Agung Podomoro Snaps Up Karawang Real Estate

Leading property developer Agung Podomoro Land has set aside Rp 2.79 trillion ($258 million) to develop a 558 hectare industrial estate in Karawang, West Java, a senior executive said on Monday.

Indra Widjaja, a vice president of the property developer, told Investor Daily the investment value excludes the cost of land acquisition.

Indra said the money would come from the company’s cash reserves. “We are still designing the master plan,” he said, adding that the company plans to start marketing plots in the planned industrial estate, designed to accommodate chemical companies, in the second quarter of 2014.

Podomoro has recently made a series of land acquisition. In April 2012, it took a 55 percent stake in Sumber Air Mas Pratama worth Rp 216 billion. SAMP controls 342 hectares also in Karawang.

In November 2012, Podomoro, through its unit Alam Makmur Indah, acquired a further 216 hectares in Karawang valued at Rp 502 billion to be developed into an industrial estate.

Indra said the company is studying a plan to bring a strategic partner in to help develop the industrial parks.

“We plan to invite foreign investors, such as from Taiwan, Japan and Korea that have experience in developing industrial estates,” he said.

He declined to name potential partners, but said they are newcomers in Indonesia. “We expect the negotiations to go into the due diligence process by the end of 2013.’’

Podomoro corporate secretary Justini Omas said the company had acquired a total of 850 hectares of new land since the start of last year, including Karawang, Makassar (South Sulawesi), Balikpapan (East Kalimantan), Medan (North Sumatra) and Batam (Riau Islands).

In the first six months of 2013, Podomoro recorded Rp 3.68 trillion in marketing sales, a term referring to sales of properties still under construction. That reflects a 27 percent increase from the same period last year.

Podomoro City Extension in West Jakarta accounted for 44.6 percent of the sales, followed by Metro Park Residences (13.8 percent) and Vimala Hills, an integrated thematic resort (13.4 percent).

The balance comes from projects including Borneo Bay Residences in Balikpapan, Grand Taruma, in Karawang and Soho@Pancoran, a mini superblock in South Jakarta.

Podomoro shares fell 3.1 percent to Rp 310 in Tuesday trading in Jakarta. The benchmark Jakarta Composite Index fell 3.2 percent for the day.