Selling your marina? Preparing for common pitfalls is key to staying afloat

Selling a marina business is a complex process that often involves many unknowns, particularly for a first-time seller who may be unaware of the common pitfalls that can disrupt a sales process. In our experience, issues that delay the process are often uncovered as a result of due diligence undertaken by the buyer, banks and surveyors, and it is in any seller’s best interests to be well prepared in advance.

Working with an experienced marina broker, who can support the pre-sale preparation by identifying potential issues in advance, is therefore essential to achieving a successful sale.

Key things to watch out for:

Dredging

Most relevant for coastal marinas and river navigations where flows of water result in greater siltation, but even off-line moorings may require period dredging (potentially every 10 years), therefore being able to demonstrate a regular programme of dredging and associated costs to potential buyers is important.

Bathymetric surveys 

Again, have these been undertaken - A bathymetric survey, (sometimes referred to as a fathometric survey), is a type of hydrographic (water-based) survey that maps the depths and shapes of underwater terrain to illustrate the land that lies below. They are commonly used as part of the data collection process for dredging and maritime infrastructure works. Informed and experienced marina buyers will expect to see these as part of a due diligence pack and in general, it is better for owners to have their own survey and therefore be on the front foot in terms of questions they may receive.

Pontoon and walkways 

What condition these are in and are they all Health, Safety and Security (“HSS”) compliant, or requiring works to bring them up to the required standard?

Electricity and hook-up supplies 

Age/Condition/Supply details.

Harbour walls/lock gates

Are these in a good state of repair and subject to a regular programme of checking and maintenance? Being able to produce documentary evidence in support is helpful.

Structural pier surveys and land contamination surveys 

Subject to cost, it can also be worthwhile investing in additional surveys and as necessary undertake any remedial works required to avoid subsequent price negotiations going to value.

Third party leases and concessions 

A valuable part of many marina operations. It is a worthwhile exercise to ensure these are up to date and accurate (schedule of tenancies) and have not expired and if so, look to execute and document lease/concession renewals? Are there any outstanding rent reviews that need addressing – all part of good general estate management.

Seabed leases 

Ensuring that all lease documentation in relation to leases of the seabed are in place with the relevant crown estate/local authority.

Trading Information 

Having at least 3 years’ certified profit & loss accounts available, together with management accounts (monthly/annual) including the current year to date, helps buyers, valuers and lenders understand the investment proposition on offer. If there have been any one-off items of expenditure or costs that would not apply to a future owner, be ready to articulate what these are in order that a “Fair Maintainable Operating Profit” for the business can be demonstrated to the market.

Mooring/Berthing data 

Ensure all mooring/berthing fee information is up to date and in a format that shows the performance of the business over a 3-year period. Information in respect of charges per meter, seasonal variations and available meterage is key.

Staffing information 

Anonymised schedule of full and part-time staff include roles, start dates, number of hours, rate per hour/annual salary.

Case Study – Port Dinorwic Marina, Y Felinheli, Gwynedd

Located on the north Welsh coast within the Menai Strait and close to Caernarfon, Christie & Co were instructed by Azets acting in their capacity as administrators to sell Port Dinorwic Marina. We provided initial pricing and marketing recommendations and implemented a structured sales process, producing quality marketing materials, supported by a bespoke on-line data site. 

Our marketing team led our multi-channel marketing initiatives with trade, property and local interest related PR, accompanied by a social campaign. A total of 17 viewing appointments were undertaken, creating a competitive bidding process which resulted in 10 offers. 

Following a second round of bidding, two parties were short-listed, leading to the selection of a preferred bidder which resulted in a successful sale, in line with our pricing advice.

GET IN TOUCH

For a confidential discussion regarding your marina business options, please get in touch.

Jon Patrick, Director – Head of Leisure & Development

P: +44 (0) 7831 263 529 or E: jon.patrick@christie.com