Boatyard Finds Niche in Making Pleasure Yachts : Leisure: Buyers of multimillion-dollar craft are guided more by emotion than tax law or economic recovery.

A 130-year-old boatyard in this Lake Michigan port town is running at full steam these days--turning out yachts that sell for as much as $10 million.

Burger Boat Co. is one of about six shipyards worldwide catering to a rarefied market for big motor yachts, according to David Ross, president and co-owner of the company.

Ranging in length from 80 to 110 feet, Burger boats sell for $3 million to $10 million. That buys luxurious living accommodations, state-of-the-art navigational aids, communications equipment and fresh water systems, in vessels trimmed with exotic woods from all over the planet.

“We are under full production,” said Ross, who sold a Chicago photography developing business and in 1993 bought the bankrupt and shuttered Burger Boat Co., a historic operation that has launched everything from 19th Century fishing vessels to World War II military craft.

Constructing a 100-foot yacht is a two-year project, which begins with the owner and Burger architects designing the vessels from scratch. Typically, the vessel is launched after 12 to 18 months of construction.

“It is a two-year process. It is not unlike building a large home,” said Ross. “Basically you can take a 5,000-square-foot home and move it to any port in the world.”

The latest launch this spring, the Forthright, was an 83-foot yacht now headed for a yearlong Caribbean cruise. Its owner, Detroit real estate businessman David Clapper, will be at the helm.

Forthright’s appointments rival that of an opulent suburban mansion. Plush furniture and thick carpeting fill the two decks of living quarters. A fully appointed galley is there for feeding crew, and the enclosed helm awaits the captain.

“These vessels are literally like a small city,” said Ross. “They generate their own electricity, have sewage treatment and desalination equipment.”

Owners of Burger yachts are mainly from North America. Ross estimates each has an average net worth of $6 million to $7 million. The King of Morocco bought a Burger yacht from the company’s previous owners, and sales under Ross have been to wealthy industrialists from Canada and the United States.

“These [yachts] are all privately owned, these are not business vessels,” Ross says of his company’s production.

The rising demand for Burger Boats mirrors the rise in demand for smaller boats as well, said Greg Proteau, spokesman for National Marine Manufacturers Assn.

But the similarities end there. Proteau said the luxury yacht market is in a different league than that for smaller pleasure craft.

“The market is pretty rarefied at that level,” he said.

Buyers of multimillion-dollar yachts are guided more by emotion than by tax laws or economic recoveries, Proteau said.

Ross, sitting in his second-floor office surrounded by boat parts and nautical publications, tells how he and his partner, Jim Ruffolo, pursued their own dream of building yachts. It was risky but appears to be paying off.

Ross and Ruffolo, who is vice president and chief operating officer, took a chance. America was exiting a recession, the work force had to be reassembled and financial encumbrances from the previous owners needed to be resolved.

But Ross and Ruffolo succeeded and the company has enough orders to maintain full production into 1996.

“This year will be our first year turning a profit,” said Ross. “We have in fact launched two boats, have five others under construction or under contract.”

Ross will reinvest the profits. The first reinvestment is the intended purchase of a nearby 180,000-square-foot building, which will allow Burger to build 150-foot yachts, up from the current maximum of 110 feet.

Also, as a hedge against future recessions when yacht sales often slow, the larger building will allow for repair and storage operations.

Burger Boat was founded more than 130 years ago by Henry Burger, who first built commercial fishing vessels and later wooden pleasure yachts. Production evolved to military vessels during the two world wars and the Korean conflict, and finally to post-war aluminum yachts.