Joe Youssef and his wife, Kara, sold most of their belongings and withdrew their savings to join a three-year cruise that never sailed. “We sold everything we have to make this dream happen,” Kara said. “We feel completely defeated.” Photo / Rena R. Effendi, The New York Times
The Life at Sea cruise was supposed to be the ultimate bucket-list experience: 382 port calls worldwide over 1,095 days. The only thing missing was a trip-worthy ship.
Kara and Joe Youssef sold their two apartments, withdrew their life savings, gave up most of their belongings and, in late October, set out for Istanbul for the trip of a lifetime: a three-year cruise around the world, scheduled to depart November 1.
But in late November, after months of behind-the-scenes chaos, the Youssefs were stuck in Istanbul, with the cruise company cancelling the trip. It did not have a ship that could handle the journey.
The Turkish company, Miray Cruises, had announced the cruise, called Life at Sea, in March. It claimed it would be the longest cruise ever — 382 port calls over 1,095 days — and a community at sea, with opportunities to explore the globe. Starlink internet and a business centre would allow passengers to work remotely.
The cruise seemed ideal for a post-pandemic era, targeting people longing for an escape. With fares starting at US$90,000 ($144,000) for an inside cabin and going up to US$975,000 ($1.5 million) for a suite, the trip even seemed like a bargain to some prospective passengers, cheaper than living three years in many cities.
Within the first month of sales, more than half of the ship’s 400 cabins had been reserved. But putting together a cruise of this magnitude is a monumental task, requiring a ship large enough to carry hundreds of people, docking rights around the world and secure funding.
Like a high-seas version of the Fyre Festival, which promised a luxury music concert in the Bahamas and delivered cold sandwiches and makeshift tents, the cruise imploded. It has left people, including the Youssefs, frustrated and confused. Despite promised refunds, only a small portion of the money has been returned so far.
In an interview in December, Vedat Ugurlu, owner of Miray, blamed a lack of financing and interest for the cruise’s cancellation.
“We tried everything to find a solution, but at the end of the day, we couldn’t get the investors and we couldn’t sell enough cabins,” he said.
That has left Kara Youssef, 36, a former humanitarian worker from Ohio, and her husband sitting in Istanbul with three suitcases and a carry-on, waiting for a refund of US$80,000 ($128,000).
“They kept leading us on, making us hold out hope until the very last minute, just days before we were supposed to depart,” she said. “We sold everything we have to make this dream happen. We feel completely defeated.”
In June 2022, as the cruise industry was recovering from its pandemic shutdown, Mikael Petterson, an entrepreneur based in Miami, had an idea for a three-year cruise. Long-term cruises are not unheard of, but they usually last a year at most, because of the logistics involved.
Petterson had plans to hit destinations all over the world. What he did not have was a ship. Through a broker, he was introduced to Miray International, which had been offering voyages and cruise-operation services since 1996.
Ugurlu suggested the MV Gemini. He had acquired the 400-cabin, 1,074-passenger vessel in 2019, and had mainly used it for excursions between Turkey and the Greek islands.
Petterson couldn’t afford to buy the ship, so, instead, the two groups joined forces. He would do the marketing while Miray took care of operations.
In November 2022, Petterson signed a three-month contract to develop their new brand: Life at Sea Cruises. He had not seen the Gemini, but said that he trusted Miray’s nearly 30 years of experience.
Kendra Holmes, then vice president for business development strategy at Miray, said the company had not only the vessel but a budget of about US$10 million ($16 million) to refurbish it for such a long cruise. It also had the experience and staff required, she said.
Petterson visited Turkey in December 2022 and saw the Gemini, but said his focus was on design and creating renderings for marketing. He planned to carry out a technical inspection later, he said.
“The cabin configuration was perfect for the pricings and affordability we were marketing,” he said.
On March 1, Life at Sea began selling space on the cruise, drawing millions of clicks to a newly created website. “It just blew up, and we could barely keep up,” Petterson recalled.
Many of the prospective passengers had never been on a cruise. Keri Witman, 56, a marketing executive from Cincinnati, was looking for a change, a new community and adventure.
She liked the ability to travel while continuing to work. “This seemed like the perfect opportunity,” she said.
Witman was one of the first to book in April. She asked a lawyer to look into the company and, after finding no red flags, placed a US$5,000 ($8,000) deposit for her US$185,120 ($296,117) cabin and put her house up for sale.
When Petterson returned to the Gemini in April, questions were raised about the ship and its itinerary. Could it even hold enough fuel to sail between some of the more distant ports? In an audio note sent to his team, Robert Dixon, itinerary planner, said he was denied access to the engine room and was told by an engineer that the vessel could not hold enough fuel to cross the Atlantic Ocean on schedule. He also raised concerns about a planned crossing in the South Pacific.
“Even if you spend another US$10 million on that ship, I don’t think it is enough to do what we want to do,” Dixon said in the recording. He declined to be interviewed.
Beyond that, there were questions about Gemini’s size. If the cruise sold out its 1,074 capacity, would there be enough space for people to lounge or work, as many of them planned to do, for three years?
Amid questions about the Gemini, tensions started to build. Petterson’s team complained that it could not process credit card transactions and lacked an escrow account to secure deposits, as is common in the United States.
Miray had expected the sales team to collect the full fare upfront, but asking for hundreds of thousands of dollars at once was prohibitive. Petterson introduced an instalment plan, which helped boost sales but caught Miray unprepared. And there was no account in the United States for the sales team to use as it secured reservations.
Ugurlu owned a pizza parlour in Orlando, Florida, and Petterson said the company asked him to deposit the initial payments into the shop’s account. According to Holmes, that was suggested as a temporary solution.
Miray pursued other ways to accept payments, including the use of Square, an online payment platform, but after Miray had a dispute with Square, Petterson, concerned at the lack of secure ways to hold deposits, asked the company to refund all the clients’ deposits. Worried that the cruise was in jeopardy, passengers cancelled reservations for at least 25 cabins.
In May, amid the turmoil, the Youssefs attended a webinar for prospective passengers but heard nothing about payment issues. The couple was assured, even on another ship, that the cruise would depart November 1. On May 6, they put down a US$5,000 deposit and were told that a 25 per cent payment was due June 7.
By then, Petterson had left the company. The internal corporate squabbling became public on the app and Facebook page created for the cruise. Petterson told passengers that Life at Sea was dismantled, and that Miray was refusing to answer critical questions. He urged passengers to complain to US maritime authorities.
Holmes portrays Petterson as the loser in a power struggle. “It got to the point where somebody can’t be the captain, so they try to sink the whole ship,” she said. She became CEO of Life at Sea and began working to reassure passengers.
Confusion and panic set in among the passengers, many of whom had already started uprooting their lives. “We felt very nervous, first sitting through one webinar with the team that left, then with Kendra Holmes,” Kara Youssef recalled.
But in the weeks that followed, Kara Youssef said she felt more comfortable as Holmes and her team hosted daily webinars focusing on getting a new ship.
“Kendra was very convincing and dedicated,” Kara Youssef said, noting that “she was very realistic, whereas Mikael had promised us the sun and the moon.”
In a webinar on May 31, Holmes said the company had decided not to set up an escrow account. She said it would use another method of protecting passenger deposits, a bond filed with the Federal Maritime Commission, a US agency that helps to regulate ocean transportation. But the bond was never filed.
In early July, Life at Sea announced that “due to unprecedented demand,” it had acquired a larger 627-cabin ship — to be named the MV Lara. In actuality, the company had put down a deposit and was negotiating to buy the Lara with the help of investors, at a cost Ugurlu later put at between US$40 million and US$50 million.
At that time, Mary Rader, 68, a retired social worker from Westchester County, New York, asked a travel agency to look into Miray Cruises and was told it was reputable. When a couple offered to transfer their cabin to her at a discounted rate, she took the opportunity, withdrawing US$80,000 ($128,000) from her retirement savings.
Rader made two payments, US$50,000 ($80,000) and US$35,000 ($56,000), but said she never received a receipt and the couple never received a refund. She eventually got a boarding pass, but on the cruise app, she and the couple were listed in the same cabin.
“This is when I started to see all the red flags, but I was trapped because I had already made the payments,” she said.
In September, the Youssefs sold their apartment to keep up with their cruise payments; others started applying for visas, shipping belongings to Istanbul and making arrangements for their pets.
At that point, although only 111 of the ship’s 627 cabins had been sold, passengers who had signed up were assured that the ship would sail, even with as few as two passengers.
On September 26, the day the payment was due to secure the Lara, Holmes received a call from Ugurlu, saying that the lead investor had dropped out, but that he was working on other candidates. After receiving some cancellation requests, Holmes posted in the cruise app that, according to the contract’s terms, passengers who cancelled now would only receive a 10 per cent refund.
By October 27, only days before the cruise’s scheduled departure — and with 30 passengers in Istanbul, ready to board — the company announced the trip had been delayed to November 11 and would depart from Amsterdam. Days later, the departure was postponed again, to November 30.
On November 16, Kara Youssef learned from a newspaper that the Lara had been acquired by another company “We were frustrated and felt stuck in limbo, with no information to go on but what we discovered on our own,” she said. Holmes resigned from Miray the same day.
On November 19, Ugurlu issued a statement saying that investors had pulled out because of the unrest in the Middle East; the next day, Miray confirmed that the cruise was cancelled.
A day later, passengers were asked to sign an agreement with Miray, which would spread refund repayments over three months, from December to February. The first deadline passed December 22, with only some passengers getting any money. Miray said the delay was caused by banks’ requesting extra documentation.
The Youssefs said Thursday that they had still not received their refund. For the past month, they have been living in a hotel in Istanbul paid for by the cruise company.
“We could soon be homeless,” Kara Youssef said.
Miray, Holmes and Petterson are now separately working on other three-year cruises, to launch next year.
Rader is not hopeful. “I have received nothing yet, but I did not expect to,” she said. “My guess is that the company will be shut down or restructured, and anything I put in cash will never get paid out.”
This article originally appeared in The New York Times.
Written by: Ceylan Yeginsu
Photographs by: Rena R. Effendi
©2024 THE NEW YORK TIMES
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