Alam Sutera may delay Bali project
Publicly listed property developer PT Alam Sutera Realty foresees a possible delay in its development project of around six hectares of land in Bali.
The company previously said that it would build a condominium hotel (condotel) on the land this year. However, Alam Sutera’s corporate secretary, Hendra Kurniawan, said his company was planning to construct other buildings in the area to accompany the condotel.
“A six-hectare plot of land is too large for a condotel. Therefore, we are considering creating the whole design before beginning the construction. The condotel’s design itself is actually completed,” Hendra said on the sidelines of his company’s extraordinary meeting for shareholders on Thursday.
“We still don’t know how long the delay will be; three months, six months or even a year,” Hendra added.
He declined to reveal how much his company would be spending for the condotel.
“We are considering whether we will develop a two-star, three-star or four-star condotel. The budget will depend on the specification. A three-star condotel will require about US$65,000 investment per room,” he said, adding that the condotel will have 300 rooms.
Hendra said Alam Sutera would likely sell the condotel units as strata-title properties, which would not be included in its recurring income.
The company is aiming to reap up to Rp 3.5 trillion in sales this year, an increase of almost 25 percent from the Rp 2.8 trillion gained last year.
“Our sales target is Rp 2.9 trillion. However, we are hoping for higher figures although our sales volume is unchanged, because the price of property is likely to go up,” Hendra said.
According to Hendra, the company’s sales reached over Rp 800 billion as of February.
Alam Sutera is allocating Rp 2 trillion to Rp 3 trillion this year for the development of several projects including shopping malls, office towers, apartments and a residential superblock in Pasar Kemis, Tangerang.
“Most of the funds will be allocated for land acquisitions,” Hendra said.
The company is planning to issue bonds to finance its acquisition plan. Hendra remained tight-lipped, however, about the amount and when the bonds would be issued.
In Thursday’s meeting, Alam Sutera’s shareholders approved the company’s proposal to install Andrew Walker as an unaffiliated director. The Indonesia Stock Exchange (IDX) requires a company to have at least one unaffiliated director.
“The position has been vacant for about a year. He [Walker] has the criteria that we want and he will be able to conform to our company,” Hendra said.
Shareholders also approved the company change its article of association to meet the demands of the Capital Market and Financial Services Supervisory Agency (Bapepam-LK).
Alam Sutera is controlled by the diversified-business group, Argo Manunggal. The company is 28.88-percent owned by PT Argo Manunggal Land Development, 16.7 percent by PT Tangerang Fajar Industrial Estate, 11.86 percent by PT Selaras Citamanunggal, 11.74 percent by PT Manuggal Prime Development, 5.94 percent by PT Bukit Asri Padang Golf and 24.88 percent by the public.