CapitaLand announced on Monday it has entered a joint venture agreement (JV) with a subsidiary of Indonesia's Credo Group to develop an integrated development in Central Jakarta, Indonesia.
CapitaLand and Credo will each hold a 50 per cent stake in the JV.
The integrated development, CapitaLand's first in Indonesia, will comprise a Grade A office tower, mid- to high-end residential units, serviced residences and supporting retail space, spanning a total gross floor area of more than 40,000 square metres. Estimated to be completed in 2018, construction for the development is expected to commence in 2015.
Under the agreement, the JV will acquire from Credo a 1-hectare site located within the central business district (CBD) of Jakarta. The site, close to embassies, renowned civic buildings, offices, affluent residential neighbourhoods and the National Monument, also has good connectivity to major roads within the CBD and other areas in Jakarta.
Said Mr Lim Ming Yan, president & group chief executive officer: "The Indonesian property market is bolstered by sound social and economic fundamentals and we see significant room for growth."
"In fact, Jakarta was one of the fastest growing cities in the world for office and prime residential sectors in 2013, and this uptrend is expected to continue with a rising middle-class population. With a strategically located site, positive market demand and a reputable local partner, we are confident this project will be well-received by the market."
The JV is not expected to have any material impact on the net tangible assets or earnings per share of the CapitaLand Group for the financial year ending 31 December 2014.