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June 4, 2009

Condo Cruise Ship Challenges

Thanks to a connection of Wayne’s, he & I got to talk to a long-time ResidenSea resident this afternoon, and I now know enormously more about the challenges of operating a condo cruise ship. Fascinating!

The challenges are daunting. ResidenSea, where the condo fees are like $200K/unit/year for the smaller units, is barely able to handle the logistical issues of traveling constantly, all over the world. Having to deal with resupply and customs and immigration and port fees and staffing and bringing in timeshare guests when you only spend a few days in each port and don’t come back for years is just a nightmare. Think of the difference between a cruise ship on a fixed loop, which gets its food in the exact same US port every 1-2 weeks, probably a central distributor for the cruise company that owns it, vs. a ship that resupplies in a different city in a different country every week! (If you are hungry for more details, I will eventually be publicly posting the bizplan/research document I am developing, which will include them).

The issues reminded me of Jim Rogers’ book Adventure Capitalist, which James & I were recently given – he faced many similar logistical issues in his 2-year trip by car around the world.

On the plus side, the challenges do not apply to seastead cities which stay in a fairly fixed location, and there are ways to mitigate them for a condo cruise ship, although they make it less appealing to residents. Specifically, if we travel in fixed loops, even fairly large ones (like spending half the year in northern hemisphere & half the year in southern), so that we deal with the same 10-20 ports every year, we can build up local relationships and knowledge that will significantly reduce these problems. Or we can use a different strategy than “residential ship traveling the world” – like following a small loop (SoCal -> Mexico), or simply sitting offshore, as Carl Palsson and Wayne have suggested.

Lots more research to be done before we can recommend or price out a strategy, but this has been a big leap forward in my knowledge!