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ublicly listed property firm PT PP Properti aims to jack up sales and earnings this year through a number of ongoing property developments.

The property arm of state-owned construction firm PT PP seeks to increase its pre-sales by 25 percent year-on-year (yoy) to Rp 3.8 trillion (US$282.34 million) this year through its apartment projects.

“The targeted marketing sales of Rp 3.8 trillion this year will come from our apartment projects,” PP Properti finance director Indaryanto told The Jakarta Post on Wednesday.

The biggest portion of its sales, 25 percent, is expected to be generated by Grand Shamaya Apartment in Surabaya, East Java. The apartment complex is being built on 1.7 hectares of land and is due for total completion in seven years, he added.

PP Properti will also bank on another major project, namely Grand Kamala Lagoon apartments in Bekasi, West Java. The project will have 32 apartment towers on a 28.5-ha area, the development of which will last 20 years.

The property developer expects the project to contribute 15 percent to its overall pre-sales target.

Another 10 percent of the marketing pre-sales target is expected to come from Begawan Apartment in Malang, East Java, while the remainder will come from other apartment projects.

“Currently, our recurring income is only 7 percent, so we also want to build hotels and malls to increase the recurring income to 10 percent within two years,” Indaryanto said.

PP Properti is also constructing shopping malls in Bekasi and Surabaya with the intention of completing the existing facilities around the residential areas, which will ultimately increase the selling price of the apartments.

The firm has also been building a four-star hotel in Lombok, West Nusa Tenggara (NTB), since last year with an investment of Rp 200 billion.

It will also operate a hotel in Labuan Bajo, a tourist area located on the westernmost tip of Flores Island in East Nusa Tenggara (NTT).

The hotel will be constructed by its parent company, PT PP, in collaboration with a state-owned company.

“We will only act as the hotel operator. Currently, the hotel is being designed,” Indaryanto explained.

In total, PT Properti currently has a land bank of 297 ha. Some of it is located in big cities, such as Medan in North Sumatra and Semarang in Central Java. Land in other locations was obtained from PT PP.

“The land that we received from PT PP cannot be used to build apartments, so we decided to build hotels and shopping malls to increase our recurring income,” Indaryanto said.

PP Properti has stopped building landed houses because of high land prices, but has not ruled out the possibility of doing so in the future.

In 2018, the firm hopes to up its net profit by 20 percent yoy to Rp 528 billion, according to company president director Taufik Hidayat.

“Capital expenditure prepared for 2018 is Rp 1.8 trillion, which will be mostly used to pay land bank installments and debt refinancing,” he said in a statement released on the Indonesia Stock Exchange website on Wednesday.

Funding for its capital expenditure will be obtained from the planned issuance of a bond or medium term notes this year.