Indonesian property giant buys 123 rai at Bang Tao

BANG TAO: A 123-rai plot of land next to the beach at the northern end of Bang Tao Bay has been sold by Hongkong & Shanghai Hotels (HSH) to Indonesian property giant PT Jakarta Setiabudi Internasional Tbk (JSI).

JSI bought the land through its wholly-owned subsidiary, Cayman Islands-based Durham Holdings, for just under 865 million baht – about 7 million baht a rai.

The land, which is just south of the Sirinart Marine National Park, had been owned by HSH subsidiary Siam Chaophraya Land for the past 15 years, but was never developed. That is about to change.

In an exclusive interview with the Gazette, JSI’s President-Director, Amir Abdul Rachman, confirmed that the land will be used for a hotel or resort, but that no decision has yet been been made whether to develop a luxury villa-style resort or a mass-market property.

Asked whether the land would become home to Phuket’s first Hyatt property, Mr Abdul Rachman confirmed that JSI is “very close with Hyatt”.

But, he added, “We are still considering all possibilities. We are working with world-class consultants and advisers, and [the scale of the project] will depend very much on who will be the operator. It’s too early for us to say.

“We are very keen to [be in] Phuket because we see that every time there is a problem in Bali [where JSI owns two Hyatts] the biggest beneficiary is Phuket. We have seen the pendulum always swinging this way and that way – Phuket or Bali, Phuket or Bali.”

He added that JSI looked at Phuket as long ago as 1986. “That was when we decided to develop the Grand Hyatt in Bali because we came to the conclusion that Bali was ready but Phuket was not.

“Now the infrastructure in Phuket is really there and the reality is that Phuket is only nine hours from Europe, and socially and politically Thailand is more salable.”

JSI is a major player in the Indonesian hotel and property industries. Its assets include the Grand Hyatt Bali, the Bali Hyatt, and the Hyatt Regency Yogyakarta, as well as three Mercure hotels. It also owns two large office buildings in Jakarta, two large shopping malls – one in Bali and one in Jakarta – three apartment blocks in the Indonesian capital, where it also has a considerable land bank that it is developing for housing estates.

In the year to September 30, 2005, it recorded sales and revenues equivalent to 1.7 billion baht and assets equivalent to 10.7 billion baht.

In a statement following the signing of the sale agreement, HSH explained that the funds would be used to reduce debt and as “general working capital”.

CEO Clement Kwok was quoted as saying, “The sale of the Phuket land is a further step in the company’s strategy of disposing of non-core assets that will allow us to focus our resources on developing and marketing our principal businesses and the Peninsula brand.”