# Tough Times for Condos at Sea



## MULTIZ321 (Mar 12, 2009)

I was curious how condo & fractional cruise ship industry was faring with the economy in a severe downturn.  What follows is what I found:


Tough Times for Condos at Sea - article by Jay Clarke in the 9/7/08 Miami Herald

Four Seasons Ocean Residences - a Development of BV International Ocean Holdings Ltd

Magellan - the $1.2 Billion Ultimate Residential Cruise Ship Comes to Dubai

Magellan CEO Seeks Investment for $1.2bn 'Floating Residence'  - from Sunday, January 11, 2009 Emirates Business 24/7

It will take $36 million to keep the ship afloat and operational annually and will be fully functional and take to the high seas in early 2011.

The company has launched a very elaborate campaign to secure investors from the region and has been hosting road shows in Dubai. The next one is in Abu Dhabi on January 15 at the Abu Dhabi Palace Hotel. Commenting on the investor’s faith in the project, Jackson said. “There’s great wealth here in the GCC and they will spend on high quality projects like Magellan.”

Adding to his faith in the region, he counters the question of the launch in the times of economic crisis. “The best opportunities for investors are in the worst economic times.”

Emphasising on the secured investment process Jackson explained that any deposit paid towards your purchase will be deposited in an escrow account between Wells Fargo Bank and The Magellan Owner’s Association; and when certain pre-defined conditions are met, the funds from Wells Fargo will be released to the shipyard. These include: the construction contract has been executed; A full financial guarantee has been provided to the ship builder; the shipyard has issued a Letter of Credit as collateral for release of the deposits.

Clearing doubts on the delivery of the ship, Jackson said: “A purchase contract provides that we have a maximum of two years to sign a contract with the ship yard and three years from the signing of that contract in which to construct the ship. In the event neither occurs within the specified timeframe, your money will be promptly returned at your request”

Jackson said: “Magellan is the most luxurious residential cruise ship ever conceived and it is different in a variety of ways, but the easiest answer is size and accessibility. The ship’s increased size means more amenities including restaurants, two executive helicopters, an observatory, indoor golf simulators, tennis court, and an onboard marina. Magellan also offers access to the ship 24 hours/seven days-a-week via our all-weather heliport (weather and sea conditions permitting).”

By utilising the latest technology and maintaining a rigorous maintenance schedule, Magellan is expected to remain in operational condition for the 100 year life of the vessel. The ship will be dry docked for a 30-day period every two-and-a-half years for maintenance.

During the last 50 years of the life of the vessel, the ship may be permanently moored/docked at a destination similar to the Queen Mary Cruise Ship now permanently moored in Long Beach, California.

Facts in figures

Magellan can carry a maximum of 1,100 passengers and 500 crew members.

There are two ways to purchase aboard Magellan. Units are available for purchase for full or fractional ownership residents. Fractional owners may purchase their time via a fixed or variable ownership plan.

Owners can sell their residence after the delivery of the vessel with a one per cent transfer fee paid to Residential Cruise Line Ltd. The Magellan Owners Association has entered into a 100-year master lease with Residential Cruise Line for the residential areas of the ship. Full owners will have unlimited access to their residence. Fractional owners will have unlimited access to their residence during the time that they have purchased via a 50-year leasehold from the Magellan Owners Association. Residential Cruise Line (the owner of the vessel) will contract with V Ships to professionally staff and manage the ship.



The Marquette - http://www.rivercitiescondos.com/

See this previous Tug Thread on the Murano - Fractional and Condo Cruise Ship


Richard


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