Cruise lines buying up private islands. I can't wait to be alone!

Want to beat the crowds? Find a little solitude. There is no better way than to board a cruise ship with 5,000 of your best rotund friends! I can feel the stress leaving my body and the buffet calling.

The Cruise Line Land Grab for Private Islands

Norwegian, Carnival, Royal Caribbean and Disney cruises are betting on private beaches to help travelers avoid crowds and have a resort experience

By Jacob Passy, WSJ

Sept. 26, 2023 9:00 pm ET

Customers seeking a sense of exclusivity and luxury are booking cruises with private islands on the itinerary, travel agents say. Here, Royal Caribbean’s Perfect Day at CocoCay in the Bahamas.

LITTLE SAN SALVADOR ISLAND, Bahamas—Stepping off the tender boat at Half Moon Cay feels like entering a straight-from-the-movies desert isle.

The beaches are carpeted in the softest white sand imaginable. The water is an almost unnatural shade of blue. Mangroves and forest cover most of the island, sheltering native wildlife.

The best part? Cruise-ship visitors have the entire island to themselves.

Cruise companies are doubling down on private destinations like Little San Salvador, operated as Half Moon Cay by Carnival and Holland America, for their customers. Industry analysts say major cruise lines have spent tens of millions of dollars to snap up and beach-ify island properties in the Caribbean and beyond. Travel agents and industry analysts say private islands entice customers to book sailings, especially at a time when ships are competing for space and amenities at busy ports of call like Nassau in the Bahamas or Cozumel, Mexico.

“Having these company-owned destinations gives us a little more control,” says Chris Chiames, chief communications officer for Carnival Cruise Line.

Many cruise-operated destinations feature rental cabanas that can run hundreds of dollars a day.

Coming attractions

Norwegian Cruise Line arguably pioneered the private-island idea when it purchased a Bahamian isle in the late 1970s, which it developed into Great Stirrup Cay. Since then, other cruise companies have bought or leased land across the Bahamas and Caribbean.

Carnival Cruise Line currently calls on several destinations owned by its sister lines, including Holland America Line’s Half Moon Cay and Princess Cruises-owned Princess Cays. Carnival will soon have its own private destination, dubbed Celebration Key, a section of Grand Bahama. Celebration Key is expected to open to visitors in July 2025.

Disney Cruise Line will begin visiting a new private destination, Lookout Cay at Lighthouse Point, in June 2024. Disney describes the stopping point, on the Bahamian island of Eleuthera, as a tropical retreat with amenities for children and adults. Disney already operates Castaway Cay, a private island also located in the Bahamas.

The success of Royal Caribbean’s $250 million Perfect Day at CocoCay in the Bahamas caught competitors’ attention. Perfect Day, which opened in 2019 and boasts a water park, a zip-line course and an enormous freshwater pool, has generated a strong return on investment since then, says UBS analyst Robin Farley.

Employees who work on private islands sometimes have room and board provided by the cruise lines.

Royal Caribbean will open an expansion on CocoCay next year. Called Hideaway Beach, the new section was the result of guest research that indicated the island was missing adults-only experiences, says Jay Schneider, Royal’s chief product innovation officer.

The company is also developing the Royal Beach Club Collection, smaller locations at ports of call aimed at providing what Schneider describes as the “ultimate beach day.” The first is being developed on the western end of Paradise Island in Nassau, featuring 17 acres of pools, restaurants and manicured beaches. It is expected to open in 2025.

Far from the crowds

The cruise industry’s growth has meant that the destinations ships visit easily can become overrun with tourists—especially when several vessels are in port.

Maru Hyndman of luxury travel agency Travel Edge has experienced this firsthand when visiting the island of St. Thomas on a cruise. “If you didn’t have an experience confirmed, you were going to have to spend a lot of time just waiting to get a taxi to go to a beach, and that beach was going to be really crowded, too,” she says.

That feeds into the allure of private islands and other cruise-exclusive destinations. Because the cruise lines control how many people are on an island at a given time, they can ensure travelers get what they expect. And it lets cruises offer an experience on par with an all-inclusive resort at, potentially, a fraction of the price, says Rebecca Thompson, vice president of sales for Travel Edge.

So popular are these getaways that cruise lines can charge more for itineraries featuring private beaches, says Truist Securities analyst C. Patrick Scholes.

The retreats reflect their brands. Royal Caribbean’s Perfect Day at CocoCay features a water park with 13 slides and a wave pool, in line with the company’s activity-packed ships.

On the more outdoorsy side, MSC Cruises’ Bahamian private island, Ocean Cay, features thousands of indigenous plants and an extensive marine reserve—and no swimming pools.

“We wanted to do something much truer to nature,” says Rubén Rodriguez, president of MSC Cruises USA. (The cruise line also operates private destinations off the coasts of Mozambique and the United Arab Emirates.)

Deena Haiber, a teacher and travel blogger from Wesley Chapel, Fla., tries to go on several cruises annually and has visited numerous cruise-owned islands. Her favorite: Ocean Cay, for the island’s simplicity and natural beauty. She also enjoys that MSC, unlike other cruise lines, offers itineraries that include overnight stays at its private island.

“You wake up and it’s just like magic,” she says. “You look outside of your balcony and you just see the whole island stretch before you.”

Know the ropes

Depending on the destination, the private-island experience might not be so different from being on the ship. You might have to pay more for a better time; sitting on the beach might cost nothing, but snorkeling at a coral reef or reserving a cabana usually costs extra. On some islands, the ship’s food and beverage packages extend on shore, but that is not the case on others.

For the cruise lines themselves, private islands and beaches can be expensive to maintain and operate.

MSC spent more than $200 million to develop Ocean Cay, previously an industrial site. The island houses 160 people full time, with the cruise line providing their room and board, Rodriguez says. The remoteness of some destinations, specks in the Caribbean, adds to the complexity and costs.

“The reason for these islands mainly is that the guests love them, and we need to sell cruises that the guests love so they come back,” he says.

Sign up for the new WSJ Travel newsletter for more tips and insights from the Journal’s travel team.

Write to Jacob Passy at jacob.passy@wsj.com