Mixed-use resort and retail schemes work in a destination like Tanamori only when the retail component is sized to captive guest demand rather than to an assumed passing trade, because an outlying coastal site has no walk-by footfall to fall back on. That single constraint explains most of the difference between mixed-use plans that trade well and those that end up with empty shopfronts subsidised by hotel revenue — and it is the first thing to settle when evaluating tourism retail space investment here.
Invest Tanamori publishes independent commentary. We are not affiliated with, appointed by or endorsed by BPOLBF, the KEK administration or any developer, we do not set or allocate leases, quotas or rents, and nothing here is legal, tax or investment advice.
What does mixed-use actually mean on a site like this?
Tanamori sits on the West Manggarai coast at a remove from the Labuan Bajo town centre, which means any retail placed there serves a defined population — resort guests, residents of the scheme, staff and deliberate day visitors — rather than the general public passing through. That is a fundamentally different retail proposition from a town-centre or transit location.
The practical translation is that retail here is an amenity that happens to generate revenue, not an independent business line. Its first job is to lengthen stay, raise on-site spend and make the accommodation product more saleable. If it also produces attractive rental income, that is a second-order benefit rather than the reason to build it.
How should the retail component be sized?
Retail area in a resort-led scheme should be derived from projected on-site population and their realistic daily spend, not from a target rental yield applied to available land — the sequence matters, because sizing from land availability is how vacancy is manufactured before a single tenant is approached.
| Input | Why it drives sizing | How to establish it |
|---|---|---|
| Guests on site per day | Defines the captive customer base | Key count multiplied by realistic occupancy and party size |
| Average length of stay | Determines repeat visits per guest | Comparable products and your own product design |
| Share of spend captured on site | Sets achievable turnover | Operator experience, not aspiration |
| Staff and resident population | Provides low-season baseline demand | Operating plan headcount |
| Deliberate day visitors | Upside, highly variable | Access, parking and attraction strength |
| Seasonality spread | Tests survivability in low months | Destination demand pattern |
The discipline that follows is uncomfortable but reliable: build the smallest retail footprint that serves the guest experience well, and design it so it can be extended if demand proves it. Empty units damage a scheme’s perceived quality far more than a compact, fully occupied offer does. Our page on mixed use resort development Indonesia works through phasing approaches that keep that optionality open.
Which tenant mix strategies hold up in a resort setting?
Resort retail performs best when it covers genuine daily needs first and discretionary purchases second, because convenience categories generate repeat visits while gift and fashion categories rely on a single transaction per guest. A mix weighted toward the discretionary end tends to look impressive and trade poorly.
- Convenience and provisioning. The highest-frequency category, serving guests, staff and residents alike.
- Food and beverage variety. Extends the reason to stay on site and reduces reliance on a single hotel restaurant.
- Activity and experience desks. Directly monetise the destination’s core draw and lengthen stay.
- Wellness and services. Steady, low-footprint, and attractive to longer-stay guests.
- Local craft and produce. Supports community relationships and differentiates the offer, but should be sized modestly.
Where third-party operators or brands are involved, terms, presence and availability are matters between those businesses and the scheme’s owner. This site does not publish tenant lists, rents or availability for any development, and readers should confirm anything of that nature directly with the project owner concerned.
What are the main commercial risks?
The dominant risk in resort mixed-use is timing mismatch: retail requires the guest base to exist before it can trade, but is usually built at the same time as the accommodation that will create it, which means the retail component often carries a period of weak trading it was never underwritten for.
- Ramp-up gap. Tenants signed for opening day face occupancy that has not yet stabilised, which drives early failures and turnover.
- Seasonal exposure. A destination with a strong seasonal pattern leaves retail idle for months unless the low season is planned for.
- Operator dependency. If one anchor F&B operator leaves, footfall through the whole precinct changes.
- Cost of remoteness. Stock delivery, staffing and maintenance all cost more at distance from town.
- Cannibalisation. Retail that competes with the hotel’s own outlets moves revenue rather than adding it.
Investors evaluating the retail element as a standalone position, rather than as part of a resort, should look at the demand and cost structure separately — that is the focus of our tourism retail space investment brief.
What has to be verified with the authorities?
Permitted uses, density, building height, setbacks and the mixing of accommodation with commercial activity are all determined by spatial planning rules and licensing classifications, none of which a private adviser can confirm or influence.
Before proceeding, verify zoning and permitted use with ATR/BPN and the local planning authority, business classifications and licensing through OSS, environmental requirements with the competent environmental agency, land title with a licensed notary or PPAT, tourism area coordination with BPOLBF, and any zone-specific rules with the KEK administration. Our existing due diligence checklist and Tana Mori investment guide cover the sequence in more detail.
Frequently asked questions
Can resort retail work without passing footfall?
Yes, but only if it is sized to the captive population rather than to a hypothetical passing trade. On an outlying coastal site the customer base is guests, residents and staff, plus a variable number of deliberate day visitors. Size the floor area from that population and their realistic daily spend, keep the footprint compact, and design the scheme so additional space can be added once demand is proven.
What is the most common mistake in resort mixed-use schemes?
Building retail area to fill available land instead of to serve a counted customer base, and weighting the tenant mix toward discretionary gift and fashion categories rather than convenience and food. The result is visible vacancy and high tenant turnover, both of which damage the scheme’s perceived quality and, indirectly, the accommodation product it was meant to support.
Who decides rents and tenancy terms in a scheme like this?
Rents, lease terms and tenant selection are commercial matters between the scheme’s owner and each prospective tenant, subject to applicable Indonesian law. This site does not set, publish or allocate rents, quotas or tenancies for any development, and has no role in any such negotiation. Anyone seeking terms for a specific project should approach that project’s owner or appointed leasing representative directly.
How should seasonality be handled in the retail plan?
Assume the low season will be materially quieter and design the cost base accordingly, with flexible staffing, modest fixed footprints and lease structures that share risk rather than loading it entirely onto tenants. A precinct that only survives at peak occupancy will lose tenants during its first low season, which is harder and more expensive to recover from than opening smaller.
Discuss a mixed-use concept for Tanamori
If you are shaping a resort and retail scheme around Tanamori and want the retail sizing and tenant-mix assumptions tested independently before design is fixed, contact us on WhatsApp at https://wa.me/6281139414563 or email bd@juaraholding.com. We provide independent analysis only. We allocate no land, leases or quotas, and all planning, licensing and title verification must be completed with the official authorities and your own licensed advisers.