Super-rich sail for Montenegro
Ambitious plans to transform the small Balkan state of Montenegro into a haven for superyacht owners could be sailing into trouble.
If the deepening global recession wasn’t worrying enough for the €650m ($824m) Porto Montenegro development, one of the project’s billionaire backers has seen his fortune decimated by the fi nancial crisis.
The idea to turn a dilapidated, former Yugoslav naval base in the Bay of Kotor into a luxury marina was the brainchild of Peter Munk, an octogenarian Canadian oil tycoon.
After struggling to fi nd a berth for his large yacht in the Mediterranean four years ago he fi gured a new port catering for the new generation of superyachts would fi nd instant favour with the billionaire boat crowd.
“Yachts are getting bigger and people are complaining they can’t fi nd proper berths for them,” he says.
Munk put together what looked to be a gilt-edged syndicate of Europe’s wealthiest businessmen to fund the project, including father and son Jacob and Nathaniel Rothschild; French luxury goods billionaire Bernard Arnaud; and Russian aluminium oligarch Oleg Deripaska.
CRISIS But the financial crisis has forced Deripaska to give up stakes in several companies, after having to make margin calls on loans and seek a bailout from the Russian Government for Rusal, his aluminium company.
The oligarch’s links to Lord Mandelson, the UK Minister for Business, have also come under scrutiny in the British media after Deripaska entertained the politician on his £80m (€90m) superyacht Queen K last summer.
During Mandelson's tenure as European Trade Commissioner, the European Union backed Montenegro’s accession to the World Trade Organisation and cut tariff s on aluminium imports to Europe.
Both moves benefited Deripaska, whose KAP aluminium plant accounts for 20% of Montenegro’s GDP and 80% of its exports. Despite his problems, Deripaska remains fully committed to the Porto Montenegro project, in which he has a 7% stake, according to a spokesperson.
Porto Montenegro brought forward its launch by a year in a bid to build momentum before the global recession really starts to bite. It is also undercutting every other superyacht marina in the Mediterranean, with annual charges of €27,000 for a 100-metre yacht being less than half the price of the next cheapest port, nearby Dubrovnik in Croatia.
Oliver Corlette, general manager of the project, says: “We lowered the price to make it enticing for people to come and try our marina in the fi rst place. As Montenegro is not a traditional location for berthing, dropping the price particularly in these times makes it easier for people to give something new a chance.”
PROPERTY A bigger challenge will be finding buyers for properties in the attached marina development, which is where Munk and his investors expect to make most of their money. Corlette is off ering a 75% discount on a berth for three years with the purchase of a property. He says: “Times are tough, but we have had some interest.”
Such has been the boom in yacht ownership in recent years that the project could yet emerge unscathed from the economic squall. The number of superyachts in excess of 24 metres (82ft) has tripled in the past decade and waiting lists remain lengthy at top boatyards.
Between 350 and 500 superyachts will be launched globally this year, according to Ugo Garassino, deputy general manager of Italian yachtmaker Azimut Yachts. He predicts Porto Montenegro will have little trouble fi lling its marina, despite the credit crunch.
He says: “A new port in the Mediterranean? It will be full within three days.”
The marina can, at least, boast its first high-profile tenant. Deripaska’s fellow oligarch Roman Abramovich is allegedly buying a berth for his £225m 168-metre megayacht Eclipse, which on completion next year will be the biggest privately owned yacht on the seas.
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