AAA Financing In Real Estate

There is no sea in Moscow, but the enthusiasm for aquatic travel is no less for it, and investors long ago understood that the love of yachting may easily be turned into cash. High quality areas for the docking of yachts are a hot commodity and the construction of such properties is an excellent investment these days. But there are still plenty of problems. The lack of proper infrastructure – such as a system for sluice gates on the Moscow waterways – has so far limited ambitious travelers to the Klyazminskoe Reservoir.

The Size of the Boat

The yachting trend, long in-style, is now actively developing in Moscow. Additionally, specialists predict that a smaller ‘Sunday yacht’ fad is not far off. In 2005, more than 3000 models were sold at one exhibition, from cutters to large motorized yachts. From that time, interest in yachting has only grown, and according to dealers the sales volume is growing by 30% every year. Today we can say for certain that the new trends are welcomed by the nautical crowd, and the Moscow canals are beginning to see some exotic new vessels the like of which was never seen on the open seas. On weekends, Klyazminskoe Reservoir actually finds itself clogged with traffic.

Though the owners of the vessels multiply every day, there are very few real yachtsmen among them. In Russia the yacht is an article of luxury, another bit of proof that the good life is being lived. The competitive aspect is either secondary to the spectacle or completely nonexistent. One could even say that this is why the motorized yacht is so much more popular in Russia than the sailing ships preferred nearly everywhere else in the world. The dimensions of these yachts are far more important. “The longer the boat the better,” the owners seem to think, forgetting that these vessels will see far more of the Moscow canals than of the Mediterranean Sea. Experts point out that this age of giants is only beginning.

This pattern is directly influencing the designs of the new Moscow yachting clubs. The sort of marina one may see in the West is nowhere to be found in our nation’s capital. “The zones for technical servicing and zones for recreation in most European marinas are generally unified, but this isn’t always pretty. The owners of the more valuable yachts expect to see something glamorous, expensive, and exclusive from the deck of their craft,” explains Maxim Guba, head of one of Belaya Dacha’s new projects. This is why the Moscow yachting clubs have begun to see a supplemental and separate entertainment zone filled with restaurants, exhibition halls, fitness centers, pools, bowling halls, and even golf courses. These investments generally pay off. A proper design can bring the period of cost recovery for these yachting zones down to a mere two or three years. The rules are simple – the early bird gets the worm, and the last few birds get nothing at all. “The cost of a pontoon is not so high in Moscow, but the cost of outfitting a yacht in this region is far higher than the European average and is matched only on the Cote d’Azur,” explains Maxim Guba.

Experts agree that the marinas of today only can operate in conjunction with other infrastructural properties such as hotels and restaurants, though the principal source of revenue will remain the outfitting and storage of the yachts. Yachting is not a particularly cheap thrill. In order to store a motorized yacht longer than 30 feet in Russia, an owner must spend around 10% of the yacht’s initial cost every year. Indeed, for the sailing yacht the cost is closer to 4%. One yachtsman has explained the expense in a curious manner, “Imagine that you are standing in your finest suit in an icy shower and tearing up dollar bills. It’s expensive and cold, but the thrill of it is unequalled!”

The Moscow Audience

A large number of yachting clubs are concentrated on the Klyazminskoe Reservoir. It is true that many of them do not have much commercial value – the wave of modern construction technology has left them perfectly dry. More interesting are the yacht clubs Vodnik, Avrora, Admiral, Spartak, and Gals. But the best of the yachting club is universally considered to be the Burevestnik, located beside the reservoir across from Pirogovskoi. The Burevestnik has grown up around an athletic society for students built in 1953 which was privatized in 1996. Today the Burevestnik is the most capacious and expensive marina in Moscow, with a helicopter pad and two harbors packed with more than 250 vessels as long as 100 feet each. The offices of the yachting company include the technical infrastructure required for luxurious recreation – restaurants with summer terraces, a man-made beach, a fitness center, and much more. The fame of Burevestnik has spread far and wide. It is one of the most well-known signs of the Gilded Age in Moscow, where the glamour set does what the glamour set does. Regulars confidently confirm that the local parties are the envy of Monaco. As the yachting club’s official site puts it, “Dolce Vita is only 8 kilometers from Moscow!”

Not so long ago, the Burevestnik began to operate more exclusively. In order to gain entry, one needed a recommendation from several existing members. As the yachtsmen admit, however, the ‘face control’ system has been simplified. The situation is simply explained. The Burevestnik was just too big for such a tiny group of elites. Andrei Boyko, the proprietor of Burevestnik, gets his revenue not only from the storage and servicing of the yachts. The Burevestnik Group is the largest importer and distributor of luxury water crafts in Russia. AG Marine is one of the Burevestnik’s partners, the exclusive source for Fairlines and other big name motorized yachts in the country. In this way, the marina has begun to play the role of the exhibition complex, where the most spectacular producers find the most elegant clientele. “We have to give Andrei Boyko his due, really. He has created a niche for himself in a market which practically did not even exist quite recently,” says Pavel Novoselov, lead expert at PNN Consulting. “We can even say that the Burevestnik started the boom.”

One more project is particularly interesting and can even be considered a valid competitor of the Burevestnik. This is of course the Royal Yacht Club, built over the old aquatic stadium, Dinamo, some distance from the center of the city. The complex was the work of the architect, Gennadii Movchan, and was built in 1937. The facilities for water sports went for decades without any serious maintenance and were in quite shabby condition, but now the entire complex has been outfitted with much more luxurious infrastructure. The Italian company, Azimut-Benetti, a large producer of motorized yachts, has invested a significant amount into the project and is managing the project in conjunction with the Moscow City authorities and the Dinamo athletic society. The conditions of this agreement have not been divulged.

Besides the marina, as employee Peter Soldatkin refers to the Royal Yacht Club, the aquatic stadium includes a hotel complex and restaurant which are already up and running. There is also a business center which accommodates companies that are all involved in some way with the yachting world, as well as the offices of Azimut-Benetti. “This is a particularly good arrangement: the office and the marina, where we will be demonstrating our models, are all together in one place,” says Peter Soldatkin. “The companies based here can only win out. This is why we offer a variety of brands the opportunity to work here, and not just Azimut-Benetti.”

Investors also plan to construct a nearby apartment hotel. The two story apartments will have areas from 100 to 250 sqm and will be rented on a yearly basis and, according to Peter Soldatkin, the company is already fielding calls from a variety of potential tenants. The structure will also include a pavilion where Stalin entertained Beria. “This is a completely unique property, which we will offer without any specified profiling,” explains Soldatkin. “Let the tenants figure out how they want to use these spaces, as offices or as residences.” Restaurants will be located in the center of the structure. It remains only to point out that the proprietors of the Royal Yacht Club, like many other such property owners, will employ an exclusivity policy. The marina can accommodate 110 vessels from 6 to 30 meters. The technical services that will be on offer here have not yet been divulged, but most likely they will include mooring, food, beverages, and internet. The territory will also include a closed beach with a restaurant and a fitness center. As for the finances of the project, according to Peter Soldatkin, apparently this part is not so expensive. The revenue ratio is calculated at 7%. This is not much, but Azimut-Benetti is pleased. “Additionally, to have such an asset in our portfolio is a prestige item, as these structures from 1937 have a great deal of historical value,” adds Soldatkin. The Azimut-Benetti marina is also an effective instrument for the sale of motorized yachts. The exact cost of the entire project, according to Soldatkin, is approximately 30-50 million euros.

The Yacht-Dacha

A large number of yacht clubs are now being built as part of the growing elite suburban areas. In some cases the marina may be simply an attractive little feature in a larger project, those occasionally it also has been seen to play an anchor role. Most often the infrastructure of a yacht club is limited to the simple moor. According to Irina Strokovaya, a consultant for residential real estate at Cushman & Wakefield Stiles & Riabokobylko, the liquidity of the suburbs will only increase. Experts admit that if a lot has access to the water, then it is essential that this feature be developed and taken advantage of, beginning with landscaping on the shore area. Without question, this requires investment but really not so very much – the construction of a pontoon system is not particularly expensive and can give the property a groomed feeling that can create a good impression on possible buyers. “Often the marina stimulates growth in value for the surrounding properties – the villages of cottages, the hotels, the entertainment and office complexes,” explains Yelena Artyushenko, market analyst for PNN consulting. “In every competitive case, it is important to understand that a marina puts other properties in a good light. A marina is an expensive pleasure that gives the visitor a whole new understanding of the real estate.”

Monaco, Pestovo, Pallada City, and Cote d’Azur all have their own facilities to accommodate yachts and a number of other suburban dwellings. “Eight years back, when we first purchased the lot, yachting was just beginning to develop around here,” says Nikolai Rezvyakov, head of architecture and design for Komstrin, the developer of Zelenyi Mys. “Many experts were skeptical to the idea of the trend developing. But the leadership of our company includes very active yachtsmen who were very behind this idea, and when we began work on the nearly 40 different designs for this area, all of them had marinas.”

As the results have shown, the rental rates for yacht club infrastructural elements completely justify themselves. For now there is too little competition, and the project is taking advantage of the vacuum. The marina is very attractive for ship owners and for the neighboring yacht clubs which are not opposed to providing this marina with special services and utilities. Investment in the construction of the yacht club, Zelenyi Mys, was recouped quickly. Investing millions in the construction of another yacht club has been planned by Belaya Dacha, which will soon build a whole resort on the shore of the Uglicheskoe Reservoir, complete with restaurants, cottages, hotels, and a spa center. The main event is planned for the marina, however. According to Maxim Guba, the head of the project, the yachtsmen will have everything they need here at their fingertips. “Our idea is to gather together those people who are enthused by these water sports,” says Maxim Guba. “The yacht-club will become one of the most meaningful project anchors.”

The future marina will be the first on the Uglicheskoe Reservoir, which has not yet seen a tremendous amount of boating in the area. This area does not quite have the same glamour set that is so evident at Klyazm, but for a nice rest out in nature, one could not imagine better. “There is a very unique natural environment here,” explains Maxim Guba. “Basically our idea is impossible to spoil. All construction will be accurately planned according to the parameters of our natural habitat. An absolute minimum of clear cutting will occur, and there won’t be much digging either. Everything will be on poles in order to maintain the ground’s natural beauty. The houses will be as unobtrusive as possible.” The location also has one more advantage – its proximity to the water, which will require absolutely no complicated system of sluice gates. The zone of technical equipage will be separated from the harbor area, hotels, and apartments. As Maxim Guba says, this will be an important factor in future projects of this type in Russia.

Networks

Today, the yachting world draws its energy from the Moscow waterways, but the motorized yachts are starting to find their way further and further out, and in less than half an hour they can be outside of Klyazminskoe altogether. For the yachting trend to continue its current rate of development, people will have to start sailing even further. Maxim Guba adds that, “There are no really civilized areas to refuel, especially beyond the Moscow oblast. This situation forces many yachtsmen to cut short their travel plans, which is quite negative for the growth of the yachting trend.” But the issue is not only the fueling stations, of course. There aren’t even the necessary mooring areas where one can stock up on the sort of refreshments that these yachtsmen are used to, nor restaurants on the river where one can stop to take a break from all that boating. “Large cities may have a hotel, but there’s nowhere to put the ship itself,” says Pavel Novoselov. “On the way from Moscow to Saint Petersburg, it is extremely unpleasant to stop in Rybinsk even worse to stop in Cherepovets. The only decent spot is at Petrozavodsk.”

Volga travel is easier, but there is a different problem – the immense distance. From Samara to Saratova it is more than 500 km, and naturally it’s impossible to traverse this without refueling. For now the brave skippers send their cutters ahead to Astrakhan and take planes instead if they want to sail on the Caspian. Obviously, investors will have to break free of the Moscow region. More importantly, experts are discussing the possibility of a network of projects. “People need to unite their efforts,” says Maxim Guba. “More importantly, the proprietors of yachting clubs need to sign cooperative agreements. Otherwise, there will be no travel, and without travel, i’m afraid that yachting will die.”