Jakarta-listed property and construction company Surya Semesta Internusa (SSIA) is looking to strengthen its portfolio in the warehouse business, having established a joint venture with two foreign companies to work on its “technopark” projects in its West Java industrial estate and other potential cities nationwide.
According to the company’s documentation, the authorised capital of the new entity is around US$185.6 million, while its issued and paid-up capital is around $46.4 million.
SSIA owns a 50 per cent stake in SLP, while its foreign partners hold 25 per cent each.
As its initial project, the joint venture will work on SSIA’s Suryacipta Technopark project, which is located within the company’s Suryacipta City of Industry in Karawang, West Java – having acquired the 22 hectares of land from the 567-ha industrial estate.
SSIA’s general manager of finances and accounting, Sony Satianegara, said that the new entity would disburse about $75 million in investments to develop the technopark, which includes a sum to purchase the plot of land.
With the issued and paid-up capital already in hand, Sony said that the new entity would source additional loans amounting to around $28 million to meet its capital needs, probably from foreign lenders.
SLP is planning to build a 146,000-square-meter industrial compound consisting of warehouses, ready-to-use factories as well as commercial building.
The first phase of the project, comprising 35,000 sqm of land, concluded construction early in 2014 with a current occupancy rate hitting 81 per cent.
SLP is expected to resume the second phase – comprising 26,000 sqm – this year, with the whole project slated to finish in 2017.
“Once of the project concludes, we expect to see recurring income from the warehouse project reach around 150 billion rupiah [$11.6 million],” he said. Johannes Suriadjaja, president director of SSIA, said that the company hoped to forge a long-term partnership through SLP and was eyeing other cities as places to develop warehouse businesses after the Karawang venture.
“There are other cities that also have promising potential, such as Medan [North Sumatra], Surabaya [East Java] and Makassar [South Sulawesi],” he told reporters
Mitsui & Co.’s general manager of second overseas business development department, Eiichi Tanabe, and Ticon managing director Virapan Pulges said they were confident that the demand was there for SLP’s projects, saying that enthusiasm from Japanese investors and Ticon customers to invest in Indonesia’s growing economy is high.