JAKARTA (TheInsiderStories) - PT Mega Manunggal Property Tbk (IDX: MMLP), an Indonesian publicly listed logistics developer and Singapore’s sovereign wealth fund GIC have entered into a partnership to develop a portfolio of quality logistics warehouses of up to 500,000m2 net leasable area in Indonesia over the next three years, with a focus in the Greater Jakarta region and Greater Surabaya.
“This is our first investment in Indonesia’s logistics sector. We are attracted by the long-term growth of this sector, which is underpinned by the strong consumption of Indonesia’s rapidly rising middle class,” Loh Wai Keong, managing director and co-head Asia of GIC Real Estate, said.
Previously, Mega Manuggal partnered with Japanese logistic firm Daiwa House Industry to build central business districts and logistics centers across the country. Daiwa House will contribute capital and marketing for the projects.
Mega Manunggal will sell up to 49 percent of its shares in Mega Tridaya Property to Daiwa House. The first joint project is a Rp 260 billion ($19 million) warehouse for Lastana Express Indonesia, the company behind e-commerce giant Lazada.
The warehouse will be constructed on a nine-hectare lot in Cibinong, West Java, with a total storage area of 60,600 square meters. Half of the project will be operational next year, with the second half targeted for completion in 2018.
The Lazada contract is expected to boost Mega Manunggal’s revenue by 40 percent from an estimated Rp 167 billion this year.
While, GIC recently invested a total of Rp5.2 trillion ($387 million) in Trans Retail, the retail arm of Indonesian conglomerate CT Corp, which operates stores under the Carrefour and TRANSmart brands.
Indonesian consumption faltered last year as growth fell to its weakest pace in six years, but it is showing signs of picking up. (*)