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Jakarta Post

Property projects continue in Jakarta and beyond

  • The Jakarta Post

    The Jakarta Post

  /   Fri, October 24, 2014   /  08:38 am

As Indonesia is home to a growth-friendly economy, several property developers have expanded their businesses with projects not confined to Jakarta but also outside the capital.

Favorable economic conditions, which have led to the rising purchasing power of the middle class, have had a positive impact on the property sector and a number of developers on the island of Java are continuing to expand their businesses.

Major property developers Ciputra Group, Jaya Property and PT Intiland Developers are kicking off new apartment, office building and mixed-use development projects in Jakarta, Bintaro in Tangerang and Surabaya, respectively.

The Ciputra Group, for example, is currently developing a new apartment block called Ciputra International in the Puri Indah area of West Jakarta, reported.

Ciputra Group director Artadinata Djangkar said that West Jakarta had good potential for property projects but was often overlooked by developers as they directed their attention to the TB Simatupang area.

'€œIn the last three years, the West Jakarta area has been relatively untapped [by developers]. Meanwhile, the area'€™s rapid development has attracted the attention of several developers,'€ he said recently.

Thanks to the development of new access roads and many new facilities in the area, he said he believed that in the next five years the area would be Jakarta'€™s new business center. He went on to say that the current development in the area was on par with that of other areas in the capital city.

The company'€™s observation of this trend had motivated it to develop the Ciputra International mixed-use project in the area.

According to Artadinata, the apartment'€™s groundbreaking ceremony would take place this October.

Meanwhile, the company had already been selling apartments in the development since the middle of September. Artadinata claimed that the market had responded enthusiastically to the sale of the apartments.

Aside from being a lucrative place for apartment block developments, Indonesia'€™s capital city, Jakarta, is also a strategic location for other property projects, like office buildings and mixed-use projects.

Office buildings

Jakarta has an exceptionally strong market for office buildings.

Office building construction tends to have been concentrated in the capital city'€™s CBD areas, covering Sudirman, Rasuna Said, Mega Kuningan, Thamrin and Satrio. However, currently developers are shifting their focus to the strategic location of Jl. TB Simatupang in South Jakarta.

Currently, at least five new office buildings: Sinarmas MSIG, Lippo Kuningan, Noble House Office Tower, Grand Rubina Tower 1 and Convergence, are under construction.

Meanwhile, CBD areas will have 12 new additional office buildings next year. The Sudirman, Gatot Subroto and Satrio areas will respectively contribute three new office buildings each, while the remaining three will be constructed in the Mega Kuningan, Rasuna and Thamrin areas.

Eleven of the new office buildings are currently in the construction phase, while one is still in concept-drafting phase.

Among the projects, the Sahid Sudirman Center in Sudirman stands on the biggest plot of land.

Most of the office buildings built outside the CBD areas are located on Jl. TB Simatupang, South Jakarta. The area has six new office buildings: Green Kosmo Mansion Tower, Manhattan Square TB Simatupang, Plaza Oleos TB Simatupang, Metropolitan Tower and Palma Tower.

Office buildings in the Simatupang area are, on average, smaller than those in CBD areas. The biggest in the Simatupang area is Metropolitan Tower, which stands on a 44,000 square meter (sqm) semi-gross area.

'€œSouth Jakarta has become the biggest non-CBD contributor of new office buildings in the capital city. From a total of 1.06 million sqm of new office buildings expected to be erected between 2014 and 2017, around 67.6 percent of them are located in South Jakarta,'€ noted Colliers International.

According to property analyst Anton Sitorus, the rapid growth of property in TB Simatupang is thanks to, among other things, sound education and leisure facilities and the huge number of offices in the area.

Projects in Tangerang and Surabaya

Property developers are also targeting areas outside Jakarta, with property projects under construction in Bintaro in Tangerang and the city of Surabaya, East Java.

Jaya Property, best known for its projects in Bintaro, is developing a mixed-use project which stands on a 10-hectare plot of land.

'€œEarly next year, we plan to launch the second tower of Plaza Bintaro Residences. In order to accelerate the construction process, we are going to hand over the keys of the residential projects,'€ Bintaro Plaza Residences marketing manager Putra Samodra said.

After completing the Bintaro Plaza Residences project, the property developer will develop a CBD in Bintaro where, aside from apartments, it also plans to build shopping centers, office buildings, small-office home-offices and shop houses.

Another property developer, PT Intiland Development, is developing a superblock project in Surabaya, with the construction of Spazio Tower, a strata-title office building equipped with a hotel, meeting rooms, retail centers and restaurants.

Intiland Development spokesperson Ardina Setiorini said that the company had invested Rp 540 billion (US$44.95 million) into the project.

'€œThe company has allocated 40 percent of the construction budget from its own internal sources and taken loans from the bank to cover the remainder,'€ she was quoted by as saying recently.

The groundbreaking ceremony for the tower was conducted on Oct. 3 and construction was expected to be completed within two years.

The new office building project was built to cater to people'€™s growing needs for office buildings, said vice president director Sinarto Dharmawan. (JP)