What Conditions Should I Include in an Offer to Purchase Private Islands?
When you invest in a private island, you need a clear, legally sound agreement that protects both buyer and seller. The Offer and Acceptance (O&A) document serves this purpose by outlining each party’s expectations and simplifying the entire process. Moreover, it enables equitable land transfers to foreign-owned entities without creating unnecessary complications.
Understanding the O&A Document
The O&A contains all essential information: buyer and seller details, land area, pricing, and a step-by-step outline of the purchase process. At this early stage, the offer remains conditional. Consequently, the buyer may reclaim the deposit if the parties fail to meet all conditions. Below, you’ll find a breakdown of typical provisions that either party may include.
Key Provisions to Consider
- Timing of Deposit
Clearly define how long the buyer has to submit the deposit after accepting the offer. This timeframe prevents delays and maintains momentum in the transaction. - Completion Period
Specify the deadline for finalizing the purchase once all O&A conditions are satisfied. Setting a firm timetable encourages each party to act promptly. - BPN Verification
Require the Indonesian land authority (BPN) to confirm title boundaries and coordinates. This step helps everyone avoid disputes or misunderstandings regarding property lines. - Site Access for Predevelopment
Grant the buyer permission to visit the property for initial project work, surveys, or planning. Early access ensures that developers can prepare efficiently. - Proof of Funds
Ask the buyer to demonstrate sufficient funds for the purchase. This requirement fosters trust and provides reassurance to the seller. - KYC and KYB Checks
Complete “Know Your Customer” and “Know Your Business” screenings for both parties. These checks promote transparency and help deter fraudulent transactions. - Buyer’s Obligations
Clarify all prerequisites the buyer must fulfill within a specified period, such as obtaining permits or corporate registrations. An explicit checklist reduces uncertainty and keeps the process on track.
Tailored O&A Templates
Kepri Estates offers various O&A templates that suit different transaction types, including large-scale corporate acquisitions and small private island purchases. These forms accommodate multi-island portfolios, individual property deals, and everything in between. Furthermore, choosing the right template streamlines the process by clearly defining expectations for both buyer and seller. If you would like more information on “What Conditions Should I Include in an Offer to Purchase Private Islands” that are specific to your investment plans, please do not hesitate to contact us at sales@kepriestates.com
Further information on the investment process, transaction costs and corporate establishment processes can be found below and don’t forget to check out Kepri Estates Private Island Due Diligence Guide (part 1) when doing your regional research to maximise your investment uplift and yield.
- Corporate Establishment for private island purchasing
- Private island investment process
- Private island purchasing costs
Check out the video below for a deep dive into private island investment due diligence.