Professionally operated villas in Bali’s prime districts can underwrite to low double-digit gross yields when ADR and occupancy are set by real operator comps and conservative fee stacks. Global prime residential yields average ~3.1%—Bali’s professionally run STRs can model multiples of that in the right micro-locations, with proper licensing and hands-off operations. Hotel KPIs confirm pricing power (ADR up) and calendar strength (record occupancy) island-wide—useful anchors for villa underwriting.

Savills+1

1) First, anchor to hard data (not hype)

• Global benchmark: Across 30 world cities, prime gross residential yields ≈ 3.1%. This is your baseline for “safe” mature cores.
  
  Savills
  
  

• Bali demand quality: The hotel sector posted record 2024 performance; occupancy and ADR both rose, lifting RevPAR ~14% YoY. That’s a directional tailwind for STR pricing and calendars.
  
  Horwath HTL
  
  

• Luxury & branded context: Independent hospitality research shows Bali’s upper-upscale/luxury set increased IDR RevPAR >13% in 2024, even as USD ADR held broadly stable—evidence of resilient spend at the top end.
  
  c9hotelworks.com
  

Why investors care: You don’t need third-party “ROI claims”. You need inputs (ADR, occupancy) that map to net yield after a realistic fee stack.

2) What actually drives STR yields in Bali

Micro-location: Prime coastal submarkets (e.g., Uluwatu/Jimbaran, Seminyak/Legian, parts of Canggu, Sanur/Nusa Dua) price higher and book steadier—especially with beach access/views and short drive times to anchors (airport, Sanur Health SEZ).

Licensing & zoning: Properly permitted villas protect ADR, OTA placement, and insurability.

Operator calibre: Professional revenue management (dynamic pricing, channel mix), brand reputation, on-site standards.

Bedroom mix & design: 2–4 BR villas lift group ADR and reduce turnover cost per guest-night.

Seasonality & calendar management: Shoulder-season smoothing via wellness/medical, retreats, and direct bookings.

Cost discipline: Transparent fee stack, preventive maintenance, insurance, and reserves keep net intact.

3) Gross vs. net yields (definitions that matter)

• Gross yield: Annual room revenue / purchase price.
  
  

• Net yield: (Gross revenue – operating costs – management & OTA fees – utilities – maintenance – insurance – local levies – reserves) / purchase price.
  
  

• Rule of thumb: A 12–16% gross range can translate to ~8–12% net if fees and OpEx are professionalised (illustrative only; see sensitivity below).
  

(Note: Global “prime” at ~3.1% is usually long-term urban rentals; Bali villas are STR, hospitality-style assets.)

Savills

4) Underwriting, step-by-step (illustrative)

We start from defensible inputs—not wishful thinking.

Base inputs (prime district, pro-ops):

• ADR: informed by hotel comps (island ADR rising) and operator villa comps.
  
  Horwath HTL+1
  
  

• Occupancy: balanced across peak/shoulder; set below operator “ask” to be conservative.
  
  

• Nights: 365; apply seasonality curve.
  
  

• Fee stack: management %, OTA, linens/cleaning, utilities, maintenance, insurance, levy, reserves (FF&E/capex 3–5%).
  

Example (illustrative; not a projection):

• ADR $300 • Occupancy 62% → $67,890 gross room revenue.
  
  

• Less management (20%) & OTA/net leakage (8%) & OpEx/insurances/utilities (~18%) & reserves (4%) → net ≈ $38–42k.
  
  

• On a $400k ticket, that’s ~9.5–10.5% net (gross ≈ 17%).
  (Adjust for purchase price, taxes, financing; numbers vary by asset.)
  

Sensitivity (quick view):

• ADR –10% → net down ~2–3 pp.
  
  

• Occ –10% → net down ~2–3 pp.
  
  

• Fee +5 pp → net down ~1–2 pp.
  This is why operator quality and clean licensing matter more than any single “yield claim”.

5) Using hotel KPIs as sanity-checks

You don’t price a villa like a hotel—but Bali’s hotel KPIs tell you if the demand tide is rising. Recent reports show record occupancy and higher ADR in 2024, with RevPAR up materially—exactly the pattern you want before underwriting villa calendars.

Horwath HTL+1

For submarket nuance or seasonal strategy, cross-check STR dashboards to avoid blindly lifting island averages. (AirDNA and similar datasets track ADR/Occ/RevPAR for Bali.)

AirDNA

6) Fee stack: where net yields are won (or lost)

Typical buckets we insist on disclosing in the memo:

• Management: 18–25% of gross (scope-dependent).
  
  

• OTA & payments: 12–18% gross on OTA bookings; blended down with direct bookings.
  
  

• Operating: housekeeping/linens, utilities, pool/garden, minor repairs, internet, security.
  
  

• Insurance & levies: property/GL coverage; local tourism levy.
  
  

• Reserves: 3–5% of gross (FF&E/capex).
  
  

• Ownership model costs: leasehold vs PT PMA set-up/compliance.
  We price net after all of the above—then run ±10% ADR/Occ stress.

7) What to buy (and where) if you want the range

• Prime micro-locations: clifftop or walk-to-beach pockets in Uluwatu/Jimbaran, Seminyak/Legian, parts of Canggu/Pererenan; proximity to Sanur Health SEZ adds shoulder-season ballast.
  
  

• Bedrooms: 2–4 BR for group ADR; avoid odd layouts.
  
  

• Compliance: licensing, fire/life/safety, operator SLAs, audited reporting.
  
  

• Operator: proven P&L, direct-booking funnel, dynamic pricing, owner transparency.
  
  

• Build quality: lowers OpEx leak and downtime.
  

8) Risks & mitigations (say the quiet part out loud)

• Policy / “quality tourism” shift: Bali is actively steering toward higher-quality visitation; comply with rules, and it’s an ADR protector—not a headwind.
  
  Business Insider
  
  

• Supply pockets: Track local pipelines; leverage brand/operator strength to defend pricing.
  
  c9hotelworks.com
  
  

• Airlift variability: Route diversity to DPS is a cushion; we watch airline counts/capacity.
  
  c9hotelworks.com

Investor takeaways

1. You’re not buying a brochure yield. You’re buying inputs (ADR/Occ) + execution (operator/fee control).
   
   

2. Low double-digit gross is achievable in prime districts with licensing and pro-ops; ~8–12% net is realistic on a tight fee stack (illustrative).
   
   

3. Macro supports micro: Bali’s hotel KPIs show pricing power and calendar strength—exactly what STR underwriting needs.
   
   Horwath HTL+1
   
   

4. Compared to global prime (~3.1%), a well-positioned Bali STR can deliver multiples of core-city yields—with lifestyle and diversification upside.
   
   Savills

FAQ

Is “12–20% gross” realistic?
Yes—for the right assets, with professional operations, clean licensing and prime micro-location. Treat it as an underwriting range, not a promise; your net depends on the fee stack.

Why not cite one single “Bali yield”?
Because yields are asset-specific. We show you assumptions and fees in the memo, run sensitivities, and let the numbers speak.

Are hotel KPIs relevant to villas?
Indirectly. They confirm demand strength and pricing climate. We still rely on operator STR comps for villa ADR/Occ.

Horwath HTL+1

Sources & further reading (non-competitor, reputable)

• Savills – Prime Residential Index (World Cities): average prime gross yield ~3.1% (global benchmark).
  
  Savills
  
  

• Horwath HTL – Bali Hotel & Branded Residences (Apr 2025): record 2024 performance; occupancy & ADR up; RevPAR +14%.
  
  Horwath HTL
  
  

• C9 Hotelworks – Bali Hotel & Branded Residences (Mar 2025): luxury/upper-upscale KPI tables (occ/ADR/RevPAR) and pipeline insights.
  
  c9hotelworks.com
  
  

• STR data platforms (market view): AirDNA (ADR/Occ/RevPAR tracking for Bali STR).
  
  AirDNA
  
  

• Policy & “quality tourism”: TIME/Reuters coverage on levy/moratorium direction (protecting destination value).
  
  Business Insider+1

Methodology & disclaimer

All yield figures here are illustrative and depend on asset selection, licensing, operator execution, and fee/OpEx control. Hotel KPIs are used as context, not as villa proxies. We underwrite asset-by-asset with conservative inputs and ±10% sensitivity on ADR/occupancy.