Cruise Lines Invest Heavily in Private Islands to Create Exclusive Passenger Playgrounds
From elaborate waterparks to tranquil adult-only zones, cruise lines are transforming leased or purchased islands into revenue-generating destinations.
Cruise lines are increasingly acquiring and developing private islands in tropical locales, transforming them into exclusive destinations designed to enhance the passenger experience and capture additional onboard spending. This trend sees islands outfitted with extensive amenities such as water parks, private beaches, and luxury cabanas, offering passengers a curated "in-house" land experience.
Royal Caribbean's Perfect Day at CocoCay in the Bahamas, located on Little Stirrup Cay, exemplifies this strategy. Opened in 2019 after a $250 million upgrade, the 144-acre island features a water park with towering slides, multiple pools, and adult-only retreats. It has become Royal Caribbean's most popular stop globally, demonstrating the financial viability of such developments.
Following this success, Royal Caribbean has expanded its private destination offerings with the Royal Beach Club in Nassau and another in Santorini, Greece. The Santorini location aims to alleviate overcrowding on the popular island while providing an additional passenger amenity. The cruise line plans to have eight such resorts by 2028, including locations in Mexico and Vanuatu.
This concept is not new to the industry. Norwegian Cruise Line pioneered the trend in 1977 with the acquisition of Great Stirrup Cay. Since then, lines such as Princess Cruises, Disney Cruise Line, and Holland America Line have followed suit, often utilizing islands in the Bahamas, which has become a hub for these private cruise line resorts.
MSC Cruises reportedly invested $200 million in transforming a former industrial island into the marine reserve Ocean Cay. Virgin Voyages has established a beach club on the Bahamian island of Bimini, and Carnival Cruise Line opened its Celebration Key resort on Grand Bahama Island, featuring a large swimming lagoon and a swim-up bar.
Beyond the Bahamas, NCL operates a second retreat in Belize called Harvest Caye, and Carnival Corporation brands share the Amber Cove resort in the Dominican Republic.
These private islands offer significant financial benefits to cruise lines. While basic amenities are often included, charges for specialty dining, drinks, and activities generate substantial revenue. For instance, waterpark passes at Perfect Day at CocoCay start at approximately $80 (converted from £66), and luxury cabanas can cost up to nearly $3,800 (converted from £3,000). Furthermore, owning or leasing these islands eliminates docking fees and helps avoid potential conflicts with local populations concerned about over-tourism.