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FREQUENTLY ASKED QUESTIONS ABOUT SHARED OWNERSHIP |
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What is shared boat ownership? How are the holiday weeks chosen? Are there special arrangements to fit in with school holidays? How much does it cost to purchase a share? How much will my share be worth if I want to sell it? For how long would I own the share? How long will the syndicate be in existence? How much is a share going to cost me? What will my annual contribution to the boat's upkeep be? What are your administration charges? Can we see if someone isn’t paying their fair share? What happens if someone doesn’t pay up? What is expected of a syndicate member? Can the boat be hired out or offered for skippered hire? Where will the boat be moored? Do I need training before using a shared ownership boat? Are your boats members of RCR? What happens if the boat has a breakdown? What if we break down a long way from our base? Do you have a central help-line? Why shouldn't I buy a boat for myself? What advantages are there in shared ownership? You put a great deal of emphasis on syndicates getting their own ‘Syndicate Agreement’ why is this? How do we know our money is safe with BCBM? How do we know you’ll do a good job? Do you get everything right all the time? Do we have to move to one of your marinas? Are you going to build new boats? How are the new boats being funded? What would happen if you or one of the team is taken ill?
What is shared boat ownership? Several families (usually 12 or 13) together own a boat as a syndicate. Each contributes to the upkeep in proportion to the size of their share of the boat. Owners usually get at least four weeks holiday on their boat each year. The boat is managed for the syndicate by a company called BC Boat Management Ltd. How are the holiday weeks chosen? There are two systems we use: The Draw system – the year is divided up into the four seasons. At the syndicate AGM each year, a slip with each week in the quarter is put in a hat. Owners draw the slips out at random, according to the number of shares they own, and that decides the week of their holiday in that quarter. A feature of this system is that once owners know their weeks they can then exchange them with other owners or some syndicates use a rota ladder system which moves owners upwards each year to give everyone a chance to draw first over a period of years. If you are unable to use your allocated week you may either swap with another owner or you can offer the unused time for use by another member of your syndicate. As weeks become available under this system you may be able to take up unused weeks from other owners, the only additional costs being the diesel and pump outs, in these cases. The List system – the shares/owners are listed in a set sequence which rotates two places each year. For this year, the first choice of weeks goes to the owners at the top of the list and then in order down the list. At the end of the year, the two owners at the top of the list drop to the bottom and everyone else moves up. Usually three weeks are selected this way, then owners can ask to use the boat for the remaining free weeks left, with the priority from the bottom of the list this time around. Are there special arrangements to fit in with school holidays? Many of the boats have some 'special status' school holiday shares that allow those owners to choose their weeks first to fit the school holidays. There are normally no more than two of these 'special' shares in any syndicate and owners pay an annual premium into the boat account to have this option. Each syndicate decides what this premium should be, but it generally ranges between £100 - £250 per annum. If the syndicate does not operate the special status share option, when the draw takes place at the AGM, other owners are encouraged to co-operate by swapping school holiday weeks that they have drawn if they don’t require them, with those who specifically need them. Many of the owners would rather not have school holidays and if they do draw them are happy to swap. Yes. Many syndicates now have share certificates on which you can include up to four family members (21yrs or over) who you will allow to use the boat without you being on board. Most shared ownership boats can sleep up to 6 people, so you can take friends and family cruising with you. Some of the boats we manage are just four berth. How much does it cost to purchase a share? Currently shares are on offer from £1,800 up to £10,000, for a share in the newly launched BCBM boat Dawn Treader – the price depends on what owners are asking for their share and generally this reflects the age, facilities and market value of the boat. The easiest way is to do this through BCBM Boat Share Ltd, who will deal with all the arrangements for you and offer a ‘one stop shop’. How much will my share be worth if I want to sell it? This is dependent on many factors - age & condition of the boat, supply & demand for shares but over recent years, the value has remained fairly constant with shares holding their value. An owner selling their share determines the price at which they wish to sell, but would generally seek advice from BCBM. BCBM Boat Share Ltd offers for sale boat shares, under the instruction of the owner, whether we manage the boat or not. We’re proud to be able to say that on average, we take just 8 weeks to sell resale shares and we get an excellent market price for them too - It’s become a sellers market. For how long would I own the share? For as long as you choose. You can keep the share, pass it on to your heirs or sell it at any time. You are issued with a share certificate and this is a tangible asset which becomes part of your estate. How long will the syndicate be in existence? The syndicate will be in existence for the life of the boat. Being maintained to a high standard the life span of the boat is virtually unlimited. Generally over 75% of the syndicate must be in agreement before the boat can be sold, this is most unlikely to happen, but this percentage can differ between syndicates. How much is a share going to cost me? Each syndicate member pays the share purchase price being asked by the current owner of the share and they contribute to the annual operating costs such as mooring charges, insurance, licence etc. and also to each year’s winter maintenance costs. The contribution amounts to 8% for each four week shareholding. You can purchase a maximum of two shares in any one syndicate. What will my annual contribution to the boat's upkeep be? This will depend on how many owners there are and what the syndicate decides to have done on the boat. Generally it's in the region of £1,500 a year, which is about what it would cost to hire a similar sized boat in the summer for a single week. So shared ownership works out less expensive than hiring. Definitely not. What’s more, you can see that we don’t via our completely transparent accounting system (see above). An electronic note is attached to each item on the spreadsheet so you can see what every single payment was for. If any owner wishes, they can request to see any invoice from a supplier, base or third party supplier. Carole Briese, our Financial Manager will scan and e-mail or post it to you. That way you know you’re getting value for money from suppliers too. What are your administration charges? Current charges are £340 plus VAT, which is £400 including VAT, (which has been held at just 17 ½% until August 2012) this is per single 8.33% or twelfth share owner. You can either pay your boat running costs and the administration charges (which of course are paid to separate accounts) on a 6-monthly OR monthly basis. If you choose the latter, then this is by standing order. In fact we actually prefer you to pay monthly That way you keep hold of your own money for longer and if anything ever did go wrong you’ve only ever paid 4 weeks in advance. Can we see if someone isn’t paying their fair share? Yes. As part of the monthly accounts, you can see the income from owners as well as expenditure. What happens if someone doesn’t pay up? We chase any unpaid invoices - not the most pleasant of tasks sometimes, but its part of the service. One of the most common questions we’re asked by new share owners is, ‘What happens if someone doesn’t pay their dues’, so it’s something we take very seriously. (See ‘Legal Matters’ in our newsletter on line) In cases of genuine hardship, we will arrange to sell the share in order to pay off the debt, with the balance going back to the owner less any commission etc. If an owner continually and knowingly defaults on their payments in a way that compromises other syndicate members we will take them to court, we have in the past and won each time. We would recommend that you have a clear course of action for such eventualities written into your syndicate agreement. What is expected of a syndicate member? Each syndicate member is responsible for the boat whilst under his/her control and for any self inflicted damage such as broken windows and damage to carpets or upholstery. At the end of each weeks use, the syndicate member is responsible for refuelling, filling up with water, pumping out and cleaning the boat so it is completely ready for the next owner. The other responsibilities are covered by the Syndicate Agreement. Can the boat be hired out or offered for skippered hire? Definitely NOT. There must be a named person on the share certificate on the boat at all times. Where will the boat be moored? The owners decide at their syndicate AGM where they want the boat to be moored for the following year. Boats usually stay in one place for a couple of years so that owners can cruise the available routes and then they move the boat somewhere else to give different cruising routes and eventually it moves around the whole canal network in a logical sequence. Do I need training before using a shared ownership boat? Many syndicate agreements now recommend that owners have appropriate training. Owners who have done so, generally find that it improves their confidence and the enjoyment of their boat? BCBM recommends Tony Ward whose details can be found HERE. Yes we do at marinas which have the highest proportion of our managed boats – ours are referred to as Area Managers. Are your boats members of RCR? No, we have a ‘rescue’ service provided by our yards and marinas where your boat is moored at the time. What happens if the boat has a breakdown? If you have a breakdown that you are unable to fix yourself, you would contact the boatyard and a mechanic will attend to rectify the problem. The cost of this call-out is invoiced and paid out of syndicate funds. As the boat has regular maintenance carried out, incidents of this nature will be few and far between. Payment for self-inflicted problems will be the responsibility of the syndicate member using the boat. What if we break down a long way from our base? Then we can arrange someone closer to come out to you from our network of bases and highly qualified engineers we use. Do you have a central help-line? Yes, and in case of difficulty you have 24/7 access to our locally based on-call engineers, we think that makes sense to be your first port of call. Our central number is manned around the clock too (01270 628 076) it will point you to the out of hours number as and when required. (We make every effort to get you on your way – we even replaced an entire engine once within 36 hours of it seizing up while out on the cut). At BC Boat Management Ltd (BCBM) we specialise in managing and looking after all types of boats which are owned by syndicates of people who just want to go boating and sailing and leave all the hassle of looking after and running the boat to somebody else. Now that’s what I call a holiday and as well as an excellent idea, it’s a good investment We are building our business on reputation and that means first class service in all departments appertaining to ‘Caring for your Investment’. We call it the personal touch! Why shouldn't I buy a boat for myself? There are several reasons for not buying your own boat, the biggest reason being the initial capital outlay. Then there is the cost of the mooring, licensing, insurance and the maintenance. As the sole owner of a boat you would probably only use it 4 or 5 times a year which is a not advisable as boats like to be used, otherwise they deteriorate much faster than if they are run regularly. What advantages are there in shared ownership? Shared Ownership is a solution to cater for those who were definitely not going to make use of a boat more than 4/5 weeks a year. This system enables you to buy into a far higher quality boat than you may normally be able to afford and then to reduce the running costs down to only 8% per share of what they would be in sole ownership. You put a great deal of emphasis on syndicates getting their own ‘Syndicate Agreement’ why is this? When the company builds a new boat and sells shares in it, they ask share owners to sign a legal agreement, which defines their rights and responsibilities. If that company ceases to exist then that agreement is null and void. So owners are usually left with no binding agreement even between themselves and this can leave owners open to all kinds of potential difficulties. It’s in every owners interest that rules are agreed and observed by each member of the syndicate. That’s why it’s extremely important to ensure that you have a syndicate agreement in place. BCBM has draft agreements available, but it is for each syndicate to agree on their own rules. That way, whichever way you decide to go in the future, your relationship within the syndicate remains intact. How do we know our money is safe with BCBM. Following the collapse of two major boat management companies over the last four years, we needed to rebuild the trust of owners who had lost money. So each boat has its own client bank account with HSBC. Income and expenditure spreadsheets are sent each month to every single owner along with a copy of the month’s bank statement from HSBC. On top of this, each syndicate Chairman has an HSBC ‘Dongle’ and can view the account online anytime day or night 24/7 - we offer complete transparency at all times. How do we know you’ll do a good job? Well, the proof of the pudding is in the eating. But there’s one thing that always keeps us on our toes. It’s that you only appoint us one year at a time. If we don’t come up to scratch after each year, we don’t deserve to be reappointed. At every AGM you get the chance to either reappoint us or not, simple as that. We also sign a ‘Service Level Agreement’ which shows exactly what we promise to deliver and by what measure you can expect to judge us. On brand new boats and syndicates however, you sign up for an initial three years with BCBM to begin with. Yes, they do. A couple have left to self-manage, but even one of those came back. We like to have a good relationship with all boaters if we possibly can, whether they are our customers or not. It’s a small world in boating and it’s good to make friends. Do you get everything right all the time? No, no-one can. But we try to get as close as humanly possible. It’s a two way street and at BCBM we believe in working closely together as a team every step of the way. Yes. It’s entirely up to you. You choose what system you want and we will gladly administer it. You would be employing us … we won’t dictate to you. Remember, It’s your boat, your Money and certainly your decision at all times. Do we have to move to one of your marinas? No. If you want to stay where you are now, there’s no reason not to. We’d sort the arrangements out. And if you do want to move, we’d sort that out too, unless your marina is owned by a competitor management company from whom you are moving of course, then a move may be necessary. Are you going to build new boats? Yes, we have just commissioned our third brand new boat. However we will not build new boats unless there is a clear demand for shares in them. Our business model does not rely on new boats being built and we do not have to do so in order to remain successful. How are the new boats being funded? NOT from syndicate funds - in fact not even from BCBM funds. We have financed the boat builds via independent financiers. This is completely ring-fenced from BCBM and of course, any of the boat accounts. What would happen if you or one of the team is taken ill? A. There is a robust contingency plan in place for each of us to ensure that continuity is maintained at all times and the business is not affected whatsoever. If you have any other questions not answered here, or need clarification on any of the points made, please don’t hesitate to call us.
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