World's First Floating Resort Scheduled To Set Sail In 2001

The world's first ocean-going luxury resort is scheduled to be afloat late in 2001 now that Bahamas-registered ResidenSea has secured financing and found a builder, company officials said. The vessel for the rich, dubbed The World of ResidenSea, was conceived four years ago by Norwegian cruise magnate Knut Kloster Jr. "After four years of an uphill struggle...we have finally made it," Henning Oeglaend, chairman of the board of ResidenSea, said at a ceremonial contract signing in Oslo with the ship's Norwegian-based builder, Fosen Mek. Verksteder AS. Flagging cruise line share prices, coupled with turmoil in the world financial market over the past few years prompted the firm to cut the size and cost of the ship to 40,000 tons at $350 million from an initial 86,000 tons at $545 million. "It's no secret financing this project has been a challenge," Oeglaend said. "I have to admit we have had a number of scary moments when [we thought] the whole thing was going to collapse, but the future is great for this product." Oeglaend reiterated ResidenSea was fully financed to cover the $350 million needed, partially by investors from the cruise, shipping and hospitality industries. Additional investment capital would come from U.S.-based Continental Casualty Company, a wholly owned subsidiary of CNA Financial Corp. and an indirect subsidiary of the Loews Corp., as well as from the ultra-deluxe cruise line Silversea Cruises Ltd. The firm in June 1998 ditched a plan to have an initial public offering of $190 million via the Oslo bourse. Oeglaend said that the company was planning a $60 million equity issue but did not specify any details. "Our plan is to list the company, to make it public. We haven't decided when yet but as soon as it is practically possible," he said, adding "it is definitely on the agenda because we plan to build more ships." He said ResidenSea had selected Fosen shipyard for the $262 million building contract over Germany's Howaldtswerke-Deutsche Werft because the German yard could not comply with the scheduled target date for delivery.