Pacific Star Cruises is moving ahead, initiating what Paul Anderson, managing director of UK-based Fractions Abroad, a company specializing in selling fractional property ownership, called a “soft launch program to build a network of travel partners around the world that can assist with sales.”
The basic concept is to sell fractional ownership in luxury mega-yachts, accommodating a maximum of 68 guests at a time.
The main party behind Pacific Star is Thomas Holding, Anderson explained to Cruise Industry News in an email. He said they have extensive knowledge of the marine market and will handle hotel and technical operations in-house. Anderson said that key hotel management and food and beverage executives have already been hired and have formerly worked for Celebrity Cruises and Holland America Line.
Since Thomas Holding is based in the Philippines, the vessels will be built there, with outfitting being supplied from Europe. The construction cost per vessel is estimated at “just over $30 million.”
Plans call for the first vessel to be delivered in 2013.
According to Anderson, the first mega-yacht will be released to the English-speaking world market. The second vessel will be designed for the Chinese market, while the third is intended to be a Kosher-compliant ship.
After this, Fractions Abroad has had inquiries about producing a ship for the Australian market and the French Canadian market, Anderson explained.
The key, according to Anderson, is to have 850 fractional owners per ship. Each owner will be able to cruise for two weeks each year, including meals and beverages (except premium brands).
The cost of fractional ownership is $81,056 plus annual operating costs of $8,200 per year for 15 years. What makes the deal interesting and unusual, according to Anderson, is that after 15 years the ships will be sold, and the owners will receive their fractional portion of the sales price. Plus, income from a guaranteed annuity that part of their initial purchase price will go into, he added.
The total costs are estimated by Cruise Industry News to be $204,056 over the 15-year period for the initial ownership purchase and the annual maintenance. However, that cost will be reduced, according to Anderson, by the company’s estimated net sales proceeds of $22,400 per owner and annuity repayment of $156,600, leaving a net cost of $25,056 -- or $1,670 per year, translating into $119.26 per couple or $59.64 per person per day. Not bad, according to Fractions Abroad, when compared to around $500 per day on comparable luxury ships.