Published May 4, 2007

You too, can buy an island

If you can afford a car, you can afford to buy an island - with maybe a little compromise - brokers tell CARMEN ROBERTS

PALM trees swaying in the breeze, waves lapping at the shore just metres from your deckchair and a cocktail in your hand - this seems to be the quintessential dream for well-heeled Singaporeans, if the take-up on residences at Sentosa Cove is anything to go by.

With property buyers prepared to pay millions for a piece on oceanfront property, exclusivity comes at a considerable cost. But if being part of a neighbourhood of 2,500 bungalows, terrace houses and condominiums, albeit on the island of Sentosa, isn't quite your idea of exclusivity, what about getting your own private island?

According to leading private island broker, Cheyenne Morrison of Coldwell Banker Private Islands, the solitude and tranquility of a private island which has always been a European ideal is beginning to spark some interest in Asia, if the number of initial inquiries from wealthy CEOs in Asia is anything to go by.

Malaysian hotel magnate Francis Yeoh is but one example of a wealthy Asian investor who was so taken by the natural beauty of Pangkor Laut that he bought the 120 hectare island. He then turned it into an award-winning luxury resort and created self-contained private estates for affluent international business people who are looking for safe, isolated luxurious hideaways.

Plans to develop 11 stunning white coral islands in Indonesian waters dubbed the Caribbean of the East, into luxury getaways for the rich and famous, accessible only by helicopter service from Singapore, is further testament to the appeal that private islands hold for those who seek seclusion and exclusivity, and are willing to pay the price for it, albeit for a holiday.

But apparently you don't have to be wealthy to own your own island paradise. It's long been thought that owning a private island is the ultimate status symbol for the super rich, along with the private jet and luxury yacht. But according to one of the world's foremost island brokers, if you can afford to buy a car, you can afford to buy an island.

Demand for getaway isles

The demand for islands is growing due to increasing environmental problems, the stresses of daily life and frustrations in the workplace in modern cities. In the past 35 years, Farhad Vladi has sold well over 2,000 islands through his company, Vladi Private Islands. Based out of offices in Hamburg, Germany and Nova Scotia, Canada, it's arguably the largest island brokerage in the world in terms of sales and rentals. The Germany-born entrepreneur has sold islands to the likes of Johnny Depp, Nicholas Cage, countless billionaires, as well as the odd waiter and clerk.

Surprisingly, the majority of his transactions have been between US$200,000 and US$800,000, with an average price of just US$300,000. When Farhad Vladi was a university student in the early 1970s, he spotted a newspaper article about a tropical island in the Indian Ocean that had been bought for just US$2,000.

'This changed my life,' he said. 'I knew from that moment on that I had to have an island for myself.' Mr Vladi spent most of his capital actually getting to the Seychelles, and when he arrived, the cheapest island he could find was US$100,000. Not being able to afford to buy his own island at the time, Mr Vladi sold it to a German businessman and collected the commission.

Word soon spread and Vladi Private Islands was born. It was only 10 years later that Mr Vladi managed to buy his own island - for a mere US$30,000 in Nova Scotia. 'This is why I can understand those among my clients who aren't fabulously rich or famous but who still dream of owning an island, and are willing to compromise to find an island within their reach.'

Some islands might look inexpensive on paper. But buyers should be aware that there are reasons for this. More often than not, the colder the climate, the cheaper the price. Like Mr Vladi's own private hideaway in Nova Scotia, there are others to be found elsewhere in Canada, some parts of Europe or Scandinavia for a reasonable five figures.

Certainly one of the cheaper options on Mr Vladi's books at the moment is a tiny, round-shaped island for sale off the coast of Japan going for US$300,000. Of course, the more exotic and tropical locations, like the Caribbean, parts of America, Australia and the South Pacific are far more popular because of the guaranteed better weather. Even so, the tropics poses the ever-present danger of hurricanes and rain-related mudslides. While in the South Pacific, even larger typhoons are a consideration, as well as tsunamis.

Mr Vladi has since bought a second island getaway on New Zealand's Pelorus Sound, which one would suspect cost considerably more than his initial purchase in chilly Canada. The most expensive island sold by Mr Vladi was Norman Island in the British Virgin Islands for US$12 million. At the other end of the spectrum, the cheapest and smallest island ever sold was a tiny 500 square metres in Lake Charlotte in Nova Scotia, Canada.

As aspiring private island owners, prospective buyers need to firstly do their homework, as some countries have strict regulations for foreign ownership and development, particularly here in Asia. Though home to some of the largest archipelagos, islands available for purchase in this region are quite limited in relation to other parts of the world.

Most countries also impose restrictions on foreign ownership, which often can only be done as an investment through a corporation. Malaysia is, however, an exception, though most of the islands on sale are not freehold. Some of the leasehold islands that are on the market include the 28-acre Pulau Rusukan Besar, 2 km off the island of Labuan, and the 17.2-acre Montukod Island right in the heart of Borneo, with price tags of US$5 million and RM350 million (S$156 million) respectively.

Despite some restrictions, which can generally be worked around, private islands for sale in Sri Lanka, Thailand, Indonesia and the Philippines are regularly advertised online, and the region continues to generate strong interest, evidenced by the sale of around 16 islands in the Philippines by Cheyenne Morrison in the space of 18 months.

Private island ownership has also extended through to China, with reports of the Chinese government selling off uninhabited islands along Zhuhai, the coastal city in Guangdong province. But paradise isn't always what it's cracked up to be. Any island broker will tell you that the first and foremost problem is running water. Most deserted islands don't come with a fresh water source. Buyer beware, desalination plants can often cost as much as the island itself. Electricity is another priority and even if you do get electricity installed, you aren't guaranteed a reliable service, especially if you are in a remote location.

'It doesn't matter how rich you are, the power will inevitably go out at night so if you are a Type A personality, this kind of property isn't going to be for you,' warns Adele Cygelman, editor-in-chief of the Malibu-based Robb Report Vacation Homes magazine.

Many brokers will recommend renting an island first. That way, potential buyers can get a feel for the environment, both during the day and at night, as well as dispel any illusions of an island paradise.

Though this doesn't sound like a task for the faint-hearted, the demand is rising because modern technology has made it much easier to live on a remote piece of land in the middle of an ocean than in the past.

A bit slower

According to Vladi Private Islands literature, a pre-fabricated home, electricity, phone as well as water, can be installed within three months. But despite modern technology, the wheels of development can move a little slower when working on island time. But often this is no problem, as many people buy for emotional rather than economic reasons.

Most people will buy islands for their personal retreat and vacation - a place that cannot be approached without permission and away from the prying eyes of neighbours, and a getaway from the everyday routine.

But solitude does come at a price. In his quest for the ultimate desert island bliss, one island owner in the Caribbean was forced to buy the island next door so he could build a landing strip for his private jet as well as maid quarters, recalls Ms Cygelman.

According to industry experts, when it comes to high value investments, island acquisition or private island ownership is not dissimilar to purchasing oil paintings. With only a sporadic and limited availability of quality islands on the market, most transactions for top-end purchases are done privately, and very few are featured on mainstream websites or catalogues.

According to industry figures, in recent years, prices have tripled in the Bahamas while areas of lesser demand, like the Eastern Caribbean, have increased by around 20 per cent. Industry insiders say that Richard Branson purchased the uninhabited Necker Island in the late 1970s for around US$300,000. He turned it into a tropical paradise and it's now rented out by the likes of royalty, rock stars and movie stars. It's now rumoured to be worth over US$100 million.

One has only to imagine what a goldmine Pangkor Laut has become, with its high appeal as an luxury resort island. Ownership of an island is important to ascertain from the outset, but any good broker should have most of the paperwork in place before an island goes up for sale. But even if you aren't part of the upper echelons of the private island clique, with the range of islands and price ranges on the market, at least there's still hope to join the club.

Carmen Roberts is a reporter for Fast Track, BBC World's regular travel guide to the latest news from the world of travel and holidays. The programme is broadcast on BBC World (StarHub cable channel 13) on Tuesdays at 8.30pm. This is an exclusive article contributed to BT.