The document discusses the history and overview of the marina industry, detailing its development and current state within the U.S. It highlights important aspects such as operations, financial challenges, competitive landscape, and trends, including the shift towards destination marinas and dry stack facilities. The marina industry faces ongoing challenges such as high construction costs, dependency on the economy, and environmental regulations, all impacting its growth and profitability.

1. RICHARD GRAVES & ASSOCIATES
MARINA BUSINESS PRESENTATION
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© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

2. HISTORY
The early concept of the marina, including public access and common ownership of waterfront
property for commerce and transportation , dates to Roman Law of 2,000 years ago. The concept was
lost during the Dark Ages, however, the Magna Carta restored public rights to coastal tidelands in
1215 AD
In the United States, marinas developed slowly. The U.S. Congress passed the River and Harbor Act
of 1899, which authorized the Secretary of the Army, through the Army Corps of Engineers, to
approve the building of any structure on or over navigable waters. Recreational boating increased and
the wealthy built private harbors in the early 1900s. By the 1930s , the term marina (Italian for a small
craft harbor) described a recreational boating facility. After World II, the middle class bought
recreational boats with discretionary income thereby creating a demand for more marinas.
Until the 1960s most marinas were owner operated. Then developers showcased the marina as the
first stage in long term, mixed use plans for Urban revitalization and resort complexes. As a result of
the increase of recreational boating across the country. Congress broadened the River and Harbor Act
in 1968 to require approval of building recreational structures, further protecting U.S. waterways.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

3. MARINA INDUSTRY OVERVIEW
• According to the National Marine Manufacturers Association’s estimate in 2002, there are about 12,000 marinas,
boatyards, dockominiums, equity yacht clubs and private clubs operating in the U.S. Additional research shows of the
12,000 marinas, 60% are salt water and 75% are 25 years or older. About 70 percent of marinas are privately owned,
profit-making businesses that sell services to the public. The remaining 30 percent are municipal and state marinas,
which are open to the public at minimal cost.
• Today’s marinas are generally freestanding and dockage is considered the main profit center (40%) of the business. In
addition to a stand alone, a marina may be an additional amenity to an upland project. Marina dockage rates are
generally charged on a daily, monthly, seasonal and annual basis and dockage rates are normally calculated by slip
size, either by a linear ft or sq. ft. There is also a close relationship between the marina business and the hotel
business. Basically, a boat slip is like a hotel room, one accommodates the guest’s boat and the other the guest. Both
deal with one of the most perishable products in the world. Once a slip or a room goes empty, that loss of revenue can
never be recovered.
• As an alternative to a wet slip marina, dry rack storage operations are quite popular. By stacking boats on racks in a
large building, an operator can handle hundreds of boats on less waterfront property than a conventional wet slip
marina. This type of operation can also be adapted to storing both boat and trailer at an inexpensive inland location.
Most Municipalities do not allow parking of boats on trailers on streets . Most Home Owner Associations (HOA) also
forbid the storing of boats on trailers in driveways, yards and streets. This type of boat rack storage is an emerging
market and quite popular in lake regions of the West Coast.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

4. FINANCE AND MAINTENANCE COSTS
• More than 70 percent of marinas are owner operated, stand-alone facilities. Investment sources
are often friends, family and local banks.
• Depending on a marina's geographic location, cash flow can be highly seasonal. Other important
financial issues are the high investment in facilities and management of accounts receivable.
Because of the risk of accidents inherent in managing large numbers of people and boats, broad
insurance coverage is necessary.
• Building and maintenance costs can be high, depending on weather and water
characteristics, and soil conditions. Ocean marinas subject to heavy tides are generally more
expensive to build and maintain than lake marinas. Pilings, floating docks, and other waterside
structures need periodic replacement. Modern docks have a life expectancy of 40 years, but
earlier structures have shorter lives. Costs per new slip are around $50,000 to $70,000. In
addition to waterside equipment and services, marinas typically need large parking areas.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

5. PERFORMANCE OF MARINA PRODUCT
LINES AS OF THE 2002 CENSUS
Product Description Sales of thisLine Percentage of Industry
($000) industry Sales (%)
Industry total 3,351,721 100
Pleasure boat dockage, slip rental,
1,307,940 39.02
launch fees, & storage
Merchandise sales 811,739 24.22
Personal & household goods repair
487,217 14.54
& maintenance
Sales of food & beverages 271,011 8.09
Membership dues 189,689 5.66
Other 284,125 8.48
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

6. MEDIAN COMPANY STATEMENTS %
2011

7. MEDIAN COMPANY STATEMENTS $
2011

8. FINANCIAL RATIOS
2011
FINANCIAL RATIOS

9. HUMAN RESOURCES
Due to the high percentage of manual and maintenance labor, the average hourly wage for marina employees is
moderately lower than the national average. Personnel turnover rate is high in recreation-related industries. The
industry’s safety record is on par with the national norm.
Industry Employment Growth
Bureau of Labor Statistics
Average Hourly Earnings & Annual Wage Increase
Bureau of Labor Statistics
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

10. COMPETITIVE LANDSCAPE
• Sales and ownership of boats create demand for marina services. The
profitability of an individual marina depends on location and good marketing.
Marinas compete by offering amenities, customized services and/or a preferred
location.
• Competition for discretionary income from other less expensive forms of
recreational activities. Demand for marina services are tightly tied to boat sales
and continued use. Power boating is not an inexpensive leisure activity.
• Boating Industry Forecast
The output for US boat building, an indicator for marinas, is forecast to grow at
an annual compounded rate of 4 percent
between 2012 and 2014. Data Published: October 2009
Boat Building Growth Peaks After Recession
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

11. SALES & MARKETING
• Rent varies according to the length of slip a boat needs. In high demand areas typical slip rents can be
as high as $15 to $20 per foot per month. Guest slip rates are usually between $2 to $3 per foot per day.
Some marinas still have flat slip rates of $120 to $250 per month. Dry stack storage costs are mostly
based on per ft rate and rack storage is generally only available on an annual contract basis – payable
monthly. Depending on the area annual stack storage rates can range from $2,500 to $4, 500 per year
for a 25’ boat.
• Most marina owners cater to annual/seasonal slip holders and transients. Although transients may be
more profitable, their use of marinas is strongly affected by weather and the economy. Marinas generally
split their slips between annual, seasonal and transient customers.
• The types of marketing used by marinas depends partly on the mix of annual and transient customers
they cater to. Word-of-mouth is very important. Contacts with boat brokers and boat dealers are
important to attract annual customers. Cruising directories, newspaper and magazine advertising is
often aimed at transients. Boat shows are a major marketing tool, and Internet sites and on-line social
networking have become a very important new source of business for both types of customers.
• Special Events sponsored or hosted by marinas are becoming important marketing tools for promoting
the facility and producing additional revenues during off peak periods. Special events are normally
geared to location and the type of boater the marina attracts. Fishing Tournaments and Poker Runs are
the most popular marina special events.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

12. TRENDS
• More power boats, fewer sail boats.- Because operating a powerboat is easier than
operating a sailboat, especially a large one, powerboats are more popular in recent
years. Of the more than 700,000 boats and personal water craft sold in 2008 more
than 200,000 were powerboats, according to the National Marine Manufacturers
Association (NMMA)
• In the realm of structural changes, docks and other structures are increasingly made
of refined composite structures or concrete designed to withstand the elements more
effectively than wood. Marinas have increasingly turned to new products with
environmental and fire-resistant attributes. Engineers in the 1990s have also
redesigned boat yard and dockside disposal systems to meet environmental
regulations.
• In areas of the country with limited waterfront space for new wet slip marinas, dry rack
storage facilities are an attractive alternative. By stacking boats on racks in a large
building, an operator can handle hundreds of boats on less waterfront property than
can a conventional marina. Drawbacks are the need for constant operation of special
forklifts and the lack of accommodation for "transient" boaters.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

13. TRENDS IN SERVICES AND AMENITIES
• Utilities - The type and quality of utilities provided by the marina depend on the market it
wants to attract. Utilities provided to yachts and megayachts are much greater than to
other types of boats. Electrical power, sewer pump out stations, and Wi-Fi are all
necessary utilities, and demand is greater for some type of upscale convenience and
grocery stores to provide essentials.
• High-Speed Fuel Pump - A high-speed fuel pump can offer marinas the opportunity to
greatly expand fuel revenues, a major income component. Boats, especially
yachts, require a lot of fuel. Installing a high-speed, instead of a standard, fuel pump can
save many hours of fuel pumping for large boats. While expensive to install, if a marina is
the only one in its market with such a pump, yachts from other marinas will be attracted.
• Online Reservations - Although most reservations for guest slips are still handled over
the phone, bookings via the Web are increasing. Some marina operators offer automated
reservation services and promotional information on their websites.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

14. BUSINESS TRENDS
• Destination Marinas - To attract both annual and transient boaters, marinas are providing more than just
docking facilities. Some are associated with restaurants, hotels, retail shops, condo developments, and golf
courses. Boaters increasingly are looking for destinations, rather than cruising or fishing.
• Megayacht Marinas - A niche market that is continuing to grow is the Megayacht segment. These are boats
in the 80’ + category and are priced anywhere from $10 to $ 100 million dollars and more. At present, due to
the fast growth of this segment of the market, there is a critical shortage throughout the world of marinas with
docks large enough to accommodate these boats. The dockage rate for this segment of the pleasure boating
community is generally 2 to 4 times higher than the rates for boats of a smaller size. Picking Location - The
location needs of the Megayacht markets are very different from cruiser or other smaller boat size markets. “
Build and they will come” doesn’t work. There must be a reason for these boats of the ultra rich to visit the
destination.
• Slip Sizes- Development of new ocean access wet slip marinas with slips less than 40’ is becoming a rarity.
The owners of boats of this size and larger are willing to pay higher dockage rates. Also, it is possible to
accommodate a smaller boat in a larger slip but not the reverse. In addition, many of the newer boat rack
storage buildings and marina fork lifts are designed to handle boats up to 40’.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

15. BUSINESS CHALLENGES
• Highly Leveraged Business - Marinas require heavy investment and have high fixed costs, so ongoing high
occupancy is crucial to financial success. With PP&E (Property Plant & Equipment) high and variable costs
low, marinas depend largely on the ability of the operator to achieve high occupancy rates through astute
marketing and excellent services. Small changes in occupancy rates have a big impact on
profitability, increasing the overall risk of this business.
• Dredging Regulations - Dredging regulations, coupled with limited dredged material management
options, typically make dredging a significant operations' cost for marinas. While new work dredging, for the
most part, is more strictly regulated than maintenance dredging, the biggest problems are created for
marina operators in terms of permits and costs by the ongoing need to maintain channel and basin depths.
• By 2017 more than 27 million people are expected to reside along U.S. coastlines The desire of people to
be on or near the water has caused a spiraling escalation of waterfront property values. This has created a
new challenge in the marina business. With all this land being purchased for land side development of
resorts, condominiums and rental apartment buildings there is less opportunity for building new free
standing marinas. Many of the free standing marinas that have traditionally been small family businesses
are selling out to land-side developers. Needless to say, the competing interests for valuable waterfront
property and new environmental policies are creating major hurdles for new marina development.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

16. CRITICAL ISSUES
• Dependence on Economy - Boating, because it's recreational, tends to be more subjective to
fluctuations in the economy than other activities. Demand for marina services are tightly bound to
new boat sales, which in turn depend on the health of the US economy and consumer spending.
The long economic expansion of the 1990s promoted steady increases in sales of inboard-motor
and sailboats. In the current economic slowdown, boat sales dropped considerably over the past
few years.
• Environmental - Marinas are subject to various state and federal environmental regulations
concerning direct water pollution from boaters, contaminated storm water runoff, and dredging
operations. Because of the high concentration of oils, fuels, soaps, paints, solvents, sewage, and
sanded materials, in addition to unknowledgeable boaters, marinas must take extraordinary
precautions to prevent water pollution. Voluntary standards have been established for best
practices that result in a “Clean Marina” designation. Violations of environmental regulations can
result in heavy fines and other penalties.
• High Construction Costs - Construction costs for new or expanding marinas can be $60,000 or
more per slip, due to the extensive permitting processes, requirement for more durable
materials, and because underwater soil must be environmentally tested. Although lumber costs fell
0.4 percent in January 2006 compared 2005; steel grew 13.3 percent; cement climbed 4.5
percent, according to Engineering News-Record. To produce a 10 percent return on such an
investment, monthly slip rental and other income must average $600.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

17. SUMMARY
• Many inland marinas are starting to report greater • Construction costs for new or expanding marinas can
customer volume as boaters leave expensive and be expensive, due to the extensive permitting
damaged coastal marinas for safer and lower priced processes, requirement for more durable materials, and
locations. because underwater soil must be environmentally
tested.
• Marinas require heavy investment and have high fixed • Although most reservations for slips come over the
costs, so ongoing high occupancy is crucial to financial phone, the internet is beginning to play a bigger roll in
success. booking reservations
• Property and construction costs, coupled with limited
• Marinas near upscale retirement locations fare particularly
supply of prime locations, inhibit new marina
well in times of increasing numbers of retirees.
development.
• Boating, because it's recreational, tends to be more subject • Many marinas are being bought by developers and
to fluctuations in the economy than other activities. converted into luxury waterfront residences.
• Dry stack facilities are common in areas with cold winters, • Newer Marinas offer electricity, water, TV and phone
and are also a launching alternative where waterfront is hookups; bilge and sewerage pump outs; maintenance
limited. This type of boat accommodation is ideal for casual and repair services; fuel sales; grocery and supply sales;
boaters. bar and restaurant sales; laundry services; boat sales; etc
• Marinas located in areas prone to adverse weather
• In some cases marinas can apply for federal grants under conditions such as yearly hurricanes and harsh winter
National Boating Infrastructure Grant Program (NBIG) to storms are more likely to have higher insurance and
construct, maintain, and renovate docks; dredge maintenance costs.
waterways; install utility services.
© 2012 Unpublished work no portion of this presentation may be copied in whole or in part without written approval of Richard Graves

18. Richard Graves & Associates
Marketing Operations
► Market Research ►Start-up Management
and Analysis
► Strategic Market ►Staff Hiring/Training
Planning
► Media Planning and ► Grant Application
Placement Assistance
► Collateral Design and ► Marina Acquisition
Production Analysis
► Market Positioningand
Competitive Analysis ► Marina Expert Witness
► Customer Relationship
Management ►Feasibility Studies
► Event Planning and
Public Relations ►Operation Manuals
► Full Marketingand Sales ► Florida Certified County
Representation Court Mediator
► Web Design and ► Marina Business
Positioning Brokerage
1000 SE 4th Street - Suite 224 — Fort Lauderdale, Florida 33301
Phone: 954-524-2131 — Skype: rvgraves - Email: rvgraves@rgassoc.com
Richard Graves & Associates Web: http://www.rgassoc.com
Professional Marine Realty, LLC Web Site: http://www.promarine-realty.com