BCA building and other prime assets for sale
BCA building and other prime assets for sale
JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA)
will sell the prime Bank Central Asia (BCA) office building next
month in its first attempt to dispose of the property assets
surrendered by former bank owners, according to an agency
official.
IBRA property specialist Bayu Utomo said on Tuesday that the
BCA building, located in Jakarta's primary business district on
the Sudirman thoroughfare, was one of the best property assets
held by the agency.
"We will start selling an office building next month located
on Jl. Sudirman and (previously) owned by the Salim Group," Bayu
told a news conference.
The BCA building is one of the property assets surrendered by
the Salim Group, the former owner of Bank BCA, to repay its debt
to the government.
Bayu said that IBRA had to carefully select which property
assets were to be sold because of the current weak property
market.
He said that the sale of the BCA building was also aimed at
"testing" the property market.
"We have to carefully select which property assets are to be
sold. If it's not attractive it (the sale) will not be
successful. We picked the BCA building because it's a good
asset," he said, pointing out that the building had a high
occupancy rate of about 90 percent and quality tenants.
"We want to know the response of investors," he added.
Bayu declined to disclose the offering price, saying it would
be disclosed after the completion of the transaction, expected to
be sometime between August and September.
Bayu said that IBRA currently controlled some Rp 112 trillion
worth of various fixed assets surrendered by former bank owners.
He said that approximately 24 percent of the portfolio was in
the form of stake ownership in property companies or ownership in
real property.
He said that 80 percent of IBRA's property assets came from
the Salim Group.
Bayu said that the disposal of the BCA building was crucial to
ensure success in the selling of the agency's other property
assets in the future.
He explained that for other less attractive property assets
IBRA would consider combining similar property assets prior to
their disposal to make them more appealing to investors.
"Property investors prefer specific kinds of assets," he said.
He said that the other strategies included a gradual disposal
strategy to avoid overcrowding the market, and initial public
offerings.
"In addition, IBRA will invite as many investors as possible
in order to maximize competition and to attain optimal value," he
said.
Bayu said that 51 percent of the property assets in the hands
of the agency was in the form of township development projects.
He said the remainder included hotels/resorts, office
buildings, residential estates, mixed use buildings and
apartments.
He said that only the retail or shopping center subsector had
started to recover from the current downturn in the property
sector
But he added that there would be a strong demand for office
buildings with high occupancy rates.
Bayu said that his division was expected to raise about Rp 500
billion this year to help the agency meet its target to raise Rp
18.9 trillion for the state budget.
Meanwhile, Godlip Pasaribu, IBRA official in charge of
recovering housing loans transferred to the agency from closed
down banks, said that the sale of the housing loans was so far
successful.
Godlip said that during the first two auctions (out of seven
batches for this year) the agency had raised about Rp 258.84
billion, compared to the initial target of Rp 375 billion.
He said that because of the success, the agency had raised the
target for this year to more than Rp 1 trillion.
Godlip added that the sale of the third batch of some 109
units, worth about Rp 150 billion, would begin on Thursday. (rei)