As Economy Slips, Yacht Sales Skyrocket

Feb. 21, 2008 — -- Forget all the talk about mortgage foreclosures and a looming recession. Instead, close your eyes and imaging yourself on a boat sailing the Caribbean. Not just any boat, but a megayacht that is two to three times the size of your house.

On board is every luxury you could ever imagine. You can lounge in a Jacuzzi on the top deck while you or your crew barbecue. Prefer something less casual? No problem, a deck or two down is your formal dinning room with a table that seats 12.

Your master suite is large enough to accommodate a king-size bed, walk-in closet and of course your own private bathroom with another Jacuzzi. Fine marble and woodworking adorn every corner of the yacht.

Ready to buy? It will cost you $30 million and up. And don't expect to get your yacht any time soon; there is such demand today for these over-the-top boats that it could take four years before you ever set sail.

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That's right, while the U.S. economy slows — if not enters a recession — the demand for these toys for the ultrarich has never been stronger. Several luxury shipyards have seen sales double in the last five years. The rich are not just buying more yachts, but larger and larger ones.

"It's not that significant to them whether we're in recession or not, because they're so wealthy," said Tork Buckley, editor of The Yacht Report, a trade magazine based in London. "The business appears to be recession proof."

Fueling this boom is the emergence of a new class of superwealthy in Eastern Europe, Russia, the Middle East and elsewhere. And like those before them, these new-money billionaires want all the trappings to prove their wealth.

"It's a must-have accessory, not much different from a watch or a villa or a Ferrari," Buckley said. "You have to have a yacht."

So you think you want a yacht?

Well, get in line. If you order a superyacht today from one of the top builders, you won't actually get delivery until 2012, Buckley said. It takes about two years to build one and there is a two-year backlog at the shipyards because demand is so high.

This delay is helping some builders outside the traditional shipyards of Holland, Germany and Italy.

American boat builders are seeing new business and countries such as China, which have little experience in yacht building, are starting to enter the market.

A weak dollar is also benefiting American shipbuilders.

The kitchen in one of Christensen's yachts.

Christensen is selling its 160-foot yachts currently for $36 million. For that price, you get an astonishing 6,500 square feet of interior living space and 3,500 square of feet exterior space. The yacht has six staterooms. All can fit either a king bed or two twin beds and each has a private bathroom.

There is a full kitchen, living room, dinning room and plenty of deck space. The yacht can sleep 12 comfortably plus the crew of 10, which has its own quarters and lounge area.

The yacht has a total of 15 bathrooms and to get from one level to another it comes with an elevator.

The long waits for a new yacht mean that these boats resell years later for more than the original price.

"We have yachts out there right now that left the yard 10 years ago for $10 million and they'll get somewhere around $19 million for them now," Foggia said.

And if you decide not to spend every week on the yacht, you can always charter it out to pay the bills. Foggia said that one of his company's yachts can rent for $370,000 a week in the Mediterranean during the summer or $250,000 a week in the Caribbean during winter. That fee doesn't include fuel, food, dock fees or a tip for your crew.

Christensen just signed its 13th repeat buyer.

John Rosatti is one of them. He already owns a 157-foot yacht that he bought from Christensen in 2005. He recently ordered a 160-foot yacht that will be ready in 2010 at which point he will sell his existing yacht, the Nice N Easy.

"It's like a hotel on the water. You have your own chef, your own crew and you just go anywhere you want," said Rosatti, who once owned 22 car dealerships in Florida and the Northeast and is now semiretired.

The bedroom in one of Northern Marine's yachts.

One of the boldest and biggest of this new class of yachts is the Maltese Falcon, a 288-foot clipper ship that Buckley, of The Yacht Report, calls "the most exciting yacht of the century."