Former Mutiara Hotel on Malioboro Placed Under Cooperation Agreement; DIY Regional Government to Receive 67 Per Cent Revenue Share

The Special Region of Yogyakarta (DIY) regional government continues to conduct an inventory of regional assets with potential to increase regional original income. One such asset that has now been formally placed under cooperation is the former Mutiara Hotel 2 located in the Malioboro area of Yogyakarta City, through a Cooperation Agreement for Utilisation (KSP) with a third party for a period of 30 years.

This utilisation cooperation was established with PT Setia Mataram Tritunggal following an open tender process that was announced twice in national media in October 2025.

Regional Secretary of DIY, Ni Made Dwipanti Indrayanti, explained that the KSP agreement was signed on 24 February 2026. This scheme was selected to provide the operator with the opportunity to undertake comprehensive building rehabilitation of a structure that had been non-operational for an extended period.

“The agreement has been signed. It is not a lease, but rather what we call a cooperation agreement for utilisation, for a hotel,” said Ni Made when confirmed by journalists on Thursday (26 February 2026).

According to her, the long-term contract is necessary because the building’s condition requires comprehensive renovation prior to resuming operations. However, the renovation process remains constrained because the hotel location is situated in the Philosophical Axis area, which has strict regulations concerning spatial planning and architectural preservation.

“About one year for renovation of the building, since there is quite a lot that needs to be repaired,” she said.

“We follow the principles that have been agreed upon in the documentation and management plans. This includes not making extensive changes to what already exists. If then the matter concerns beautification or reinforcing structural aspects and so forth, perhaps that is acceptable, so we are not adding anything extra,” she added.

Profit-Sharing Scheme of 67 Per Cent for DIY Regional Government

Under the KSP agreement, the DIY regional government will not only receive annual rental fees but also a share of business profits. The agreed scheme establishes approximately 67 per cent of profits for the DIY regional government and 33 per cent for the operator.

“The profit, approximately 67 per cent or thereabouts, will go to the regional government,” said Ni Made.

Besides the Mutiara Hotel, the DIY regional government is also conducting an inventory of several other assets with development potential, including assets in the Dr. Yap Street and Baciro areas of Yogyakarta City. The identification process is being undertaken jointly with the DIY Regional Asset Management Agency (BPKA) to determine the next optimisation steps.

“We are still identifying these. We actually have quite a lot,” she said.

However, not all assets can be immediately utilised, as some require physical repairs and budget support.

“Our assets are in poor condition. So we must repair them first, which requires a budget. Meanwhile, if we must spend a budget, we also need to consider priorities,” she explained.