In 1886, Albert Ballin joined HAPAG (Hamburg-Amerikanische-Packetfahrt-Actien-Gesellschaft) as manager of its passage department. Thirteen years later, in 1899, he became managing director. It was during this term that he realized his company’s largest and flagship vessel, Augusta Victoria,
lay largely unused during the winter season. Due to inclement weather,
travelers largely stayed away from the North Atlantic route. It was then
that Ballin, despite criticism from his fellow directors at HAPAG and
other steamship companies, planned to send Augusta Victoria on a 58-day “pleasure voyage” from Cuxhaven,
Germany to the Mediterranean and Orient. This extended cruise would
include well-planned excursions ashore to ports-of-call along the route
and Ballin would be a passenger himself. The voyage was a success, and
similar ones were planned.


Despite their increasing success, these early cruises, called
"excursions", were difficult to plan with existing ships. Constructed as
ocean liners,
they did not meet the requirements of the pleasure-seeking market. They
offered few amenities aboard. This became apparent during long
stretches at sea. Furthermore, their construction as multi-class vessels
also proved a hindrance as such vessels provided restricted access to
deck space. Whatever deck space there was, was mostly sheltered, and
designed to accommodate the rigors of the North Atlantic instead of the
seas of more southern climes. Ballin believed that only a vessel
specifically designed for cruising would be appropriate. Furthermore,
such a vessel could spend the entire year doing so.


A few months after Ballin became managing director, he commissioned – in 1900 – Blohm & Voss to construct such a ship, to be named after Kaiser Wilhelm II's daughter. The ship was launched on 29 June 1900 and christened Prinzessin Victoria Luise.