Understand Property Rights for Hotel Investment in Indonesia. Apart from Bali, Jakarta remains the main parameter for growth in the hotel sector. Various classifications of lodging facilities have been and will continue to be developed in Batavia, so that the growth reaches 10 to 12 percent per year. However, of all classes of hotels operating and opening soon in the capital city, the growth of the five-star plus (upscale) class is the most interesting to observe. If 2010-2011 ago, cheap hotels reached their heyday, now is the turn of luxury class hotels.

Understand Property Rights for Hotel Investment in Indonesia

Understand Property Rights for Hotel Investment in Indonesia

Jones Lang LaSalle reported that until the end of 2012, Jakarta’s upscale hotel market recorded an average occupancy rate of 64 percent with an average daily room rate (ADR) of 151 US dollars (Rp.1,496,530). When compared with this year’s achievement, the occupancy rate grew by 0.3 percent to 67 percent and ADR by 10.6 percent to US $ 168 (Rp. 1,665,010).

Economic growth encourages high intensity of hotel business activities

This performance was considered attractive by several hoteliers. Moreover, the trend of increasing occupancy rates and ADR will continue, in line with the potential for economic growth that encourages high intensity of business activities. There are at least seven new brands brought by international hotel chains to Jakarta in collaboration with National developers. The seven brands are Fairmont, St. Regis, Westin, W, Raffles, Rosewood and The Langham.

To protect your property or land like a smart investor, understanding your property rights can determine the success of your business. In Semarang and other cities in Indonesia, there are certain restrictions for foreign investors.

If you are not a resident of Indonesia, you are not allowed to own any assets, such as land or property, as an individual. Don’t despair just yet because by understanding your property rights, you will be able to have alternative access to the assets that have been mentioned.

Hak Guna Bangunan – HGB

HGB is one of the certificates that you must study first. This certificate allows you to build on certain land. The land in question is government land and freehold land (only for Indonesian citizens). With HGB, you can use land for up to 80 years, build property and operate it for 30 years with an extension for 20 years or renewal for 30 years.

Remember that the HGB is valid for only 30 years if the land is freehold land. In addition, this land is only for Indonesian citizens and companies in Indonesia such as PT PMA.

Right of Use – HP

The best way to gain access to land in Semarang is to form a PT PMA. However, if a foreigner cannot form a PT PMA, with a cellphone they can still use land in Indonesia as long as they have a KITAS or KITAP. This was done by renting land for less than 25 years. HP can be extended up to 80 years depending on the agreement between the landlord and tenant.

Ownership Rights to Apartment Units – HMASRS

HMASRS is new to expats. They can own units of property, such as offices or apartments. Ownership Rights to Apartment Units HMASRS. HMASRS is new to expats. They can own property units, such as offices or apartments, in tall buildings without owning property land.

Depending on the land itself, the validity period of property ownership may vary. Other existing property rights and licenses, such as Hak Milik, Lease Rights and Management Rights are not open to foreign investors.

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Renting Property in Semarang for Lodging Business

Renting property in Semarang as a foreigner is probably the easiest way to start your inn business. Of course, there are risks. Tenants need to be careful before signing an agreement. In addition, you must also understand all your rights and obligations to avoid future disturbances that may harm your business.

Lease agreements can help simplify rental procedures for foreigners looking to lease property. The lease period can be extended multiple times and will not exceed 25 years.

License for Accommodation in Semarang

You need to consider two licenses before running an accommodation business: an accommodation license and a building license. The accommodation license includes a homestay license and a hotel license, depending on the number of rooms and the type of accommodation.

Hotel License

Properties with more than 5 rooms require a hotel license. Due to the many requirements, obtaining this license is considered complicated. The hotel must be in a location 500 meters from the hotel and must be in a tourist area.

Investment in luxury hotels is a long-term investment

According to Head of Research & Advirosy Cushman and Wakefield, investment in luxury hotels is a long-term investment. Returns on investment cannot be as fast as playing stocks or foreign exchange. “In addition, the risk is much higher than investment in the office or apartment sector. Because, once this luxury hotel opens, no one can guarantee the achievement of its occupancy level. A similar sentiment was stated by Knight Frank’s Head of Capital Market and Investment. According to him, the room rate for five-star hotels is not sufficient for the development costs incurred by the developer. If you can’t partner with a truly bona fide brand, don’t try to play in this class.

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