need advice about investing in a budget hotel in canggu

[awhar3]

HI guys im a new member in this forum. my name is Andrew i’m an indonesian chinese living in indonesia now (i’ve lived in Melbourne, australia for 15 years and now i’m back in Indonesia working)..I am interested in buying land in Canggu to build a quality budget hotel.

The land i’m interested in is a 3 minutes drive to Canggu club (on a straight line north).. 5 minutes drive to brawa beach and 20 minutes drive to seminyak
The hotel concept i’m interested in is like clio apartments in seminyak
Clio Apartment Hotel | Seminyak Bali - minimalist studio hotel in the heart of Seminyak, Bali

Facilities includes a 7x6 room with hot water aircon, tv, dvd player, ipod dock, stove forcooking (thinking of charging 500k per night).... public facility includes a pool and a big bale for chilling out.

What do you think of canggu and the demand for budget hotel now and in the future. Do you guys think i’ll get at least 50% occupancy in this area?

I would appreciate any tips or advice.. thank you in advance

 

[spicyayam]

Since no one else has responded, I will give it a go.

The first thing I wonder is whether you are investing your own money in this project or are you getting some help?

If I was an investor, I would be worried about hearing "quality" and "budget" in the same sentence. I would like to hear something like "quality", "exclusive" or "high-end".

If it is your own money, you really need to come up with a business plan and realistically evaluate if you will be better off starting a hotel or investing your money with the bank or in stocks.

Even if you develop the greatest hotel in Bali, how will you get people there? You need to
assess what your skills are whether it is hotel management, marketing or financial.

 

[ali alavi]

Awhar, I have BA in Hotel and Hospitality Management. Even though I do not live in Bali (yet) I can tell you that Spicyayam's adivce is very critical and to the point. You need to have a Business plan.

I am reviewing the link you provided above. Its interesting but I can't give you any feedback yet as I need to get some crucial information from them.

If anything else hits me on the way, I'll let you know. In the mean time good luck and hope it works out for you.

 

[Markit]

Hey there Awhar,

Looked at the Lofts link you supplied as a comparison to your idea and to be honest with you I wouldn't consider staying there if it was half the price. Why?

No point in staying in Bali if there is no "Bali" where you are staying - no decent windows or view and the owners think that by saying "the only true lofts in Seminyak" they can turn a necessity into a bonus - to me that's like saying that a house with a hole in the back yard has the "only true outside restroom on the island" - bullshit.

As to decor, well about "taste" you can't argue cause that's personal and everyone has their own ideas, but looking at what they have on show there I will tell you that in about 6 months it will start to look very shabby and old. You need to spend some good money and get solid furnishings that will last a while thru hard usage and as a bonus they look better too.

Cheap and nasty aint going to get it anymore no matter how much you wish it, I think?

 

[JohnnyCool]

...(thinking of charging 500k per night).... public facility includes a pool and a big bale for chilling out... What do you think of canggu and the demand for budget hotel now and in the future. Do you guys think i’ll get at least 50% occupancy in this area?

You're joking, right?

You'd be better off (IMHO) leasing some land near wherever the train stations will be (if and when the railroad gets built) and slapping up "quality budget" accommodation there. Ooops - there goes another workable business idea for free.

Or, if not a luxury "kos"/"losmen", maybe a small bar/warung (with free WiFi) for disgruntled truck drivers and train-loving tourists who want to see the real Bali.

Canggu is an over-priced illusion - doing "OK", so far, but its days are numbered. Try and pre-empt where the new Circle K's will be and act accordingly. Last count, there are 13 in Sanur alone!

Good luck, in any case. You're going to need heaps of it. You're Indonesian, right? Living in Melbourne for as long as you say is possibly an impediment.

(For those who think this post is too negative...I'm sorry. "Negativity will pull you through". Maybe - maybe not.)

 

[waterdogs]

low budget is not equal cheap

I actually think its a great idea for canggu. There are so many low budget traveler in Bali. Most of them don't like Kuta, but still want to be close to the live of Kuta and Seminyak. So in my opinion such a place in Canggu between all the high prices villas would be good.

Yes people want to have balinese style, but people book based on pictrues on your web, and if they see your Villas is cool and modern, they would like it, why not.

But what i thing when i see the pictures of the Clio in Seminyak. It's not cheap done at all. Just this wood doors, wood tables, mirrors, this style of bed is all not cheap (well cheaper than in western countryies). I have furnished our Villas with 30 Million Rp. (3 Villas, with 5 King Size beds, and other furniter (Dining Table, TV Table, Reception Furniture,...) and this was the least expensive i could find, and still looking good. I would imagine, this furniture in this picture is about 30 Mill just for one room, easily. Just to give you a heads up....

Calculate your buisness trough. How much you invest to build/furnish/notary/tax/licences....... (its a long list) and if you would come around with 50$ / night.

Occupation: Try not to calculate with a occupation of 50% in your first month. Start with 0% in the first month.. 10% in the second... and so on....

If you have money to invest to make some realy dam good digital photos, you can market your place bevore you open, so you can ad som 20% to above calculation. Just based on my experience...

Well, all depends on how much cash money you have...

 

[JohnnyCool]

While you're at it, you could also produce the "Backpackers Guide To Seminyak/Canggu".

:icon_biggrin:

 

[getzoff]

good idea

Hey Andrew,

canggu is going to happen for sure, and i know people renting average villas for top dollar, in average locations, a clio type thing out there would do well, but we left it a bit late, next location we are looking at is in Kerobokan. but a much larger plot

clio was my concept start to finish, i have also worked on other larger luxury and budget hotels , as well as villa hotels and private villas ..so have been involved in over 1000 hotel rooms and a little under 70 villas,

Sure I would have loved to have built big bali villas.. but the budget I was on I would have one big villa, that would be either full, or empty, and high end accommodation means high expectations and service, and the competition is fierce

main thing is you offer value for money,

when we first opened we did studio's for 5jt a month, and then slowly as the place becomes well known you can go nightly..

design it well, and they will come,

come past some day, i'll try to point you in the right direction

 

[MDoliveck]

Hi All,

Thank you for this post. Congrats and good luck for Awhar. I hope to stay one day in your budget hotel in Canggu.

 

[Min+Co]

Hotel opportunity Nusa Lembongan

Hi Andrew,

Have you considered Nusa Lembongan?

Whilst Canggu is certainly happening at the moment, I feel that the frenzy of interest and development there is at a risk of burning itself out, rather quickly.

Having operated one of Nusa Lembongan's most popular resorts since 2002, I've seen solid, steady growth on the tiny island and a very interesting shift in the quality of development. Services have improved, tourism has boomed, and most remarkably, the island has retained its beauty and traditional charm.

For the first time, we are offering the resort for sale and believe it to be potentially one of the best investment opportunities in Bali.

Drop me a line if you might be interested in further info.

Regards,

Minjarrah

Playgrounds Resort
Nusa Lembongan, Bali

 

[matsaleh]

Minjarrah, Andrew posted the original message in March of this year and hasn't looked at this forum since August, so I doubt if you'll receive a reply.

 

[Min+Co]

Thanks...

I didn't think to check the date of the original post

 

[matsaleh]

I'd suggest you add your property in a new thread to this forum: Bali Property and Real Estate

 

[Min+Co]

Will do... thank you!