PHOTO: Facebook/Prestige Yacht Auction

Following the first-ever yacht and megayacht auction at a boat show last month, Morley Yachts plans to hold one again during the upcoming Monaco Yacht Show.

Prior to the Antibes Yacht Show a few weeks ago, where the first auction was held as Prestige Yacht Auctions, Tim Morley of Morley Yachts pledged that the auction would redefine the way megayachts sell. It was promoted much the way fine-arts auctions are, including featuring live television feeds via satellite (to the Star Deck at Stars ‘n’ Bars in Monaco, in this case). In addition, the goal was to eliminate the seemingly constant price adjustments that go on in the brokerage market. Among the yachts available for bidding were the famed Delphine and Lone Ranger (pictured), the latter of which sold. It’s also worth noting that Lone Ranger sold to a longstanding client of Burgess and was bid on at the auction by a Burgess broker at his request. Morley says other yachts continued to attract interest after the auction closed and then sold, while others are the subject of ongoing negotiations.

The main problem encountered with the auction during the Antibes Yacht Show was limited prior notice. News came only a month beforehand, for example. That problem should be remedied for the Prestige Yacht Auctions event at the Monaco Yacht Show, however, as it will take place on September 28. In addition, “We are planning several new strategic partnerships to further improve the awareness amongst buyers and sellers,” Morley says. He adds that potential buyers and/or their brokers will also have more time to inspect the yachts.

Morley cannot yet reveal many specifics regarding the yachts and megayachts that will available for auction, though for comparison’s sake, 22 were on hand for the Antibes Yacht Show event. For now, he can say that a sailing superyacht measuring more than 131 feet (40 meters) and a classic motoryacht will participate. A catalog will be produced and sent to registered buyers prior to the auction. (Should a seller happen to strike a regular sales deal between the release of the catalog and the auction date, Morley says, he or she will be able to withdraw the yacht up to 48 hours before the auction.)

The auction will see megayachts sold either as-is or “subject to survey.” The latter means the highest bidder will have a chance to commission an independent survey after the auction. Should significant issues be uncovered that were not previously disclosed, an appropriate price reduction can take place, or the seller can fix the problem at his or her expense prior to completing the deal.

In addition, sellers will set confidential reserve prices, just like a traditional auction, and the megayachts will not sell for less than that figure. Sellers will be required to pay an entry fee of €1,800 ($2,378 at press time) and a nine-percent commission if their yacht sells. Buyers pay only a 0.2-percent fee for the legal stakeholder service—no commission. They additionally sign a memorandum of understanding drawn up in accordance with the standards of the Mediterranean Yacht Brokers Association, one of the leading industry trade organizations. Brokers representing the buyers will receive a commission of at least four percent, Morley says, something not offered at the last auction. Further changes: A large screen will display lot numbers, making it easier for bidders to keep track of the auction, and the auctioneer will be a native English speaker.

Morley says he and his team learned several lessons from the last auction and are putting them into practice to make the Monaco Yacht Show auction better for all parties. Above all, though, Morley believes the immediacy of an auction attracts buyers and sellers alike. “Of course, the buyers are also looking for a good deal, but the sellers are realistic, and they know the auction is a good opportunity to strike for, so they set the reserves as low as they are willing to accept,” he adds.

Specifics on registering, pre-auction inspections, and more will be available in the coming weeks. We’ll update this story accordingly.