Ubud Eco-Luxury Boutique Hotel

About this home

A 13-unit boutique eco-luxury hotel in the Ubud highlands, raising IDR 10 billion of development capital against freehold land already owned by the developer. Rooms-only operating model, no F&B complexity. Capital protected first, 12% preferred return, then a 70/30 profit split. Targets ~26-28% cash yield, ~3.8-year payback, and a 9-10x EBITDA exit window in Year 5-7. Designed for investors who want institutional-grade hospitality returns from a low-density, operationally simple asset in one of Bali's most resilient luxury clusters. The asset sits in Tegalalang, on the northern edge of the Ubud luxury resort cluster — a supply-constrained band where boutique inventory commands premium pricing. The land is freehold (SHM) and fully owned by the developer at the structuring stage, eliminating acquisition risk and pulling forward the development clock from day one. The thesis is intentionally narrow. Thirteen units. Rooms-only operations, no food and beverage. A single integrated guest journey designed for couples, wellness travellers, and digital nomads. The economics are not built on scale — they are built on pricing power, low operating complexity, and a high-margin operating model that compounds inside a tight inventory. Investor capital of IDR 10 billion funds the full development. The developer contributes the freehold land, concept, build oversight, and operating team in-kind. Capital returns first — every rupiah of distributable cashflow flows to the investor until the full IDR 10 billion has been repaid. A 12% IRR preferred return then accrues to the investor before any profit splits begin. After the hurdle clears, the residual splits 70% to the investor, 30% to the developer. The development cycle runs 12 to 18 months from structuring to stabilisation, with hard construction the dominant capex line (~65% of budget) between months 4 and 12. The asset reaches full NOI by month 18, and capital recovery is targeted inside Year 4. From Year 5 onward, the investor either holds for the yield phase (~IDR 2.75B annual NOI, ~26-28% cash-on-cash) or exits at 9-10x EBITDA against a stabilised base, modelled at approximately IDR 26-29B — a 2.6-2.8x total return on the IDR 10B ticket. Downside is engineered, not assumed. The waterfall puts the investor first in line. The 12% preferred return is a contractual hurdle, not a soft target. Construction is locked early in the cycle to absorb inflation risk, and a 5% contingency reserve sits on top of the budget. Even on a stress-tested low case (IDR 1.75B NOI), the asset stays cashflow-positive — capital erosion is structurally protected.