Jakarta asset management: Well-known developers to be prioritised
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.
Bisnis Indonesia: Pengelolaan aset Jakarta: Pengembang terkenal agar diutamakan
22 October 2019
By: Fitri Sartina Dewi
Bisnis, Jakarta – The government is expected to establish cooperation with well-known and recognised developers to utilise state assets in Jakarta.
The state asset utilisation plan is one of the steps that will be taken by the government regarding the capital city relocation to East Kalimantan province.
Advisory Head of JLL Indonesia Vivin Harsanto said that, to make sure that the state asset utilisation plan in Jakarta well and optimal, the government must prepare a well-prepared and clear plan, especially in choosing developers.
“In the market, when somebody wants to buy a property, they will usually see the developer’s reputation first. This means that that government cannot cooperate with unknown developers which causes the development progress to be precarious,” Vivin stated last week.
She stated that the government’s state assets in Jakarta could not be fully offered for cooperation with private companies. According to her, a thorough study on the assets that will be under the cooperation is required.
“[The assets] must be seen from the supply side of things, because if [an asset] is going to be made into an office, there is already an abundance of supplies. If it is forced [to be made into an office], then it will flood the market,” he revealed.
To attract developers, Vivin said that the government should provide an incentive, especially regarding the cooperation period.
Minister of National Development Planning (PPN)/Head of the National Development Planning Agency (Bappenas) Bambang Brodjonegoro stated that there were several options for cooperation on state asset utilisation with private companies.
However, the most interesting options for private companies are the build operate transfer (BOT) scheme with a maximum period of 30 years and the cooperation utilisation (KSP) scheme with a maximum period of 30 years, but the maximum period will be 50 years for infrastructures.
For cooperation using the KSP scheme, Vivin revealed that developers could not change the form of the building, while developers establishing cooperation using the BOT scheme could change the form of the building.
“Area development process usually takes a long time, which is around 20 years [for the development] to be established. So, maybe the cooperation period can be extended,” she explained.
Interested
Capital and Investment Management Director of PT Intiland Development Tbk Archied Noto Pradono said that his company was quite interested in the offer of cooperation on state asset utilisation.
He said that, as long as the location of assets offered was good and its business potential was interesting, his company was interested to be involved in a cooperation with the government to utilise state assets in Jakarta.
His company is currently still waiting for the details regarding the cooperation offer. “We are still waiting for the details, and how the value is going to be,” Archied stated.
Meanwhile, to take advantage of the opportunity from the capital city relocation from Jakarta to East Kalimantan, financial technology service provider Gradana is cooperating with a property agent in Samarinda.
Gradana Co-Founder Angela Oetama said that the government’s plan to relocate the capital city to Kalimantan had had a positive impact for property industry growth in the area. Because of the relocation plan, Angela said that the property market potential in Samarinda had become more prospective.
“Samarinda’s population is more than 800,000 individuals. It is quite congested compared to other cities in Kalimantan which have fewer citizens. The capital city relocation will obviously affect Samarinda’s economy,” she revealed through a press conference on Monday (21/10).
Angela added that property in East Kalimantan, which had had insignificant growth, could be more active and become a catalyst for economic growth. Hence, Gradana enters Samarinda property market.
Gradana also provides solutions for Samarinda residents who want to rent a house in the city. In her opinion, for specific reasons, not everybody has the capacity or the desire to purchase a permanent house.
“For example, there are some who only plan to live temporarily in Samarinda. Maybe it is work that caused them to live there. Then, our service facility, such as GraSewa, can be a solution,” she stated.
Angela explained that Gradana only financed house purchases, but based on consumer’s needs and demands, Gradana provided GraSewa to finance rent, GraRenov to finance renovation, and GraStrata to finance the purchase of second-hand houses.
