Choose a country
Why I settled on Sri Lanka
When I was first choosing a country, I didn't do any special analysis, because the flow of Russian tourists — and therefore investors — isn't all that big. Not much to analyse😄
My criteria were:
💰 1. Low entry price. I'd never done development — I needed room for error – the Maldives and the UAE were out straight away
🥊 2. Low competition. A market where I'm not one in a thousand – Thailand and Bali dropped out too
📈 3. High margins. A buffer where a mistake is a lesson, not the end of the project – so much for Turkey
✈️ 4. Minimal distance from Moscow – Sri Lanka is 8 hours away
The rest dropped out either because the market is very specific, like China, Vietnam or Cuba, or because there's no apartment market, as in Egypt, for example
As usually happens) once the choice is made, the brain starts finding explanations and looking for confirmation. The first time I noticed this was when I co-owned an investment company: after buying shares, I only ever saw positive news😊
Post-analysis:
· In Sri Lanka, foreigners can buy property outright rather than on a lease, unlike the rest of Asia
· Competition is low, only 3 apartment complexes are under construction right now
· Land cost – genuinely very low compared to the other countries on the list, because there's little competition
· Construction cost – $600–1,000 per sq. m, roughly the same as everywhere else, even though the country is fairly poor — apparently because of high import duties, since the island produces very little of its own, plus taxes you couldn't exactly call low
· Average nightly rate – the same as everywhere in Asia, $100–200
· There is seasonality, mostly due to the currents that appear in summer; temperature and rainfall are almost the same all year round, and the really heavy rains only last a couple of months a year.
· The number of tourists to the island is growing, as in other countries; true, there's no growth from Russia, but there's a huge giant right next door — and by next door I mean you can see it from the shore😏 — India, where the middle class is growing fast and starting to travel.
· Business culture and all that – like in all small countries, local companies are used to working with foreigners, everyone speaks English; it also helps that this is the former British colony of Ceylon, in case anyone didn't know), and the legislation is similar to English law too.
· The nature, colonial architecture, temples and so on are, in my opinion, better than in Thailand and Bali. I'll tell you about that some other time
· And, as usual, another point went into the piggy bank: most of my friends have been to Sri Lanka in the last 5 years
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Here are the destinations:
1. Turkey — up to 7 million
2. UAE ~2.3 million
3. China ~2 million
4. Egypt ~1.4–2 million
5. Thailand ~1.3–2 million
6. Vietnam ~435 thousand
7. Sri Lanka ~200 thousand
8. Bali / Indonesia ~180–220 thousand
9. Maldives ~199 thousand
10. Cuba ~150 thousand
My criteria were:
💰 1. Low entry price. I'd never done development — I needed room for error – the Maldives and the UAE were out straight away
🥊 2. Low competition. A market where I'm not one in a thousand – Thailand and Bali dropped out too
📈 3. High margins. A buffer where a mistake is a lesson, not the end of the project – so much for Turkey
✈️ 4. Minimal distance from Moscow – Sri Lanka is 8 hours away
The rest dropped out either because the market is very specific, like China, Vietnam or Cuba, or because there's no apartment market, as in Egypt, for example
As usually happens) once the choice is made, the brain starts finding explanations and looking for confirmation. The first time I noticed this was when I co-owned an investment company: after buying shares, I only ever saw positive news😊
Post-analysis:
· In Sri Lanka, foreigners can buy property outright rather than on a lease, unlike the rest of Asia
· Competition is low, only 3 apartment complexes are under construction right now
· Land cost – genuinely very low compared to the other countries on the list, because there's little competition
· Construction cost – $600–1,000 per sq. m, roughly the same as everywhere else, even though the country is fairly poor — apparently because of high import duties, since the island produces very little of its own, plus taxes you couldn't exactly call low
· Average nightly rate – the same as everywhere in Asia, $100–200
· There is seasonality, mostly due to the currents that appear in summer; temperature and rainfall are almost the same all year round, and the really heavy rains only last a couple of months a year.
Fun fact: it's 700 km from Sri Lanka to the Maldives.
· The number of tourists to the island is growing, as in other countries; true, there's no growth from Russia, but there's a huge giant right next door — and by next door I mean you can see it from the shore😏 — India, where the middle class is growing fast and starting to travel.
· Business culture and all that – like in all small countries, local companies are used to working with foreigners, everyone speaks English; it also helps that this is the former British colony of Ceylon, in case anyone didn't know), and the legislation is similar to English law too.
By the way, Sri Lanka's railway was the first in Asia, opened in 1864, just 34 years after the very first railway was built in England. And it was built not to export tea, but to export coffee.
· The nature, colonial architecture, temples and so on are, in my opinion, better than in Thailand and Bali. I'll tell you about that some other time
· And, as usual, another point went into the piggy bank: most of my friends have been to Sri Lanka in the last 5 years
Where Sri Lanka's tourists come from:
1. Europe ~1,050,000 - 44%
2. India 531,511 - 22.5%
3. Russia 186,580 - 7.9%
4. China 132,035 - 5.6%
5. Australia 109,487 - 4.6%