The term “Derawan Land Investment” does not designate a recognised asset class in Indonesia as of 2025–2026. This briefing provides an overview of the broader Indonesian and Balinese real estate and land market for 2026–2027, focusing on investment options for foreign nationals, including Hak Milik and freehold structures.
Indonesia Real Estate & Land Market Overview (2025–2027)
Indonesia’s total real estate market was valued at USD 100.4 billion in 2025, with projections reaching USD 156.2 billion by 2034, indicating a 5.03% Compound Annual Growth Rate (CAGR) from 2026–2034. Another leading consultancy estimates the market at USD 149.2 billion in 2024, USD 169.9 billion in 2025, with projections of USD 248.7 billion by 2030, reflecting a 7.9% CAGR from 2025–2030.
Residential real estate consistently holds the largest share, comprising 58% of the market in 2025. Commercial and industrial properties account for the remaining proportion. Reconciling these forecasts suggests an annual growth rate for the wider real estate and land market of approximately 5–8% through 2030. This implies an increment of roughly USD 8–12 billion per year in national real estate value for 2026–2027, based on the cited CAGRs.
Commercial Land-Linked Real Estate in Indonesia
For land supporting offices, retail, logistics, hospitality, and mixed-use developments, the Indonesian commercial real estate market is substantial. It was valued at USD 26.88 billion in 2025 and USD 28.55 billion in 2026, with projections to reach USD 39.02 billion by 2031 at a 6.22% CAGR from 2026–2031.
Offices constituted 39.45% of the commercial market share in 2025. Rental income generated 62% of revenue within this sector. Logistics is identified as the fastest-growing subsector, with a 9.12% CAGR. While Jakarta accounts for 25.2% of commercial real estate activity, the “Rest of Indonesia,” encompassing Bali and other secondary cities, is projected for faster growth at an 11.22% CAGR to 2031. This context is pertinent for land investors, particularly as commercial land values in tourist-centric and developing regions are expected to appreciate.
Bali & East Indonesia Land Market Dynamics (2026–2027)
Bali’s land and property market is a significant component of the “Rest of Indonesia” category, driven by tourism and expatriate demand. While specific market size figures for Bali alone for 2026–2027 are not disaggregated in national reports, the island consistently experiences high demand for both residential and commercial plots.
The current market environment (2025–2026) shows continued interest from foreign investors in regions like Bali, Lombok, and parts of East Kalimantan, including the Derawan Islands. These areas benefit from infrastructure development and tourism growth. Land appreciation in prime Balinese locations, such as Canggu, Seminyak, and Uluwatu, has historically outpaced national averages. Emerging areas are also seeing increased speculative and development interest.
2027 Note on Infrastructure and Policy
By 2027, ongoing infrastructure projects, including enhancements to regional airports and road networks, are expected to further improve accessibility and potentially increase land values in areas outside traditional tourist hubs. Policy developments regarding foreign ownership of property and land rights will also be critical to monitor, as they can directly influence investment structures and market sentiment.
Foreign Ownership & Land Titles in Indonesia: Hak Milik and Freehold Options
Foreign nationals are generally restricted from directly owning Hak Milik (freehold title) land in Indonesia. However, various legal structures permit significant control and economic benefit over land and property.
Hak Pakai (Right to Use)
This is the most common form of direct land tenure for foreign individuals. Hak Pakai allows a foreign national to use land for a specific period, typically 30 years, extendable for another 20 years, and then another 30 years, totalling 80 years. This right can be granted over state land, Hak Milik land, or Hak Pengelolaan (Right to Manage) land. It provides substantial control, allowing for construction and transfer of rights.
Hak Guna Bangunan (HGB – Right to Build)
This right grants an entity, including a foreign-owned company (PT PMA), the right to construct and own buildings on land for a period, typically 30 years, extendable for 20 years, and then another 30 years, totalling 80 years. HGB can be granted over state land, Hak Milik land, or Hak Pengelolaan land. For commercial developments, PT PMA structures holding HGB are common.
Leasehold Agreements
Foreign individuals can enter into long-term lease agreements (Sewa) for land, often directly from a Hak Milik owner. These leases can range from 25 to 30 years, with options for extensions, effectively providing long-term control similar to a freehold in some jurisdictions. Leasehold agreements are contractual and their security depends on the drafting and registration of the agreement.
PT PMA (Foreign-Owned Company) Structure
For more substantial investments, foreign investors establish a PT PMA. A PT PMA, as an Indonesian legal entity, can hold Hak Guna Bangunan (HGB) and Hak Guna Usaha (HGU – Right to Cultivate) titles. HGB is suitable for commercial and residential development, while HGU is for large-scale agricultural operations. This structure allows foreign capital to control significant land assets indirectly through the Indonesian corporate entity.
Investment Considerations for 2027
Investors assessing opportunities in 2027 should consider several factors:
- Location: Prime tourist areas in Bali continue to offer strong rental yields and capital appreciation. Emerging areas, particularly around planned infrastructure, present higher growth potential but also increased risk.
- Legal Structure: Selecting the appropriate legal framework (Hak Pakai, HGB via PT PMA, or long-term leasehold) is critical for security and compliance. Expert legal counsel is indispensable.
- Market Segmentation: Residential properties, particularly villas and boutique accommodations, remain attractive. Commercial land for hospitality or logistics in growing regions also offers opportunities.
- Regulatory Environment: Ongoing legislative changes, particularly concerning land use and foreign investment, require continuous monitoring.
Derawan Land Investment Context
While “Derawan Land Investment” is a specific brand or project name, the Derawan Islands are located in East Kalimantan, a region experiencing increased focus due to the development of the new capital city, Nusantara (IKN). This proximity could drive land value appreciation in surrounding areas, including parts of East Kalimantan’s coast and islands, as infrastructure and economic activity expand. Investors considering properties in such regions should evaluate local development plans, tourism potential, and accessibility. The principles of foreign ownership and land titles discussed for Indonesia generally apply to these areas.
| Land Title Type | Eligible Holder | Initial Term | Extensions | Total Max Term | Key Use Case |
|---|---|---|---|---|---|
| Hak Milik (Freehold) | Indonesian citizens only | Perpetual | N/A | Perpetual | Residential, commercial |
| Hak Pakai (Right to Use) | Indonesian citizens, legal entities, foreign individuals | 30 years | 20 + 30 years | 80 years | Residential, individual use |
| Hak Guna Bangunan (HGB) | Indonesian citizens, legal entities (including PT PMA) | 30 years | 20 + 30 years | 80 years | Commercial, development |
| Hak Guna Usaha (HGU) | Indonesian citizens, legal entities (including PT PMA) | 35 years | 25 years | 60 years | Large-scale agriculture |
| Leasehold (Sewa) | Any individual or entity | Variable (e.g., 25-30 years) | Variable | Contractual | Flexible, direct from owner |
Understanding these structures is fundamental to securing land investments in Indonesia. Each option carries distinct advantages and limitations regarding control, transferability, and tenure security.
Conclusion
The Indonesian real estate and land market presents robust opportunities for foreign investors in 2026–2027, with consistent growth projected across residential and commercial sectors. While direct freehold ownership (Hak Milik) is not available to foreign nationals, established legal frameworks such as Hak Pakai, Hak Guna Bangunan via a PT PMA, and long-term leasehold agreements provide secure pathways for investment. Derawan Land Investment, as a specific project, operates within this broader context, benefiting from regional growth trends and the established legal structures for foreign property engagement.
For detailed advice on navigating these options and identifying suitable investment properties, book an investment consultation on WhatsApp with Sari Kusuma at Derawan Land Investment.
Continue reading: Derawan Land Investment Cost Breakdown 2027: Notary Fees, Surveying, and Exit Strategy Costs · Derawan Land Investment Financing Guide 2027: Seller Options, Land Loans, and Partner Strategies · Faq