How Do Bareboat Charter Yacht Programs Work?

Let's talk about charter management...I have been involved with this for 24 years and was the Managing Director of a charter company in the BVI. There are two ways to do this:

1. Buy a new boat from a charter company and get a guaranteed income... You will ONLY get income guarantees if you buy a new boat. Their programs normally last 5.5 years or 66 months. The boat will earn between 8%-10% per year of whatever you spent to buy the boat. So, for example, if you buy a 300,000 Euro boat you will get 8% (or 24,000 Euros/year payable monthly for 5.5 years) if it is an Owner's Version catamaran (because it will not get as much business) ... or you can get up to 10% Guaranteed Income if you buy a "Charter Version" catamaran which will work more weeks/year so they can afford to pay you more.....but these "Charter Versions" depreciate more rapidly than Owner Versions so you have to factor this into your "exit strategy" (when you go to resell your boat)....You will have no expenses in the Guaranteed Program because the charter company pays all of those. You will get some "Owner Use" (but sometimes only 2-3 weeks in the high season) and you get "Reciprocal Use" which means you can use a similar boat at another location if you prefer...so you can cruise all over the world at the various bases...What other investment will pay you 8-10% guaranteed and you can have fun with it!?!  I do recommend doing the 8% program because when you resell your boat it will be in high demand and you won't be competing with 40 other owners who HAVE to sell. 

There are also "Variable Programs" but I'd never recommend this because you could get left "holding the bag" and end up with nothing, or worse, owing the charter company money and having your boat beat to death.

2. If you buy a used boat and place it in charter there are NO GUARANTEES. Every charter company that will take used boats has a different program. Some give you 70% of the gross charter income and charge you for every possible expense...others split 50-50 and split some of the expenses...But it's all meaningless because a creative charter company accountant can charge a lot of expenses to your account and you can end up with nothing or even owe them money!...so don't get all wrapped up in comparing charter company programs. It is mostly fiction and it will drive you crazy. Instead, ask the charter company for some Owner references and contact some owners who have boats in their fleet like what you have....and ask the owners what they are actually netting every year. Usually placing a used boat in a charter fleet is only going to cover some of your expenses and there will not be much of anything left over for you at the end of the year. And there will be "wear and tear" on your boat. But you may cover the cost of insurance, dockage and maintenance...and the boat is professionally maintained...so that's why owners place their used boats in charter.

I can talk for hours about this subject and invite your questions.

What Makes The Best Crewed Charter Cat?

Here is a discussion about buying a cat for husband and wife crewed charter.

Lagoons and Leopards make the best charter boats in my opinion (when talking about $250k-800k boats)...Catamarans are the best because you have maximum staterooms, double the room of a monohull and the boat is super-stable (for those charter guests prone to seasickness this is a must)........I have owned two Lagoons and like them a lot... we can get you a 3-5 year old boat and capture the most depreciation but get the most maintenance-free boat possible....in the charter business most charterers want to bring as many people as will fit. So the cost of the vacation on a "per person basis" is the lowest... so the 4 and 5 stateroom charter versions are better for this...your utilization will be higher with a "charter version" boat than an "Owner Version" boat...so, for example, in the BVI you may get 16-23 weeks/year of charter with a "charter version" boat and the "Owner Version" boat may only do 11-14 weeks...so you have to decide what is more important to you.

Yes, I like flybridges a lot because they become the focal point for sunset cocktail parties and having coffee in the morning...and also whilst underway everyone wants to be up there...I also think it's safer because you can see much further ahead (especially at night) when you are higher up...you also gian more usable square footage in the cockpit...a few people will say "but they have to raise the main and you lose sail area" to accomodate a flybridge... but in my opinion the drawbacks to losing a few square feet of sail area are far outweighed by the benefits of a flybridge...the best boat in the price range we are talking about? The Lagoon 500 (5 stateroom version) with mini-flybridge...the Lagoon 560 and 620 are awesome big sisters.

 There is a sailing school in Miami (where I am an instructor) called Castle Harbor Sailing School where you can take the beginning sailing courses...it's best to learn on a smaller keelboat because they are more sensitive to the wind and I think you gain a better knowledge of boat handling on a smaller keelboat than a larger (more sluggish) keelboat.... and then I recommend taking the week long live-aboard catamaran course in the Bahamas with Bluewater Sailing School...this will get you some basic knowledge

The reason I stopped doing charters:

I was a captain of some sailing yachts that were in charter in the Bahamas and Florida Keys in the 1980's and 1990's...I was mostly doing "instructional charters"; that is, I was mostly teaching a liveaboard sailing course...(Beginning Coastal Cruising and Intermediate Coastal Cruising) in an ASA Sailing School.... Our season was compressed into 4 winter months and we were very busy....I enjoyed exploring the islands with customers and showing them the great places we have around here...I still do enjoy that ...In one year, the charter company booked me 7 weeks in a row on "instructional charters" (like the one you may do with Bluewater in the Bahamas)  and, each week,  I'd have a half-day back at the dock to see my girlfriend, do my laundry, answer my mail and get everything else done...and I just burnt out...the charter company didn't have any other qualified captains at the time so they begged me to do these charters...it was just too much and I decided to "swallow the anchor" and stay ashore as a yacht broker and I still do instruction but only work 5-8 hours a day one or two days a week....remember, doing crewed charter can be long hours (wake up, get breakfast going, fix mechanical problems, get underway to the next anchorage, get lunch going, stay up late partying with charterers etc etc)... I urge you to have balance in your life as a yacht crew and NOT go out 7 weeks in a row like I did that one year! 

Another alternative is to do "day charters" which means you do 3-4 hour "snorkel/lunch cruises" or 2-3 hour "sunset cocktail cruises"...I know some crews doing very well with this ...you basically connect with high-end hotels to do this for their guests

Most Important Factors In A Cruising Cat

We were having a discussion about finding the best catamaran to cruise in and some of this discussion may prove useful to cat buyers:

3 staterooms allow more storage space in the Owner's Suite that makes it easier to "kill the clutter"...but many buyers find that the $20,000-60,000 premium for a 3 stateroom version isn't worth it to them...the last time I lived on a cat I had a late model Prout 45 with 4 staterooms and it was just my wife and I...we turned the 4th stateroom into a store-room and absolutely filled it up to the top with stuff we really liked having: folding bikes (I think these are a great thing to have and when stored below last much longer and don't clutter up the deck), water toys (rafts, noodles), spare parts, extra tarps and awnings for monsoons, colder weather clothes, luggage for taking short side trips, and the best thing is to stock up on paper towels, toilet paper, cases of beer and other bulky items from WalMart to last you 6 months...this saves time and money and we also use them as trade items. I don't drink beer but if you run into a lobster fisherman in the middle of nowhere you can sometimes trade a cold beer for a 1.5 lb lobster or a fully cleaned fish...  

I  believe that the best way to go about this is to first establish a budget. Then focus on the newest/lowest-hours boats even if you have to go smaller in size...but first you have to determine what "makes/models" appeal to you... some of the late model 40' boats have as much usable interior space as 10-15 year old 45'-47' boats because the space designers got better! The smaller boats may not sail quite as well in some choppy conditions but usually interior space and comfort while at anchor or at the dock becomes much more important than sailing 1 knot faster with a little less hobby-horsing. At least that's what I and many experienced live-aboards think....

For whatever this is worth: I think the most important factors in order of importance are:

- usable interior space in the salon/galley.... galley up because you "remain part of the party" and don't become a galley slave...Fountaine Pajots have the least interior space

- well-maintained or late model machinery that isn't likely to break while you are in the middle of nowhere...I spent a lot of my early days "fixing stuff" and nowadays I dont want to do much of that. I prefer to spend my time having fun: exploring new islands, snorkeling, meeting sailors for drinks and good food, sharing the best islands with people who haven't seen them yet...I DO NOT like sweating my butt off in an engine room, getting grease permanently ingrained in my fingernails, getting my clothes full of oil and grease and having engines conk out at the "wrong time"...I have already had more than my share of that and I'd rather go smaller/newer/simpler and have an easy life. 

- a raised steering station or better-yet: a flybridge (it's safer because you have better visibility underway especially at night and it's a great party platform at anchor)...so what (!), if the mainsail is 15% smaller! They are usually overpowered anyway.

- side tables by my bed so I can keep all my "stuff" nearby...OK, I know this is quirky but it's important to me...FP's usually dont have room for this

- cockpit enclosures so rain doesn't overpower you and the cockpit then becomes another "room" in all conditions

- sailing characteristics are over-rated...I qualified for the 1980 US Olympic Sailing Team and raced Tornados for a while...so I know something about speed in a cat...and 90% of the time it's not the boat making things go slow...it's the guy steering the boat and setting up the sails or course wrong for those winds. Also: in my opinion: if you are in a hurry, take a plane! They are much more efficient than boats.