We'd all like to live the good life, but expensive big-ticket items like private jets and luxury yachts are often beyond the reach of even the most successful individuals. That's why fractional ownership is heading into new waters.
If you've ever owned a time-share unit, you've participated in fractional ownership. The same approach is being applied to multi-million-dollar properties of all kinds, enabling several individuals to own a single expensive asset jointly. Well-to-do flyers have been buying fractional ownerships of private jets since the mid-1980s, and fractional ownership pioneer NetJets is owned by none other than Warren Buffet's
. Now, savvy captains can similarly own a piece of a yacht.
The time-share concept has moved from condos and jets to yachts.
Get your share:
In a typical fractional ownership arrangement, you purchase a share of a new or existing yacht. The numbers of shares vary by company, but usually two to 10 shares are available for each yacht.
Each share enables you to spend a certain amount of time on the yacht each year. For example, if you purchase a 10% stake in a yacht, you're entitled to spend about 30 days aboard a year. Since most full-time owners use their yachts only a few times a year, this arrangement should give you plenty of time aboard. If you'd like to spend more time sailing the Seven Seas, you can simply purchase additional shares or a larger share.
Most yachts include their own captain and crew, including a gourmet chef and concierge. The yacht company cleans, maintains and insures the craft, so you have more time to kick back and relax. In addition, most companies make it easy to book your time aboard and choose your destination.
About a dozen companies offer variations of fractional yacht ownership. Typically, you own the yacht for a period of time, after which the yacht is sold, so you can recoup some of your investment. You then have the option of purchasing a new ownership stake in another yacht. With some programs, you can sell your share when you're ready to move on. In addition, some companies offer fractional lease options as an alternative to equity ownership.
So what types of yachts are available to share, and how much will your piece of sea-going paradise cost? Here's a quick look at the offerings at three fractional yacht companies:
Monocle Fractional Yachts:
One of the pioneers in the fractional yacht ownership industry,
sells 10% ownership stakes in yachts, which entitles owners to four weeks of use per year (two weeks in the winter, two in the summer).
Monocle's fleet includes yachts from 50 to more than 300 feet in length, from manufacturers such as Benetti, Westport, Feadship, Azimut and Hatteras. The yachts cruise a variety of locations, including Mexico, the Mediterranean, the Middle East and Asia. Share prices for equity ownership range from $150,000 into the millions. When you're ready to move on, Monocle will help you sell your share or, should all owners agree, will handle the sale of the yacht.
Though it currently has only two yachts in its fleet available for fractional ownership,
makes it easy for owners to book time aboard with its online scheduling system. Ten shares are available for each yacht (a 62-foot Azimut Flybridge motor yacht and a 72-foot Cheoy Lee raised pilothouse), which give owners 30 days aboard annually. Shares are priced from $220,000 to $240,000. Ownership lasts for three years, after which the yachts will be sold. The owners will receive a portion of the sale price.
SeaNet Fractional Yachts:
Located in Newport Beach, California, with additional ports of call in San Diego and Los Angeles,
offers fractional ownership stakes as well as fractional lease options for new and existing
yachts. For its lease program, the company offers one-third, one-quarter, one-sixth and one-10th shares, which run for one or two years of service. A one-third share gives the owner 108 days a year of on-board time, while a one-sixth share offers 54 days annually. A share can cost $90,000 to $400,000 or more, depending on the yacht, size of the share and term of service. For instance, a one-quarter share in a 62-foot Sunseeker Predator, built in 2007, costs about $150,000 for a one-year term and about $285,000 for a two-year term.
Bob Feeman is a former editor of Robb Report and Smart HomeOwner magazines, and now writes full time about a variety of subjects. He's based in Maine.