Kelapa Gading developer fails to meet obligations

Kelapa Gading developer fails to meet obligations

Bambang Nurbianto, The Jakarta Post, Jakarta

PT Summarecon Agung, the main property developer in Kelapa
Gading, North Jakarta, has failed to give some 34.3 hectares of
land back to the city with social facilities, as part of its
contractural obligation.

City regulations state that once a company wins a contract
from the city to build, it must also develop 30 percent of the
land for social facilities, such as a park or a church and then
that land is legally transferred back to the city administration.

However, data from the City Asset Bureau dated March 4, 2003,
released during Thursday's hearing at the City Council's
Commission D for development affairs, states that the 34.3
hectares had been accumulated over the years after it was given
development projects between 1989 and 1997.

The developer is now required to give the 34.3 hectares of
public land back to the city after it developed housing projects
on 96.9 hectares in two subdistricts of Kelapa Gading district:
Pegangsaan Dua and Kelapa Gading Barat.

Head of the Commission D Koeswadi Soesilohardjo urged the
company as the developer in the fastest growing area in the city,
to immediately fulfill its obligation.

"We demand that PT Summarecon Agung immediately hand over the
land as is required," Koeswadi told the press after meeting with
the company's management.

PT Summarecon president director Sunardi Rusli said that the
data issued by the City Asset Bureau was not entirely accurate,
but he could not elaborate. He said that parts of the land had
been handed over to the city administration.

But he failed to show clear data about how obligation had been
fulfilled.

Koeswadi stressed that PT Summarecon could not claim that it
had fulfilled its obligation if it could not show an official
document.

"They can claim that they have handed over the land, but if
there is no supporting document we cannot just believe them," he
added.

During the meeting, Sunardi also revealed that the city
administration still owed PT Summarecon 4.7 hectares of land in
Cilincing, North Jakarta, worth some Rp 53 billion rupiah.

The city administration constructed buildings on the land for
a city training center for job seekers.

According to Sunardi, Gubernatorial Decree no. 7 issued in
1994 allowed PT Summarecon to provide the 4.7 hectares of land in
Cilincing as part of the social facility/public facility for PT
Summarecon's properties in Kelapa Gading.

Kelapa Gading district, which was established in early 1990s,
is the fastest growing area in the city. The 1,633-hectare
district is now crowded with shopping centers and housing.

There are three subdistricts in Kelapa Gading district: Kelapa
Gading Barat, Kelapa Gading Timur and Pegangsaan Dua. Kelapa
Gading district was formerly part of Koja district, but it became
a separate district following the development of the area.