Victor Ballestas, a principal with a Miami investment firm acquiring marinas, has a tongue-in-cheek screening method for choosing his firm’s next Class A target. “I joke with my guys that if you don’t want to keep your boat in that marina personally, we shouldn’t be looking at buying it,” Ballestas says.
In five years, Integra Investments, the firm he’s with, spent $350 million on marinas that meet that test. It bought three of its seven marinas in 2023 alone.
Integra thus was part of the headline trend in the marina world: Major investors with billions of dollars in the aggregate rolling up marinas across Florida and the nation — until this year. Integra and its competitors paused in 2024 due to higher interest rates. “I think we all kind of looked at a similar tactic and slowed things down a little bit, just to kind of assess,” Ballestas says.
The marine industry is big business in the state. Florida annually does $5.4 billion in new boat, engine, trailer and accessory sales at 7,146 businesses, according to the most recent National Marine Manufacturers Association study.
All those businesses depend on consumers navigating a bottleneck: access to water. The number of Florida boaters, post-COVID, has grown while the number of marinas is shrinking. The nation’s largest market for boat ownership, Florida as of 2023 had 1.004 million registered recreational boats, up 16% in a decade — roughly the same rate as population growth — and another 31,000 commercial vessels, plus boats registered elsewhere visiting Florida. There’s about one boat for every 23 Floridians.
Some 95% of boats can get to the water via trailer and ramp. But owners with vessels longer than 26 feet can face wait lists for slips and dry racks. Further constricting slip supply is a trend toward longer, wider, heavier boats that take up more marina space. “It’s a very finite resource,” says A. Michelle Ash of Simply Marinas, a Coral Gables-based marina broker.
That resource is undergoing a rapid change in control. Some marinas, such as the Pier Sixty-Six in Fort Lauderdale, long have been tied to major resort properties owned by significant investors. But most marinas are mom-and-pop affairs lacking capital to redevelop and upgrade.
Emerging a couple decades ago were acquisition-minded, high net worth investors such as Wayne Huizenga Jr., the son of the late Fort Lauderdale billionaire H. Wayne Huizenga, who in 2004 led the purchase of what became the Rybovich Spencer superyacht marina in Riviera Beach in Palm Beach County. The family acquired several marinas over time.
Buyers like them saw opportunity in the growing number of boats in Florida and the difficulty in securing governmental approval of more marina space to keep up. The city of Fort Pierce, after Hurricanes Frances and Jeanne destroyed its marina in 2004, wanted to construct protective artificial islands before rebuilding its marina. It took until 2010 to get through permitting with the Army Corps of Engineers. “It’s not an easy path,” says Fort Pierce Marina Manager Dean Kubitschek.
Regulatory barriers to entry are part of the attraction for marina investors. Integra’s Ballestas says permitting a marina redevelopment can take 24 to 36 months compared to 12 months from approval to permitting for construction on land.
Investment floodgates opened with an Internal Revenue Service ruling that clarified the status of slip and storage income as real estate rents, opening the way for real estate investment trusts to buy marinas. Says Ash, “There is a lot of interest from big money, Wall Street money, private equity folks.” Indeed, a University of Florida business college report cited one source saying 35 to 40 marina acquisition groups are active.
Integra, which was founded in 2006 by Paulo Tavares de Melo, a member of Brazil’s prominent Tavares de Melo family business, is best known for its $2.3 billion in real estate projects such as the St. Regis Residences on Brickell in Miami. Ballestas joined in 2013. Integra bought an Islamorada marina the next year. A Colombia native raised in Miami since he was 1, he has a finance bachelor’s from Florida International University and a real estate finance master’s from the University of Florida. Ballestas was an executive with WCI Communities, where he led development of 15 luxury high-rises, and also worked at two real estate investment firms, Wheelock Street Capital and a Starwood Capital subsidiary.
“I was driving a boat before I was driving a car,” he says. He owns a 45-foot catamaran motor yacht, 23-foot skiff and a houseboat. Boating life begat an interest in marinas. Plus, Integra investors wanted to not only be part of real estate development but also invest in existing assets with cash flow.
Backed by Chicago-based BLG Capital Advisors and friends and family, Integra went after marinas, drawn by their cap rates, or return on investment, compared to apartments and warehouses. Margins also attract — in the low 40%s on slip rentals and services, according to a financial report from Texas marina company Safe Harbor.
Integra purchased downtown Miami’s 185-slip Sea Isle Marina, one site of the Miami boat show, in 2021 and renamed it the Venetian Marina & Yacht Club. It also has marinas in Tampa, Aventura, Jensen Beach, Stuart in Martin County and Rhode Island. Integra’s largest is the 288- slip, 35-acre Perry Marina on Stock Island at Key West, for which it paid a reported $29.7 million in 2023. Integra likes land-side real estate development potential — “we’re developers at heart” — and wants redevelopment and expansion opportunity on the water. It plans, for example, to double the size of the Perry Marina.
Marina consolidators want to reap whatever economies of scale can be had — insurance, fuel, financing — and reinvest in the marinas so that they can increase slip and storage rates. An example: Marina consolidator Safe Harbor acquired the Old Port Cove marina in Palm Beach County for $65 million in 2018, invested $3.3 million in additional capital and saw operating profit jump 58% to $8.4 million for a 12.3% yield, according to a 2020 investor presentation.
Consolidators look to reconfigure marinas for more and bigger boats and re-invest in sophisticated clubhouses, wifi, food, beverage and amenities and service. They’ve worked on that in the interest-rate induced hiatus in acquisitions. “We decided, look, this is a time to settle things down on the acquisition side, and really focus on the operations side of the marina, making sure we’re delivering the highest boater experience in our marinas,” Ballestas says.
Austin Schell, CEO of Charleston, S.C.-based marina acquirer, developer and operator Port32, says that just as the hotel industry was revolutionized by J. Willard Marriott, the marina industry will be transformed by technology, better facilities and elevated hospitality service. Port32 raised $280 million in 2021 to buy marinas and has nine of its 10 in Florida. “It’s kind of cool to be part of something special,” Schell says. Through an app and virtual store, boaters order ahead for everything from beer to fuel, sunscreen and ice. “So when you get to the marina, there’s nothing to do but step on the boat and turn the ignition on,” Schell says.
Port32 redeveloped one marina property on the Marina Mile in Fort Lauderdale and is redeveloping another in Palm Beach Gardens. Both facilities were near obsolescence and now will be rebuilt to accommodate trends in boating and boat sizes for decades to come, Schell says.
Most marinas remain in small operators’ hands and are ripe for buying as owners age and their children lack interest in taking over. State government doesn’t keep a marina count, but the U.S. Census reports Florida had 445 marinas generating $684.5 million in annual revenue in 2017, the most recent year data were available.
The holdup in transactions has been higher interest rates — the first interest rate cycle since consolidation started rolling. “Once the interest rate environment starts coming back in again, we can kind of pick back up and ramp up the acquisitions machine,” Ballestas says.
One sign consolidation will continue: Suntex Marina Investors, which owns 18 Florida marinas, and New Yorkbased Centerbridge Partners in April announced a joint venture to buy and develop $1.2 billion in marina real estate.
Ballestas says Integra will stick to coastal, Class-A marinas with redevelopment potential from Florida to Maine and along the Gulf coast to Texas. “There’s more people, more people that want to spend time on their boats, more boats are being sold,” he says, “and there are not more marinas being built. So I think those fundamentals, which is what we liked about this business, are very strong.”
Industry Anchor
The leading consolidator in the fragmented marina market is Dallas-based Safe Harbor, the nation’s largest marina company. It went from 22 marinas in 2015 to 135 now — 18 of them in Florida — totaling 48,000 wet slips and dry racks. In 2021, in a single deal, it paid $340 million for the Lauderdale Marine Center in Fort Lauderdale. Safe Harbor itself was acquired in 2020 for $2 billion by publicly traded Sun Communities, a Michigan-based manufactured housing and RV company. Safe Harbor last year turned a $273 million operating profit on $421 million in revenue.