Abu Dhabi's newest marinas are in a price war, as they try to fill their berths in uncertain economic times.
Price war in capital as marinas try to fill berths
The top luxury marinas in Abu Dhabi are locked in a price war as they compete to fill berths in a difficult economic environment.
Toby Haws, the marina manager at Emirates Palace, said the marina, which opened this year, was offering a third off the original price of berths of any size, depending on the location in the marina.
The discount was originally introduced to entice boaters to rent berths, but is likely to become permanent.
"But I am not looking to fill the marina at any cost," Mr Haws said.
Yas Marina is also offering attractive packages to lure boat owners. The marina recently launched annual rates starting at Dh16,455 (US$4,480) for an eight-metre boat, inclusive of one berth for the Formula One Grand Prix in Abu Dhabi next year.
Berths with track views at the marina start from Dh30,800 for a 15-metre berth and rise to Dh491,400 for a space that can accommodate a 120-metre yacht. "Our discounted annual berth prices start from Dh39,000 and go up to over Dh1 million, depending on the size of boat and location of the berth," said Mr Haws.
"It's better to have a berth sold with a discount than not having it sold at all," said Berend Lens van Rijn, the managing director at Belevari Marine in Abu Dhabi.
"There's more supply of course now than demand. Before, there was more demand than supply and berths were being sold under the table for Dh30,000, Dh40,000," he said.
One of the challenges for the growth of Abu Dhabi's marine industry is that so much of the population is made up of expatriates in uncertain economic times.
"People don't even know if they're going to have a job in the next three months, so the people who own boats tend to be ones who have their own businesses, have been here for a long time, have job security, or are locals," said Mr van Rijn.
The high costs were also a deterrent to potential boat owners, he said.
"The price to keep a normal small boat, to keep it in a marina, with a tracking device, with the insurance, with the headache of owning it, and the maintenance, will cost you Dh30,000 minimum. There's only a small percentage of expat residents that could actually have that kind of disposable income." Ultimately, any decline in prices would be positive for the industry, said Mr van Rijn.
"It's good because the cheaper it is to keep your boat in Abu Dhabi, the more boats will be there and the more people will buy boats. It's a whole circle of more people buying boats, the cheaper the services will come and more competitors. It's a healthy situation."
Emirates Palace said its tariffs remained relatively expensive, despite the offers.
"We have publicised that there are opening discounts available, but we're not shouting about the price because we are not the cheapest marina," said Mr Haws.
"There are yacht owners who are just trying to get the most economical deal.
"I want people in the marina that are active but are keen on our yacht experience. "If your reason for moving berths is financially motivated, then we are not going to stand a chance because that's not our appeal."
Nonethless, "there's a pricing war going on in Abu Dhabi, there's no doubt about that".
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