Film director James Cameron and Russian President Vladimir Putin share a common experience: They squeezed into mini-subs in separate dives this year to explore the depths of the world’s oceans.
But they aren’t the only hobbyist explorers diving beneath the deep blue sea.
Hedge fund managers, entrepreneurs and other wealthy adventure seekers are increasingly adding mini-subs to their collection of toys.
“Our clients see the allure of trailblazing and being the underwater Magellans of our era,” says Marc Deppe, vice president of sales and marketing for Triton Submarines, a Vero Beach, Fla., maker of small “personal luxury” submarines.
Mini-sub owners also are donating time on the subs for marine biologists to conduct research that their universities cannot afford on their own, he says.
“They have had tremendous financial success in their lives, and now they are thinking about their legacy,” Deppe says. “So they are allowing scientists to explore regions of the planet that have never been seen before.”
But before billionaires can become U-boat commanders, they typically turn to their financial advisor to perform due diligence on how to buy and maintain a mini-sub.
The first thing advisors might want to know is that technology is making submersibles more affordable and more compact so they can fit aboard a large yacht and carry the latest sonar and other electronic gear. They come in various configurations and can cost from $1 million to nearly $5 million, depending on the number of occupants they carry and the depth they reach.
Plan on your client spending from $100,000 to $150,000 a year for maintenance, training, insurance and inspections, according to executives in the mini-sub industry.
One crucial requirement is a system to launch the sub into the water and then recover it when the dive is completed, says James James, vice president of Yacht Chandlers, a Fort Lauderdale, Fla., yacht and min-sub retailer.
“The bigger issue is the support vessel and support team needed to run it,” James says. “You need a three- to five-ton crane to lift [it] onto a boat.”
The owner’s yacht can serve as the support vessel if it has been retrofitted to accommodate a launch and recovery system, according to mini-sub executives. If a new yacht is under construction, the owner can include such a system in the boat’s design plans.
Financial advisors also should ask manufacturers about their delivery track record. “Some companies will promise to deliver it in 10 months, but that is really pushing it,” says Charles Kohnen, president of SEAmagine Hydrospace Corp., a Claremont, Calif., mini-sub maker.
The battery-powered subs are built to order and typically require a year to 18 months to complete, depending on how much customization is requested. Sub manufacturers usually require payments to be made at key milestones during the construction process. Mini-subs are usually paid for in cash rather than financed.
“The milestones typically involve American Bureau of Shipping [ABS] surveyors that witness a number of tests that go on during construction,” Kohnen says.
The pilot and the ship’s topside crew need special training to handle the sub. “Training typically takes three to four weeks for a crew of three people,” Kohnen says.
Every year the company provides preventive maintenance for the sub “and helps the client coordinate the ABS surveyors that will also perform a survey of the sub each year.” If maintenance is not performed according to the manufacturer’s protocols, customers will have a difficult time collecting on an insurance claim, he says.
The sub stays on the yacht when it is not being used and is stored in large marinas during the off season so maintenance can be performed on both vessels, he says. Only the biggest marinas can handle a 200-foot yacht with a submarine, and they are typically in U.S. ports such as San Diego, Seattle, Fort Lauderdale and Miami or in the south of France and Germany.
Subs can be customized with options such as maneuverable arms, various cameras or remotely operated vehicles that can explore shipwrecks, according to Deppe, vice president for Triton Submarines.
“Every time you dive, you could be the first to document new deep marine predators or plant life,” he says.
