Due diligence · 5 min read
Five questions before you commit
A short list of questions we ask every client and ourselves before recommending a property.
1. Does the paperwork permit the plan?
Zoning, permits and lease terms should allow exactly the use you intend. Have independent advisers verify this rather than assume it from what neighbours are doing.
2. What is the downside case?
Model a weaker year. Can you comfortably carry the costs if occupancy or rates fall, or a major repair arrives early?
3. Who will run it, day to day?
Guest quality and asset condition depend on the people on the ground. Meet them, and understand how they report.
4. What does it really cost?
Purchase price is only one line. Add notary and legal fees, taxes, fit-out, furniture, licences, set-up, working capital and any lease extension.
5. How would you exit?
Consider who the next buyer would be, how much lease term they would inherit, and what would make the property attractive to them.
This article is general information, not legal, tax or financial advice. Regulations and their interpretation change; confirm your position with qualified Indonesian advisers before acting.