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Jakarta Post

Developers look beyond island of Java

Several cities outside the island of Java are set to enjoy fast growth in 2016 thanks to a series of infrastructure development projects in the region, according to Indonesia Property Watch

The Jakarta Post
Thu, November 19, 2015

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Developers look beyond island of Java

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everal cities outside the island of Java are set to enjoy fast growth in 2016 thanks to a series of infrastructure development projects in the region, according to Indonesia Property Watch.

 As the price of land in Greater Jakarta area (Jabodetabek) continues to rise, developers have set their sights on other major islands throughout the country. In addition to this, increased growth in gross regional domestic product is seen to be helping with property product sales.

 Indonesia Property Watch CEO Ali Tranghanda said the property market is expected to bounce back in the second quarter of 2016 due to positive sales growth in middle-to low class housing markets.

 '€œSome cities have the potential to lead this shift, from the slowdown the industry has been experiencing this year,'€ he said in a written statement quoted by bisnis.com recently.

 According to Ali, those cities with such a potential include; Medan, Batam, Palembang, Makassar, Balikpapan, Samarinda and Manado. They will enjoy the derivative impact of infrastructure development in the region.

 The Trans Sumatra toll road project has kicked off, starting with a 17-kilometer-long road connecting Medan and Binjai, the 140-kilometer Bakauheni-Terbanggi Besar road and the 22-kilometer Palembang-Indralaya road. Construction of these three roads is projected to be completed in 2018.

 In Sulawesi, the status of the 146-kilometer Trans Sulawesi railway line is, at present, in the rail mounting stage. The railroad connecting Makassar and Parepare is estimated to be completed in 2017.

 Meanwhile in North Sulawesi, the construction of the 39-kilometer Manado-Bitung toll road started in October 2014. According to Ali, construction of the Manado outer ring road will complete the existing infrastructure.

 Ali expressed confidence that the infrastructure construction would be a boon for the property sector, including its subsectors, such as commercial property, accommodation, trade and residential.

The property industry, according to Ali, will also benefit from the development of some of the Special Economic Zones (KEK).

 Earlier in November, the government launched economic package phase VI under which eight special economic zones are to receive several incentives ranging from tax holiday and accelerated licensing process to special wage council.

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