We have already noted that some in the yacht business think that owning any part of a yacht is a bad idea, since asset depreciation seems to happen so quickly. But a group of experienced entrepreneurs and bankers, including Rob Hersov (one of the founders of Marquis Jet Europe), and Han Verstraete, have formed a new venture, YachtPlus, to sell fractional yacht ownership.

Here is the first part of a profile of this new offering – an email interview with the CEO. Over the next few weeks, we hope to talk to Verstraete directly, and learn more. In particular, we want to understand how owning and using a fraction of a super-yacht is better than chartering, in terms of the experience and the cost.

What is the profile of a typical member? How are they similar and different to a typical destination club member or fractional jet card user?

I can profile my owner in two words: smart money. They typically have a townhouse in the city where they work, say London, they are likely to have a second and/or third home and may add a ski solution or transatlantic destination through a destination club, and use a jet share to get to all these places. Irrespective of whether they can actually afford our yacht as a sole owner (and a lot of my clients can!) they see YachtPlus as their solution for luxury yachting in style.

If they had owned a yacht themselves they would not use it more than as a YachtPlus client, as it would be their fourth or fifth asset. And of course, they’d have another asset to look after and manage. Most of them have chartered and feel it is an expensive hit and miss proposition. They spend a lot of time researching the yacht (layout, number of cabins, location etc) and often don’t get the yacht they want where they want it. With YachtPlus the product is defined and the service predictable.

Please explain the financial terms of the ownership?

One of the strengths of YachtPlus is the transparency of its pricing. We offer the yachts through a pre-sale similar to the phased pricing you see in very upscale real estate. Once we complete one yacht we open the next one for subscription, and as we add yachts the price goes up. We are now offering the yachts at EUR 12MM so a minimum participation of 12.5% is priced at EUR 1.5MM. Annual dues too are predicable, we average the cost of crewing, managing and servicing the yachts, including their transatlantic repositioning, over the number of boats in the fleet.

Per yacht, the cost is divided pro rata with regards to the Owner’s share. So for an eighth of what it would otherwise cost to keep the yacht in turn-key condition, our Owners have access to a fully serviced fleet.

How do you handle availability and the inevitable demand for peak/holiday periods?

Interestingly, a lot of my owners are emancipated from office life and don’t always have a preference for peak week cruising. Irrespective of this, our booking system works such that every Owner has guaranteed access to the fleet during both peak and off-peak weeks. Its simple arithmetic, you look at the total number of available weeks per year on both sides of the Atlantic, define what is peak and off-peak – and there is no secret in this – and pro-rata it according to your Owner’s stake. Any number of weeks the Owner decides not to use the yacht, whether it is in peak or off-peak season, can be chartered out and they will recieve the charter revenue.

Who determines the trip plan? How far the yacht can travel and what do you do in storms? How about crew?

You as an Owner. This is not a cruise line or a charter where the journey is fixed or the yacht’s positioning is pretty much decided for you. The yacht can travel anywhere but there is of course always the authority of the Captain who can decide in the interest of safety not to go to certain areas, e.g. in the case of a storm. And whilst you cruise, the crew will look after you. With YachtPlus, we even have an onshore Owner Services Team that looks after transport needs, hotel bookings, etc. It’s a lifestyle solution.

Can I transfer, resell the membership? Can I buy it under a corporation?

The share is yours and you can hold it in your personal name or through a company, provided we know who is behind it. We will help you resell your share if for any reason you want to come out of the Programme, which you can after your second year of use. We expect there to be a liquid market as many people will see our Programme as a way of skipping the queues for accessing a mega-yacht.

What are your long term plans for the business – locations, size of yachts, number of members, etc.?

We want to be the preeminent player in the mega-yacht fractional space. We want to measure this not necessarily by the number of yachts in our fleet but by the consistently high quality of service we provide to our Owners. So long as we continue to service them properly, we can scale up the fractional fleet to a very significant size, offering different types and sizes of yacht in all the major yachting locations around the world.

Final question: what’s your favorite yacht in your fleet and why?

The design of the 40 meter launch yacht is radical and the angle Foster and Partners has brought to luxury yachting is very refreshing. Here’s a yacht that offers maximum space and comfort but builds on the best ideas of the past. It is a yacht for the 21st century and the yachting industry is widely applauding the result Norman Foster and his team have come up with. We all look forward to taking delivery of the first in the Series in 2008.