XXL Toys for the Super Rich: Yacht Building Business in Germany Booms
The seriously rich are living it up in decadent style on luxury yachts. And they particularly value German craftsmanship. Shipyards like Lürssen and Blohm & Voss are backed up by dozens of smaller companies that cater to the billionaires' every whim -- even on-board showers that squirt champagne.
Not many people in Germany have as illustrious a circle of acquaintances as Oliver Treutlein. The native Rhinelander knows Microsoft co-founder Paul Allen as well as Libyan President Moammar Gadhafi's son Saif al-Islam, American software billionaire Larry Ellison, the Saudi Crown Prince Sultan Bin Abdul Aziz, as well as members of the Horten department store dynasty.
Treutlein doesn't brag about the people he knows. In fact it's something of an embarrassment for him. But what can he do? He just happens to meet many of them on a regular basis. Not their staff, but them in person.
Forty-something Treutlein certainly wasn't predestined to rub shoulders with the super-rich. He originally trained as an auto mechanic, though he soon discovered a passion for luxury materials. In the 1980s he drove his old VW Passat around Germany visiting dye works and spinning mills to get quality goods and turn his hobby into a career.
Today he has realized his dream, though he still dresses casually and wears his wide shirt outside his pants. Sitting at the head of a long table in the foyer of his company in Meerbusch near Düsseldorf, he keeps bounding up to pull samples out of white boxes stacked on the ceiling-high shelves around him. Each box bears photos of yachts with names like Octopus, Rising Sun, Al Salamah, and Carinthia.
These are among the largest, most expensive and most splendid private ships on the planet. And even though there will be some wonderful examples on display at this week's "Boot" trade fair in Düsseldorf, they will have as much in common with Treutlein's customers' boats as a sack of coal has with mahogany marquetry.
Even the entrance area of his company has become something of a Hall of Fame, decked out as it is with dozens of letters from yacht designers, owners and captains, all praising his work. Treutlein points to a mint-green square of carpet that must be at least two inches thick and appears to have concentric waves rippling out from its center. "This carpet symbolizes a stone falling into water," he says. But it only really works well in a 300-square-meter (3,000-square-foot) salon."
'A Yacht Is a Status Symbol'
Treutlein fitted this carpet on the Swift 141, a boat owned by the royal family of Abu Dhabi. He's also kitted out an entire fleet of private boats for Russian oligarch Roman Abramovich: The Pelorus, the Le Grand Bleu, the Mayan Queen, the Ecstasea, the Luna, and last, but not least the Eclipse, the world's largest private yacht -- for now -- which left the shipyard in Hamburg just a few weeks ago.
Treutlein designs, produces and uses the most precious floor coverings that a billionaire can find. Pure silk? No problem! That'll be approximately 3,000 per square meter -- plus another 120 for laying. Bamboo thread carpets are available for as little as 1,500. Simpler "plain goods" are a snip at only 600 a square meter.
The people who hire Treutlein needn't watch their spending. "A yacht is and remains a status symbol," says German boat designer Joachim Kinder, who is still somewhat in awe of such ostensible wealth.
"The sheer cost of buying and maintaining such vessels creates a kind of class envy and leads to criticism of such supposed decadence," he says. Kinder isn't the only one of his countrymen to profit from this global nautical one-upmanship.
All the world's most important shipyards, constructors and outfitters of these motor yachts are now located in Germany. Nowhere else is there as much know-how about the fine art of showing off. And yet it took Germany just two decades to become the center of the luxury yacht-building industry, leapfrogging countries like Holland and Italy in the process.
When Vanity Fair magazine put together a map it called "A Mogul's View of the World," just one German location got to rub shoulders with the Caribbean island of St. Martin and skiing paradise Aspen, Colorado: The Lürssen shipyard in the Bremen district of Vegesack.
You'd be hard-pressed to avoid Lürssen if you wanted to realize your dream of floating decadence. Michael Breman is its head of sales, a job he has been doing for the past 15 years. He recalls that it used to take six years from the initial sales discussion to the signing. Today that can sometimes takes as little as six weeks.
"We have an unusual situation," Breman explains. "Never in the history of Mankind has so much money been available." The recent financial crisis hasn't changed things much. It may have put a small damper on the industry, but no more than that. If you're thinking of owning a Lürssen yacht, you'd better be prepared to put upwards of 50 million on the table.
The demands from customers are getting more and more eccentric: A helipad is already de rigueur. Some customers even want two -- after all, berths for floating palaces are in short supply, even in super-yacht marinas in places like Monaco, Nice, Portofino and Palma de Majorca. Some clients want freezer rooms so that they can have snowball fights off the Bahamas. While others order complete operating rooms or recording studios.
'We're in the Entertainment Business'
The furnishings for the upper decks should ideally be made of exotic woods; wafer-thin Papaya bark with 15 coats of varnish, for example. If this is too common for you, you get can marcasite veneer instead. "Nothing is unusual anymore," Breman says. "We're in the entertainment business and will do anything -- as long as it isn't illegal or questionable from a nautical point of view."
Shipyards like Lürssen, Abeking & Rasmussen in Bremen, and Blohm & Voss in Hamburg are often responsible for the construction and development of such luxury toys. They therefore rely on a veritable armada of small businesses specializing in tuning and finishing. "We're a bit like a modern Robin Hood," says Lürssen salesman Breman. "We pass the money on."
Apparently there was more than usual to redistribute during the construction of Abramovich's Eclipse, even though this was built by Blohm & Voss, Lürssen's competitor. "Blohm & Voss must have paid dearly for that order," Breman says. Carpet expert Treutlein agrees. "Abramovich is a really nice guy, but Blohm & Voss got themselves a questionable deal with the Eclipse," he says.
The Hamburg-based shipyard landed the contract six years ago. It agreed to build the yacht for 340 million ($485 million) and have it ready for the 2010 soccer World Cup in South Africa. When the yacht set sail from Hamburg last December, one year late, the total cost of building it was estimated at about 800 million ($1.2 billion).
Abramovich probably paid something between the two figures. The shipyard will have to write off the remainder as a loss. Nevertheless, the Russian billionaire managed to make a mockery of the old rule of thumb that a yacht costs 1 million a meter.
Peter Hülsemann knows the Eclipse very well. He was the head of furnishings at Blohm & Voss during the boat's construction, though he subsequently moved to Abramovich's yacht management company, Blue Ocean, which looks after and charters the billionaire's flotilla. Today Hülsemann has a senior position at the Deutsche Werkstätten Hellerau in Dresden, an industrial furniture company that once supplied all of communist East Germany with uniform fitted cabinets. Nowadays it creates complete room concepts in luxury materials for the corporate headquarters of the likes of energy utility E.on as well as penthouse apartments in Moscow -- and yachts.
But even Hülsemann is occasionally amazed by his clients' bizarre requests. "I wouldn't be surprised if someone ordered furniture covered in hummingbird tongues one day," he jests. He doesn't find the Eclipse especially attractive either. "It's really no more than a blown-up 60-meter yacht," he adds.
The ship is 163.5 meters (536 feet) long. It has nine decks, a surface area of some 8,000 square meters (80,000 square feet), dozens of rooms and salons, and a crew of 70. Maintenance alone is estimated to cost 20,000 a day. Abramovich wanted to own the world's longest yacht. A generous spa area, movie theater, and disco are obligatory features for such orders. And should the Russian businessman decide he wants to leave his yacht less conspicuously than by helicopter, he can always used the ship's own mini-submarine.
When it was launched, Abramovich's boat was half a meter (1'8") longer than the previous record-holder. But even when he placed his order, he must have known that someone else would immediately commission an even longer yacht simply to outdo him. "The desire to own the largest yacht will always be a sort of competition among a handful of the super-rich," says designer Kinder. "It's something of a natural law."
Abramovich only held the record for a short while before he too was eclipsed. While the Eclipse was still under construction, the Lürssen shipyard began work on a 180-meter (590-foot) yacht, the Topaz, for an Arab sheikh. The yard has also been asked to build a 200-meter (656-foot) yacht.
Abramovich was obsessed with his boat, constantly tinkering with the plans and trying to at least improve the features and fittings. At one point he decided he wanted one of the two helipads to be raised and lowered. And instead of normal flatscreen TVs he wanted 3D monitors in all the rooms instead. The order got even more expensive when he insisted on having RainSky showers fitted, each of which has a shower head about the size of a car hood. Supplied by the German company Dornbracht, these heads cost a staggering 18,000 a piece -- though for that you can program the color of the illumination and have scents mixed into the water.
"Our clients have long moved on from Jacuzzis. They now want special showers in which you can control the droplet size and the speed at which they fall," says Dornbracht's Matthias Voit. His business card states his job as "Sales Management Elite Interior." It's a position Voit created himself at the Iserlohn-based luxury fixtures company, though he's rarely at its headquarters.
Voit's annual calendar looks like this: He attends the Monaco Yacht Show in September, the Fort Lauderdale International Boat Show in October, the Mets in Amsterdam in November or the Dubai International Boat Show in March, and visits international customers in London, New York, and Moscow in between. He's also advised Abramovich.
The Russian wanted faucets from Dornbracht's Tara series for the Eclipse -- though not off-the-shelf faucets. His personal designer, Terence Disdale, refashioned them so that the cross-shaped handle on each looked like little vine tendrils were growing around it. "It looked horrible," says Voit, who managed to reject the suggestion and have the handles entwined in platinum wire instead.
He didn't find it pretty either, but at least he got to have the faucets installed on all 51 basins aboard the Eclipse -- a seven-figure order "produced by craftsmen and individually cast."
Voit's gigantic RainSky showers are a big hit with his customers. To properly simulate rainfall, they have to be installed in ceilings at least 2.40 meters (7'11") high. If a yacht has a specified deck height of 2.20 meters (7'2"), that's a problem, albeit not an insurmountable one. You simply rip out the existing decks and make them higher. "It just costs a few million more," Voit says. But the heads are just one aspect of the shower. They usually require bigger water and waste-water tanks to be retrofitted. That's because a RainSky system consumes 40 liters (10 gallons) of freshwater a minute "delivered at three bars of pressure."
"We produce things that others simply can't produce," Voit says. His latest challenge: A Russian customer wants the RainSky shower on his boat to be able to squirt either water or champagne on demand. "We'll manage that," Voit says. The only question that has yet to be resolved is whether the champagne should be warm or cold.
This bizarre order is not from Abramovich, that much Voit will reveal. But he takes great pains to warn his staff not to tell anyone about specific projects. That's because Dornbracht and all other contractors are required to sign long non-disclosure agreements for every boat they work on.
Perhaps partly to prevent absurd details coming to light. One indiscretion revealed that the American owner of the yacht Big Fish had a three-story auditorium installed on his yacht comprising 60 flatscreen TVs stacked next to and on top of one another, on which family photos were projected all day long. The ventilation system alone for this video wall cost millions.
Swarovski Stones and Ray Skin
"If anyone talks about a yacht that's being built, he'll find himself out of a job the next day," says Reiner Gehr, the owner of an interior design company. "Misplaced pride in one's work can cost us millions in lost orders. We are respectable, seasoned craftsmen who aren't interested in the latest fashion."
Maybe this is precisely why Gehr has been used only rarely to furnish owner's cabins. Because in the world of super-mega-giga yacht-building, there are very clear distinctions between who is allowed to do what. And not every company is involved in every area of a yacht. For example, Gehr primarily does crew and guest areas. Nevertheless, owners insist on the finest materials even for their "second-class" areas.
His last major project was on the Roma. This, Gehr explains, followed a typical pattern: Men pay for their ships, their wives are responsible for furnishing, which sometimes leads to misunderstandings in terms of style and taste.
In the case of the Roma, the owner's wife didn't only want to have all furniture handles embellished with Swarovski stones. She also insisted the surfaces of the closets be covered in the exclusive skins of rays. Gehr, a master carpenter by trade, faced a challenge: Where could he get ray skins? What was the best time of year to buy them? How do you work with the stuff? What did it cost? And what should he estimate?
When all the questions had been answered, and the furniture had been upholstered in ray skin, the owner and his wife came to Lunestadt in Lower Saxony to see the result. Unfortunately the owner didn't like the fish-covered surfaces at all, saying, "Get that off, and replace it with beige leather!" The order was carried out. But he paid for both variations.
Translated from the German by Jan Liebelt
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