The Jakarta Post
PT Repower Asia Indonesia, a property company whose shares were listed on the Indonesia Stock Exchange (IDX) on Friday, plans to develop residences integrated with education and public transportation infrastructure in South Jakarta, Bekasi in West Java, as well as Tangerang and South Tangerang in Banten.
"We want to introduce an education and transit-oriented development [ETOD] concept at our projects," president director Aulia Firdaus said in a ceremony for his company’s listing.
He said the concept would bring together residences, schools and public transportation infrastructures such as LRT stations and toll road gates.
The company, for example, plans to integrate its 1.4-hectare apartment project in East Bekasi with nearby toll road gates and LRT stations, as well as schools through partnerships with educational institutions, according to the company’s prospectus.
The company introduces the concept as its business strategy to weather a bleak outlook in the property sector.
"We predict that next year, the property sector will continue its declining trend since 2017 and the ETOD strategy will help us overcome the market's challenges," marketing director Andy Kesuma Natanael told reporters.
Repower Asia Indonesia notes in its prospectus that Bank Indonesia's (BI) policy to lower loan-to-value (LTV) ratios for mortgages by 5 percentage points, effective since Dec. 2, will likely improve the property sector and therefore influence the company's performance.
Finance consulting company Koneksi Kapital Indonesia’s head of research, Alfred Nainggolan, told The Jakarta Post on Friday that the lowering of the LTV ratio was a "positive catalyst" for the property sector to start recovering after a three-year decline.
But consumers' low confidence was obstructing the impact of the ratio relaxation, preventing the property sector’s indices on the stock market from picking up, he added.
Firdaus said that Repower Asia Indonesia, listed as REAL, would use the fund, about Rp 250 billion (US$17.8 million) generated from the initial public offering of 2.5 billion new shares or 37.69 percent of its total shares, to finance its ETOD-related projects.
Of the figure, 47.23 percent will be allocated for land acquisition in Tangerang, 36.67 percent in East Bekasi, 10.19 percent in South Tangerang and 5.92 percent in South Jakarta.
The property company’s shares were quoted at Rp 170 apiece, 70 percent higher than its IPO price of Rp 100, during trading on Friday. (dfr)