If you like boats, you’ll love yachts. Officially, there’s nothing that separates a boat from a yacht; a yacht may just be a bigger boat. But here’s where people do agree: Those large floating vessels with a crew, helicopter landing pad and swimming pool are definitely yachts – or a cruise ship. Let’s go with yacht.
Only a privileged few can actually throw down tens or hundreds of millions of dollars on a super yacht. Such individuals can also afford the huge costs associated with maintaining these vessels. Experts say that running costs normally amount to about 10% of the yacht's purchase price each year. Even a smaller yacht is out of most affluent people's price range. (For more, see What Size Yacht Can You Afford and Can I Afford a Super Yacht?)
Many people who can afford a yacht still may not want to buy one. Unless you’re going to live on it, most of the time your yacht will sit idle in a marina.eating up your hard-earned dollars. You can, of course, try to charter it when you're not there, but that adds a new layer of management issues.
There is another alternative. Sharing a yacht with a select group of other people can make a lot of financial sense if you organize the process well.
How It Works
You’ve likely heard of timeshares – those sometimes shady agreements where you buy an ownership stake in a piece of real estate in exchange for having access to it for a specified number of weeks during the year.
Yacht sharing is somewhat similar, and there are companies that would love to sign you up to arrange it – for a fee, of course. Sanlorenzo Shares, a company affiliated with the Italian yacht manufacturer Sanlorenzo, will help you set up a fractional ownership program. The company sells shares in 20% increments, and each 20% share entitles the owner to six weeks of usage per year. As a participant in the fractional ownership program, you get a “show up and go” model. Sanlorenzo handles all of the yacht’s management and maintenance. When you arrive, the yacht feels like your personal property. The crew, which consists of a captain, mate, steward/stewardess and a chef, lays out the personal items you've provided to use on the yacht when you're there.
How much does it cost? You won’t find that kind of information on its website, but according to the New York Times, a 92-foot Sanlorenzo yacht cost $1.6 million per share, plus another $11,000 per month for expenses (excluding fuel), a couple of years ago.
If you’re more the sailboat type than the yacht type, take a look at SailTime. Unlike Sanlorenzo, which offers actual ownership, SailTime charges a monthly fee in exchange for all of the maintenance, mooring, and other headaches that come with owning a sailboat, powerboat or catamaran. SailTime’s services are more akin to a club membership, but you get many of the perks associated with ownership.
Partnerships involve people, and people sometimes come with baggage that may affect the agreement. What if somebody falls ill, goes through a nasty divorce or loses their job after the agreement is signed? Or some shareholders may simply decide that ownership is no longer for them, forcing the other owners to sell the boat. It’s not hard to find people with horror stories of trying to co-own a boat with other people, but many also have called it a positive experience. (For more, see How to Get a Loan on a Boat or Yacht.)
On the other hand, you may just want to get a few of your well-heeled friends together and buy a yacht without one of these yacht-sharing companies. That leaves you and your friends in charge of handling the work involved in the yacht’s upkeep. Be sure you each get an attorney who knows something about shared ownership – and decide who will be the maintenance point person. (For more, see How to Buy Your First Super Yacht.)
The Bottom Line
Like most hobbies, people often overestimate the amount of time they will have to use their new toy. Before diving into yacht ownership, be realistic about how much you will use the boat. If you don’t have a lot of time for sailing, you may be better served by joining a boat club with some kind of chartering arrangement or spending more time with a really good friend who owns a boat.