Should a European invest in Southeast Asia?

I owned three properties in France before I left. I know exactly what that experience is worth, because I paid for it.

The buildings were fine. The tenants were fine. What was not fine was everything around them: a tax treatment that took a large share of a modest yield, a rental framework that moves in one direction, and a market where the difference between a good purchase and an average one is measured in fractions of a percent, because everything is priced by the same people using the same assumptions. French residential is not a bad asset class. It is a mature one. Mature markets pay you for patience and leverage, not for judgement.

Southeast Asia pays you for judgement. That is the whole argument, and everything below is a consequence of it.

What actually changes when you cross over

Less debt, more return. You will generally not get the leverage you are used to. Foreign buyers in most of the region finance with equity or with expensive local debt. That sounds like a disadvantage and it partly is — but the returns are not comparable. A well-selected short-stay asset in Indonesia or the Philippines can pay back capital in five to seven years. In France, on a residential asset, you are typically underwriting fifteen to twenty-five, and relying on leverage and capital appreciation to make the arithmetic work. Take the leverage away from a French deal and there is nothing left. Take it away from a good Southeast Asian one and it still works.

The entry price is on a different scale. Land in a genuinely emerging coastal market can cost a fraction of French periurban land, and construction costs are a fraction again. That matters less for the yield than for something else: it means you can be wrong once without it being fatal. A €120,000 project is a position you can take, learn from and repeat. A €600,000 Paris studio is a decision you make once.

You are buying growth, not stability. Southeast Asian populations are young, urbanising and increasingly domestic-consuming. Regional tourism is no longer only European and Australian — it is Korean, Chinese, Singaporean, and increasingly Filipino and Indonesian middle class. That second wave is what turns a seasonal market into a year-round one, and it is the part that European buyers consistently underestimate.

Where the money is actually made

Not in the building. In the timing and the location. Three patterns are worth more than any spreadsheet:

Follow the infrastructure, not the influencers. When a government commits to an airport, a port, a ring road or a national tourism programme, it publishes the fact years before the concrete arrives. That gap is the opportunity. Land near a confirmed and funded airport upgrade is a different asset the day the funding is confirmed than it was the day before — but the market takes two to four years to reprice it. Very little of investing here is clever. Most of it is reading the public works budget and being early.

Buy the market before it is the market. Lombok today is roughly where Bali's Bukit peninsula was fifteen years ago: infrastructure landing, international attention arriving, land still priced for agriculture in places. I have watched land values on several secondary Philippine islands multiply since the pandemic as flight connections improved. The Perhentians and the smaller Malaysian islands are on a similar path. None of this is a secret — it just requires being there before the price reflects it.

Avoid the saturated ones, however good they look. Canggu, parts of Phuket, the busiest strips of Bali are not bad places. They are simply places where the upside has already been taken and where you are now buying at yields that no longer compensate you for being a foreigner in an unfamiliar system. If a market is easy to find, you are late.

Now the part most people skip

I would be doing you no favours by telling you this is easy, and you should be suspicious of anyone who does.

Ownership is the real risk, not the market. Foreigners cannot hold freehold land in Indonesia or the Philippines, and only under narrow conditions in Thailand. There are legitimate, well-tested structures — long leaseholds, local corporate vehicles, condominium title within foreign quotas — and there are arrangements that are technically illegal and widely used anyway, most notably the nominee arrangement, where land is held in a local person's name on your behalf. That structure is unenforceable when tested. People do lose everything this way, and it is almost always the buyer who was told not to worry about it.

Title chains matter more than surveys. The single most common failure I see is not fraud. It is a chain of ownership with a gap in it — an inheritance never settled, a subdivision never registered, a lease assigned without consent. These are all discoverable before you sign, by a local lawyer who is paid by you and only by you.

Exit is slower. Liquidity is thinner than in Europe. Underwrite the asset on the rental income it produces, not on the resale you hope for. If the numbers only work with an exit assumption, the deal does not work.

Climate is now an input, not a footnote. Typhoon corridors, coastal erosion, water table and drainage. This is priceable, and it belongs in the model rather than in a paragraph of caveats.

None of these are reasons not to invest. They are reasons not to invest alone, in a jurisdiction where the vocabulary, the professionals and the failure modes are unfamiliar. Every one of them is knowable in advance. That is the point: the risks in Southeast Asia are largely diligence risks, and diligence risk is the cheapest kind to eliminate. The risks in a mature European market — taxation, regulation, rate cycles — are the opposite. You cannot do anything about those at all.

So: should you?

If you want a passive, leveraged, regulated asset that quietly compounds for twenty years, stay in Europe. That product exists there and it does not exist here.

If you want a return that reflects the quality of your decisions rather than the cost of your mortgage, and you are prepared to do the work — or to pay someone to do it properly on your side of the table — then yes. Emphatically yes. But on three conditions: the right market, at the right moment in its cycle, through the right structure.

That is what we do. We do not sell land and we take no fee from anyone selling it. We tell clients which markets we would put our own money in, which ones we would avoid, and — as often as not — that a particular parcel is not the one. The last engagement we published ended in a recommendation not to buy.

Getting the market and the moment right is worth more than any negotiation on the price. Come and talk before you find the plot, not after.

Antoine Sailly is the founder of Latitude Development Advisory. He spent eight years in residential land development in France, most recently as Regional Director at HECTARE, and now works between France and Southeast Asia. This note is general commentary, not investment, tax or legal advice; any specific transaction should be reviewed with qualified local counsel.

What a de-densification actually costs

You buy land on a programme. Fifty homes, a price per unit, a land charge that works. Then the network operator comes back with a capacity figure, or the planning department reads its own local plan differently than you did — and the programme is thirty-three.

Everyone in the room counts the same thing: seventeen homes lost, a third of the scheme. It is the wrong number, and reaching for it is what makes the next decision bad.

The seventeen homes took no infrastructure with them

A two-hectare site needs one spine road, one drainage system, one retention basin, one set of network connections, one entrance, and whatever public realm the consent obliged you to build. None of that is a function of how many homes sit on the plots. It is a function of the site.

Here are the real numbers from a scheme I ran near Toulouse — two hectares, fifty homes cut to thirty-three before design had begun. Civil works came to €520,000. Technical studies — survey, hydraulics, soils, environmental — came to €85,000. Almost none of it moves with the unit count: a hydraulic study costs what it costs whether the scheme carries thirty-three homes or fifty.

That number appears in no one's count of lost lots.

The land price is already fixed

The second cost is structural. You committed to a land charge on the basis of fifty homes. That commitment is signed. The thirty-three that remain now carry all of it.

If the promise came before the capacity was tested — and it almost always does, because the land is what everyone is competing for — the reduction lands entirely on your margin. There is no mechanism to send it back up the chain. The landowner's price was agreed against a programme that no longer exists, and he has no interest in revisiting it.

And the obligations stay whole

Third: statutory requirements are imposed on the scheme, not proportioned to it. A social housing quota, a typology mix, a share of the site given to public space and planting — sized against the site and the local plan, and they do not fall by a third because your programme did.

Once the plots and the two macro-lots were drawn on that scheme, roughly half the site was saleable land. The rest was road, planting, retention and public realm — all of it paid for by thirty-three homes instead of fifty.

Three levers, and only one of them works

Reprice the land. Almost never available. If you have signed, you have signed; if you have only promised, you may have a conversation, and it will be a bad one.

Defend the density. Tempting, and it loses. Capacity constraints and heritage constraints are not negotiating positions, they are findings. You can spend eight months contesting a network study and arrive at the same number with eight months of carrying costs added to it. I have watched this happen more than once and have never seen it recover the units.

Move the product up. The only lever that reliably returns the value. Larger plots, better specification, a mix aimed at a buyer who pays more per unit — you recover on price what you lost on volume. It works because periurban buyers are far more elastic on plot size and finish than developers assume, and because a lower-density scheme is genuinely a better product: more planting, more distance between houses, more of what people say they want when asked.

The catch is timing. This lever changes the design brief, the target buyer, the pricing and the phasing all at once. Pull it within weeks and the scheme is simply a different, better scheme. Pull it after the masterplan is drawn and the marketing written, and you are retrofitting — which costs more than the units did.

The cheap thing nobody does at the right moment

All of this is avoidable, and the avoidance costs almost nothing: a written capacity enquiry to the network operators before the land is committed rather than after.

It is a short letter. It takes a few weeks to come back. It is routinely done at the wrong end of the process — once the land is secured and the architect appointed — because at the start everyone is afraid of losing the site to a competitor, and a capacity question feels like a delay.

It is not a delay. It is the difference between designing a thirty-three-home scheme on purpose and discovering you own one.

Antoine Sailly is the founder of Latitude Development Advisory. He spent eight years in residential land development in France, most recently as Regional Director at HECTARE, and now works between France and Southeast Asia.

The objection you hear is never the objection that matters

Every development that stalls, stalls for a stated reason. The density is too high. The access is unacceptable. The architecture does not fit the village. The commune is not ready.

In eight years of land development in France, I do not remember a single case where the stated reason was the real one. Not because people lie — they rarely do — but because the real objection is usually harder to say out loud, and sometimes the person holding it has not put it into words themselves.

What is actually being said

A neighbour who objects to a scheme's height is not usually objecting to the height. He is objecting to the fact that a field he has looked at for twenty years is going to become something else, and that nobody asked him first. The height is what the planning system gave him to write on the form.

A mayor who says the commune cannot absorb more housing is often saying that the last developer left a mess, or that the school is full and the funding for a second one is not, or that he faces an election in eighteen months and the file has become a liability.

A landowner who refuses your price is sometimes refusing your price. More often he is refusing to be the one who sold first, or the one who sold for less than his brother did, or he is holding out for a tax position that changes in two years.

None of these are unreasonable. All of them are invisible if you only read the formal objection.

Why this matters commercially

Because you cannot negotiate with the stated objection. If you answer the height complaint by lowering the building, you lose units and the neighbour objects to something else, because the thing he minded was never the height. You have paid a real price for nothing, and you have taught the other party that objections work.

Whereas the real objection is almost always negotiable — and usually cheaper than the stated one. The neighbour who wanted to be asked can be asked. The mayor who needs a school contribution can be given one, phased. The landowner who cannot sell first can be structured to sell third.

The skill is not persuasion. It is diagnosis.

How to find it

Three things work, and one thing does not.

Go bilateral, and stay bilateral for as long as possible. A joint meeting turns four private positions into four public ones, and a public position is much more expensive to move. People will tell you the real thing across a kitchen table and never in a room with the mayor in it. On a recent scheme near Toulouse — two hectares, four separate landowners, one of them the commune, one of them a competing developer — the file took more than thirty meetings across twenty-two months before anything was built. The construction itself took eight. That ratio is not a failure of the process. On a site like that one, it is the process.

Ask what a good outcome looks like, not what the problem is. The problem question invites the formal answer, which is the one already written down. The outcome question invites the real one, and people are surprisingly willing to answer it, because nobody usually asks.

Count the cost of the delay out loud, early, with the people causing it. Not as a threat — as information. Most parties blocking a scheme have never been shown what the block costs them: the owner whose land stays agricultural for four more years, the commune whose housing quota keeps accruing. That number changes conversations that argument does not.

What does not work is going to the formal process first. A scheme that arrives at consultation with the real objections unaddressed will collect them all again, this time in writing and on the record, where they are far harder to unwind. The formal process is where you ratify an agreement. It is a poor place to reach one.

The same problem, further away

I now work between France and Southeast Asia, and the surface of this could not look more different. In France the constraint is a planning code of extraordinary density, applied by institutions that operate at their own pace. In Indonesia and the Philippines the constraint is more often the paper itself: who holds the title or the lease, how cleanly, for how long, and how many people believe they have a claim on it.

But the structure is the same. The stated blocker — a title irregularity, a permit that will not move, a signature that does not come — is a symptom of an arrangement nobody has written down. And the same method applies: find out what each party actually wants, ask before you file, and never let the formal process be the place where you discover a position.

European developers arriving in Southeast Asia tend to bring their capital and their design standards and leave this behind, on the assumption that it is a local skill. It is not. It is the same skill, and it is the one that transfers most cleanly.

Antoine Sailly is the founder of Latitude Development Advisory. He spent eight years in residential land development in France, most recently as Regional Director at HECTARE, and now works between France and Southeast Asia.