Northrop & Johnson is considered one of the world’s foremost yachting authorities, with more than six decades of experience offering sale, purchase, charter, management, and new construction services for an elite clientele. And while 2020 has been a confounding year for many businesses, brands that cater to high-net-worth individuals have seen an uptick in demand, largely attributed to the increased desire for privacy and seclusion brought on by the Coronavirus pandemic.
JustLuxe recently spoke with Daniel Ziriakis, the COO of Northrop & Johnson, who discusses business growth in these complex times and provides insight into the market outlook for yachting consumers.
Luxury has evolved beyond scarcity, craftsmanship, and true worth to also include sustainability. How has the superyacht industry fared in these areas?
Yachting clientele have always focused on scarcity, craftsmanship, and true worth as hallmarks of the yachts that they purchase or charter, but we have seen a rise in sustainability. More owners are requesting fuel efficiency and other sustainability options onboard their yachts in an effort to reduce carbon footprints and help the environment. The increased interest in superyacht sustainability is on the rise, but we did not notice a particular uptick in 2020.
From our perspective at Northrop & Johnson, the superyacht industry fared well in 2020 despite a global pandemic. As many yacht owners and charter clients focused more on family and togetherness, we saw many purchasing yachts to quarantine away from the masses and charter clients enjoying holidays in more isolated areas. Yacht sales remained steady throughout the year with impressive upticks in sales during the summer months. Charter was slower in the beginning of the summer but began to steadily increase toward the fall and into the holiday season.
As for 2021, with the advent of the COVID-19 vaccine, we are seeing a lot of interest for the summer charter season as many put off their summer holidays in 2020. This is why we are encouraging clients to book now – N&J offers trip cancellation insurance – as many yachts will be booked up as people feel more confident traveling again once they get the vaccine. We anticipate a very busy charter season and a steady year for sales as people come out of quarantines and isolations and get back on the water.
What insights do you have into the wants and needs of ultra-high-net-worth individuals in 2021, and how will Northrop & Johnson fill those needs?
In May of 2020, Northrop & Johnson conducted a survey of its UHNW clients, seeking their insights on yachting and other luxury interests, including how COVID-19 is impacting their plans, behavior and lifestyle for the foreseeable future. In every category except online shopping, home entertaining, private aviation, and yachting, over 50% of Northrop & Johnson customers said they plan to decrease or completely stop their usual activities until COVID-19 is mitigated. Those categories include flying on commercial airlines, dining out at restaurants, shopping at malls, department stores and small boutiques, attending live events, attending conferences and conventions, and staying at hotels/resorts.
These insights tell us that until a vaccine is widely distributed and COVID-19 is mitigated, which will be several months into 2021 at best, the priority for UHNWIs is to stay safe. More than ever, this affluent segment is looking to travel cautiously, seeking secure environments or safe sanctuaries for their vacations. Owning a luxury yacht or booking a luxury yacht charter allows for a safe, hygienic and worry-free experience, and Northrop & Johnson is here to assist clients in creating that experience and making their yachting dreams a reality.
CEOs of luxury brands like Exclusive Resorts and JetEdge have said that they saw an uptick in membership this year, and with JetEdge, the demand for larger jets. Have you seen similar increases in demand?
The demand for larger yachts is something we see every year and the yachts launched from the world’s yacht builders are larger every year. In 2020, we saw a lot of interest in the mid-size brokerage yacht market as newcomers to the industry dipped their toes into yacht ownership but tried-and-true yacht owners are always interested in building bigger. We are extremely excited to welcome these new yacht owners into the market and we hope that as they find their true passion for yachting, they, too, will continue to upsize their yachts.
Do you have any new destinations that are available for yacht charter in 2021?
One of the best aspects of a luxury yacht is the ability to explore the world. This year, various yachting favorites were not available due to travel restrictions stemming from COVID, so yacht owners and charter guests enjoyed destinations they perhaps hadn’t visited in a while or ever before. A lot of owners have opened the door to exploring less typical regions. For example, Antarctica and Alaska are two remote destinations that are definitely gaining interest and the more remote islands of the South Pacific and Southeast Asia are garnering some interest as well. Northrop & Johnson