Industry News

FOUR SEASONS ON THE SEVEN SEAS

Luxury Hotel Operator Takes Brand Into Cruise Ships, Takes Aim at ResidenSea

Four Seasons Hotels and Resorts Inc. is planning to try its hand at managing a luxury residential cruise ship, a concept pioneered two years ago by ResidenSea Ltd.

In a move that would see the luxury brand extended on to the high seas, the Toronto-based company plans to manage a floating residential resort aboard a luxury ship controlled by Ocean Development Group, a cruise ship development company.

The 200-metre-long ship will be built by Kvaerner Masa-Yards in Finland, and should be ready to sail by 2006. It will contain about 100 apartments, varying in size from 125 to 320 square metres.

"We are excited to expand our residential portfolio with this new and visionary lifestyle product," Kathleen Taylor, Four Season's president of worldwide business operations, said in statement from the shipbuilder.

Aynsley Wintrip, a spokeswoman for Four Seasons, said yesterday the company wasn't prepared to comment further on the agreement. She added, however, that the move was not part of a larger initiative to enter the cruise ship business.

Four Seasons, with sales of $268-million last year, manages 62 luxury hotels and resorts and three Residence Clubs, containing about 16,000 guest rooms and residential units in cities and resort destinations in 29 countries.

ResidenSea, a company registered in the Bahamas, introduced the idea of a luxury cruise ship with permanent apartment-style residences in 2002.

The World of ResidenSea, a 196-metre luxury vessel that operates a "continuous worldwide itinerary," boasts 110 apartments and 88 studio residences. An average two-bedroom apartment on board the ship runs for about $2.2-million and offers people access to four gourmet restaurants, two large swimming pools, a full-sized tennis court, a golf simulator and a grocery store, among other amenities.

Will Marks, an industry analyst with JMP Securities in San Francisco, said the power of Four Seasons' name makes the endeavor promising. "Four Seasons differentiates itself by its service levels," he said. "While the brand doesn't stand alone, it's certainly one of the few hotel companies that have a worldwide presence in that category."

While there are no financial details available, UBS says it's likely Four Seasons would receive a 7% to 10% commission on sales in addition to a management fee -- similar to the management contract governing its Four Seasons Residence Clubs.

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