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Old 12-07-2017, 10:07   #1
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Lagoon 52 - Thinking About Starting a Private Charter Company

Hello all-

I have a client whos in an interesting spot. I wont bore you with the details, but essentially they do 15-20 charters in the BVIs each year with at risk kids. For understandable PR reasons, they dont want to own a million dollar yacht in the Caribbean so I'm looking at starting a private charter company with them as my main client. Once the boat is paid for, I can drop the rates and help them stretch their dollars. I'm still a ways from retirement per s, but it would be a great option for me to have a boat down there plus I'd love to support the awesome work they're doing. They've been doing the trips for years and will continue to do so, so the rough numbers seem to work pretty well.

I wouldn't be competing with the big companies, pretty much just there to serve this non-profit and maybe do a few other charters for friends. I've been researching ancillary costs and was hoping to get some harder numbers from the good folks here who have been there, done that and got the tee shirt.

I'll rattle off my questions in order.

1) If everything moves forward, we'll probably buy a new or close to new 5 cabin Lagoon 52. I'm estimating a $1.3M purchase with a 25% down payment and a 7 year mortgage. Does that sound about right?

2) The next thing I need to know is the cost to register the boat and where to register. I was thinking of setting up a local company in the BVIs. I don't have any plans to bring the boat stateside. All transactions and income would happen there, so that seems to make sense. But this is new territory, so if anyone has any wisdom on that, I'm all ears. Also, what do I need to budget annually for boat registration, taxes, etc.? I know there are no taxes in the BVI's but if I have state side liabilities, I want to make sure they're covered.

As someone pointed out on another thread, I also need to know what work permits are required. As a US Citizen, would it make more sense to register in the USVI and just operate in BVI when needed?

3) I've estimated 2% for insurance ($26k annually) $4k for cleaning ($200 after each charter) $5k per year for scheduled maintenance for the first three years since the boat will be new or nearly so, then $6k for years 4&5, $7k for years 6 and 7. Do these numbers seem reasonable?

4) Dockage. Here's where things get nebulous. I'm planning on keeping the boat on a mooring ball most of the time with a few day rates when we're island hopping on the charters. In the interest of planning for worst case, I took a $35 day rate and multiplied by 365 for a total of $12,775 per year. What are some real world numbers for long term mooring / dockage?

5) Fuel. What can I plan on spending on fuel each month or year? I sail a Jeanneau 409 out of Marina Del Rey and the fuel costs are pretty minimal. But I know a cat has two of everything and I don't have a good feel for how much motoring we would be doing in a typical week of island hopping.

6) What am I missing?

Thanks in advance for your help and guidance!

Best-

Chris
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Old 13-07-2017, 18:32   #2
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Location: Saint Thomas, USVI
Boat: Beneteau Oceanis 40
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Re: Lagoon 52 - Thinking About Starting a Private Charter Company

I'll rattle off my questions in order.

1) If everything moves forward, we'll probably buy a new or close to new 5 cabin Lagoon 52. I'm estimating a $1.3M purchase with a 25% down payment and a 7 year mortgage. Does that sound about right?

This is in the ballpark.

2) The next thing I need to know is the cost to register the boat and where to register. I was thinking of setting up a local company in the BVIs. I don't have any plans to bring the boat stateside. All transactions and income would happen there, so that seems to make sense. But this is new territory, so if anyone has any wisdom on that, I'm all ears. Also, what do I need to budget annually for boat registration, taxes, etc.? I know there are no taxes in the BVI's but if I have state side liabilities, I want to make sure they're covered.

If you do it in the BVI's you will need a trade license registration work permits etc. Not terribly expensive but will cost and be an aggravation. You also will have to pay national park fees and cruising fees for every charter.
These numbers are not insignificant. $8 a person per week for the cruising fee for a BVI based boat and $16 per person USVI based. $70 for the park per week.


As someone pointed out on another thread, I also need to know what work permits are required. As a US Citizen, would it make more sense to register in the USVI and just operate in BVI when needed?

You can do it St Thomas based for less up front. The customs fees to visit the bvi's will be higher. But you won't need work permits.

3) I've estimated 2% for insurance ($26k annually)
This is about right.

4k for cleaning ($200 after each charter)
Not even close probably more like $400 to $500 per week.

$5k per year for scheduled maintenance for the first three years since the boat will be new or nearly so, then $6k for years 4&5, $7k for years 6 and 7. Do these numbers seem reasonable?

Not even close. Annual haul and bottom paint, hurricane storage, keeping up the systems you could double this number and probably still not be right.

4) Dockage. Here's where things get nebulous. I'm planning on keeping the boat on a mooring ball most of the time with a few day rates when we're island hopping on the charters. In the interest of planning for worst case, I took a $35 day rate and multiplied by 365 for a total of $12,775 per year. What are some real world numbers for long term mooring / dockage?

You will need to add in crew salaries or caretaker for this. Add in the hurricane storage listed above. A boat that size at Spanish Town for three months will add another 7 t 10 K to your budget.

5) Fuel. What can I plan on spending on fuel each month or year? I sail a Jeanneau 409 out of Marina Del Rey and the fuel costs are pretty minimal. But I know a cat has two of everything and I don't have a good feel for how much motoring we would be doing in a typical week of island hopping.

With the gen air conditioning etc. $300 a week.

6) What am I missing?

Wear and tear. Upgrades, surprises and accidents. Any or all of these will raise your costs of operation. Interior upholstery, cockpit cushions, sail bag, sails, dinghy. None of these will last seven years of charter. The genset will likely die or be near death at the end of seven years.

For disclosure purposes I am part of the management team for a bare boat company that runs 20 plus boats in St Thomas.
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Old 16-07-2017, 07:42   #3
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Re: Lagoon 52 - Thinking About Starting a Private Charter Company

I think captainjay is pretty much spot on. We bought a new 2016 Lagoon 52 and I would say the scheduled maintenance will likely run at least $10K. For me, this includes Oil / filter changes on the engines and genset, winch maintenance, rigging inspections, windlass maintenance, sail inspections and minor repairs, etc. and of course, annual haul out and bottom paint. Many of these things you can do yourself and save some money but in reality, you should plan that you don't have time- especially if you are focused on as many charter weeks as possible.

We moved onto the boat full-time about two weeks ago and it will be interesting to see how the expenses change. The boat really hasn't had too many issues but you should be prepared to deal with issues when you buy the new boat. For example, Lagoon ships plastic batten holders that attach the battens to the mast. These break easily and you should immediately replace them with aluminum ones (we learned the hard way). This is just one example of some of the small things that add up.

Best,

Christian
www.sailsummerkai.com
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Old 16-07-2017, 22:35   #4
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Re: Lagoon 52 - Thinking About Starting a Private Charter Company

Quote:
Originally Posted by Chris Coyote View Post
) $5k per year for scheduled maintenance for the first three years since the boat will be new or nearly so, then $6k for years 4&5, $7k for years 6 and 7. Do these numbers seem reasonable?

Mmm. This may be adequate for scheduled maintenance. But you need to allow for unscheduled maintenance. And you will have plenty of it. While the Lagoon hull is very sturdy, the 3rd party components are not. We have a 2014 450 and while unscheduled maintenance will vary from boat to boat, whether its a DIY repair or you farm it out, you'd be best to allow for USD$3-10k per year. This is from experience.
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Old 23-11-2017, 16:24   #5
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Re: Lagoon 52 - Thinking About Starting a Private Charter Company

I want to work for a non-profit and I want to sail, crewing for your charter company sounds like my dreams come true. I work for food and a bed :-) don't need much more. I would love to hear about your venture in getting this up and running regardless. Please message me
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