The Yacht Share Network | Yacht Syndicates | Yacht Fractions
Frequently Asked Questions
How is a syndicate created?
Yacht Share find like minded owner to combine to buy a vessel. This is then managed by Yacht Share coupled with a professional crew on board. owner then use their yacht in proportion to their share of ownership. It is set up for each arrival with their personal items placed on board (and others’ removed). Just like arriving at 5* hotel suite, all linen, towels and basics are there to provide a turn key yachting experience for each week on board.
How is a syndicate legally set up?
Each Syndicate is set up by Yacht Share as a SPV limited company, incorporated in the UK, whose sole business purpose is to own and operate the vessel. Each Syndicate Member is a member in two senses of the word; a shareholder in the company, directly pro-rata to their equity stake in the yacht, and as part of a community of like-minded owner.
How is the syndicate operated?
The Syndicate is operated for the benefit of the owner, and is managed by Yacht Share who are accountable to the owner Yacht Share manage the day to day operations and report all activity through the yacht’s app which offers real-time data on every facet of the yacht and its operation. The app’s fair usage algorithm makes sure every owner gets the correct proportional access to periods on board commensurate with their equity stake in the yacht.
One owner of the syndicate is appointed as the finance manager of the running expenses. He oversees the spend on behalf of the owner to ensure that the syndicate is well run and is always getting great value for money.
Are there different sizes of shares in a syndicate?
Yes, we’ve learned that one size doesn’t fit all. Some families may only want to go yachting a few weeks a year, while others may be retired and have more time. This can be achieved by making every aspect of the syndicate proportional to each owner equity stake. For example, a owner with a 12-week share pays triple the maintenance contribution compared to a owner with a 4-week share. However, the 12-week shareholder gets triple the usage on board and has triple selection preferences, so they’re more likely to book peak season weeks. In short, every aspect of usage and cost is allocated proportionally to each owner share size.
What is included with each yacht?
Every yacht in our fleet is individualised to the owner preferences on a majority vote basis. For example any owner can suggest adding a jetski, seabob, flyte board, kayak, paddle board or other addition to the yacht’s inventory of water toys. That suggestion is then put to the vote through the yacht’s app. If the majority of owner favour the suggestion, the item is added and charges pro-rata to each owner in line with their equity stake.( Their voting % is also in line with their equity).
How easy is it to exit from a syndicate?
Yacht Share advertise all of the shares in all of the yachts all of the time. The underlying purpose is that there is a waiting list of interested parties ready to buy a share, so a current owner can exit more quickly.
What happens if somebody breaks something on our yacht?
Each owner has a duty of care as outlined in the syndicate agreement. Should an issue arise on their watch then the responsibility to financially rectify the situation falls upon them. There is insurance in place to cover major issues.
What happens if somebody doesn't pay their maintenance dues?
The syndicate agreement which every owner signs and abides by covers this in great detail.
- If a owner is behind on their payment they cannot use their allocated weeks. That week is then placed on the app as available and the remains owner can pay the maintenance fund dues to use the week. Typically that is a relatively small sum (circa £3k to £5k per week) which is likely less than 10% of the cost of an equivalent charter rate. Generally, there are a number of owner would would happily pay the £3k – £5k sum for an extra week on board so the maintenance account is quickly replenished.
- If the defaulting owner contuse to default there is a simple mechanism where his share is auctioned to a new owner after 3 months, and the proceeds are used to repay his dues before returning any residual balance to him.
How is usage allocated?
The algorithm has two fundamental facets:
- To give every body a week at a time selection in line with their share size.
- To mix the selection order year on year so that over a 5 year period every owner has completely fair access to peak weeks.
If I can't use my week, can I offer it for charter?
Sadly not. Our yachts a generally not coded or licensed for charter, and our owner generally don’t wish to have charter guests on board – as they just don’t share the same owner related sense of care and responsibility without an equity stake in the yacht.
However, so long as there is no commercial aspect to the usage, family and friends can be given you week. We have many happy and appreciative circumstances where a family member is welcomed on board without the principle owner being present.
Can I buy my share through my company or with a friend?
Yes. We have many shares held by companies like accountants, solicitors, architectural practices for example, where their different individual partners use the yacht for business and personal use.
What happens if we can't all agree on something?
In the very unlikely event that an individual owner, or a small group of owner cannot reach agreement Yacht Share are very experienced in finding a fair, suitable, and equitable way forward. Representing over 300 yachts now, with many years of experience under our belt we have likely dealt with every conceivable issue in the past and found a fair resolution.
However, should we fail to find a satisfactory resolution to an issue, as part of the syndicate agreement we are all party to, we have by default all signed-up the Fractional Association’s Code of Conduct for Yachting as Platinum Members. We all therefore agree to be bound by their mediation services.
www.fractionalassociation.com