What a rental pool actually pays: how to read a villa income offer

What a rental pool is

In a managed resort, each villa owner signs a management agreement and hands the villa to a single operator, who lets all the villas together as one hotel. Guests do not book your villa; they book a room category. Revenue goes into a pool and is paid out to owners by a formula. The alternative, letting your villa yourself through Airbnb, is what I have done in Bali since 2014, and it is a part-time job.

Gross, net, and what sits between

The number that matters is not the headline rate. It is what reaches you after the deductions, and those come in layers.

Room revenue. What guests actually pay, after discounts and taxes collected on their behalf.

Platform fees. Online travel agents take a commission on bookings they bring. A pool that pays "after platform fees" has already taken this off.

The operator's share and costs. The hotel operator is paid from the pool for running the place: staff, cleaning, utilities, marketing, maintenance. Some agreements express this as a percentage, some as a management fee plus costs.

The owner's share. What is left, split among owners.

At Saraya, owners receive 60 per cent of room revenue after booking-platform fees. The point is not whether 60 is the right number for every project. The point is that it is stated, and stated against a defined base.

View tiers and fairness

If a beachfront villa and a garden villa share one pool equally, the beachfront owner is subsidising the garden owner. Good pools group villas into tiers so that each tier shares the revenue its category earned. Saraya uses four: beachfront, ocean view, sunset and mountain view, and garden. Ask how your villa is grouped and how the tiers are weighted.

Occupancy is the real variable

A rental pool's income is occupancy multiplied by rate. Both are forecasts until the resort opens. A brochure that quotes a yield is quoting an occupancy assumption. Ask what it is, ask what comparable resorts in the region achieve, and ask what the operator's brand brings in terms of guests who book direct.

The operator matters more than the architect

A beautiful villa run badly loses money. Ask who the operator is or will be, what else they run, and how they are paid. Kinnara Capital ran a competitive process for Saraya with international groups and will name the operator once agreements are signed. If a project cannot tell you who will run it, treat the yield as a guess.

Questions to ask before you believe a number

1. Is the percentage of gross revenue, room revenue, or net operating income?
2. What comes off before my share is calculated?
3. How are villas tiered, and where is mine?
4. What occupancy and rate assumptions produce the forecast?
5. Who is the operator, and how are they paid?
6. How and when am I paid, and can I see the accounts?
7. What are my ongoing costs: tax, company costs, insurance, a furniture reserve?

If the answers are in the agreement rather than the brochure, you are dealing with a serious developer. The Lombok guide for Australians covers the rest of the due diligence.