Dragons Den

Billed as the new Bali, investors are rushing to Flores, home of the Komodo dragon. But the pitfalls of investing in Indonesia’s ‘Wild East’ are legion.

- Ian Lloyd Neubauer

For more than 20 years, Star-bucks has sold Komodo Dragon, a blend of coffee beans named after the gigantic lizards of eastern Indonesia. But now Starbuck’s customers can savor a Komodo Dragon cappuccino or caffe latte in Labuan Bajo on Flores Island – the gateway to Komodo National Park – where the US coffee giant opened a new store in May.

In coming months, the new $29 million Bajo Marina and Executive Port housing the Starbucks will also welcome a KFC, Hard Rock Cafe plus a 200-room Mercure resort. The Mercure will be Labuan Bajo’s second international hotel following the November opening of Ayana Komodo Resort, a luxury resort with 205 rooms and six F&B venues and killer water and island views. The redevelopment of two existing hotels will add another 135 new rooms by the end of the year while two more international hotels – a Marriott and the Alila Komodo – are scheduled to open in 2022 and 2023 respectively.

All this construction may seem like overkill for a fishing town of 2,000 people that until a few months ago didn’t even have a paved main road. But the new hotels won’t even touch the side of demand for accommodation in the Komodo region, the beneficiary of one of Asia’s most robust tourism booms.

Market research firm C9 Hotelworks notes arrivals at Komodo Airport have increased by nearly a third every year since 2012. The trajectory puts the region on track to meet a government target of 500,000 visitors per year and the creation of the first of ‘10 new Balis’ – a plan that aims to replicate Bali’s economic success across the Indonesian archipelago.