Vinci Group invests US$1 billion in Mandalika SEZ
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily: Vinci Group Investasi US$ 1 Miliar di KEK Mandalika
9 August 2018
By Eva Fitriani
Jakarta — Vinci Group, one of the largest companies in France, plans to invest US$1 billion, or equivalent to Rp14.5 trillion in Mandalika Special Economic Zone (SEZ), West Nusa Tenggara. The fund will be allocated for the development of integrated sport and entertainment district in the Mandalika, including street race circuit.
The commitment to the investment is realized by the signing of Master Land Utilization and Development Agreement (LUDA) between Vinci Construction Grands Projects (VCGP) and Indonesia Tourism Development Corporation (ITDC) for utilization and development of 131 hectares (ha) of land in Mandalika Tourism SEZ, Tuesday (7/8). ITDC is a state-owned enterprise appointed by the government to manage 1,175 ha Mandalika SEZ in Mandalika, West Nusa Tenggara.
“The investment will be made in stages for 15 years. In the early stage, we will build four hotels and street race circuit,” said VCGP Director Michel Oliveres during media briefing at the ITDC office in Jakarta, Wednesday (8/8).
Michel said his office will allocate US$ 600 million or around Rp8.7 trillion to build around 10 hotels with 2,500 rooms. Furthermore, as much as US$70 million or around Rp1.02 trillion will be earmarked for street race circuit, and the remainder for other facilities.
“This is the first circuit in the world which, since the beginning of its construction, has been designed to function as a road and as an international-standard circuit. We set the circuit to start operation in 2021,” he explained.
VCGP is a subsidiary of Vinci, a global-scale company from France engaging in the fields of design, funding, construction and operation of large infrastructure and facility projects around the world. At present, Vinci has market capitalization reaching 55 billion euro (Rp900 trillion) with more than 195 thousand workers across 100 countries.
“Cooperation between ITDC and VCGP marks the entry of Vinci Construction to Indonesia for a project with a large investment value,” said ITDC President Director Abdulbar M. Mansoer.
Abdulbar said the construction of integrated entertainment & sport district will begin no later than the end of 2018, starting with the construction of Shaza Resort and Mysk Hotel as the first projects. The two hotels, which are five- and four-starred sharia hotels operated by Shaza Hotels, are expected to begin operation at the end of 2020, providing 400 room keys.
Abdulbar said his office will establish a joint venture company with VCGP to operate a cluster of 131 ha built by ITDC and VCGP.
To date, Mandalika SEZ has absorbed a total investment of Rp17.7 trillion from eight investors. As much as Rp14.5 trillion comes from Vinci, and the remainder are from some investors from the United States, Korea, and local investors.
Previously, the Association of the Indonesian Tours and Travel Agencies (Asita) reported a number of foreign tourists have cancelled their trip to Lombok, West Nusa Tenggara, and its surroundings due to the 7.0-magnitude earthquake rocking the area. The cancellation was even made by those scheduled for arrival in the next 4 – 5 days.
