Administration to review decree on developers
Administration to review decree on developers
JAKARTA (JP): The city administration is reviewing a loop-hole riddled gubernatorial decree stipulating that developers must build low cost apartments.
The Assistant City Secretary for Administrative and Development Affairs, Prawoto Danoemihardjo, said yesterday that Decree No. 540/1990 does to have the legal clout necessary to force developers of luxury apartments to set aside 20 percent of the commercial site for low-cost apartments.
Prawoto said that the decree does not clearly define what a commercial site is. The decree only stipulates that housing developers should provide 20 percent of their commercial sites for low-cost apartments.
Prawoto said the use of the word "commercial" has weakened the decree. Usually shops and other business sites are defined as commercial sites. But now, many people consider houses as commercial sites because they can be sold.
"So now the city administration is trying to formulate a decree that contains a clearer definition of commercial sites," he said.
The review is being carried out by the office of the deputy governor for economic and development affairs.
Prawoto did not mention when the process will be completed.
He said the administration has tried to be flexible by allowing developers to build the low-cost apartments on locations outside of the luxury apartment complexes they build.
However, many developers continue to be reluctant to build low-cost apartment houses. They see the decree as a burden and source of financial losses.
The administration has ruled that low-cost apartments be sold at 50 percent less than the construction costs in an effort to help the needy obtain housing.
There are 70 developers who have been operating in Jakarta in since 1991, but only four have abided by the decree. They have constructed a total of 988 apartments for low-income people.
The four developers are PT Danayasa Arthatama with 240 units in Tambora, West Jakarta; PT Catur Swasakti Utama with 160 units in Penjaringan, West Jakarta, and PT Kuningan Persada with 292 units in Tanah Tinggi and another 296 units in Bendungan Hilir, Central Jakarta.
PT Mandara Permai is currently building 3,000 low-cost apartments in Pantai Indah Kapuk, West Jakarta. The project is scheduled for completion by the end of 1997.
The private developers' contribution of providing low-income people with apartments is vital because the administration can build only 3,150 units per year, or 30 percent of the total demand. The total demand is projected at 10,500 units per annum.
A total of 7,163 low-cost apartments have been built in the capital since 1985. Their sizes vary, ranging from 18 square meters to 54 square meters. (yns)