Gregg and Nancy Burdick took back Stuart Yacht when the boatbuilder that bought it fell on hard times
Gregg Burdick and his wife, Nancy, were settling into a comfortable retirement after 30 years in the boatyard business when Riviera Yachts - the Australian boatbuilder that bought their Stuart, Fla., yard - went into receivership.
That has thrown the Burdicks back into the business. Riviera, which purchased Stuart Yacht in 2006 for $5.25 million, filed May 8 for reorganization under Australian bankruptcy laws. Six weeks later, Burdick took back the yard.
"I had to come out of retirement," he says. "I didn't want to. At 73 years old, I'd like to do other things." He hopes he will be doing other things again soon.
Stuart Yacht, a 1.5-acre property on the south fork of the St. Lucie River, is for sale again for $4.2 million, an attractive price, Burdick says, especially since Riviera made some improvements to the property, including the recent purchase of a 50-ton marine lift. Right off, he had four nibbles from overseas boatbuilders interested in using the property as their U.S. commissioning and distribution yard.
"Hopefully I'll be able to sell it without going back to work," he says. "But if we have to, we will."
Burdick chose to hold the mortgage on the yard when he sold it to Riviera and receive monthly principal-and-interest payments to fund his retirement, an arrangement that seemed better at the time than investing a lump sum in stocks.
Riviera, which is considered the largest luxury-boat builder in the Southern Hemisphere, headquartered Riviera Yachts of the Americas in Stuart as its distribution center and commissioning yard for the Americas, the Caribbean and Europe. The company was moving out, but keeping an office at the yard, and a skeleton yard crew was moving in.
Yachting magazine columnist Jay Coyle, who used to skewer Burdick and his yard - all in good fun - when he kept his boat there in the pre-Riviera days has come back.
"Jay insisted on being our first customer," Burdick says.
Burdick has been in the business long enough to know that there's always demand for service, even when sales are in the doldrums. "There's been some big belt-tightening for everyone," he says. But even in hard times, boats need servicing. "People are still using their boats."
And even if they are not, the boats need to be maintained. He is ramping up yard operations as business volume warrants, and he expects to go into the black later this year as owners begin investing again in maintenance.
If the Burdicks have to run a boatyard again long term, it will be full-service and mainly for boats from 40 to 80 feet, though the yard once worked on a 102-foot Broward. It will do repairs and renovations, install thrusters and stabilizers, repower yachts, paint hulls, do commissionings - "regular boatyard services and major renovations," Burdick says. He'll oversee the work, and Nancy will handle purchasing, logistics and working with the customers.
"It's a family business," he says. "It was very successful. It will be again."
Burdick had already retired once - from work as a yacht captain - when in 1976 he took over as manager of Matlack Yacht Builders with an option to buy, which he did with a modest sum down and the rest paid monthly out of his earnings. "It was a 30-hour-a-day, eight-day-a-week job," he says.
He built two of Tom Fexas' prototype Midnight Lace motoryachts at the Stuart yard and went on to build 14 other sail- and powerboats, most of them custom designs, over 60 feet. Burdick was one of the early builders to use Airex in lightweight composite construction. "I've seen a whole lot come and go in this industry," says Burdick.
One thing he has learned is economies thrive when consumers and businesses have a sense of certainty about the future. "Uncertainty is the culprit in this time of economic chaos," he says. "[We] have been through several economic downturns over the years and, as bad as they may have been, once we realized the 'certainty' of the situation [we] could reorganize and rebuild. I challenge anyone to suggest what the certainty is today, other than uncertainty."
Once some sense of certainty begins to set in, Burdick says people will start spending again. They'll start using their boats again, and some of the first marine businesses to benefit will be the service and repair yards and marinas, then brokerage sales as financing loosens up. Production boatbuilders may have a long wait before their business picks up. "Only a few will recover soon after certainty sets in, and those will be the ones who at this time are not in drastic financial trouble," he says.
The yard has about an acre of upland; a half-acre privately owned basin; a 12,000-square-foot two-story building housing a warehouse, workshops, offices, storage and supply rooms; a 5,600-square-foot over-water shed; 450-square-foot floating workshop; 10,000-square-foot haulout area; and parking for 45 cars.
"I enjoyed the marine industry for most of my life," Burdick says. After he retired, however, he put it behind him. "Now I've got to start [the business] all over again."
Burdick is hoping that some sense of economic certainty kicks in quickly.
This article originally appeared in the October 2009 issue.