Investors sought to develop Kramat Tunggak

JAKARTA (JP): The city administration hopes to attract new investors to develop the 10.4-hectare Kramat Tunggak red-light district in North Jakarta into an integrated business center after the three initial investors pulled out.

"The construction of the business center must go on. We, therefore, are opening the project to new investors," Deputy Governor of Social Affairs Djailani said on Thursday.

He said the city administration might give incentives, such as tax reductions, to investors willing to develop the area.

"But we first want to know who are serious bidders," he said.

Djailani said the city administration would not extend the deadline for the closing down of the brothel complex even though the initial investors had pulled out.

"Temporarily, the brothel complex could be used as a residential area until the city administration finds new investors," he said.

The city administration decided earlier this year to close the Kramat Tunggak brothel complex, which is the country's oldest government-authorized red-light district, in December this year.

The head of the city social services agency, Edi Widodo, said on Thursday that the initial investors withdrew from the project because they thought it would not turn a profit.

"They calculated that the construction of a business center in the area would not be profitable," Edi said.

One of the initial investors, PT Nuansa Jasa Realtindo, reportedly doubted it would earn any profit from the project because of the skyrocketing prices of building materials.

The investor said it also had difficulty obtaining credit from banks to finance the project.

Edi said at least 650 prostitutes still worked in the complex, while the same number of prostitutes had quit.

"Some of the former prostitutes have been employed by several firms," Edi said.

The complex, located near Tanjung Priok Port in North Jakarta, has 221 brothels. (jun)