New marinas give berths to supersize yachts



DUBAI // With its sleek hull, rooftop Jacuzzi and state-of-the-art navigation system, Tradition may seem a snip to anyone with Dh45 million to spare. But even before the shrink wrap came off the elegant 30-metre superyacht, its days as the pride of Dubai's Festival Marina were numbered. For Tradition will be dwarfed by the new breed of luxury yacht appearing on the horizon. With technology providing increasingly better navigation, gadgets and comfort, it is common for owners to replace their boats every three years as they become outdated.

"Our customers are pushing for ever bigger yachts," says Erwin Bamps, executive manager of Gulf Craft, an Ajman-based firm that has a two-year waiting list for its luxury boats. "Our sales have at least tripled in the past three years and extras like helicopters, pools and Jacuzzis are no longer considered extravagant. "The market is moving very fast and the only thing it is limited by is the ability to park them."

Yachting magazine says nearly a third of the world's top 100 yachts are owned by GCC nationals while six of the world's 10 biggest yachts have Arab owners. "The boating industry is exploding here in the UAE," said Matthew Bate, director of operations at Island Global Yachting (IGY), the company responsible for marinas in Festival City and the Palm Jumeirah. "The demand on our berths is huge and we cannot fit any more in."

Long waiting lists coupled with the lack of space for larger vessels have meant IGY is rolling out plans for more than 20,000 berths within five years in Dubai alone. Abu Dhabi is not far behind, with plans to create marinas capable of taking gigayachts within the next two years. "We cannot build them quick enough," says Michael Horrigan, chief executive of IGY's Middle Eastern operations. "The yachts that will be berthed there will be among the most expensive in the world. Megayachts, more than 50 metres long, and gigayachts, more than 100 metres, are a dynamic market that has not diminished despite the current economic crisis.

"The people in that bracket have been somewhat impacted but it is not like they have been driven into poverty. Their wealth is still intact." As yachts become ever more lavish, so too do the onshore facilities. Festival Marina, which already has three helipads, is to be transformed by 2010 with designer stores, upmarket restaurants and a clubhouse with suites for "VVIP" clients. Laurent Perignon, of Camper and Nicholson International, which compiles a yachting index on 80ft-plus vessels, says: "Demand is still bigger than supply.

"Give it another five years and the heart of the market will be 120-165ft yachts." Back on board the Tradition, Ivan Slavica, of the Art Marine boat maintenance firm, points to his neighbours. "That one bought an Azimut but wanted three cabins instead of four so changed the entire interior. And that one ripped out two cabins to put in a dance floor with a top-end sound system. "Customers change their minds all the time - but then, you wouldn't ask Bill Gates why he wants to change things."

tyaqoob@thenational.ae

Company%20Profile
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COMPANY PROFILE
Name: Kumulus Water
 
Started: 2021
 
Founders: Iheb Triki and Mohamed Ali Abid
 
Based: Tunisia 
 
Sector: Water technology 
 
Number of staff: 22 
 
Investment raised: $4 million 

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Top New Zealand cop on policing the virtual world

New Zealand police began closer scrutiny of social media and online communities after the attacks on two mosques in March, the country's top officer said.

The killing of 51 people in Christchurch and wounding of more than 40 others shocked the world. Brenton Tarrant, a suspected white supremacist, was accused of the killings. His trial is ongoing and he denies the charges.

Mike Bush, commissioner of New Zealand Police, said officers looked closely at how they monitored social media in the wake of the tragedy to see if lessons could be learned.

“We decided that it was fit for purpose but we need to deepen it in terms of community relationships, extending them not only with the traditional community but the virtual one as well," he told The National.

"We want to get ahead of attacks like we suffered in New Zealand so we have to challenge ourselves to be better."

Election pledges on migration

CDU: "Now is the time to control the German borders and enforce strict border rejections" 

SPD: "Border closures and blanket rejections at internal borders contradict the spirit of a common area of freedom"