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MARINA – RENTAL INCOME MULTIPLIER

East Coast sailboat marina

MARINA – RENTAL INCOME MULTIPLIER

As an analyst and appraisal specialist I am always trying to better understand how a market performs so that I can evaluate operating businesses. Whether it be a golf course or marina, there are many similar applicable techniques. For years when golf was struggling and very few sales were posting a net profit, the golf community became accustomed to calculating a GIM, or Gross Income Multiplier. This allowed investors to quickly assess whether a deal warranted further analysis. It also proved to be a useful tool for appraisers when developing a Financial Unit of Comparison, as part of the Sales Approach. In the course of our work, we have found a similar financial benchmark is applicable to marina properties, known as RIM, or Rental Income Multipliers.

Marina Rental Income Multiplier Chart
The most profitable form of income for a marina is slip, rack or land storage rental fees. Income from these sources is what “drives the bus”. Other departments like fuel sales, service, boat sales, ship stores, or food & beverage carry high costs of goods, and or heavy payroll costs. For that reason, income from rentals is most critical to the profitability and value of a marina. As indicated by the graph above, we have presented the RIM for 10 marina sales where we had access to actual rental income at the time of sale. The RIMs vary from 7 to 13, while most fall in the 9-10 range.

Jeff Dugas
jeff@leisureappraisal.com