Marina Dock Age, November 1996

How to Determine Dry Storage Return
by Dennis P. Kissman

Dry stack boat storage, which I call valet storage, is increasing in popularity throughout the world. Over the years, I have reviewed a number of existing valet boat storage operations and done financial models on many new projects. Although I recognize no two marina operations are exactly alike, I have been able to see patterns for revenue, operating costs and return on investment evolve.

These patterns seem to be comparable whether the facility is newly constructed or a refurbished or expanded existing facility. The key is the number of racks. A dry stack operation has a certain threshold of fixed operating cost regardless of the number of boats it can accommodate. Once this threshold is achieved, the incremental increase in operating cost is minimal until the next threshold. I have found that each threshold is about 260 boats stored. Note that I refer to boats stored, not total capacity of the facility. There is fixed cost associated with each rack, but that cost is minimal compared to the variable cost associated with actually storing a boat in an active valet boat storage facility.

Construction costs per rack range from $2,600 to $3,000 for a four-rack-high totally enclosed rack-supported structure containing 260 racks that can accommodate boats up to 40 feet with a 12-foot beam. The type and weight of the individual boats will most likely be the limiting factor than a boats overall dimensions. This also assumes the structure has the traditional metal sheeting on the exterior surfaces and is fully sprinkled, with a concrete center section and prepared earth under the boat storage area.

In comparing operating costs for a dry stack operation, it is more important to recognize the major components than to detail the cost associated with each. First, you have the cost associated with the individual rack. Second, you have the cost associated with handling the boat stored in the rack. Third, there is the cost associated with administering the entire marina. I wont factor in administrative costs, though, because they can fluctuate substantially.   Continue »