Palm Beach, Fla., Marinas and Businesses Cater to Megayachts

By Lori Becker, The Palm Beach Post, Fla.

Nov. 18–Every time one of those sleek, luxurious yachts glitters and glides through South Florida waters, piles of cash pour from its decks.

From service to dockage, supplies to crew, megayachts spend money — lots of it.

For the local boating scene, these enormous vessels are much more than a status symbol for their well-heeled owners. They support thousands of jobs and small businesses that keep these floating mansions churning.

“The amount of time the owners spend on these boats is relatively short. But the crew is on station all the time. They’re running a business on that boat,” said Jonathan Luscomb, dockmaster at the town docks in the town of Palm Beach.

Palm Beach County’s marine industry wants a bigger piece of the $732 million South Florida megayacht market dominated by Broward and Miami-Dade counties. A handful of new marinas and proposed projects are aimed at drawing more of the big boats here, offering new super-sized slips, gigantic boatlifts and a less crowded berth than Fort Lauderdale.

Old Port Cove in North Palm Beach just reopened its north marina, after a $7 million overhaul that brought new floating docks for yachts as large as 190 feet.

West Palm Beach plans to rehab its Palm Harbor Marina to center around large boats, and the new Rybovich Marine Trade Center is aimed at servicing them.

“There has been a void in Palm Beach that needs to be filled by these operations,” said Rick Morgan, president of Old Port Cove Holdings Inc., the largest marina operator in Palm Beach County. “You’ve got captains of industry and stars of stage living right here in Palm Beach, and they can’t find places to keep their yachts.” Marine industry leaders say the demand is there but facilities have been lacking.

Fort Lauderdale, pegged the yachting capital of the world, has long been the place to berth when these superyachts come to town. Megayachts, generally defined as vessels longer than 80 feet, can’t pull into just any marina. They need lots of room, lots of power and lots of services.

Until recently, the Town of Palm Beach Docks was the only marina in Palm Beach County that had more than a handful of slips that could hold the big boats, with dozens on its waiting list.

Newcomers may be hard-pressed to lure many more megayachts north, Luscomb said. “The megayacht market here hasn’t quite arrived,” he said, pointing to a short supply of support services, crew and deep water.

While his marina has boaters waiting in line to snag a slip, he’s quick to point out that the longest list is for the mid-size slips for 50- and 60-foot boats. And, he says frankly, he’s in Palm Beach.

“The panache of Palm Beach is why people come here. This town is a destination,” he said. “But now everybody’s going for the bigger boats. Just because the megayacht market is where they’d like to be, I’m not sure if it’s a good bet.”

Those businesses are banking on the tremendous growth in the number of superyachts sold globally.

Despite a sales slump for small and mid-size boats, the lucrative megayacht market has continued to climb. Last year, nearly 800 megayachts were under construction at shipyards around the world, according to the Global Build Report by Yachts International Magazine. That’s up from 520 vessels five years ago.

“The fleet’s expanding by about 20 percent a year. The Fort Lauderdale facilities are going to be full. Let’s give them another place to come,” said David Roach, executive director of the Florida Inland Navigation District, which manages the Intracoastal Waterway. “Those are jobs and salaries for blue-collar guys that are painting the boat and scraping the boat and doing the electronics.”

Marine leaders are hopeful the megayachts and their big spending will bring more jobs here, key for an industry that has lost businesses to redevelopment and slowed sales in the smaller boat markets.

“There’s a lot of interest in it locally,” said Charlie Isiminger, a marine engineer and president of the Marine Industries Association of Palm Beach County. “It absolutely could be a boon for the marine industry.”

Last year, each megayacht visiting South Florida generated an average of $488,000 for the local economy through boat-yard repairs, brokerage commissions and charter fees, according to a recent study of the megayacht industry in Broward, Palm Beach and Miami-Dade counties.

About 1,500 of the big boats cruised local waters in 2006, bringing an estimated $732.2 million and 7,366 jobs to the tri-county region, the study found. The number coming has nearly doubled over the past decade — up from 800 in 1997 — and Broward County marine leaders say limited space will hinder future growth.

Leisure Resorts, in partnership with West Palm Beach’s downtown redevelopment project, is planning a $20 million renovation of Palm Harbor Marina to host the larger vessels. The expanded marina will have 165 slips, accommodating boats as long as 200 feet, said Cheryl Chase, an owner of Leisure, a subsidiary of Hartford, Conn.-based Chase Enterprises that has managed the marina for the city since 1979.

“We really wouldn’t speculate if we didn’t believe that the demand in the market was there,” Chase said.

The project includes a high-end hotel, and Chase said the downtown location will offer boaters prime access to shopping and restaurants. The firm hopes to start construction on the new docks next summer.

With its current configuration, the marina has been able to dock a few large boats, including the Chase family’s 150-foot Swiftship. But the requests have far surpassed the availability. “We’ve had to turn away many,” she said.

Old Port Cove’s Morgan reports the same. Before the marina’s renovations, it had a few slips on its margins that could hold larger vessels, and those spaces were always in the most demand, he said.

So when it came time to upgrade the aging marina, Morgan opted to aim for the megayachts to round out his company’s boat storage options. The marina operator owns two other marinas, also renovated in the past few years. His North Palm Beach Marina aims at the mid-size boats, and the New Port Cove Marine Center offers storage for small boats.

Old Port Cove, which also has a south marina slated for renovation next year, now will hold about 50 boats in its north marina, ranging from 50 feet to 190 feet in length.

The first boats moved in this month, with more than two-thirds of the spaces already spoken for. Amenities at the high-tech marina’s amenities include amped-up power pedestals, concierge service and Wi-Fi access.

The marina has spaces for transient and seasonal boaters. But Morgan is aiming for annual leaseholders. Its new rates depend on the length of the lease and size of the slip, with a 150-foot slip costing more than $95,000 for a yearlong berth.

Megayachts travel and usually don’t call any one place home. But owners will pay for an annual lease to guarantee a spot when needed.

Among the first is Mine Games, a 164-foot Trinity. The boat has a year lease on its slip, even though it will only be there for one month of the coming year, said captain J.D. Ducanes. “That’s to secure our position here,” he said. “During the season, it’s just crazy to secure dockage for a boat my size.”

Ducanes, who has a home in Delray Beach, said he prefers the “quieter” Palm Beach to the “hustle and bustle” of Fort Lauderdale. Dock rates are generally lower here, and there are fewer fixed bridges to slow travel.

Yet Fort Lauderdale is the home base for a flotilla of marine vendors from electronics to engines. About two-thirds of Ducanes’ vendors are located there, so he has to schedule their trips north. On any given stop, he could have 12 to 20 vendors on board.

Rybovich’s new service center is the only boatyard in Palm Beach County that can handle the extra-large yachts. The West Palm Beach yard opened a new 40,000-square-foot megayacht repair shop in late summer, as part of South Florida entrepreneur Wayne Huizenga Jr.’s $100 million renovation of the 12-acre marina and boatyard.

The center’s new equipment includes a 660-ton Travelift to hoist big boats out of the water. It has space on land for yachts up to 200 feet and up to 275 feet in the water.

But getting boats that large to these marinas is a challenge. The water is not deep enough in parts of the Intracoastal for the bigger yachts to navigate. “The boats that want to come here have to be shallow draft boats,” Luscomb said. “If you’ve got a $50 million boat, you don’t want to run aground.”

The navigation district’s Roach is working with the U.S. Army Corps of Engineers on a $6 million to $8 million dredging project that would deepen a stretch of the Intracoastal near the Palm Beach Inlet to make way for the superyachts.

Pushed by the marine industries association, the effort has been in the works since the mid-’90s, Roach said. It’s been stalled by the corps’ environmental and economic evaluations, Roach said, and any digging likely is still two to three years away.

“We see it happening. It’s just getting there,” he said. “We can have this business in Palm Beach County as well.”

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