend sail. It is truly a boat to suit every need.
This $750,000 vessel can be yours for the share price of $79,950. Finance terms are available to qualified purchasers. Maintenance is additional but rest assured that you never pay more than an 1/8th of the cost, saving you 87% as compared to traditional solo boaters. Everything is taken care of for you. No worrying about maintenance or repairs.
Fractional yachting offers an exceptional value proposition. Or, as Warren Buffett says - "Fractional just makes sense." You only pay 1/8th of the usual cost of boating and enjoy a higher-level of satisfaction. Best of all, you’re not just limited to a week or a month… it’s yours, whenever you need it as long as it’s not in use.
The company believes this is a unique opportunity to own a premier yacht that meets everyone’s needs - from a career-oriented professional looking to get-away from the daily grind or a couple or family looking for a weekend on the water. For more information on this vessel, please visit www.tiarayachtshares.net or contact Capt. Dennis Pellicci at (239) 470-3549
For more information about Signature Yacht Shares, contact Matt Condon, (850) 279-6888 or visit www.signatureshares.com
Signature Yacht Shares is proud to announce the addition of “Mr. Casey”, a fully outfitted 39' Tiara Convertible to its fleet of fractional yachts managed by the company. The Tiara is based in Ft. Myers Beach at the popular Salty Sam’s Marina and operated by Capt. Dennis Pellicci. Members of the Signature Yacht Shares network have reciprocal access to all boats in the fleet which include a 29’ Regulator, 32’ Regulator, and 58 Viking.
The 39 Tiara Convertible is the perfect "all purpose" yacht. Fish, cruise, or just enjoy time at the dock with your friends - the 39' does them all well. Her cabin layout features an island bed forward for the master with a cozy bunk room for the kids or visiting friends. Plus, the open salon is perfect for relaxing or entertaining. The oversized and air conditioned flybridge features dual Release Marine helm chairs and a large forward facing bench seat.
The crisp and rugged exterior is contrasted by a soft and luxurious interior appointed with sumptuous leather and teak. This beauty screams to be taken out for a private get-away from the world or a romantic weekend sail. It is truly a boat to suit every need.
This $750,000 vessel can be yours for the share price of $79,950. Finance terms are available to qualified purchasers. Maintenance is additional but rest assured that you never pay more than an 1/8th of the cost, saving you 87% as compared to traditional solo boaters. Everything is taken care of for you. No worrying about maintenance or repairs.
Fractional yachting offers an exceptional value proposition. Or, as Warren Buffett says - "Fractional just makes sense." You only pay 1/8th of the usual cost of boating and enjoy a higher-level of satisfaction. Best of all, you’re not just limited to a week or a month… it’s yours, whenever you need it as long as it’s not in use.
The company believes this is a unique opportunity to own a premier yacht that meets everyone’s needs - from a career-oriented professional looking to get-away from the daily grind or a couple or family looking for a weekend on the water. For more information on this vessel, please visit www.tiarayachtshares.net or contact Capt. Dennis Pellicci at (239) 470-3549
For more information about Signature Yacht Shares, contact Matt Condon, (850) 279-6888 or visit www.signatureshares.com
Tuesday, March 23, 2010
No Surprises! Fractional yachting budgets all the costs so there are no surpises!
Part 1 in a Series of Articles on the Advantages of Fractional Yachting
Any time you start something new, you are bound to learn things along the way. When we started Signature Yacht Shares, we anticipated some challenges specific to the fractional world, such as scheduling the use of the yacht or creating equitable payments from each shareholder. We knew that we would have to be creative and open-minded with this new form of yacht ownership. We figured that one of the easiest things to do would be to put a budget together and give customers an “easy monthly payment” that would cover all the costs. Boy, were we wrong!
The problem has not been our ability to determine the fixed operating cost of boating - after 25 years in the industry we know what things cost. What we discovered is that customers don’t like knowing these costs! As a fractional operator it is important that we know our costs so we can properly budget for them.
As an example, we have a 39’ Tiara Convertible based in Ft. Myers. The fixed operating costs run about $1,200 per month per 1/8th share. When most people see that, they think “that’s expensive”, but is it really? It not only includes the slip fee, on-going cleaning, and general maintenance but other items including the insurance premiums, bi-annual trips to the boat yard, monthly weather subscriptions, diesel engine oil changes, engine repair reserves, soft goods reserves, and miscellaneous items.
Most solo boaters only consider the recurring monthly costs in the monthly budget. “One-off transactions” such as an engine breakdowns, yard bills, or oil changes are not typically considered part of the monthly budget. At Signature Yacht Shares, we plan for these one-off transactions and spread them out evening throughout the year and shared equally by the shareholders. For example, a $5,000 yard bill only costs $52 per month per shareholder. A $9,000 insurance premium only costs $94 per month per shareholder. When budgeted and shared, the cost of yachting is manageable.
No boater likes bad surprises, such as an unplanned engine bill. Fractional yachting budgets for all the costs of boating to give you peace of mind financially. And, remember, you never pay more than a fraction of the cost!
Contact Matt Condon (850) 259-9900 www.signatureshares.com
Any time you start something new, you are bound to learn things along the way. When we started Signature Yacht Shares, we anticipated some challenges specific to the fractional world, such as scheduling the use of the yacht or creating equitable payments from each shareholder. We knew that we would have to be creative and open-minded with this new form of yacht ownership. We figured that one of the easiest things to do would be to put a budget together and give customers an “easy monthly payment” that would cover all the costs. Boy, were we wrong!
The problem has not been our ability to determine the fixed operating cost of boating - after 25 years in the industry we know what things cost. What we discovered is that customers don’t like knowing these costs! As a fractional operator it is important that we know our costs so we can properly budget for them.
As an example, we have a 39’ Tiara Convertible based in Ft. Myers. The fixed operating costs run about $1,200 per month per 1/8th share. When most people see that, they think “that’s expensive”, but is it really? It not only includes the slip fee, on-going cleaning, and general maintenance but other items including the insurance premiums, bi-annual trips to the boat yard, monthly weather subscriptions, diesel engine oil changes, engine repair reserves, soft goods reserves, and miscellaneous items.
Most solo boaters only consider the recurring monthly costs in the monthly budget. “One-off transactions” such as an engine breakdowns, yard bills, or oil changes are not typically considered part of the monthly budget. At Signature Yacht Shares, we plan for these one-off transactions and spread them out evening throughout the year and shared equally by the shareholders. For example, a $5,000 yard bill only costs $52 per month per shareholder. A $9,000 insurance premium only costs $94 per month per shareholder. When budgeted and shared, the cost of yachting is manageable.
No boater likes bad surprises, such as an unplanned engine bill. Fractional yachting budgets for all the costs of boating to give you peace of mind financially. And, remember, you never pay more than a fraction of the cost!
Contact Matt Condon (850) 259-9900 www.signatureshares.com
Saturday, December 12, 2009
Boat Sales Rising After Falling for 3 Years
I recently read an article by Mike Davin from Boating Industry that included a very interesting chart showing boat sales are rising, albeit from very low levels. None the less, they are rising for the first time in a verrrrrrry long time. Interesting trend!
Capt. Matt Condon
Signature Yacht Shares
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