Sensing that business sentiment is picking up strongly after more than six years of near flat economic growth, property developers are pushing hard to complete a slew of commercial, retail and upmarket apartment developments over the next two years.

Property experts told BT that apart from new developments, a number of mega projects that were mothballed during the 1998 financial crisis have found new investors and are being revived. Chief amongst them is the massive US$250 million Pacific Place development just behind the Jakarta Stock Exchange building.

Consisting of one office tower, two apartment towers, the luxurious Ritz Carlton Hotel, service apartments and possibly the largest shopping and retail centre in the city, Pacific Place will comprise more than one million square metres. In terms of distance, it will stretch more than 1.6 kilometres – the same distance from the Marriott Hotel on Singapore’s Orchard Road to McDonald’s House – when fully completed.

The first phase is expected to be ready in 24 months. The project will dominate the city skyline and is being dubbed Jakarta’s version of Orchard Road, Singapore’s famous shopping belt.

All the buildings will be linked by underground passageways for easy access and the area will be connected to the main Jalan Sudirman thoroughfare by tunnels as well as the proposed mass rapid transit system.

Its owner, Chinese business tycoon Tan Kian, has emerged as the most aggressive property player in the country and could over time rival the likes of the Ciputra Group.

Besides Pacific Place, Mr Tan Kian also owns the JW Marriott hotel in the Mega Kuningan area. He is in the process of developing the Ritz Carlton Jakarta across from the Marriott; two luxury apartment buildings; one office tower and one combined commercial and residential project.

The combined value of his property projects under construction is estimated to be more than US$1 billion.

BT understands that Mr Tan Kian made his money in the shrimp business through his family-owned Dua Mutiara Group but entered the property business in the early 1990s after developing its flagship office tower along Jalan Sudirman.

‘Tan Kian is very aggressive but he is not the only player on the property scene at the moment,’ said Jeffrey Hong, chief operating officer of PT Procon Indah. ‘A number of mega projects are kicking off again…We are starting to receive a lot of inquiries about office space in the city. But this time, developers are taking a more sensible approach by not overextending themselves.’

Another major property player is Trihatma Kusuma Haliman, founder of the Agung Pudomoro Group. He is said to have built more than 10,000 apartment units in Jakarta over the past three years and is currently developing a number of luxury apartment complexes including the Peak and Pakubuwono.

Asia’s second largest service apartment managers and developers, Singapore-based Oakwood Asia Pacific, is also bullish about the Jakarta market. The company had a groundbreaking ceremony for its 250 unit Oakwood Premier Cozmo service apartments last week. When completed in 2007, the US$50 million development will be the first five star service apartments to open in Jakarta in 13 years. The company also has plans to develop a residential apartment complex in Surabaya and a resort in Bali.

‘We are very optimistic about the Jakarta market for the business traveller,’ said Robert Philips, director of sales and marketing for Oakwood Asia Pacific.
Apart from service apartments and 22 owner occupied units, the development will also have 5,000 square metres of retail space.

The Mega Kuningan area is fast becoming Jakarta’s version of Singapore’s Suntec City as the area has high-end hotels, retail outlets and commercial developments.

The JW Marriott is just across from the Oakwood site while the Ritz Carlton Jakarta will open in May on an adjacent plot. The Ritz Carlton will comprise retail and commercial space.

‘We think that the Mega Kuningan area in four years will be like Hong Kong’s Pacific Place,’ he said, referring to the upmarket retail complex located in the hub of the former British colony.