Foreign buyers eye local properties

JAKARTA (JP): International fund managers from Europe, North America, Australia and the United Arab Emirates are lining up to buy cheap properties in crisis-hit Asian countries, including Indonesia.

Bayu Utomo, associate director of Procon Indah and Agus Kustandi, manager of sales and investment for the firm of property consultants said yesterday that fund managers had so far targeted properties owned by cash-strapped companies.

They said that by and large, fund managers, who have allocated at least US$300 million to buy property in Southeast Asia, are still waiting for the right time to enter the market.

They could not give details of the funds earmarked for individual countries in the region, but expected fund managers to focus particularly on Indonesia, Malaysia and Thailand.

"Gross funds of around US$300 million are now ready to be invested in property in these countries," he said.

Agus said that most fund managers who had made inquiries about Indonesia had expressed interest in purchasing property in strategic business areas along Jl. Sudirman, Jl. Thamrin and Jl. Rasuna Said, known locally as the golden triangle.

"They only want to buy property in the central business district," Agus said.

Bayu added that most foreign fund managers had shown a preference for properties currently occupied by multinational corporations in the golden triangle area.

"Foreign funds managers believe that multinational corporations who become the main tenants of properties in the area will not relocate business to other areas of Jakarta," he said.

However, analysts said that a lack of legal certainty surrounding property ownership by foreigners in Indonesia would pose a problem for the fund managers. (aly)