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roperty developer PT Jakarta Setiabudi Internasional (JSI) will allocate Rp 1.6 trillion (US$116.8 million) next year in capital expenditure (capex) to take advantage of the expected recovery in the country'€™s economy.

JSI director Chandra P. Asali said that the capex would be used to finance ongoing property projects in several locations including the renovation of the Bali Hyatt hotel.

'€œWith the current slowing economy, our capex this year was not spent as planned. But our projects are still going, it'€™s just that we are saving [some funds] for 2016,'€ Chandra said on Tuesday.

The allocation for next year is higher than this year'€™s realized capex, which only reached Rp 1.2 trillion, as a portion of the expenditure is also being carried over for next year.

Chandra said that half of the expenditure would be focused on the company'€™s projects in Bali, including the Bali Hyatt as well as five-star boutique hotel Andaz Bali.

The company plans to rebrand the Bali Hyatt into the Hyatt Regency Bali, as well as adding new facilities at the hotel. The rebranded hotel is slated to be launched in mid-2017.

Meanwhile, Andaz Bali is to have a Balinese village concept, consisting of 145 rooms and villas on 6.2 hectares of land in Sanur.

Chandra also said that the company would allocate Rp 200 billion to its Mega Kuningan project in Jakarta, which is set to consist of two hotels, two office towers, retail stores and ballrooms.

Apart from the projects, the company revealed a budget allocation of Rp 300 billion to procure land banks for future projects. Although the board of directors refused to specify the details of areas targeted for land procurement, the company hinted that it could be outside of Java, considering the extensive infrastructure development on other islands like Sumatra and Kalimantan.

'€œWe expect Indonesia will focus on infrastructure to spur the country'€™s economic growth,'€ JSI president director Jefri Darmadi said.

The company will source the capex mainly from loans, which will make up 70 percent of the funds, as well as 30 percent from the company'€™s equity.

The company has so far recorded Rp 250 billion in total marketing sales this year, driven by Rp 150 billion of sales at the Puri Botanical project in West Jakarta as well as sales in the JogjaOne Park project in Yogyakarta which have earned the company Rp 100 billion.

JogjaOne Park was also slated to begin construction in the second quarter next year, following the ongoing sales, according to Chandra.

However, JSI director Margiman said the marketing sales figure this year was almost stagnant compared to last year, although the company hoped to see better sales next year.

The company suffered a 4.14 percent decline in revenue to Rp 891.7 billion as of September from Rp 930.3 billion in the same period this year. Its profit fell by 21.74 percent to Rp 141.8 billion by the end of September from Rp 181.2 billion in the same month last year.

'€œThe economy is down, so our sales are also down,'€ Chandra said.

Regulations on taxes, particularly on luxury products, have also created uncertainty for the property market, Chandra added.

The government previously issued a regulation on a Rp 10 billion price threshold on housing, applied with a tax on luxury products, which amounted to 20 percent. (fsu)