Marinas are a sector of the leisure industry that has experienced a consistent level of interest from investors over the last few years, so how does the landscape look now and what should interested parties keep their eye on?
There are approximately 95,000 marina berths across the UK, generating income of around £222 million a year. Two thirds of this income is from coastal marinas, with the remainder coming from inland marinas and moorings. The rate of growth of the number of marina and other moorings slowed slightly to 3.6 per cent in 2016. The slowdown can be partly attributed to the effects of the EU referendum and an anticipation of rising overheads. 2017 got off to a cautious start as well.
However, the Canal and River Trust have encouraged inland marina growth in recent years and the appetite from inland waterway users also continues to grow. The South East and South West are the biggest hotspots for marinas, each accounting for approximately 31 per cent of the total revenue generated in the UK. These areas also see the highest demand from marina operators looking to open new properties. London is seeing an increase in appetite for more facilities and mooring too, as rising house prices encourage people to look for alternative places to live. The number of people living on boats in the capital has increased 57 per cent since 2012.
From an investor’s point of view these are income-producing assets which require relatively little management once established and are high capital cost, high margin businesses with a secure income stream – all are attractive features if traditional investment opportunities are scarce.
In terms of transparency, however, very few marina transactions take place each year, with some years passing with no sales. This means that when they do come up for sale, they attract considerable attention. There is a discernible trend of increased interest from other leisure sector operators and from private equity expanding into the sector. Last year Tingdene Park Homes expanded its marina portfolio by purchasing Hartford Marina near Huntingdon. In 2015, Premier Marinas sold to The Wellcome Trust.
Despite not offering as much opportunity to invest compared with larger leisure sectors such as holiday parks and hotels, marinas are still a sector to watch, with much to commend them from an investment point of view.
Read more: Aspects of Leisure