I spent some time today looking at current marina listings on the web.  Of course I cannot peg numbers for marinas by just looking at a picture, but I saw some extremely large listing amounts, extremely long days on markets and many who are touting their approvals for condos, dockominiums, etc.  I picked out a few to look at in easy areas and found that many were recently purchased and people were trying to recoup their investment plus a large profit.  The reality is if you bought in 2006-2007 and even into the beginning of 2008 you most likely overpaid and you are upside down unless you put big bucks down at closing.

Waterfront land can be very valuable, but it is not a free pass.  In most areas so much more time and effort goes into building on or near the water.  Heightened environment laws make it harder along with an ever expanding time frame to obtain improvements.  Many investors lost out on the momentum of the past market simply because approval times for expansion or conversion were so long.

Some advice for new marina owners or long term ones looking to sell their property:

1. Decide if you can cover your debt service and stay with the marina maximizing income or give up.  Many have listing prices well above the height of the market.  You’re wasting your time and prolonging this crisis.
2. Realize that investors are out there, but they are looking for 50 cents on the dollar from the top of the market.
3. Giving up can also be renegotiating with your lender.  Remember… lenders have the same 50 cents on the dollar buyers and perhaps lower at that point.
4. Entitlements and approvals for expansion are not adding value to properties.  It cost a small fortune to get that condo tower approved.  I’m sorry to say it means nothing in this market.
5. Find out what it’s worth so you can make decisions and start negotiating with your lender.
6. If you can find a way to stay‚ good … now get yourself experienced management if you are new at this.

The Realtors are frustrated.  Many tell me they cannot convince you that you cannot get the number your were hoping for.  I understand how that feels.  I’m an entrepreneur and I’ve made bad decisions in my life.  Everyone has. Many investors were mainstream real estate people who had no idea what they were getting into.  The value of your marina is based on the current income potential.. not three years from now or two years ago. It’ s what you can do now that matters.

We do see some hope.  The large players are starting to get financing, but right now financing is scarce for the individual marina.  We’re working hard to come up with reasonable underwriting criteria and benchmarks so lenders will come back to marinas but they will not come back to listing and sales prices that are not supported by solid numbers and at a capitalization rate higher than other forms of real estate.

Find out today where you really need to be.  Don’t agree with your Realtor?  Get an opinion from a disinterested party.  Make the hard calls and get momentum going.  Marketing your property for over a year only hurts your business, prolongs this crisis and puts you more in debt.