Thelife- Founder Chris Krolow runs a marketplace for buying, selling, and renting private islands.
- He discovered demand as a tour guide when he was 19 and built a website.
Chris Krolow's obsession with islands started when he was 19 and working as a tour guide in Canada for a group of Germans. "The big thing for these Europeans was having an island all to ourselves — and Canada has so many," he told Insider. "They were in heaven."
Each of those visitors paid $5,000 for their trip, he said — an impressive margin for the teen who ran the tour company himself and used campgrounds run by the Canadian national parks system. "My firm only paid $20 to rent an entire island for the night," Krolow said. "I thought, 'I am onto something here.'"
More than 20 years later, Krolow is now an island expert and the owner and operator of Private Islands Inc., a marketplace for renting and selling islands around the world. He also spent four seasons as the executive producer and host of HGTV's "Island Hunters," where he showed prospective island buyers properties in different locations worldwide before they made a purchase.
"After pitching the show, several networks were interested, and we eventually landed with HGTV — but they insisted the show follow their 'House Hunters' brand format," Krolow said.
Krolow owns several islands in places like Canada and the Caribbean. He said the rentals of those properties act as a key revenue stream, forming around 25% of his annual income — the rest comes from commission he makes off of island sales.
From tour guide to island salesman
Krolow left home when he was 14 and spent a year living on the streets in Canada before scrimping enough money together to take a plane to London. He briefly returned to Canada to try to finish his schooling, only to return to the UK at 18 to work in the restaurant industry.
It was while he was working in hospitality, Krolow said, that he recognized the potential of being a tour guide to Europeans looking to explore North America. He said the people he met while traveling, especially Germans, were fascinated with Canada, and he picked their brains on what they were the most fascinated about before starting his company.
Krolow posted flyers on university campuses in Germany and put a few ads in classified newspapers advertising an orientation evening where he would share photos and information of what his tours entailed. "I wasn't sure where it would go, but I put out advertisements, and the response was big," he said.
"I was just a kid, and my goal was to basically charge as much money as I could and pay as little as possible for the camping — I'd feed them cheap hotdogs and white Wonder Bread. And they loved it," he added. "But I ended up getting shut down because I had no permits or anything like that."
He did, however, have connections, having met many island owners during his time running the business. "I was trying to think of a way to monetize the experience of that, so I put together a website with some islands for sale, maybe 12 or 18 of them," he said. Rather than act like a broker, he decided to treat his business like a marketing tool and partner with local agents.
He'd stumbled on a smart formula: Marketing a private island individually is expensive, as the audience for rentals or sales is small and dispersed. Using a destination platform like his, however, reduced costs and drew a worldwide audience.
His strategy relied in part on his internet knowledge — he'd trained in web design after his tour firm shuttered. "It was basically about getting all the keywords for private islands because everyone was fighting for search-engine prominence at the beginning," of the internet boom in the late '90's, he said. "My goal was to own the private-island brand."
His first client found him soon after launching his website — a guy from Panama who offered Krolow commission to list his island and sold it shortly after. "That was a fluke, of course, like beginner's luck. But that's when I decided, 'OK, there's something here. People aren't just crazy about renting islands, but they'll pay a premium to own one," he said.
Today, Krolow said there's a huge demand for Greek islands, but the sale process can take years because of bureaucracy. In some island regions closer to larger cities — like Georgian Bay, Ontario — islands can get snapped up before they even hit the open market, but he added that it typically takes six months to a year to close a deal.
Buying up his own land investments
Canada has more than 52,000 islands, the fourth largest number in the world, which provided Krolow with steady local supply and demand, as well as his own first island purchase — the three-quarter-acre Deepwater Island in Sans Souci Georgian Bay, which he said he closed on in 2013 and began renting out a few months later to tourists.
Krolow was so confident buying this property because he'd seen the viability of island rentals via his own business. "It was my own money, and I bought that island for cash, but we had so much traffic to the website renting out so many islands for other people."
After exploring the Canadian island market, Krolow turned to Belize, another English-speaking country whose coastline is fringed with countless islands, or Cayes. By one estimate, there are 450.His idea was simple: Find an out-of-the-way island and create a private resort, likely with room for just one couple, and charge them a premium for the privilege. He partnered with developer David Keener, a former client who appeared on an episode of "Island Hunters" with Krowlow, to do it. "I told him my concept and he looked at me, then opened a beer — I remember, it was a Heineken — and he said, 'Let's do it.'"
The result was Gladden Private Island, where couples now pay $3,950 a night to stay in glorious seclusion (for two couples, the cost is $4,950 a night). The staff for the villa-hotel lives on a second, adjoining island.
Krolow declined to share what the pair paid for the property, but said it would cost around $5 million for someone else to replicate the existing setup. He added that Gladden is booked solid a year in advance, other than the occasional cancellation — so much so that he's building a second, sister property nearby called Sapodilla Private Islands, which he aims to open next year.
Location and seasonal considerations are vital in turning a profit as an island owner
Krolow said it was crucial for him to focus on the premium tier of clientele, since it's near-impossible to make money otherwise. "A private island is always going to cost more to run than a luxury hotel: transportation costs a mainland resort doesn't have to deal with, hurricane insurance, staffing," he said.
Islands can also be seasonal, which reduces the window during which the owner can make money. Canada's islands, for instance, typically only rent out for the months of June, July, August, and September due to weather — property taxes, however, are due year-round.
He said isolation is key, too: If you're renting out a room for thousands of dollars, the island must be truly private — so no fishing shacks available for $100 a night on a nearby beach, for instance. But a viable island should be close enough to the mainland that a water taxi isn't prohibitive and can be incorporated effortlessly into the rental cost. "It's almost impossible if it's too far out, because you have to get someone there to do the turnover between guests, too," he said.
Part of his strategy is to focus on week-long rentals rather than single nights (Gladden's minimum stay is seven nights per booking). Cancellation policies must be stringent, too. Krolow will rebate 80% of the reservation amount if canceled in writing 60 to 90 days prior to arrival, while no refunds are offered after that window. Cancellations, he said, are "rare," but the waiting list usually allows him to quickly plug any gaps. "It's not an island resort with 12 villas where you have 12 incomes. There's literally one group per day, so a last-minute cancellation can put your margins in the negative," he said.