1. Vail Williams Marinas – an alternative property investment A presentation by Ian Froome BSc MRICS Partner, Marine & Leisure

2. Marinas – an alternative property investment ■ Marina characteristics ■ What makes a popular marina? ■ Marina valuation ■ A marina as a trading related property investment ■ Investment criteria applied to marina income ■ Case study 2 19 November 2013Marinas – an alternative property investment

3. Marina characteristics ■ Floating pontoons and secure bridgehead ■ Commonly include a breakwater to create a secure marina basin ■ Boatyard marina or Marina village? ■ Tidal access restrictions and dredging ■ Workshops and boat repair ■ Dry storage 8 July, 2016Marinas – an alternative property investment 3

4. Sparkes Marina, Chichester Harbour 4

5. Hythe Marina Village, Southampton 5

6. Portland Marina and Olympic Sailing Venue 6

7. Boat lifting and storage 7

8. Dry stack boat storage 8

9. 8 July, 2016 What makes a popular marina? Marinas – an alternative property investment 9 ■ Location ■ Facilities ■ Water depth and access – restricted by tide? ■ Racing & tradition

10. 8 July, 2016 Location Marinas – an alternative property investment 10 POPULARLESS POPULAR Solent  Poole Harbour  Lymington River  River Hamble  Cowes, Isle of Wight  Portsmouth Harbour  Chichester Harbour South East Littlehampton to Thames Estuary South West  South Devon and Cornwall South West North Devon Coast North Wales  Conwy  Anglesea  Pwllheli South Wales West Scotland  Outer Clyde Estuary  Western Islands Eastern Scotland East Coast  River Crouch  South Suffolk North East

11. Ancillary facilities ■ Workshops – leased or owner managed ■ Boat sales – new boats or used boat brokerage ■ Chandlery ■ Restaurant / Clubhouse ■ General retail and leisure 8 July, 2016Marinas – an alternative property investment 11

12. Marina valuation ■ Profits method of valuation – similarities to investment valuation ■ Trading related property – valuing a business opportunity, not just land & buildings ■ Market Value “as a fully operational marina, valued with reference to trading potential” ■ Fair Maintainable Profit: The level of profit, stated prior to depreciation and finance costs relating to the asset itself, that a reasonably efficient operator would expect to derive based on an assessment of the market’s perception of the potential earnings of the property. 8 July, 2016Marinas – an alternative property investment 12

13. Marina valuation Sample accounts summary YEAR ENDING200820092010201120122013 Total Revenue£852,000£787,000£802,000£783,000£771,000£787,000 Total costs and expenses£375,000£368,000£338,000£321,000£331,000£360,000 Net Profit (EBITDA)£477,000£419,000£464,000£462,000£440,000£427,000 Profit as % of turnover56%53%58%59%57%54% 8 July, 2016Marinas – an alternative property investment 13

14. Marina valuation Fair Maintainable Trade & Profit YEAR ENDING 201120122013FMT Total Revenue£783,000£771,000£787,000£784,000 Total costs and expenses£321,000£331,000£360,000£371,000 Net Profit (EBITDA)£462,000£440,000£427,000£414,000 Profit as % of turnover59%57%54%53% 8 July, 2016Marinas – an alternative property investment 14

15. Marina valuation ■ What yield is appropriate? ■ Location & specification ■ Income security ■ Future growth prospects ■ Allowances for irregular or one-off income/expenditure 8 July, 2016Marinas – an alternative property investment 15

16. Marina valuation Fair Maintainable Profit£414,000 Yield9% YP in perpetuity11.111 £4,600,000 Deductions: Replacement pontoons£500,000 Sea wall repairs£500,000 £1,000,000 Market Value£3,600,000 8 July, 2016Marinas – an alternative property investment 16